Henry Hazlitt started to write his only novel, The Great Idea in 1949. It was finally published in 1951, but the British editors were not happy with the title. Among the alternatives Hazlitt submitted, one of them, Time Will Run Back, particularly struck their attention. It was published in England under that title in 1952. Today Time Will Run Back is still in circulation thanks to the efforts of the Mises Institute.
Time Will Run Back is set in a completely communist world under the yoke of an almighty world government. Any trace of capitalism has been erased from history and the state’s hegemony over the individual is complete. Facing serious health issues, Stalenin, the Dictator of Wonderworld, calls on his son, Peter Uldanov, heir to the dictatorship. Peter, who had been raised by his mother who opposed Communism, is aware of the inadequacies of central planning. In his attempt to confront these problems, and with the support and advice of one sympathetic Politburo member, Peter succeeds in reintroducing free-market capitalism.
Being anti-totalitarian, Hazlitt’s novel shares some striking similarities with Orwell’s 1984. In both books, for instance, a new language — Newspeak in 1984, Marxanto in Time Will Run Back — was created by the State. But despite those apparent similarities, both books approach the problem in a fundamentally different manner. Whereas 1984 deals with the moral and intellectual bankruptcy under totalitarianism, Hazlitt tackles the fundamental economic problem necessarily implied in any totalitarian regime: the impossibility of allocating resources without a system of market prices.
Hazlitt’s book is, in fact, an economics treatise disguised as a novel. Almost every chapter is approaching a particular theme under the format of Socratic dialogs. Building upon Ludwig von Mises’s works in economic science, Hazlitt explains difficult aspects of economic theory with confidence. While Mises offered his “very special thanks” for Hazlitt’s “kindness in reading the manuscript” of Human Action, Hazlitt felt indebted enough to Ludwig von Mises so as to dedicate Time Will Run Back to him. This novel is therefore particularly well adapted for undergraduate students who want to learn sound economics, for individuals who, although vaguely familiar with Austrian economics, want to further their knowledge on the matter, and for fellow Austrian travelers who seek some entertaining reading. Time Will Run Back can also be a well-suited reading in a Political Economy class.
The Structure of the Book
Although Hazlitt did not name his chapters, there is a clear structure in his book. The first part of the book introduces the situation in Wonderworld. After this, almost every chapter, from chapter 17 onward, addresses a specific subject in economics and political economy.
The first part deals with the political problems under socialism. Here the reader can find similar arguments found in Hayek’s The Road to Serfdom (1944). Hazlitt exemplifies why no political freedom can exist without economic freedom.
The second part deals with the economic problems of Socialism, namely, the impossibility of economic calculation in the absence of private property. The problem of economic calculation as analyzed by Mises is particularly subtle, but Hazlitt, in his inimitable style, makes it much easier for the reader to understand than any formal treatise on the subject.
As Hazlitt explains, without market prices, there can exist no common yardstick to measure costs. As time and resources are necessarily scarce and as capital goods are substitutable to one another the socialist planner can only grope in the dark in his vain attempt to coordinate economic activity. Hazlitt’s best chapters on the subject are especially chapters 27 through 30 dealing with the failing attempts made by socialists to solve the calculation problem under socialism.
The third part is probably the best in that it deals with the discovery of the market society. Some solutions put into place by the hero Peter Uldanov will strike the Austrian reader for their familiarity. The solution put into place to privatize public ownership in chapter 32, for example, is the same as Murray Rothbard’s solution put forward in his essay “How and How not To Desocialize.”
Hazlitt’s Groundbreaking Work on Entrepreneurship
The most amazing chapter in this part — and, in my opinion, in the entire book — is chapter 37 on entrepreneurship and uncertainty. First, Hazlitt precedes Israel Kirzner by more than 20 years by applying the term “alertness” to entrepreneurship — a term that Mises did not use in Human Action. Hazlitt writes:
These market adjustments were anything but “automatic.” They took place solely because there was an alert group of people ready to seize upon the slightest discrepancy to make a transaction profitable to themselves. It was precisely the constant alertness and the constant initiative of these specialists that prevented any but the most minute and short-lived discrepancies from occurring. [Emphases are mine]
But in no way was Hazlitt a Kirznerian. Kizner’s entrepreneurs do not own capital, they are only alert to profit opportunities. According to Hazlitt, however, alertness is not even the predominant feature present in an entrepreneur. “Uncertainty regarding the future,” he writes, “inevitably exists in human affairs, particularly in economic affairs. And somebody has to bear it.” In one of the most enlightening and lucid paragraphs of the book, Peter Uldanov says:
The speculator, the promoter, the enterpriser, are various types of risk-bearer. But there is a vital difference, as I see it, between these and the gambler. The gambler deliberately invents his own risk. He doesn’t have to lose money simply because one horse can run faster than another. His risks are artificial. But in economic life the risks already exist; they exist necessarily; somebody has to bear them. The speculator, the promoter and the enterpriser undertake that function.
For Hazlitt, entrepreneurship consists in “risk-bearing,” in decision-making under the conditions of uncertainty. It is therefore no surprise that 23 years later, Hazlitt criticized Kirzner’s Competition and Entrepreneurship (1974) and questioned Kirzner’s claims that the pure entrepreneur can be “a decision-maker who starts out without any means whatsoever” and that “purely entrepreneurial activity involves no element of resource ownership.” For Hazlitt, someone taking risks using other people’s capital “is merely a hired manager.”1
The fourth and last part deals with the rise of the hampered market economy. Here, Hazlitt shows the dangers of the state’s violent intervention in the market order. As with Mises in A Critique of Interventionism, Hazlitt demonstrates that the middle road policy must lead to further interventionism and at last — if nothing is done — to the destruction of the market order. In chapter 41, the reader can find a brilliant critique of fractional reserve banking and a strong defense of the gold standard.
The Need for a Fresh Voice
By writing Time Will Run Back, Henry Hazlitt’s goal was to hide sound economic theory in a readable, novelistic form. To this extent, he succeeded masterfully. With the decrepitude of the old political economy, the literary genius of the Bastiats, Cobdens, and Wicksteeds had sunk into oblivion. Few professional economists — maybe because of the influence of Keynes’s indigestible General Theory — continued to express themselves in a clear cut and unambiguous style. Hazlitt, however, remained an exception. As H.L. Mencken once wrote, Hazlitt is “one of the few economists in human history who could really write.” Hazlitt was particularly well suited for the work of writing a novel. Murray Rothbard in his annotated bibliography of Hazlitt’s works, called Time Will Run Back “An act of creative imagination” and “the only novel ever written that exemplifies and explains the Misesian doctrine of the impossibility of calculation under socialism.” Ludwig von Mises called it a “brilliant novel,” praising its author for having “demonstrated to the world the value of freedom and of the free market economy.” The only criticism one could make concerns the first 70 pages which tend to be a little bit too Manichean from a top-down approach to the destruction of socialism. But except those minor points, Hazlitt’s novel is outstanding.
Of course, Hazlitt was not naïve enough to believe the struggle for freedom will ever end. Liberty, by its very nature, needs to be renewed every day. But if you read Hazlitt, he will bring you this message: “Be of good heart: be of good spirit. If the battle is not yet won, it is not yet lost either.”
Louis Rouanet is currently a student at the Paris Institute for Political Studies. Contact: email.
- 1Hazlitt, Henry. 1974. Review of Competition and Entrepreneurship by Israel M. Kirzner. The Freeman 24 (December): 756-60.
