If the triumph of the New Right could be blamed on one person, that villain might be Austrian economist F.A. Hayek (1899-1992). Hayek’s career included a Nobel Prize, many books, and long stints at the London School of Economics and the University of Chicago. Hayek’s ideas were most famously laid out in his best-selling The Road to Serfdom, which espoused… return to article
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Reader Comments (16)Page 1 of 1 pagesWow, what a fantastic article! Two in one issue on the importance of ideas is a true gift. Great historical context. . . The author is to be commended for such illuminating research and - most importantly - on drawing attention to the bigger picture.
One of the challenges we face is in overcoming the “rediculous and shrill” perception that many Americans have about progressives. I absolutely agree with the author that to do this, think-tanks and position papers [as well as media cultivation] are crucial to victory. If we are want to live in USA 2003 [as opposed to Germany 1933], the war of ideas is not merely important, it is absolutely critical.
By an conventional measurement, progressives are vastly “outgunned” by the sheer magnitude of financial and other resouces arrayed against the Common Sense Movement. Thankfully, so were Ben Franklin and George Washington but they succeeded. The “Common Sense” pamphlets by Thomas Paine were undoubtedly helpful, and it was no coincidence that Ben Franklin was a printer/publisher. They too understood the power of spreading ideas. To succeed, we must take a page from their playbook if we are to salvage the beautiful experiment [America] that they created for us. To accept anything less is to accept defeat.
Posted by Ed Mellon on Oct 17, 2003 at 6:02 PM Ed- Right on!
But you didn’t go far enough. The only way to achieve equality-true equality- is REAL socialism (and don’t anybody give me that junk that the USSR failed- that was NOT real Socialism- it failed b/c that prick Reagan forced them to spend gazillions on Earth ruining nukes).
If we follow the true words of Marx we could all benefit from our labors- and not be slaves to a tiny percentage of the nation.
It’s finally nice to see economics that isn’t espoused by morons like that Milton guy.
Posted by love it all on Oct 18, 2003 at 9:14 AM We are born with common sense (imho) and have to be trained out of it. Can we point out in simple terms, to the undecided, where the ancient bases of morality (thou shalt not kill) directs us; and that the law is but an expression of a deeper idea, that of justice. We can change it, we don’t have to idolize the law as it currently exists. It can be a “work in progress.”
Posted by Dr. Fran Day on Oct 19, 2003 at 7:43 PM Enjoyed your historical review of Hayek and the spawning of think tanks. And your discussion of short term and long term ideation focus; a key to success.
I DO, however, question your premise of “...Their beloved capitalist system had led to the worst depression in world history.”
Remind me how this is so. The work of Milton Friedman (and os wife rose?) on the ‘real’ cause of the Great Depression, federal reserve banks and government use of fiat monies, is well known among many economist and substante the reality that governmet interventionism and the warfare/welfare model of governance is the culprit.
Murray Rothbard’s work have furthered the scholarly truth of this.
So, my question, on what do you base this rather flippant remark?
Thanks,
Noel
Posted by Noel Berge on Oct 20, 2003 at 9:47 AM The author loses much of his credibility in the second paragraph by blithely asserting that The Road to Serfdom defended “unbridled” market economics. Mr. Parenti has clearly not read Mr. Hayek’s famous work because it does nothing of the sort.
Posted by Brent on Oct 20, 2003 at 7:35 PM WOW,...this article turns the little I know (that would be the pure knowledge stuff) inside out and/or on its head. I’ll have to read it over several times, and contemplate (a great deal) before arriving at any conclusion on my own.
However, I must note the interesting antithesis of a paragraph in this article which I find kinda peculiar:
“According to the Mont Pelerin Societyís founding statement, ìa view of history which denies all absolute moral standards and Ö the rule of lawî threatened Western Civilization. That danger was exacerbated by ìa decline of belief in private property and the competitive market; for without the diffused power and initiative associated with these institutions it is difficult to imagine a society in which freedom may be effectively preserved.î
That proposition is rhetorical, and certainly contains internal opposition depending upon one’s basic philosophical perspective on humanity. It allows me a great deal of imaginative thinking (just my cup of tea *smile*).
