Sunday, June 27, 2010

Cowen on Austerity and Hayek

even Professor Hayek favored welfare spending and social insurance, so those programs will not alone bring us to serfdom....

Finally, effective political ideas are those that can still do good in half-baked form. We have neglected this insight in designing financial reform, and it remains to be seen if we can apply it successfully to climate change.

And when it comes to the budget? Even if our real fiscal problems lie in the more distant future, it’s important to start worrying about them now, because we cannot count on a grand plan later to save the day.

That's professor Tyler Cowen on the general trend toward favoring austerity.

I included the line about Hayek because I think it underscores an important point about The Road To Serfdom that I don't think is widely understood by those who haven't read the book or have been exposed to it primarily through Glenn Beck or other sources.

Namely that it isn't the existence of a social welfare apparatus that would lead inevitably to enslavement, it was economic planning.

Once we cede power for economic decision making to a central authority, it is certain that some individuals will be deprived of liberty and, even more frightening, life, in pursuit of some national program. That is the real warning that Hayek issued in his famous book.

Posted via email from rhymeswithclown's posterous

1 comment:

D said...

And yet, the pillage of one group for the benefit of another requires central planning and coercion. One of the major themes of Hayek's book is his doubt that democracies can exist without central planning - and that the boards they invent for the purpose of mass pillage are hopelessly ill-equipped to make such decisions.
Although a good read, it is a stumbling, confusing work throughout and does not leave the reader with any discernable notions about which types, or even if, government is an acceptable means of social order.
Hayek himself, throughout his life, was never quite sure where he stood on the political spectrum. Some see this as a good thing. To me, it shows that lack of principle leads to ever more acceptance of tyranny.