Central Planning Destroys Democracy—F. A. Hayek (1899 – 1992)

Published October 17, 2009 by AV Team in featured

Hayek.jpg   During the Second World War it was necessary for the British government to take control over much of the economy to concentrate all its effort in the fight against Nazi Germany. At that time many thought that the central planning of the British economy should be continued after the war in singular pursuit of other objectives, such as the betterment of the working class. In this passage from his book The Road to Serfdom, written in England during the war years and published in 1944, the Nobel-prize winning economist F. A. Hayek explains, however, why a state-controlled and centrally planned economy cannot be combined successfully with democratic procedures and is eventually bound to lead to a suppression of freedom.

It is the price of democracy that the possibilities of conscious control [over society] are restricted to the fields where true agreement exists and that in some fields things must be left to chance. But in a society which for its functioning depends on central planning this control cannot be made dependent on a majority’s being able to agree; it will often be necessary that the will of a small minority be imposed upon the people, because this minority will be the largest group able to agree among themselves on the question at issue. Democratic government has worked successfully where, and so long as, the functions of government were, by a widely accepted creed, restricted to fields where agreement among a majority could be achieved by free discussion; and it is the great merit of the liberal creed that it reduced the range of subjects on which agreement was necessary to one on which it was likely to exist in a society of free men. . . . planning leads to dictatorship because dictatorship is the most effective instrument of coercion and the enforcement of ideals and, as such, essential if central planning on a large scale is to be possible. The clash between planning and democracy arises simply from the fact that the latter is an obstacle to the suppression of freedom which the direction of economic activity requires. . . .1
 
Footnotes:
 
1  F. A. Hayek, The Road to Serfdom (Chicago: University of Chicago Press, 1945), 69-70.
 
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