BUT,...I do not see how that is synonymous with our challenges today. Might someone bridge the gap for me?
Posted by Ms. Monica on Oct 21, 2003 at 6:52 PM just to further clarify “the bridge” I hope someone will define for me,...please paint the picture which blends morals, rules (of law), competition and private property; then, offer the roads outside the present frame within which our country and world exists.
Posted by Ms. Monica on Oct 21, 2003 at 7:09 PM Brent of London is correct to point out that Serfdom did not defend “unbridled” market economics. No book published immediately after the war would have gone so far. In fact, we have Milton Friedman to thank for that. (Thank? I am being sarcastic of course.)
I think Hayek’s real importance lay in the use of an argument suggesting that attempts to manage capitalism, no matter how benevolently intended, would in the end just lead to fascism. Absolute nonsense of course, but lots of people swallowed it.
Posted by James Paterson on Oct 21, 2003 at 8:45 PM I would like to point out that ‘The Road to Serfdom’ immediately encountered a devastating rebuttal by British political scientist (and Fabian socialist, I think) Herman Finer (1898-1969). The book was called ‘Road to Reaction’ (1946) Unfortunately, Hayek’s book was widely popularized but nobody read Finer.
To this day, Finer’s book is virtually unknown and I suspect I may even be the only person who has even read it in the last sixty years!
Posted by James Paterson on Oct 21, 2003 at 8:58 PM Folks,
This article was poorly researched trash. First of all, The Road to Serfdom emphatically did NOT advocate “unbridled” free-markets. If the author had actually *read* the book, then this would have been obvious. Hayek makes numerous concessions to social democrats in the book.
Second, to attribute to HAYEK the switch from Keynesian economics to supply-side economics shows total and complete ignorance of Hayek’s economic views. Hayek did have debates with Keynes, but his positive economic views were not held in high regard at all by the neoclassical establishment - in fact, they still are not. If anyone changed these things, it was the folks at the University of Chicago.
A third thing: the University of Chacago refused to give Hayek a job in the economics department. So to imply that somehow Hayek “led” the mild revolt against Keynes is just an error. Hayek was an obscure anachronism to most people at U. Chicago, certainly not a leader of any kind.
There were more factual errors made here. More on this later, perhaps. A final suggestion to the author: before you write about Hayek you should either A) read Hayek or B) talk to someone who has.
--Kevin Vallier
Posted by Kevin Vallier on Oct 23, 2003 at 10:41 AM This just in for Ed and “Love It All”...Marx’s system has been refuted in part, in whole, and then back again. His focal point for all theory that follows is the labor theory of value. Read Eugen von Bohm-Bawerk’s “Karl Marx and the Close of His System” for some rather illuminating details. No economist worth his/her salt beleives that the value of a pruduct comes from the labor embodied in it. This has been refuted ad nauseum. However, if you need one final death blow to the Utopian ideal, you may want to read Ludwig von Mises’ “Socialism” where he points out that even angels on earth could not make soicalism work. Why? Socialism’s central planning lacks the mechanism to transfer information relative to supply and demand in prices because prices are set by a some entity other than the free market. Ironically, all socialist responses to this have proffered an answer - capitalism in some form or another. Unfortunately for those of us that have our heads in the clouds, Utopia won’t work. That is the reality. I suppose we can always keep dreaming that socialism will work though....
Posted by chris on Oct 24, 2003 at 9:10 AM Parenti’s piece is one of the most terrible pieces of “journalism” I’ve had the misfortune of reading. The history is hopelessly warped out of recognition, unsupportable factual claims appear in each paragraph, and it’s obvious Parenti hasn’t read the writings he presumes to educate us about. This article is a complete waste of time and I advise readers that there is nothing you can learn from it.
