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Who’s Afraid of Planning? Thoughts on Friedrich Hayek’s ‘The Road to Serfdom’, Introduction and Chapters 1-3

September 3, 2012

It’s a clichéd response, but reading the introduction and the first three chapters of Friedrich Hayek’s The Road to Serfdom, I was more than a little shocked.

Why? Listen to the arguments coming from so-called ‘conservatives’ who seem to oppose the state at every turn (as opposed to Burkean conservatism, a tradition which I find much more productive), and what are the most common tropes?

They’re not hard to list off. First, it’s important to eliminate people’s ‘dependence’ on the state and welfare services. Second, it’s important that ‘government’ (usually spoken of as some alien force rather than something that men themselves construct and can transform) be reduced as much as possible – ‘small enough to drown in a bathtub’, to use Grover Norquist’s memorable phrasing. Third, ‘regulation’ is strangling the economy. Whether it’s Department of Energy regulations preventing the constructing of the Keystone XL pipelines, or the wave of regulations bilging forth from President Obama’s Washington, we’re frequently told by policy intellectuals on the right that ‘regulation’ is holding us back from more prosperity and wealth. Combine these three elements  together, and you have the outline of the charge that more than just energized Tea Partiers often make of the Obama Administration today.

Would Hayek approve?

Because many of the figures that the Tea Party and the current GOP coalition hold up as ‘serious thinkers’ themselves frequently cite Hayek as their intellectual inspiration, I opened up the first chapters of The Road to Serfdom with held breath and a a clothespin pinched around my nose. Yet only a few paragraphs in, I could soon exhale. Read a few pages more, and the clothespin even came off. Far from a free-market ideologue, Hayek came across as eminently reasonable and – maybe more to the point, given that it’s an election year – far to the left f some of the rhetoric coming out of the Republican Party today. Was I really reading the same book that some of these people were citing with admiration? And if I was, how could people presumably of good intentions come to such different interpretations of this author?

Part of the problem, I think, starts with historical context and avoiding Hayek’s precisely-defined terms. In the Introduction and first three chapters of The Road to Serfdom, Hayek begins to lay out his case against what he calls ‘planning.’ There’s a word we hear a lot in our contemporary politic discussions – when not plotting a ‘government takeover’ of the economy or the health insurance industry, the current Administration is sometimes said to be contemplating the end of the free market and the move towards (variously) ‘Euro-socialism’ or a planned economy. That might be true, but Hayek’s specific definition of ‘planning’ in this context is quite precise and, I think, reasonable. In Chapter Three, ‘Individualism and Collectivism’, Hayek writes that

‘Planning’ owes its popularity largely to the fact that everybody desires, of course, that we should handle our common problems as rationally as possible, and that in so doing we should use as much foresight as we can command. In this sense everybody who is not a complete fatalist is a planner, and there can be differences only between good and bad, between wise and foresighted and foolish and short-sighted planning. 

Who could disagree with that? Indeed, Hayek’s criticism of planning is much more specific than that. He goes on:

According to the modern planners, and for their purposes, it is not sufficient to design the most rational permanent framework within which the various activities would be conducted by different persons according to their individual plans. […] What our planners demand is a central direction of all economic activity according to a single plan, laying down how the resources of a society should be ‘consciously directed’ to serve particular ends in a different way.

This specific definition of planning that Hayek sets out to attack might sound indefensible today, but it’s important to remember that at the time, in England of the late 1930s and early 1940s, there were plenty of ‘serious people’ who supported such a vision. Perhaps most famously (but still obscure for non-specialists or non-historians), one of the most dynamic intellectual groups in Edwardian and interwar Britain was the Fabian Society, a fluid group headed by British Marxists Sidney and Beatrice Webb and which had a significant influence on the Labour Party in 20th century Britain. In general opposed to British imperial adventure abroad and the liberal individualism (i.e. the lack of a welfare state) at home, thinkers like the Webbs (who founded the London School of Economics), Herman Finer, and Barbara Wootton often took stances at tension with Hayek’s later criticism: the establishment of a national health service; proposals for more workers’ co-operatives; a minimum wage; and, in more radical cases, the use of eugenics and population control to create a ‘scientifically planned’ society sans inequality.

Charming but dangerous? It’s important not to rip Hayek out of his context – one that includes British socialists like Beatrice Webb

In the United States, meanwhile, as documentaries like Arguing the World remind us, in New York City’s universities (often populated by dynamic young Jewish men locked out of the Ivies by anti-Semitic policies) there were still plenty of Stalinists even after the Nazi-Soviet Pact in 1940. More privileged intellectuals like Paul Sweezy and Walt Rostow also gained exposure to socialist ideas of planning at Harvard (Sweezy) and Yale and Oxford (Rostow) in the 1930s and early 1940s before, in some cases, breaking with these ideas. While socialist ideas on both sides of the Atlantic surely had an influence on the mainstream Left (Labour and the Democratic Party), as I have argued elsewhere, it is surely an oversimplification to assert, as writer (and birther) Jonah Goldberg does, that there is a direct line from this eugenicist socialist moment to John Kerry or Barack Obama.

How much do we abuse or mis-remember Hayek by ripping him out of his historical moment?

There’s a lot more here in these first few chapters, of course. Look for a post soon on Hayek’s distinction between ‘regulation’ and ‘planning’, as well as his definition of ‘freedom’ – all crucial stuff that it’s important to wade through before moving on to the next few chapters of the book.

One Comment
  1. nickik permalink

    One has to be clear about one thing. Hayek did not support many of the things he talks about in the road to serfdom or Law, Legislation and Liberty but he thinks his framework allows for them ie. he think you can have social walfair programm without the state beeing really bad. Republicans sometimes make it sound like, if there is a social programm the state is evil. While hayek said one could do this without beeing an evil state per se.

    Other then that I as a hayek fan dislike to use of hayek by the replublicans. There politcs have nothing todo with hayek, as far as I can see the diffrent between democrats and republicans is where they expand the state. The republicans fight for there conservative agenda that is not in line with hayek hat all, more border control, more protectionism, more military, more police state ….

    A programm like Obamacare is not hayekian at all, yes he said that support in healthcare could be ok to do but he very much focuses on local knowlage and emergin order, where obamacare is a huge top down programm.

    I think neither democrats nor republicans should point to hayek as far as there policys go.

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