Liveblogging World War II: May 10, 1942
When Risk Management Fails

The 1956 Preface to Friedrich von Hayek's "The Road to Serfdom"


Preface: 1956: ALTHOUGH THIS BOOK might in some respects have been different if I had written it in the first instance with American readers primarily in mind, it has by now made for itself too definite if unexpected a place in this country to make any rewriting advisable. Its republication in a new form, however, more than ten years after its first appearance, is perhaps an appropriate occasion for explaining its original aim and for a few comments on the altogether unforeseen and in many ways curious success it has had in this country.

The book was written in England during the war years and was designed almost exclusively for English readers. Indeed, it was addressed mainly to a very special class of readers in England. It was in no spirit of mockery that I dedicated it "To the Socialists of All Parties." It had its origin in many discussions which, during the preceding ten years, I had with friends and colleagues whose sympathies had been inclined toward the left, and it was in continuation of those arguments that I wrote The Road to Serfdom.

When Hitler came into power in Germany, I had already been teaching at the University of London for several years, but I kept in close touch with affairs on the Continent and was able to do so until the outbreak of war. What I had thus seen of the origins and evolution of the various totalitarian movements made me feel that English public opinion, particularly among my friends who held "advanced" views on social matters, completely misconceived the nature of those movements. Even before the war I was led by this to state in a brief essay what became the central argument of this book. But after war broke out I felt that this widespread misunderstanding of the political systems of our enemies, and soon also of our new ally, Russia, constituted a serious danger which had to be met by a more systematic effort. Also, it was already fairly obvious that England herself was likely to experiment after the war with the same kind of policies which I was convinced had contributed so much to destroy liberty elsewhere.

Thus this book gradually took shape as a warning to the socialist intelligentsia of England; with the inevitable delays of wartime production, it finally appeared there early in the spring of 1944. This date will, incidentally, also explain why I felt that in order to get a hearing I had somewhat to restrain myself in my comments on the regime of our wartime ally and to choose my illustrations mainly from developments in Germany.

It seems that the book appeared at a propitious moment, and I can feel only gratification at the success it had in England, which, though very different in kind, was quantitatively no smaller than it was to be in the United States. On the whole, the book was taken in the spirit in which it was written, and its argument was seriously examined by those to whom it was mainly addressed. Excepting only certain of the leading politicians of the Labour party--who, as if to provide an illustration for my remarks on the nationalist tendencies of socialism, attacked the book on the ground that it was written by a foreigner--the thoughtful and receptive manner in which it was generally examined by persons who must have found its conclusions running counter to their strongest convictions was deeply impressive. The same applies also to the other European countries where the book eventually appeared; and its particularly cordial reception by the post-Nazi generation of Germany, when copies of a translation published in Switzerland at last reached that country, was one of the unforeseen pleasures I derived from the publication.

Rather different was the reception the book had in the United States when it was published here a few months after its appearance in England. I had given little thought to its possible appeal to American readers when writing it. It was then twenty years since I had last been in America as a research student, and during that time I had somewhat lost touch with the development of American ideas. I could not be sure how far my argument had direct relevance to the American scene, and I was not in the least surprised when the book was in fact rejected by the first three publishing houses approached. It was certainly most unexpected when, after the book was brought out by its present publishers, it soon began to sell at a rate almost unprecedented for a book of this kind, not intended for popular consumption.

And I was even more surprised by the violence of the reaction from both political wings, by the lavish praise the book received from some quarters no less than by the passionate hatred it appeared to arouse in others.

Contrary to my experience in England, in America the kind of people to whom this book was mainly addressed seem to have rejected it out of hand as a malicious and disingenuous attack on their finest ideals; they appear never to have paused to examine its argument.

The language used and the emotion shown in some of the more adverse criticism the book received were indeed rather extraordinary. But scarcely less surprising to me was the enthusiastic welcome accorded to the book by many whom I never expected to read a volume of this type--and from many more of whom I still doubt whether in fact they ever read it.

And I must add that occasionally the manner in which it was used vividly brought home to me the truth of Lord Acton's observation that "at all times sincere friends of freedom have been rare, and its triumphs have been due to minorities, that have prevailed by associating themselves with auxiliaries whose objects often differed from their own; and this association, which is always dangerous, has sometimes been disastrous."

