Monday, October 19, 2009

Quote - F.A. Hayek on Economic Dictatorship

"Most planners who have seriously considered the practical aspects of their task have little doubt that a directed economy must be run on more or less dictatorial lines. That the complex system of interrelated activities, if it is to be consciously directed at all, must be directed by a single staff of experts, and that ultimate responsibility and power must rest in the hands of a commander-in-chief whose actions must not be fettered by democratic procedure, is too obvious a consequence of underlying ideas of central planning not to command fairly general assent. The consolation our planners offer us is that this authoritarian direction will apply "only" to economic matters. One of the most prominent economic planners, Stuart Chase, assures us, for instance, that in a planned society "political democracy can remain if it confines itself to all but economic matters." Such assurances are usually accompanied by the suggestion that, by giving up freedom in what are, or ought to be, the less important aspects of our lives, we shall obtain greater freedom in the pursuit of higher values. On this ground people who abhor the idea of a political dictatorship often clamor for a dictator in the economic field."
F. A. Hayek, The Road To Serfdom, 1944.

11 comments:

Christopher said...

I agree, but unfortunately is the libertarians who are the most guilty of hypocrisy on this point.

Josh said...

I don't follow.

Christopher said...

Small businesses are tyrannies.

Josh said...

How so?

Christopher said...

Who makes the decisions? Who has the power?

Josh said...

Which decisions? Which power? You need to be more specific.

Does a small businessman have the power to physically coerce me into working for wages I'd rather not in a work environment I'd rather not, no. So which decisions and which power are you referring to?

Does a small businessman have the power to tax my income? To ration my food? To hold me without charge? To physically abuse me? No.

Does a small businessman have the power to make decisions in regard to his private property? Absolutely; thankfully you do too Mr. Small Businessman (performing private tutoring is a small business).

Again, which power and decisions are we referring to?

Christopher said...

"Does a small businessman have the power to physically coerce me into working for wages I'd rather not in a work environment I'd rather not, no. So which decisions and which power are you referring to?"

If the average wage is low enough, yes he does.

"Does a small businessman have the power to tax my income? To ration my food? To hold me without charge? To physically abuse me? No. "

If you do the wrong things at his business, yes. It is called docking pay, and, yes, some small business men are violent. Thankfully, we have labor laws that prevent this.

"Does a small businessman have the power to make decisions in regard to his private property?"

Tyranny. Production is carried out by both the owner and the workers, which makes his decisions tyrannical.

"Absolutely; thankfully you do too Mr. Small Businessman (performing private tutoring is a small business)."

I don't hire anyone.

Josh said...

"If the average wage is low enough, yes he does."

In China people are choosing to move from the rural areas to large cities because of they are making a choice between the working conditions in rural areas and the working conditions in the factories. The small businessman CANNOT force you to work for a wage you do not want to work for. The labour market guides wages and working conditions.

"If you do the wrong things at his business, yes. It is called docking pay, and, yes, some small business men are violent. Thankfully, we have labor laws that prevent this."

First of all, when you agree to perform a job for an employer you are entering into a contract. If you do not meet your end of the contract, maybe your employer docks your pay, but if he does so unjustly, government has a role in providing an efficient means of justice that is equally available to all.

Second of all, why do you need specific labour laws to protect you from violent employers? The law already protects individuals from physical abuse and the government is supposed to provide protection to individuals from such attacks.

"Tyranny. Production is carried out by both the owner and the workers, which makes his decisions tyrannical."

Yes, please compare those individuals that suffered under Hitler, Mao, and Stalin to those that work in small businesses. That you do not see the difference (that while employed the individual has a choice to leave but in the previous examples the individuals had no choice) is appalling. Small businessmen cannot practice tyranny because the government is there to protect people from it. Deciding who you want to work for you and how you wish to utilize your own capital is not tyranny.

"I don't hire anyone."

Small businesses typically always start out as just yourself or yourself with a partner (not an employee).

Christopher Furlong: said...

"In China people are choosing to move from the rural areas to large cities because of they are making a choice between the working conditions in rural areas and the working conditions in the factories."

Garbage. They don't have a choice. There is no choice when the choices are grinding poverty and slightly less grinding poverty. Give your head a shake.

"The small businessman CANNOT force you to work for a wage you do not want to work for. The labour market guides wages and working conditions."

If the businessman is in favor of the current economic system, and the businessman pays a low wage because workers have no other choices, then that businessman is forcing you to work for him and should be overthrown as a result. He is a "free" market tyrant.

"First of all, when you agree to perform a job for an employer you are entering into a contract."

Garbage. You said free market, not "contract market". Contracts are only entered when a contract is signed. Don't be stupid, Hobbes.

"If you do not meet your end of the contract,"

There is no contract unless there is a contract.

"maybe your employer docks your pay, but if he does so unjustly, government has a role in providing an efficient means of justice that is equally available to all."

I thought you were for liberty! And all this time you have been just a dirty socialist! And a hypocritical dirty socialist at that!

"Yes, please compare those individuals that suffered under Hitler, Mao, and Stalin to those that work in small businesses."

Different types of the same thing: tyranny.

"That you do not see the difference (that while employed the individual has a choice to leave but in the previous examples the individuals had no choice) is appalling."

Sure they did! Those who "chose" to leave those regimes, left. Don't be stupid. Everyone has a choice.

"Small businessmen cannot practice tyranny because the government is there to protect people from it."

LOL. Is it opposite day?

"Deciding who you want to work for you and how you wish to utilize your own capital is not tyranny."

Maybe not now, but it has been in the past and definitely can be again, and it definitely is in China and Mexico.

"Small businesses typically always start out as just yourself or yourself with a partner (not an employee)."

I will never hire anyone.

Josh said...

"Garbage. They don't have a choice. There is no choice when the choices are grinding poverty and slightly less grinding poverty. Give your head a shake."

That's the same choice our ancestors made generations before us. Prosperity doesn't happen over-night, there is no quick fix.

"that businessman is forcing you to work for him"

How?

"He is a "free" market tyrant."

You've failed to demonstrate a businessman as a tyrant; There's no such thing.

"Contracts are only entered when a contract is signed."

You hold a very rigid definition for so many words...contract, agreement...its the same thing. Most jobs now you do sign a contract; even when I worked for Downeast I signed a contract. When I pumped gas there was an agreement as to what my job duties were, if I ever felt I was asked to do something I didn't want to, I had the freedom to walk away. Contracts are part of the free-market and the government has a responsibility to protect contracts. How does this make me a socialist?

"Different types of the same thing: tyranny."

For someone who keeps such a rigid definition for most terms, you certainly choose a broad definition for the word "tyranny"..and one that makes absolutely no sense. Is every boss a tyrant? Was Dad a tyrant? Have I been a tyrant? Garth is a tyrant?

"Sure they did! Those who "chose" to leave those regimes, left. Don't be stupid. Everyone has a choice."

That's like saying the slaves in the south had a choice. Some managed to escape, but for many the only choice they had was between death/torture and slavery. Because a small managed to escape does mean they were living under any less of a tyrant or tyrannical system.

When you have a choice to walk away without harm in the face of an order you wish not to perform, you are not living under a tyrant. When you do not have a choice to walk away without harm in the face of an order you wish not to perform, you are living under a tyrant.

"I will never hire anyone."

You are still a capitalist, and you are still a small businessman. You're simply in denial.

The Arthurian said...

Well anyway, it's a great quote from Hayek.