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Hayek’s star on the rise, sometimes

Partly due to Glenn Beck’s interest, a book and its ideas is receiving increased attention. F.A. Hayek is the author, and The Road to Serfdom is the book.

Personally, I find the book difficult to read. An example of Hayek’s writing is from the jacket notes prepared by the author himself: “The economic freedom which is the prerequisite of any other freedom cannot be the freedom from economic care which the socialists promise us and which can be obtained only by relieving the individual at the same time of the necessity and of the power of choice: it must be the freedom of economic activity which, with the right of choice, inevitably also carries the risk and the responsibility of that right.”

Someone else might have written: “A socialist government that provides for our needs doesn’t make us free. Freedom, both economic and political, comes from having choices and the power to exercise them. With that comes responsibility and risk.”

I might suggest interested readers look to The Reader’s Digest condensed version of The Road to Serfdom, which may be purchased or read online at the Institute of Economic Affairs. The forward by Walter E. Williams is especially valuable.

(Hayek’s realization of the importance of economic freedom is one of the reasons why I named my analysis of votes of the Kansas Legislature the Kansas Economic Freedom Index.)

This week George Mason University’s Russell Roberts wrote about The Road to Serfdom in the pages of the Wall Street Journal. The article, titled Why Friedrich Hayek Is Making a Comeback and available only to subscribers, lists four of Hayek’s important ideas:

First, “[Hayek] and fellow Austrian School economists such as Ludwig Von Mises argued that the economy is more complicated than the simple Keynesian story.”

Second, Hayek recognized the Federal Reserve’s control of monetary policy as a factor in the business cycle. Applied to current events, Roberts writes: “Former Fed Chairman Alan Greenspan’s artificially low rates of 2002-2004 played a crucial role in inflating the housing bubble and distorting other investment decisions. Current monetary policy postpones the adjustments needed to heal the housing market.”

Third, “political freedom and economic freedom are inextricably intertwined. In a centrally planned economy, the state inevitably infringes on what we do, what we enjoy, and where we live.”

Fourth, “order can emerge not just from the top down but from the bottom up. … Hayek understood that the opposite of top-down collectivism was not selfishness and egotism. A free modern society is all about cooperation. We join with others to produce the goods and services we enjoy, all without top-down direction. The same is true in every sphere of activity that makes life meaningful — when we sing and when we dance, when we play and when we pray. Leaving us free to join with others as we see fit — in our work and in our play — is the road to true and lasting prosperity. Hayek gave us that map.”

In Wichita, we see the importance of economic freedom ignored — trampled upon, I might say — on a regular basis as the City of Wichita seeks to direct economic development in our town from city hall. We are entering an especially dangerous period, as the master plan for the revitalization of downtown Wichita will soon be in place. This form of centralized planning by government is precisely what Hayek warns against.

Why Friedrich Hayek Is Making a Comeback

With the failure of Keynesian stimulus, the late Austrian economist’s ideas on state power and crony capitalism are getting a new hearing.

By Russ Roberts

He was born in the 19th century, wrote his most influential book more than 65 years ago, and he’s not quite as well known or beloved as the sexy Mexican actress who shares his last name. Yet somehow, Friedrich Hayek is on the rise.

When Glenn Beck recently explored Hayek’s classic, “The Road to Serfdom,” on his TV show, the book went to No. 1 on Amazon and remains in the top 10. Hayek’s persona co-starred with his old sparring partner John Maynard Keynes in a rap video “Fear the Boom and Bust” that has been viewed over 1.4 million times on YouTube and subtitled in 10 languages.

Why the sudden interest in the ideas of a Vienna-born, Nobel Prize-winning economist largely forgotten by mainstream economists?

Continue reading at the Wall Street Journal (subscription required)

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4 Comments

  1. Lauren June 29, 2010

    I’ve started to read “The Road to Freedom” a number of times, but I never seem to get past the first few pages…

    Back in college I read the Whitaker Chambers’ shocking true story in “Witness.” It shocked me, for I learned nothing about Soviet infiltration of our government in my public school education, except for that McCarthy made the whole thing up (according to my history teacher). Yesterday I came across this report on the New York Times about Russian spies being arrested throughout the U.S., so I have to wonder if much has changed. Anyway, I hope the Tea Party Movement grabs hold of these classics and starts familiarizing themselves with both old classics and new ideas alike. We must learn from leaders of the past, yet there’s much to be gained with new ways of thinking and creative new solutions.
    http://www.nytimes.com/2010/06/29/world/europe/29spy.html?hp

    The Leadership Institute offers a solid book list, “Read to Lead”, of 26 conservative classics. Check it out at
    http://www.leadershipinstitute.org/resources/readtolead.cfm

  2. Wichitator June 30, 2010

    If anyone like Lauren is interested in how the Soviet espionage establishment penetrated and stole US secrets the Venona Papers about this espionage is the definitive work. After WW II, this espionage became worse.

    Hayek’s native language is German and especially his writing prior to 1960 in English reflects the difficulty of writing in a second language.

    However, if you google, “Keynes and Hayek” you’ll get a link to the “boom/bust” rap video featuring these two economists that is an internet classic having received over a million views. Check it out!

  3. Kevin Streeter June 30, 2010

    I have an MA in economics from WSU. I now understand that most of what they taught me about macroeconomics was wrong. With microeconomics and the start of macroeconomics, they tell you how free markets work. Later, you are told they do not really work and you need the government to step in and fix where the free market has failed.

    I have found Keynesian economics to be like a religion. Keynes was the Prophet, the professors are the priests, with Paul Krugman as the high priest.

    I was just too much of an independent thinker to follow along. I now know that recessions are not caused by a lack of demand and that inflation is not caused by too much demand. Recessions are the way the economy readjusts from a misallocation of resources. Inflation is caused by devalued money.

    The question before us this election is “Which candidate most understands this?” I believe it is Anderson.

  4. Lauren July 1, 2010

    Ah, economics – I have so much to learn. Can anyone recommend a solid economics professor at WSU, Newman, or Friends?

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