It seems hardly likely that this extraordinary difference in the reception of the book on the two sides of the Atlantic is due entirely to a difference in national temperament. I have since become increasingly convinced that the explanation must lie in a difference of intellectual situation at the time when it arrived. In England, and in Europe generally, the problems with which I dealt had long ceased to be abstract questions. The ideals which I examined had long before come down to earth, and even their most enthusiastic adherents had already seen concretely some of the difficulties and unlooked-for results which their application produced. I was thus writing about phenomena of which almost all my European readers had some more or less close experience, and I was merely arguing systematically and consistently what many had already intuitively felt. There was already a disillusionment about these ideals under way, which their critical examination merely made more vocal or explicit.

In the United States, on the other hand, these ideals were still fresh and more virulent. It was only ten or fifteen years earlier--not forty or fifty, as in England--that a large part of the intelligentsia had caught the infection. And, in spite of the experimentation of the New Deal, their enthusiasm for the new kind of rationally constructed society was still largely unsoiled by practical experience. What to most Europeans had in some measure become vieux jeux was to the American radicals still the glittering hope of a better world which they had embraced and nourished during the recent years of the Great Depression.

Opinion moves fast in the United States, and even now it is difficult to remember how comparatively short a time it was before The Road to Serfdom appeared that the most extreme kind of economic planning had been seriously advocated and the model of Russia held up for imitation by men who were soon to play an important role in public affairs. It would be easy enough to give chapter and verse for this, but it would be invidious now to single out individuals. Be it enough to mention that in 1934 the newly established National Planning Board devoted a good deal of attention to the example of planning provided by these four countries: Germany, Italy, Russia, and Japan.

Ten years later we had of course learned to refer to these same countries as "totalitarian," had fought a long war with three of them, and were soon to start a "cold war" with the fourth. Yet the contention of this book that the political development in those countries had something to do with their economic policies was then still indignantly rejected by the advocates of planning in this country.

It suddenly became the fashion to deny that the inspiration of planning had come from Russia and to contend, as one of my eminent critics put it, that it was "a plain fact that Italy, Russia, Japan, and Germany all reached totalitarianism by very different roads."

The whole intellectual climate in the United States at the time The Road to Serfdom appeared was thus one in which it was bound either profoundly to shock or greatly to delight the members of sharply divided groups. In consequence, in spite of its apparent success, the book has not had here the kind of effect I should have wished or which it has had elsewhere. It is true that its main conclusions are today widely accepted. If twelve years ago it seemed to many almost sacrilege to suggest that fascism and communism are merely variants of the same totalitarianism which central control of all economic activity tends to produce, this has become almost a commonplace. It is now even widely recognized that democratic socialism is a very precarious and unstable affair, ridden with internal contradictions and everywhere producing results most distasteful to many of its advocates.

For this sobered mood the lessons of events and more popular discussions of the problem (The most effective of these was undoubtedly George Orwell's 1984. The author had earlier kindly reviewed this book.) are certainly more responsible than this book. Nor was my general thesis as such original when it was published. Although similar but earlier warnings may have been largely forgotten, the dangers inherent in the policies which I criticized had been pointed out again and again. Whatever merits this book possesses consist not in the reiteration of this thesis but in the patient and detailed examination of the reasons why economics planning will produce such unlooked-for results and of the process by which they come about.

It is for this reason that I rather hope that the time may now be more favorable in America for a serious consideration of the true argument of the book than it was when it first appeared. I believe that what is important in it still has to render its service, although I recognize that the hot socialism against which it was mainly directed-that organized movement toward a deliberate organization of economic life by the state as the chief owner of the means of production-is nearly dead in the Western world.

The century of socialism in this sense probably came to an end around 1948. Many of its illusions have been discarded even by its leaders, and elsewhere as well as in the United States the very name has lost much of its attraction. Attempts will no doubt be made to rescue the name for movements which are less dogmatic, less doctrinaire, and less systematic. But an argument applicable solely against those clear-cut conceptions of social reform which characterized the socialist movements of the past might today well appear as tilting against windmills.

Yet though hot socialism is probably a thing of the past, some of its conceptions have penetrated far too deeply into the whole structure of current thought to justify complacency. If few people in the Western world now want to remake society from the bottom according to some ideal blueprint, a great many still believe in measures which, though not designed completely to remodel the economy, in their aggregate effect may well unintentionally produce this result. And, even more than at the time when I wrote this book, the advocacy of policies which in the long run cannot be reconciled with the preservation of a free society is no longer a party matter.

