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Sunday, February 1, 1998

The Collected Works of F. A. Hayek: Volume 10, Socialism and War edited by Bruce Caldwell

A Book Sure to Be Useful to Students of Economic History and Opponents of Government's Economic Meddling

University of Chicago Press • 1997 • 270 pages • $36.00

In this, the tenth volume in the planned 19-volume set of Hayek’s complete works, we are given an assortment of essays and reviews, most dating from the interwar years when Hayek was in London, dealing with the topics of socialism and war. In choosing to juxtapose these two subjects, the editor, Professor Bruce Caldwell of the University of North Carolina, Greensboro, not only combines issues that were very much on Hayek’s mind during this period of his life, but also reminds us that, as Hayek and many others have argued, socialism is anything but a path to peace. The coercion it necessarily entails leads to conflict and even warfare. That truth can never be stated too often.

For readers unfamiliar with F. A. Hayek’s contributions to the pro-market, anti-socialist literature, it should be briefly noted that he was a student of Ludwig von Mises and established early on a reputation as a powerful opponent of central economic planning. He was invited to teach at the London School of Economics in 1931 and throughout the Depression and war years was one of the few opponents of socialism among Western intellectuals. His great 1944 book, The Road to Serfdom, clearly and patiently explained why socialism must lead to the gradual loss of all freedom. For his many contributions in economics, he received the Nobel Prize in 1974. He died in 1992.

One of the great battles Hayek fought during these years was over the feasibility of “market socialism.” Mises had essayed a devastating critique of socialism in his 1922 book Socialism, centering around his argument that socialist planning authorities could never make optimal use of resources because socialism lacks a price system to guide decision-makers. That attack touched off a furious debate, with both Mises and Hayek countering the contention that some “middle way,” namely market socialism, was possible and desirable.

The first part of Socialism and War is devoted to Hayek’s contributions to and commentaries upon the “calculation debate.” In his introduction, Professor Caldwell does an excellent job of setting forth the historical context of the debate. He also provides an answer to the obvious question, “Is this still of any relevance?” He observes that there are still academics among us who argue that there are varieties of socialism that have yet to be tried. The collapse of the Soviet Union and the mounting evidence of just how pathetic its economic performance was have done little to eradicate the hardy delusion that coercive interference in the peaceful operation of the market can ever improve human welfare.

The arguments for “different” kinds of socialism are mere variations on a fundamentally discordant theme. As we continue to confront socialists’ claims that they have finally hit upon the variation that can’t fail, we will find a wealth of insights and arguments in these writings of Hayek.

Apropos of the allure of socialism, the book includes one of Hayek’s masterpieces, the essay “The Intellectuals and Socialism.” The left, he writes, “have always directed their main effort towards gaining the support of [the intellectual] elite, while the more conservative groups have acted, as regularly but unsuccessfully, on a more naïve view of mass democracy and have usually vainly tried directly to reach and persuade the individual voter.” This is a point we must contemplate. Despite the “Reagan Revolution” and the ouster of the Democratic Party from control of Congress, can anyone confidently say that there has been much of a change in the attitudes of the people toward the state? In pushing for an increase in the minimum wage in 1996, the backers of this irrational and immoral measure pointed to opinion polls showing that roughly 75 percent of Americans were in favor of it. Would the numbers have been any worse 50 years ago?

Just as he did in the “calculation debate,” here Hayek plumbed the essence of the problem. Although the common man may disdain intellectuals, his thinking is largely their thinking, filtered through various media that are themselves generally sympathetic to interventionism. As long as interventionists dominate the channels through which ideas are produced and disseminated, the nation will continue to drift in their direction.

Bruce Caldwell has done a splendid job of editing and the University of Chicago Press has published a lovely volume. The set of Hayek’s works will be useful to students of intellectual history and to opponents of government’s economic meddling for years to come.

  • George Leef is the former book review editor of The Freeman. He is director of research at the John W. Pope Center for Higher Education Policy.