Published: 2007 (original 1944)

Publisher:  University of Chicago Press

ISBN: 0226320553

My mother-in-law sent me a copy of this book for my birthday and I finally got around to reading it this last fall.  Economics is a fascinating field and von Hayek's work "The Road to Serfdom" is incredibly relevant today even though it was originally published in 1944.  The book was not intended to be an economic treatise but rather an application of economic theory to political reality.  Hayek saw what happened in Europe between the wars and felt compelled to write a book to his fellow Britons warning them against the dangers of socialism.  Many today see similar signs in America as we push the envelope of capitalism to be ever closer to Keynesian thinking.

Quotes

"I think what is needed is a clear set of principles which enable us to distinguish between the legitimate fields of government activity and the illegitimate fields of government activity.  You must cease to argue for or against government activity as such."

Keynes read this book on his way to Bretton Woods.  He remarked "Morally and philosophically I find myself in agreement with virtually the whole of it, and not only in agreement with it, but in deeply moved agreement."  (So much for Keynes being the evil mindless idiot some on the American "right" would make him out to be!)

"Socialism can be put into practice only by methods which most socialists disapprove."  (Love this statement... wish my liberal friends could grasp this concept.)

Keynes wrote in "The General Theory of Employment, Interest and Money", "I am sure that the power of vested interests is vastly exaggerated compared with the gradual encroachment of ideas."

"There is in particular, all the difference between deliberately creating a system within which competition will work as beneficially as possible and passively accepting institutions as they are." (Libertarians?  Anyone?)

Thoughts

One of the more interesting concepts that Hayek talked about was a section where he explains what should and should not be handled by government.  In his opinion, things which are genuinely "insurable" can be folded into the government without significantly reducing the freedom of individuals.  During the health care debate there was much talk about whether or not government should be involved in health care but there was very little talk about which facets of health care government should be involved in. 

If government were limited to only the insurable portion of health care, it would likely have all the positive effects that the liberals hoped for without the negative effects that the conservatives are worried about.  Rather than having a reasoned debate about the scope of government involvement however, the political forces in America turned it into an all or nothing, black and white argument. 

I suspect von Hayek would have been very disappointed in the placard carrying folks at Tea Party meetings who invoke his name without ever reading his work.

Conclusion

By all means, every voter in America should read this book but only with an open mind and a conscious effort to avoid confirmation bias.  Afterwards they should research the history of the time and research the economic concepts involved and then re-read the book. This book, if understood, would greatly increase the quality of the economic debate in our country.