That hodgepodge of ill-assembled and often inconsistent ideals which under the name of the Welfare State has largely replaced socialism as the goal of the reformers needs very careful sorting-out if its results are not to be very similar to those of full-fledged socialism. This is not to say that some of its aims are not both practicable and laudable. But there are many ways in which we can work toward the same goal, and in the present state of opinion there is some danger that our impatience for quick results may lead us to choose instruments which, though perhaps more efficient for achieving the particular ends, are not compatible with the preservation of a free society.

The increasing tendency to rely on administrative coercion and discrimination where a modification of the general rules of law might, perhaps more slowly, achieve the same object, and to resort to direct state controls or to the creation of monopolistic institutions where judicious use of financial inducements might evoke spontaneous efforts is still a powerful legacy of the socialist period which is likely to influence policy for a long time to come.

Just because in the years ahead of us political ideology is not likely to aim at a clearly defined goal but toward piece-meal change, a full understanding of the process through which certain kinds of measures can destroy the bases of an economy based on the market and gradually smother the creative powers of a free civilization seems now of the greatest importance.

Only if we understand why and how certain kinds of economic controls tend to paralyze the driving forces of a free society, and which kinds of measures are particularly dangerous in this respect, can we hope that social experimentation will not lead us into situations none of us want.

It is as a contribution to this task that this book is intended. I hope that at least in the quieter atmosphere of the present it will be received as what it was meant to be, not as an exhortation to resistance against any improvement or experimentation, but as a warning that we should insist that any modification in our arrangements should pass certain tests (described in the central chapter on the Rule of Law) before we commit ourselves to courses from which withdrawal may be difficult.

The fact that this book was originally written with only the British public in mind does not appear to have seriously affected its intelligibility for the American reader. But there is one point of phraseology which I ought to explain here to forestall any misunderstanding.

I use throughout the term "liberal" in the original, nineteenth-century sense in which it is still current in Britain. In current American usage it often means very nearly the opposite of this.

It has been part of the camouflage of leftist movements in this country, helped by the muddleheadedness of many who really believe in liberty, that "liberal" has come to mean the advocacy of almost every kind of government control. I am still puzzled why those in the United States who truly believe in liberty should not only have allowed the left to appropriate this almost indispensable term but should even have assisted by beginning to use it themselves as a term of opprobrium.

This seems to be particularly regrettable because of the consequent tendency of many true liberals to describe themselves as conservatives.

It is true, of course, that in the struggle against the believers in the all-powerful state the true liberal must sometimes make common cause with the conservative, and in some circumstances, as in contemporary Britain, he has hardly any other way of actively working for his ideals.

But true liberalism is still distinct from conservatism, and there is danger in the two being confused.

Conservatism, though a necessary element in any stable society, is not a social program; in its paternalistic, nationalistic, and power-adoring tendencies it is often closer to socialism than true liberalism; and with its traditionalistic, anti-intellectual, and often mystical propensities it will never, except in short periods of disillusionment, appeal to the young and all those others who believe that some changes are desirable if this world is to become a better place.

A conservative movement, by its very nature, is bound to be a defender of established privilege and to lean on the power of government for the protection of privilege. The essence of the liberal position, however, is the denial of all privilege, if privilege is understood in its proper and original meaning of the state granting and protecting rights to some which are not available on equal terms to others.

Perhaps a further word of apology is required for my allowing this book to reappear in entirely unchanged form after the lapse of almost twelve years. I have many times tried to revise it, and there are numerous points I should like to explain at greater length or to state more cautiously or to fortify by more illustration and proof. But all attempts at rewriting only proved that I could never again produce as short a book covering as much of the field; and it seems to me that, whatever other merits it may have, its relative brevity is its greatest. I have thus been forced to the conclusion that whatever I want to add to the argument I must attempt in separate studies. I have begun to do so in various essays, some of which provide a more searching discussion of certain philosophical and economic issues on which the present book only touches.

On the special question of the roots of the ideas here criticized and of their connection with some of the most powerful and impressive intellectual movements of this age, I have commented in another volume. And before long I hope to supplement the all-too brief central chapter of this book by a more extensive treatment of the relation between equality and justice.

There is one particular topic, however, on which the reader will with justice expect me to comment on this occasion, yet which I could even less treat adequately without writing a new book. Little more than a year after The Road to Serfdom first appeared, Great Britain had a socialist government which remained in power for six years. And the question of how far this experience has confirmed or refuted my apprehensions is one which I must try to answer at least briefly. If anything, this experience has strengthened my concern and, I believe I may add, has taught the reality of the difficulties I pointed out to many for whom an abstract argument would never have carried conviction. Indeed, it was not long after the Labour government came into power that some of' the issues which my critics in America dismissed as bogeys became in Great Britain main topics of political discussion. Soon even official documents were gravely discussing the danger of totalitarianism raised by the policy of economic planning.