Posted by Sorry I wasted my time on Oct 24, 2003 at 2:21 PM In case those of you who think Socialism doesn’t work believe what they spout, let me remind them that ALL government spending is Socialism. We pay the bills with our taxes and the government doles it out to those who helped catapult them into power. Think about it, folks, what would you name, for instance, the recent $87 billion giveaway to Bush & Co.? Think of the incredible sums of revenue each strata of government receive from the tax payer...then think about the bailouts, giveaways, rescues, and boondoggles, the military’s indifferent expenditure of our money on incredibly expensive new technology and weaponry, all of which is either destroyed in combat, scrapped for newer models, or merely set aside because of design flaws. Who foots the bill when the Pentagon purchases war materiel from giant defense contractors who deem themselves models of Capitalism on the one hand but receive our money with the other. Hey folks, wake up...each incumbent regime has it’s own favored spending places. The Republicans will give the store away mostly for those who already have more than enough. The Democrats give a little more to the disadvantaged but in the end, the money goes to whatever special interest put up the most in that candidates successful winning of an election. That, friends, is Socialism, pure and simple. Let’s not complicate it by repeating, parrot-like, the brainwashing propaganda about ours being a Capitalist, Free Enterprise economy. Were that true, all income, excise, and sales taxes would then be eliminated entirely, no? Oh, and as for the national defense, let the falsely super-patriotic war profiteers pay their for their own wars and send their own kith and kin to fight it because they are, after all, qui bono? The only bastards who rake in the obscene profits of any war are ONLY those who seek to initiate them because peacetime profits, albeit substantial just can’t compare with those which wars deliver, guaranteed. Who needs economists and scholars, experts, or intellectuals, all second-rate, uncreative, stultified minds in search of an amateur’s original idea to steal? Want to read a REAL book about Socialsm? Try Howard Zinn’s, “The people’s history of the United States”.
Posted by Dom Mastroserio on Oct 24, 2003 at 9:30 PM Just an update. I think most readers of this piece would agree that Parenti - whose books, I should say, I admire very much - has erred in this particular instance and dramaticallyoverestimated the influence of ‘The Road to Serfdom.’
I read this on a rightwing website today, which I cite here as pertinent:
‘If you want to know where American supporters of free markets?learned economics, take a look at ‘Economics in One Lesson’ by Henry Hazlitt. A brilliant and pithy work first published in 1946, at a time of rampant statism at home and abroad, it taught millions the bad consequences of putting government in charge of economic life. College students all across America and the world still use it and learn from it. It may be the most popular economics text ever written.’
http://www.mises.org/hazlittbio.asp
Sometime the most influential books in their own times are ones that get almost completely forgotten by posterity. And, correspondingly, it seems to me that Hayek’s importance is something that looms bigger in retrospect than in reality.
Posted by James Paterson on Oct 25, 2003 at 2:46 AM Folks,
I would just like to respond to two things James Paterson said.
“I think Hayek’s real importance lay in the use of an argument suggesting that attempts to manage capitalism, no matter how benevolently intended, would in the end just lead to fascism. Absolute nonsense of course, but lots of people swallowed it.”
What is nonsense about this? One of the most obvious facts of contemporary history is that government intervention begets further government intervention - just take a look at the growth of the United States’ government, the transition of the German government from the social-democratic Weimer Republic to Nazi Germany, etc.
For an excellent essay on this, see Ludwig von Mises’ “Middle of the Road Policy Leads to Socialism” here:
http://www.mises.org/midroad.asp
As to the reference to the “Road to Reaction” isn’t one of Finer’s critiques based on the idea that economic law doesn’t really exist - that it merely is an ideological imposition that classical economists placed on the world to justify capitalism? At least, that’s what I remember from reading about it.
If that was what Finer said, then it is appropriate that his book was forgotten as this is an absolutely absurd view. But, I could be wrong about the critique. Perhaps you could link to it, Mr. Paterson?
--Kevin Vallier
Posted by Kevin Vallier on Oct 25, 2003 at 12:41 PM Find out more about Friedrich Hayek at the Friedrich Hayek Scholars Page:
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