The Road to Serfdom (1944) – F.A. Hayek

Chapter 1 – The Abandoned Road

  • When things go wrong we look to blame others & not ourselves. We’re sure we did our best. We put our best people on the job. Our hearts were in the right place. So, if the outcome is not freedom & prosperity but bondage & misery, some evil forces must have been working against us…
    • We’re offered every excuse, except one: The present state of the world could be the result of our cherished but wrong ideals that have produced results different from what we were expecting.
    • Now all our energy is focused on the war & we’ve lost sight of the fact that the values we’re fighting for now were being threatened & destroyed elsewhere This conflict comes from a struggle of ideas from within a common European civilization & the tendencies that lead to Totalitarianism aren’t just found in those that have caved to it.
    • We should look at Germany, Italy & Russia not as different planets but as products of similar thinking to ours. It’s more comforting to us to think of them as completely different but that’s not true.
      • We’ll recognize a lot of ourselves in them.
  • Change of ideas makes that world what it is & Anglos haven’t had any spontaneous changes to make us see this. That’s caused us to lag in these changes.
    • But we still think of the ideals guiding us as things to be implemented in the future without realizing how far they’ve transformed our world already.
    • We still think we’re living under laissez-faire. Compared to others that make sense. But since 1931, the US & England abandoned that, albeit slowly. Now only the old know what a truly liberal world looked like.
    • People don’t realize how abruptly our ideas & social order have changed. 25 years before Totalitarians actually showed up, we’d already been turning away from the ideas that Western Civilization were built on.
      • We’ve abandoned the economic freedom that personal & political freedoms require.
      • We’ve ignored the warnings of Tocqueville & Acton that Socialism is slavery.
    • The break with the past becomes clearer with a longer view of history. Not just from Smith, Hume, Locke & Milton – but Christianity, Greeks & Romans. Not just 18th & 19th Century Liberalism but basic individualism stemming from antiquity.
      • The Nazis themselves have said their movement was to destroy the Renaissance & individualist civilization.
      • Individualism has been maligned as egotism & selfishness. But Individualism, in contrast to Socialism, isn’t connected to those.
      • The Individualism stemming in its elements from Antiquity & Christianity, & then being fully developed in the Renaissance has essential features:
        • 1 – Respect for the individual man in that he is a man.
        • 2 – The recognition that his own views & tastes are supreme in his own sphere.
        • 3 – Men should develop their individual gifts & talents.
      • The words “Freedom” & “Liberty” have been twisted by many. Their meanings need to be examined & defined before using them.
      • “Tolerance” is the only world that still holds any meaning. It was ascendant but the movement toward Totalitarianism is snuffing it out.
  • The growth of a rigid hierarchical society into one where men can shape their lives comes from the growth of commerce, starting in cities in Northern Italy. The idea spread throughout Europe – anywhere without despotic rule to stifle it.
    • It spread more development to the West & East – & then on to the New World.
    • During this period, social development freed the individual from older ties. There was a conscious realization that spontaneous & uncontrolled efforts of individuals were able to produce a complex order of economic activity, that could only come after the development had made some progress.
      • What followed was an elaboration of the argument for economic freedom which was an undesigned & unforeseen by-product of political freedom.
      • The unchaining of individuals led to growth of science.
      • Earlier, man’s ingenuity was confined to toys. Industrial technique was stationary, & only mining & watch-matching were allowed to be practiced & to grow.
      • Moves toward industrial growth were suppressed & desire for knowledge was stifled. Beliefs of the majority on what’s right & wrong prevailed & blocked the innovator from making discoveries. Only when industrial freedom was allowed, new knowledge was gained. Since then, the sciences took off.
  • The enemies of the West, especially Auguste Comte, made it clear what the 19th Century was all about. It added to the individualism of the previous period the class consciousness of freedom, developed systematically & continuously what had grown in a haphazard & patchy manner & to spread it from England & Holland to Europe.
    • Once the barriers of free exercise were removed, man became able to satisfy desire. Rising living standards shined light on dark spots of society that people were no longer willing to tolerate.
    • Material comfort, security & personal independence grew beyond imagination. People felt a sense of power over their own fate & the unbounded possibilities in improving their lot. Success led to ambition.
    • But what seemed like an inspiring promise seemed to be not enough & too slow.
      • The principles that led to this stage then seemed like obstacles to be overcome & pushed aside. They should be preserved to maintain what has already been achieved.
  • There’s nothing in Liberalism to make it stationary – no fixed rules. The fundamental principle in ordering our affairs is to use the spontaneous forces of society & to resort to coercion as seldom as possible.
    • Liberals don’t necessarily rely on rules-of-thumb, e.g. laissez-faire. It may bring great benefit to many but also great harm to others. To present industrial liberty being established as a rule, with exceptions never really seen, is dishonest.
    • Many liberals had their points belittled because of the exceptions & it seems liberalism’s collapse to be inevitable. Progress of policy to improve the institutional framework of free society slowed. The progress depended on deeper understanding of social forces & conditions to their working properly.
      • Like a gardener who must know what plants survive or die under certain conditions.
    • Crude rules applied to economic policy were just a beginning. Much more learning was to come. Advancement & progress depended on that. We needed to know much more about monetary policy, monopoly control & prevention.
    • The government possesses powers for good & evil. In order to use them for good, we have to understand them & their effects better.
  • While progress to what’s called “positive” action is slow, the immediate improvement liberalism relied on was a large increase of wealth & it had to fight to proposals that threatened it.
    • This was known as “negative creed” because it only offered particular individuals just a share in the progress which was starting to be taken for granted.
    • But man became less willing to tolerate evils that were around him & they seemed unbearable & unnecessary.
  • The growing impatiences with slow progress in liberal policy & those abusing liberalism for anti-social privileges & ambition for material improvements – tenets of liberalism wore off.
    • The level of progress achieved seemed permanent & irreversible. The people wanted new things, even if the principles had to be abandoned.
    • It became more popular to see the only way to make more progress was abandoning the principles in favor of a complete re-modeling of society. The idea of trying to understand the existing framework was abandoned.
      • It was at this point where our attitudes to society changed. Time only had a cumulative effect leading to the abandonment of individual tradition.
      • According to dominant views, the question isn’t how best to use spontaneous forces of free society. It is how to replace the collective & “conscious”direction of all social forces. Mankind is tending to regulate all its social life.
  • There’s a change in the direction of flow of ideas. For 200 years, it was from England eastward. By 1870, it was at its furthest extent.
    • Then it began to retreat, being replaced with ideas from the East.
    • For the next 60 years, Germany became the leader of political & economic thought
    • Most of these German ideas weren’t new or originally German but perfected there & were able to reach full development.
    • Germany was able to exert intellectual influence supported by material progress & the good reputation of German thinkers & scientists.
      • Germany then spread ideas against European foundations of its own civilization.
      • The Germans saw the conflict between the West (liberalism/democracy, capitalism/individualism, free trade/internationalism) & their new ideas.
      • The G

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