There is no better illustration of the manner in which the inherent logic of their policies drove an unwilling socialist government into the kind of coercion it disliked than the following passage in the Economic Survey for 1947 (which the Prime Minister presented to Parliament in February of that year) and its sequel:

There is an essential difference between totalitarian and democratic planning. The former subordinates all individual desires and preferences to the demand of the State. For this purpose, it uses various methods of compulsion upon the individual which deprive him of his freedom of choice. Such methods may be necessary even in a democratic country during the extreme emergency of a great war. Thus the British people gave their war time Government the power to direct labour. But in normal times the people of a democratic country will not give up their freedom of choice to their Government. A democratic Government must therefore conduct its economic planning in a manner which preserves the maximum possible freedom of choice to the individual citizen.

The interesting point about this profession of laudable intentions is that six months later the same government found itself in peacetime forced to put the conscription of labor back on the statute book. It hardly diminishes the significance of this when it is pointed out that the power was in fact never used because, if it is known that the authorities have power to coerce, few will wait for actual coercion.

But it is rather difficult to see how the government could have persisted in its illusions when in the same document it claims that it was now for "the Government to say what is the best use for the resources in the national interest" and to "lay down the economic task for the nation: it must say which things are the most important and what the objectives of policy ought to be."

Of course, six years of socialist government in England have not produced anything resembling a totalitarian state. But those who argue that this has disproved the thesis of The Road to Serfdom have really missed one of its main points: that the most important change which extensive government control produces is a psychological change, an alteration in the character of the people.

This is necessarily a slow affair, a process which extends not over a few years but perhaps over one or two generations.

The important point is that the political ideals of a people and its attitude toward authority are as much the effect as the cause of the political institutions under which it lives.

This means, among other things, that even a strong tradition of political liberty is no safeguard if the danger is precisely that new institutions and policies will gradually undermine and destroy that spirit.

The consequences can of course be averted if that spirit reasserts itself in time and the people not only throw out the party which has been leading them further and further in the dangerous direction but also recognize the nature of the danger and resolutely change their course. There is not yet much ground to believe that the latter has happened in England.

Yet the change undergone by the character of the British people, not merely under its Labour government but in the course of the much longer period during which it has been enjoying the blessings of a paternalistic welfare state, can hardly be mistaken. These changes are not easily demonstrated but are clearly felt if one lives in the country.

In Illustration, I will cite a few significant passages from a sociological survey dealing with the impact of the surfeit of regulation on the mental attitudes of the young. It is concerned with the situation before the Labour government came into power, in fact, about the time this book was first published, and deals mainly with the effects of those war regulations which the Labour government made permanent:

It is above all in the city that the province of the optional felt as dwindling away to nothing. At school, in the place of irk, on the journey to and fro, even in the very equipment A provisioning of the home, many of the activities normally possible to human beings are either forbidden or enjoined. special agencies, called Citizen's Advice Bureaus, are set up to steer the bewildered through the forest of rules, and to indicate to the persistent the rare clearings where a private person may still make a choice .... [The town lad] is conditioned not lift a finger without refering mentally to the book of words first. A time-budget of an ordinary city youth for an ordinary working day would show the he spends great stretches of his eking hour going through motions that have been predetermined for him by directives in whose framing he has had no part, whose precise intention he seldom understands, and of lose appropriateness he cannot judge . . . . The inference at what the city lad needs is more discipline and tighter control is too hasty. It would be nearer the mark to say that he is suffering from an overdose of control already . . . . Surveying parents and his older brothers or sisters he finds them as regulation-bound as himself. He sees them so acclimatised to that state that they seldom plan and carry out under their own any new social excursion or enterprise. He thus looks forward to no future period at which a sinewy faculty of responsibility is likely to be of service to himself or others .... the young people] are obliged to stomach so much external d, as it seems to them meaningless control that they seek ;ape and recuperation in an absence of discipline as complete as they can make it.

