The Road to Serfdom is a Good Book
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Last Modified: March 25, 2008 Issue: January 2008 |
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There, I said it. Likely all who stop reading this post at the title, and who have done the same with Hayek’s book will be appalled, and will proceed to lambast me somewhere (oh wait, I’m not that important!). But it’s something that needs to be said, though perhaps not for the reasons that one usually praises a book for. Many on the left know the frustration of having certain author’s taken out of context by their ideological opponents, whether it be Marx or Chomsky, two very common candidates. Hayek is an equal candidate, and like Marx, he is misunderstood and misinterpreted by both the left and the right. And especially since it is those who have championed the actual implementation of neoliberalism and claim Hayek as their ideological founder that obscure his - at least as stated - positions, and thus wrap themselves in yet another shawl of false legitimacy, it is especially frustrating. But I digress. Why then is The Road to Serfdom a good book?
Mainly, or at least from my uninformed position, because it actually presents serious challenges to the positions of socialists of varying stripes. In short, it forces one, unless they choose not to read the book or uncritically shrug Hayek’s arguments off, to actually ponder and critically analyze the positions that they hold. The basic argument, that certain aspects of state planning produce the propensity towards greater power concentrations (’totalitarianism’, as he puts it), though not a truism, is certainly borne out in historical practice. Thus, for proponents of national state socialism, Hayek provides the perfect springboard for critically approaching the practical dilemmas of coordination, decision-making, power distribution and adjudication. Indeed, those radical democrats who decry technocratic rulership that, at least currently, goes hand in hand with national centralization will share at least one common point with Hayek. For the growing number that views the national state with the same distrust as capital, be they liberal anarchists, social libertarians, left communitarians or any of the myriad political distinctions out there, Hayek’s book is largely dated. Almost all of Hayek’s arguments assume the national state, which is increasingly being contested in the scholarly community - but there is still value in reading this book as a way of further contextualizing their positions within a long strand of intellectual history.
But of course, The Road to Serfdom is not without its flaws. Hayek’s use of rhetoric is conniving and distracts from his actual message, which he explicitly states is his intention. As an example, Hayek crudley equates “fascism” (which is almost never used in the book) with “socialism”. This is clearly an attempt to reframe the word to include the negativity of Britain’s Nazi enemies without regard to the qualitative differences between the two terms. It would be like claiming that ‘anarchism’, in the pejorative sense, is liberalism, in the Hayekian sense. Chapter 12 seeks to trace “The Socialist Roots of Naziism”, an endeavor with about as much validity as tracing the roots of British slavery to the rediscovery of Aristotle during the Renaissance. These two factors are clearly correlated, and indeed, many proponents of slavery did rely on the classic texts, but they are clearly not causally linked in any rigorous way. Hayek’s spuriousness and imprecision in making this argument leaves him open to ridicule, such as that German democracy sprang from Naziism - after all, Hayek says himself that the Nazi’s viewed themselves as practicing the ‘true democracy’.
But for me at least, these flaws are balanced by the intellectual honesty that Hayek displays in the first paragraph of the preface to his original book. He states, “This is a political book.[…] But, whatever the name, the essential point remains that all I shall have to say is derived from certain ultimate values. I hope I have adequately discharged in the book itself a second and no less important duty: to make it clear beyond doubt what these ultimate values are and on which the whole argument depends” (xlv, 1994 ed.). We may, and should, criticize those “ultimate” values for being utopian, selfish, insufficient, inefficient and irrational, almost all of which Hayek has a counter-argument for that will spark important debates, but we must also commend him for not hiding behind “scientific fact” or determinism, and (not entirely) relying on reductive and static conceptions of human nature, unlike his future ‘disciples’.
For me, the most fundamental fallacy Hayek makes is to equate the decentralization of power in society with the automatic propensity for competition (214). We have the historical ‘advantage’ of living through what Peck and Tickell call ‘roll-out neoliberalism’, where Schumpeterian creative destruction reigns free (ironically still carefully regulated of course), and can see that competition is only a classificatory means of changing who will hold power, rather than a progressive end, or even a sustainable process. Those who have subverted Hayek’s proscriptions in chapter 14, those unlucky recipients of neoliberal policy, have only redecorated for a new era of monopoly capitalism.
Avoiding The Road to Serfdom is an easy thing to do, if we choose to hole away in hospitable intellectual enclaves, but we do so at our peril, while those who manipulate Hayek’s ideas work to advance the interests of those whom he condemns (namely monopoloy capitalists, or just about all of them!). And for those who think that reading this book is unnecessary due to its antiquated publication date, it’s not, at least not to the uninitiated like myself. Just as Karl Polanyi’s The Great Transformation has garnered so much attention in recent years (an absolutely perfect complement and critique to Hayek, written in the same year by yet another Austrian - perhaps the subject of another post), The Road to Serfdom is still highly relevant for those engaged in the critique of contemporary North American society. I encourage everyone who is interested in the values underpinning socialism, and critical thought, to actually read this book - it will make criticizing Thatcher and Reagan a little easier!
Matthew Lymburner is an MA student at the Institute of Political Economy, Carleton University. He is interested in Brazilian history and political economy, and progressive politics worldwide.
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I haven’t actually read Hayek in any great detail, but I guess my main problem with Hayek (a political economist of marginal theoretical importance to the US/UK economics taught in universities), like Hayeks protege Friedman (an economist who data-mined his way to a pseudo-nobel prize, but still deserving of respect as an intellectual), and his idiot son David, is their arguably incorrect view of freedom. Of course, my ad hominem’s don’t explain my point in any way! Let’s just say, the ideal of an “autonomous man” makes no sense to me. Social life, up until present anyways, and regardless of the fancy (outdated) banners given to the modes of social organization witnessed historically, is serfdom.
