The Roads to Serfdom

PEOPLE IN BRITAIN WHO LIVED through World War II do not remember it with anything like the horror one might have expected. In fact, they often remember it as the best time of their lives. Even allowing for the tendency of time to burnish unpleasant memories with a patina of romance, this is extraordinary. The war, after all, was a time of material shortage, terror, and loss: What could possibly have been good about it?

The answer, of course, is that it provided a powerful existential meaning and purpose. The population suffered at the hands of an easily identifiable external enemy, whose evil intentions it became the overriding purpose of the whole nation to thwart. A unified and preeminent national goal provided respite from the peacetime cacophony of complaint, bickering, and social division. And privation for a purpose brings its own content.

The war having instantaneously created a nostalgia for the sense of unity and transcendent purpose that prevailed in those years, the population naturally enough asked why such a mood could not persist into the peace that followed. Why couldn’t the dedication of millions, centrally coordinated by the government—a coordinated dedication that had produced unprecedented quantities of aircraft and munitions—be adapted to defeat what London School of Economics head Sir William Beveridge, in his wartime report on social services that was to usher in the full-scale welfare state in Britain, called the “five giants on the road to reconstruction”: Want, Disease, Ignorance, Squalor, and Idleness?

By the time Beveridge published his report in 1942, most of the intellectuals of the day assumed that the government, and only the government, could accomplish these desirable goals. Indeed, it all seemed so simple a matter that only the cupidity and stupidity of the rich could have prevented these ends from already having been achieved. The Beveridge Report states, for example, that want “could have been abolished in Britain before the present war” and that “the income available to the British people was ample for such a purpose.” It was just a matter of dividing the national income cake into more equal slices by means of redistributive taxation. If the political will was there, the way was there; there was no need to worry about effects on wealth creation or any other adverse effects.

The growing spirit of collectivism in Britain during the war provoked an Austrian economist who had taken refuge there, F. A. von Hayek, to write a polemical counterblast to the trend: The Road to Serfdom, published in 1944. It went through six printings in its first year, but its effect on majority opinion was, for many years to come, negligible. Hayek believed that while intellectuals in modern liberal democracies—those to whom he somewhat contemptuously referred as the professional secondhand dealers in ideas—did not usually have direct access to power, the theories that they diffused among the population ultimately had a profound, even determining, influence upon their society. Intellectuals are of far greater importance than appears at first sight.

Hayek was therefore alarmed at the general acceptance of collectivist arguments—or worse still, assumptions—by British intellectuals of all classes. He had seen the process—or thought he had seen it—before, in the German-speaking world from which he came, and he feared that Britain would likewise slide down the totalitarian path. Moreover, at the time he wrote, the “success” of the two major totalitarian powers in Europe, Nazi Germany and Soviet Russia, seemed to have justified the belief that a plan was necessary to coordinate human activity toward a consciously chosen goal. Against the collectivists, Hayek brought powerful—and, to my mind, obvious—arguments that, however, were scarcely new or original. Nevertheless, it is often, perhaps usually, more important to remind people of old truths than to introduce them to new ones.

Hayek pointed out that the wartime unity of purpose was atypical: In more normal times, people had a far greater, indeed an infinite, variety of ends, and anyone with the power to adjudicate among them in the name of a conscious overall national plan, allowing a few but forbidding most, would exert vastly more power than the most bloated plutocrat of socialist propaganda had ever done in a free-market society.

Collectivist thinking arose, according to Hayek, from impatience, a lack of historical perspective, and an arrogant belief that, because we have made so much technological progress, everything must be susceptible to human control. While we take material advance for granted as soon as it occurs, we consider remaining social problems as unprecedented and anomalous, and we propose solutions that actually make more difficult further progress of the very kind that we have forgotten ever happened. While everyone saw the misery the Great Depression caused, for example, few realized that, even so, living standards actually continued to rise for the majority. If we live entirely in the moment, as if the world were created exactly as we now find it, we are almost bound to propose solutions that bring even worse problems in their wake.

