The year 2024 marks three significant anniversaries for Friedrich August von Hayek, who follows Ludwig von Mises as influential in the Austrian School of economics. This is the one hundred twenty-fifth year of Hayek’s birth, the fiftieth anniversary of being awarded the Nobel Prize for economic science which he shared with Gunnar Myrdal, and the eightieth anniversary of the publication of his The Road to Serfdom, which is available in the Mises online store.
Hayek was born in Vienna, Austria, in 1899. He attended the University of Vienna at the age of nineteen after World War I. He earned doctorates in law in 1921 and political science in 1923. In 1922 Mises published his Die Gemeinwirtschaft, later translated as Socialism. “To none of us young men who read the book when it appeared,” Hayek recalled, “the world was ever the same again.” The influence upon Hayek from reading Mises’s Socialism is unknown.
The motivation for the Nobel Prize was “for their pioneering work in the theory of money and economic fluctuations and for their penetrating analysis of the interdependence of economic, social and institutional phenomena.” This award led to the revival of Austrian economics in 1974 after its wilderness state of the early to mid-twentieth century.
The Road to Serfdom describes the bankruptcy of socialism in European culture, society, and thinking. Hayek said about socialism, “That government planning would make society less liveable, more brutal, more despotic. Socialism in all its forms is contrary to freedom.”
His book was prescient when socialism enveloped most European nations after World War II ended in 1945 and the resurrection of socialism decades later with its United States adherents.
Part of an Amazon write-up about the book states,
For F.A. Hayek, the collectivist idea of empowering government with increasing economic control would lead not to a utopia but to the horrors of Nazi Germany and Fascist Italy. First published by the University of Chicago Press on September 18, 1944, The Road to Serfdom garnered immediate, widespread attention. The first printing of 2,000 copies was exhausted instantly, and within six months more than 30,000 books were sold.
From the republished book in 1972, “The book is Friedrich’s well-reasoned, graceful and forceful warning to the free nations of the world that the extended collectivism implied in ‘social planning’ is incompatible with democracy. His exhortation that we understand how economic controls can destroy individual freedoms remains powerful and relevant today.”
Keynes, Orwell, and Schumpeter’s Thoughts on the Book
John Maynard Keynes wrote, “Morally and philosophically I find myself in agreement with virtually the whole of it; and not only in agreement with it, but in a deeply moved agreement.”
George Orwell wrote, “It cannot be said too often—at any rate it is not being said nearly often enough—that collectivism is not inherently democratic, but, on the contrary, gives to a tyrannical minority such powers as the Spanish inquisition never dreamt of.”
Joseph A. Schumpeter wrote, “The reader will be glad to have the views of one of the most eminent economists of our time.”
Comments from these three famous people show the book was well read and impactful.
Other Insights from the Book
Hayek dedicated his book to the socialists of all parties. Some of the chapter titles are “The Great Utopia”; “The ‘Inevitability’ of Planning”; “Planning and Democracy”; “Economic Control and Totalitarianism”; “Why the Worst Get on Top”; “The End of Truth”; and “The prospects of international order.” We see the contents of each chapter being realized in our very day.
From page thirteen of the book foreword, “Such a power does not destroy, but it prevents existence; it does not tyrannize, but it compresses, enervates, extinguishes, and stupefies a people, till each nation is reduced to be nothing better than a flock of timid and industrial animals, of which government is the shepherd.” Does this sound like a prediction of government coronavirus tyranny or government public school education indoctrination?
The opening page of chapter two, “The Great Utopia,” says, “Where freedom was concerned, the founders of socialism made no bones about their intentions. Freedom of thought they regarded as the root-evil of nineteenth-century society, and the first of modern planners, Saint-Simon, even predicted that those who did not obey his proposed planning boards would be ‘treated as cattle.’” The freedom of the individual would be usurped by required government group thought.
In chapter three, Hayek writes, “Liberalism . . . regards competition as superior not only because it is in most circumstances the most efficient method known but even more because it is the only method by which our activities can be adjusted to each other without coercive or arbitrary intervention of authority.” Free market function is possible if government can stay out of the transaction.
In chapter five, “Planning and Democracy,” it says, “Not only do we not possess such an all-inclusive scale of values: it would be impossible for any mind to comprehend the infinite variety of different needs of different people which compete for the available resources and to attach a definite weight to each.” This quote is a government central planner’s nightmare, to accept the reality of individual people having the freedom to make choices to benefit them.
Many other powerful and practical insights are found within its roughly two hundred forty pages. You are encouraged to read The Road to Serfdom, where you are not transported to 1944; one can see socialism jumping from its pages today. Hayek’s book was truly ahead of its time. He and Mises were pioneers in the Austrian economic school where individual choice flourishes compared to the stranglehold of government central economic planning.