So this is not actually in response to anything you have said, just a general comment about liberal/libertarian/leftist/rightist thought etc.
Ed, I’d agree with your point that the ideal of (hu)man outside of social context makes little sense. You could take it further to say that the ideal of economy makes little sense outside of society, as Polanyi does. For Polanyi, disembedding the market from the social fabric is essentially how modern captalism propagates.
I think the question of “autonomous man” and the disembedded economy are important concepts to critique. Alexander Wendt, in a number of articles (such as “Collective Identity Formation and the International State”) has argued that neoclassical economics is flawed precisely because it fails to take into account social context. This social context is what Wendt calls “intersubjectivity” or the continually changing relationships between individials and organizations, and is a necessary component for an accurate understanding of political relations.* I wouldn’t call myself a constructivist like Wendt, but I do think critical theory has this idea at its core, and it’s authors like Hayek, Friedman and the Chicogo School boys that are the focus of its critique.
*To take an example from Wendt, say there are two countries, the UK which has 20 nuclear weapons, and North Korea which has 1 nuclear weapon. A neoclassical approach would say that the UK is more dangerous, which would seem absurd to many on the international political stage. However, Wendt (who is a constructivist) argues that a consideration of social and historical context would reveal an answer that makes more sense - that North Korea is more dangerous.
I would just like to point out that you need to be careful in your identification of Hayek’s relationship with the neoclassicial school of economic thought. He is not a neoclassicist. Critiques of neoclassicism do not necessarily apply to him and the Austrian school of which he is a part. Neoclassical economics is founded on assumptions of equilibrium and optimality. The Austrians join in the critique of these assumptions, along with the Marxists, institutionalists and various strains of post-Keynesians. During two degrees in economics I never read either Hayek or Schumpeter, both of whom were critical of the neoclassical model, even as many big name neoclassicists paid homage to their contributions.
As for constructivism: while social context is important, let us never forget that both the UK and North Korea command bombs that create big booms and no amount of ’social construction’ will alter the physical meaning of that reality.
Troy, no doubt you are right about the example I used (I was hesitant even to use it because I think it takes away from the more important question of whether there should be nuclear weapons in the first place). I guess my point was that the way constructivists pose the question is not in whether those countries can create the big booms, but whether they will. And this is what takes them somewhat farther from the realist end of the political spectrum (in terms of international relations). Still, there are problems with understanding things in terms of a difference of degree rather than a difference in kind, which I think it part of the problem here. Of course, there are number of different variations in IR constructivism, but that’s a longer/different discussion.
Oh and I’ll have to defer to you on the relationship between Hayek and neoclassical economics. Though I think you are right (from what I’ve read elsewhere), I’m one of those people who hasn’t read the book, and has only secondary sources as reference. My previous understanding was that the modern neoclassical school emerged from the spirit of Hayek’s work.
Neoclassical economics well pre-dates Hayek, emerging from the likes of Jevons, Walras, and Clark at the turn of the 20th century. It also bears allegience to Mengers, who is one of the foundational thinkers of Austrian economics, so they have a common and overlapping heritage. Schumpeter also called Walras the most important economist of contemporary economic thought. Given his authoritative work on economic history this is a pretty profound statement, particularly when you consider Walras’ importance in the equilibrium thinking that underpins neoclassical thought; thinking that Schumpeter found so problematic. (Of course, this is simply a part of his immense intellectual honesty in giving credit where he felt it due, even if he disagreed with where the thinker took their ideas [or worse, where their followers have taken their ideas]). So, neoclassicism and the Austrian school are not diametrically opposed, but there are important differences.
It’s a shame I’m at NPSIA because Polanyi consistently comes up in my personal endeavour of attempting to smash the four years of the institutional vacuum economics I learned (the best work I’ve seen is from D. North - and new institutional economics is not all that…. comprehensive?). That said, I have no response, but its nice to see, as a hastily self proclaimed constructivist, that Wendt and I agree! If you recall any of Polanyi’s “seminal” stuff, do tell (I know he wrote a lot of market transformation/synthesis etc).
Yes, I would make it clear that Hayek is not against neoclassical economics per se. The Austrian school is often considered part of Continental neoclassicism since, as D.T. pointed out, it springs from the marginalist heritage of Menger. Unlike ‘mainstream’ neoclassicism as we are thinking about it, this particular brand was never a dominate force in most academic economics departments, though as we well know, it did have considerable political clout in the fallout of the decline of Keynes.
But specifically, Hayek’s academic economics works are something I know absolutely nothing about (and that is probably true of most people with doctorates in economics!). However, I would argue that in the context of The Road to Serfdom, Hayek is best described as a political economist. We can quibble over whether or not we want to call him ‘neoclassical’, but generally I think you can find a number of features in this book to fit him into a number of different schools of political economy.
Ed - Polanyi is certainly a must read if you are interested in social constructivism. The Great Transformation is a great start - it succintly introduces the critique of “rational” economic actors and self-regulating markets. Trade and Markets in Early Empires is also considered a powerhouse, so you might want to look at that later.
For those interested in more on the life and legacy of Karl Polanyi, CBC Ideas produced a program in 2006 called “Markets and Society”. It explores the thought of Polanyi in a five part series. You can download the podcasts from Inside the CBC.
A CBC piece was also done on Hayek in 1990, but it is unavailable for download at the current time.