In reaction to the unemployment rampant in what W. H. Auden called “the low dishonest decade” before the war, the Beveridge Report suggested that it was government’s function to maximize security of income and employment. This proposition was bound to appeal strongly to people who remembered mass unemployment and collapsing wages; but however high-minded and generous it might have sounded, it was wrong. Hayek pointed out that you can’t give everyone a job irrespective of demand without sparking severe inflation. And you can no more protect one group of workers’ wages against market fluctuations without penalizing another group than you can discriminate positively in one group’s favor without discriminating negatively against another. This is so, and it is beyond any individual human’s control that it should be so. Therefore, no amount of planning would ever make Beveridge’s goals possible, however desirable they might be in the abstract.

But just because a goal is logically impossible to achieve does not mean that it must be without effect on human affairs. As the history of the twentieth century demonstrates perhaps better than any other, impossible goals have had at least as great an effect on human existence as more limited and possible ones.

The most interesting aspect of Hayek’s book, however, is not his refutation of collectivist ideas—which, necessary as it might have been at that moment, was not by any means original. Rather, it is his observations of the moral and psychological effects of the collectivist ideal that, 60 years later, capture the imagination—mine, at least.

Hayek thought he had observed an important change in the character of the British people, as a result both of their collectivist aspirations and of such collectivist measures as had already been legislated. He noted, for example, a shift in the locus of people’s moral concern. Increasingly, it was the state of society or the world as a whole that engaged their moral passion, not their own conduct. “It is, however, more than doubtful whether a fifty years’ approach towards collectivism has raised our moral standards, or whether the change has not rather been in the opposite direction,” he wrote. “Though we are in the habit of priding ourselves on our more sensitive social conscience, it is by no means clear that this is justified by the practice of our individual conduct.” In fact, “It may even be . . . that the passion for collective action is a way in which we now without compunction collectively indulge in that selfishness which as individuals we had learnt a little to restrain.”

Thus, to take a trifling instance, it is the duty of the city council to keep the streets clean; therefore my own conduct in this regard is morally irrelevant—which no doubt explains why so many young Britons now leave a trail of litter behind them wherever they go. If the streets are filthy, it is the council’s fault. Indeed, if anything is wrong—for example, my unhealthy diet—it is someone else’s fault, and the job of the public power to correct. Hayek—with the perspective of a foreigner who had adopted England as his home—could perceive a further tendency that has become much more pronounced since then: “There is one aspect of the change in moral values brought about by the advance of collectivism which at the present time provides special food for thought. It is that the virtues which are held less and less in esteem and which consequently become rarer are precisely those on which the British people justly prided themselves and in which they were generally agreed to excel. The virtues possessed by the British people in a higher degree than most other people . . . were independence and self-reliance, individual initiative and local responsibility . . . non-interference with one’s neighbour and tolerance of the different and queer, respect for custom and tradition, and a healthy suspicion of power and authority.”

The British are no longer sturdily independent as individuals, either, and now feel no shame or even unease, as not long ago they would have felt, at accepting government handouts. Indeed, 40 percent of them now receive such handouts: For example, the parents of every child are entitled not merely to a tax reduction but to an actual payment in cash, no matter the state of their finances. As for those who, though able-bodied and perfectly able to work, are completely dependent on the state for their income, they unashamedly call the day when their welfare checks arrive “payday.” Between work and parasitism they see no difference. “I’m getting paid today,” they say, having not only accepted but thoroughly internalized the doctrine propounded in the Beveridge Report, that it is the duty of the state to assure everyone of a decent minimum standard of life regardless of his conduct. The fact of having drawn 16 breaths a minute, 24 hours a day, is sufficient to entitle each of them to his minimum; and oddly enough, Hayek saw no danger in this and even endorsed the idea. He did not see that to guarantee a decent minimum standard of life would demoralize not only those who accepted it, but those who worked in the more menial occupations, and whose wages would almost inevitably give them a standard of living scarcely higher than that of the decent minimum provided merely for drawing breath.