Is it too pessimistic to fear that a generation grown up under these conditions is unlikely to throw off the fetters to which it has grown used? Or does this description not rather fully bear out De Tocqueville's prediction of the "new kind of servitude" when

after having thus successively taken each member of the community in its powerful grasp, and fashioned him at will, the supreme power then extends its arm over the whole community. It covers the surface of society with a network of small complicated rules, minute and uniform, through which the most original minds and the most energetic characters cannot penetrate to rise above the crowd. The will of man is not shattered but softened, bent and guided; men are seldom forced by it to act, but they are constantly restrained from acting. Such a power does not destroy, but it prevents existence; it does not tyrannize, but it compresses, enervates, extinguishes, and stupefies a people, till each nation is reduced to be nothing better than a flock of timid and industrial animals, of which government is the shepherd. I have always thought that servitude of the regular, quiet, and gentle kind which I have just described might be combined more easily than is commonly believed with some of the outward forms of freedom and that it might even establish itself under the wing of the sovereignty of the people.

What De Tocqueville did not consider was how long such a government would remain in the hands of benevolent despots when it would be so much more easy for any group of ruffians to keep itself indefinitely in power by disregarding all the traditional decencies of political life.

Perhaps I should also remind the reader that I have never accused the socialist parties of deliberately aiming at a totalitarian regime or even suspected that the leaders of the old socialist movements might ever show such inclinations.

What I have argued in this book, and what the British experience convinces me even more to be true, is that the unforeseen but inevitable consequences of socialist planning create a state of affairs in which, if the policy is to be pursued, totalitarian forces will get the upper hand.

I explicitly stress that "socialism can be put into practice only by methods of which most socialists disapprove" and even add that in this "the old socialist parties were inhibited by their democratic ideals" and that "they did not possess the ruthlessness required for the performance of their chosen task."

I am afraid the impression one gained under the Labour government was that these inhibitions were if anything weaker among the British socialists than they had been among their German fellow-socialists twenty-five years earlier. Certainly German Social Democrats, in the comparable period of the 1920's, under equally or more difficult economic conditions, never approached as closely to totalitarian planning as the British Labour government has done.

Since I cannot here examine the effect of these policies in detail, I will rather quote the summary judgments of other servers who may be less suspect of preconceived opinions.

Some of the most damning, in fact, come from men who not long before had themselves been members of the Labour Party.

Thus Mr. Ivor Thomas, in a book apparently intended to explain why he left that party, comes to the conclusion that

from the point of view of fundamental human liberties there is little to choose between communism, socials, and national socialism. They all are examples of the collectivist or totalitarian state . . . in its essentials not only is completed socialism the same as communism but it hardly differs from fascism.

The most serious development is the growth of a measure of arbitrary administrative coercion and the progressive destruction of the cherished foundation of British liberty, the Rule of Law, for exactly the reasons here discussed in chapter 6.

This process had of course started long before the last Labour government came into power and had been accentuated by the war. But the attempts at economic planning under the Labour government carried it to a point which makes it doubtful whether it can be said that the Rule of Law still prevails in Britain.

The "New Despotism" of which a Lord Chief justice had warned Britain as long as twenty-five years ago is, as The Economist recently observed, no longer a mere danger but an established fact.

It is a despotism exercised by a thoroughly conscientious and honest bureaucracy for what they sincerely believe is the good of the country.

But it is nevertheless an arbitrary government, in practice free from effective parliamentary control; and its machinery would be as effective for any other than the beneficent purposes for which it is now used.

I doubt whether it was much exaggerated when recently an eminent British jurist, in a careful analysis of these trends, came to the conclusions that

in Britain to-day, we live on the edge of dictatorship. Transition would be easy, swift, and it could be accomplished with complete legality.

Already so many steps have been taken in this direction, due to the completeness of power possessed by the Government of the day, and the absence of any real check such as the terms of a written constitution or the existence of an effective second chamber, that those still to be taken are small in comparison.

For a more detailed analysis of the economic policies of the British Labour government and its consequences I cannot do better than refer the reader to Professor John Jewkes's Ordeal by Planning (London: Macmillan & Co. , 1948). It is the best discussion known to me of a concrete instance of the phenomena discussed in general terms in this book. It supplements it better than anything I could add here and spells out a lesson which is of significance far beyond Great Britain.

It seems now unlikely that, even when another Labour government should come into power in Great Britain, it would resume the experiments in large-scale nationalization and planning. But in Britain, as elsewhere in the world, the defeat of the onslaught of systematic socialism has merely given those who are anxious to preserve freedom a breathing space in which to re-examine our ambitions and to discard all those parts of the socialist inheritance which are a danger to a free society.

Without such a revised conception of our social aims, we are likely to continue to drift in the same direction in which outright socialism would merely have carried us a little faster.



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