Investor's Business Daily
April 16, 1999
April 16, 1999
Why the Worst Get On Top
When ''The Road To Serfdom'' was published, smart people turned up their noses at the groundbreaking free-market book. In Great Britain - where the book's author, economist F.A. Hayek lived - the Labour Party was in ascendancy.
The U.S. was still swooning over the New Deal. Most intellectuals believed in a strong role for government in the economy.
No one wanted to hear some cranky Austrian exile telling them that the benevolent statism they so loved was little different from the Nazism they'd worked so hard to defeat. And Hayek's dedication of the book to ''the socialists of all parties'' didn't win him many friends.
But now, 55 years later, Hayek, who went on to win a Nobel prize in economics, doesn't look like a crank.
And ''The Road to Serfdom'' is ''a true classic and essential reading for everyone who is seriously interested in politics in the broadest and least partisan sense, a book whose central message is timeless,'' wrote his fellow Nobel laureate Milton Friedman.
Hayek believed that giving government the power to control the economy wouldn't lead to utopia. In fact, it could very well lead to the sort of horrors seen in Nazi Germany. He reminded his readers that National Socialism was just that, socialism. Yes, he admitted, communists and fascists fought most heatedly with each other in both Germany and Italy before the fascists finally won.
''They competed with each other for the support of the same type of mind and reserved for each other the hatred of the heretic,'' he noted.
In practice, there was little difference between the fascists and the communists.
''To both, the real enemy, the man with whom they had nothing in common and whom they could not hope to convince, is the liberal of the old type,'' Hayek wrote.
Those old-style liberals believed in private property, free markets and limited government.
Germany saw its war against the U.S. and Great Britain as a battle against nations made decadent by market economies that encouraged selfishness.
In Nazi Germany, most economic activity was under the control of the state. The difference between Germany and the social-welfare states that were the ideal of Western intellectuals was one of degree, not kind.
And Hayek warned that Nazi Germany was proof that attempts to control economic activity so completely would lead to similar tyrannies.
As government regulation and taxation grow, he wrote, ''the individual would more than ever become a mere means, to be used by the authority in the service of such abstractions as 'the social welfare' or the 'good of the community.' ''
Planners always assume that such power would only be wielded by the wisest and kindest of people.
But Hayek pointed out that in practice that power had been used by the likes of Hitler and Stalin.
And that was no accident, he said.
A socialist state makes it easy for such people to climb to the top.
Once a government sets out to control the lives of its citizens - to regulate how and when they do business, to guide economic activity - it must assume tremendous power over their lives.
And it must by necessity disregard the wishes of individuals.
It should be no surprise, then, said Hayek, that the persons who rise to the top of such a government are those who most want to wield power, those who are most ruthless in using power.
That is why the very worst get to the top of socialist states.
''That socialism can be put into practice only by methods which most socialists disapprove is, of course, a lesson learned by many social reformers in the past,'' Hayek wrote.
The reformers of Hayek's day had forgotten those lessons. But it remains to be seen whether today's would-be reformers have learned any better.