In any case, Hayek did not quite understand the source of the collectivist rot in Britain. It is true, of course, that an individualist society needs a free, or at least a free-ish, market; but a necessary condition is not a sufficient one. It is not surprising, though, that he should have emphasized the danger of a centrally planned economy when so prominent a figure as Orwell—who was a genuine friend of personal liberty, who valued the peculiarities of English life, and who wrote movingly about such national eccentricities as a taste for racy seaside postcards and a love of public school stories—should so little have understood the preconditions of English personal liberty that he wrote, only three years before Hayek’s book was published: “The liberty of the individual is still believed in, almost as in the nineteenth century. But this has nothing to do with economic liberty, the right to exploit others for profit.”

It is depressing to see a man like Orwell equating profit with exploitation. And it is certainly true that Britain after the war took no heed of Hayek and for a time seemed bent on state control of what were then called “the commanding heights of the economy.” Not only did the Labour government nationalize health care, but also coal mining, electricity and gas supply, the railways and public transportation (including the airlines), telecommunications, and even most of the car industry. Yet at no time could it remotely be said that Britain was slipping down the totalitarian path.

The real danger was far more insidious, and Hayek incompletely understood it. The destruction of the British character did not come from Nazi- or Soviet-style nationalization or centralized planning, as Hayek believed it would. For collectivism proved to be not nearly as incompatible with, or diametrically opposed to, a free, or free-ish, market as he had supposed. The effect of collectivist thought on a capitalist society would not be socialism, but something quite distinct. The means of production would remain in private hands, but the state would offer workers certain benefits, in return for their quiescence and agreement not to agitate for total expropriation as demanded in socialist propaganda.

The state action that was supposed to lead to the elimination of Beveridge’s five giants of Want, Disease, Ignorance, Squalor, and Idleness has left many people in contemporary Britain with very little of importance to decide for themselves, even in their own private spheres. They are educated by the state (at least nominally), as are their children in turn; the state provides for them in old age and has made saving unnecessary or, in some cases, actually uneconomic; they are treated and cured by the state when they are ill; they are housed by the state, if they cannot otherwise afford decent housing. Their choices concern only sex and shopping.

No wonder that the British have changed in character, their sturdy independence replaced with passivity, querulousness, or even, at the lower reaches of society, a sullen resentment that not enough has been or is being done for them. For those at the bottom, such money as they receive is, in effect, pocket money, like the money children get from their parents, reserved for the satisfaction of whims. As a result, they are infantilized. If they behave irresponsibly—for example, by abandoning their own children wherever they father them—it is because both the rewards for behaving responsibly and the penalties for behaving irresponsibly have vanished. Such people come to live in a limbo, in which there is nothing much to hope or strive for and nothing much to fear or lose. Private property and consumerism coexist with collectivism, and freedom for many people now means little more than choice among goods. The free market, as Hayek did not foresee, has flourished alongside the collectivism that was—and, after years of propaganda, still is—justified by the need to eliminate the five giants. For most of the British population today, the notion that people could solve many of the problems of society without governmental Gleichschaltung, the Nazi term for overall coordination, is completely alien.

Of course, the majority of Britons are still not direct dependents of the state. “Only” about a third of them are: the 25 percent of the working population who are public employees (the government has increased them by nearly 1 million since 1997, no doubt in order to boost its election chances); and the 8 percent of the adult population either unemployed or registered as disabled, and thus utterly dependent on government handouts. But the state looms large in all our lives, not only in its intrusions, but in our thoughts: for so thoroughly have we drunk at the wells of collectivism that we see the state always as the solution to any problem, never as an obstacle to be overcome. One can gauge how completely collectivism has entered our soul—so that we are now a people of the government, for the government, by the government—by a strange but characteristic British locution. When, on the rare occasions that our Chancellor of the Exchequer reduces a tax, he is said to have “given money away.” In other words, all money is his, and whatever we have in our pockets is what he, by grace and favor, has allowed us.

Our Father, which art in Downing Street. . . .

Theodore Dalrymple is a Contributing Editor of City Journal. A version of this article originally appeared in the Fall 2005 edition of City Journal. Reprinted with permission from City Journal.