The Road to Serfdom

Summary

The Road to Serfdom is a short book by the Austrian-born economist F. A. Hayek, written in London during the Second World War and published by Routledge in March 1944 and by the University of Chicago Press that September. Hayek dedicated it to the socialists of all parties. His claim was that many in Britain and America who sincerely wanted freedom and prosperity were embracing central economic planning, and that comprehensive planning would, step by step and against the intentions of its supporters, lead to the kind of tyranny the Allies were fighting. The opening chapters describe the abandonment of the liberal tradition of the nineteenth century and the hope, shared by socialists of many kinds, that planning would bring both security and a new freedom. Hayek distinguishes two meanings of planning: the state may set general rules within which individuals plan for themselves, or it may direct the economy toward chosen ends. He supports the first, including rules on working hours, sanitation and dangerous substances, and opposes the second. In a modern economy, he argues, no central authority can gather the scattered knowledge needed to direct production, and no democratic assembly can agree on a single scale of values to rank every need. Planners will then demand powers to act without waiting for agreement. Chapter 6 contrasts the rule of law, in which government is bound by general rules known in advance so that people can foresee how coercion will be used, with discretionary rule by officials who must constantly decide whose needs count. Chapter 7 argues that control of economic life is control of the means to all our ends. Chapter 9 accepts that a society can secure everyone a minimum of food, shelter and clothing, and social insurance against sickness and accident, while warning against guarantees of a particular income or position. In Chapter 10, Why the Worst Get on Top, he argues that a planning regime rewards those willing to use coercion without scruple, and in Chapter 11 that it must enlist propaganda and bend science and language to its aims. Chapters 12 and 13 trace the socialist strands in German thought before Hitler and warn that similar ideas were spreading in Britain. The last chapters ask how material ends relate to moral ones and propose an international order of federated, rule-bound states rather than international economic planning. The book sold widely, especially after a Reader's Digest condensation in April 1945, and was answered at once by critics such as Herman Finer and Barbara Wootton. It remains in print in a definitive edition edited by Bruce Caldwell (2007). The library holds no text; the work is under copyright.

Plot or Argument

• Introduction and Chapters 1–2: the abandoned road and the great utopia

  Hayek writes as one who has watched ideas in Germany and Austria before and in Britain after. Western nations, he says, are gradually abandoning the liberal principles that produced their prosperity and freedom. Socialists promised a new freedom from want, but he argues that the promise rests on confusing liberty with power over material circumstances.

• Chapters 3–4: individualism, collectivism and the claim of inevitability

  Planning in the sense of a framework of general rules is compatible with competition; planning in the sense of central direction replaces it. Hayek allows many forms of regulation, but denies that technological progress or monopoly makes central direction inevitable, arguing that monopolies have often been created by policy.

• Chapters 5–6: planning, democracy and the rule of law

  A democratic assembly cannot agree on a complete ranking of all ends, so economic planning ends by delegating great powers to experts and officials. The rule of law requires that coercion follow general, known rules; planning requires decisions about particular people and cases. The more the state plans, Hayek says, the harder it becomes for individuals to plan their own lives.

• Chapters 7–9: economic control, distribution and security

  Because money and economic choice are the means to nearly all our ends, control of economic life brings control of life as a whole. Planned distribution forces the question of who will decide the share of each person. Hayek defends a guaranteed minimum and social insurance but argues that guarantees of particular positions or incomes would freeze society and require compulsion.

• Chapters 10–11: why the worst get on top and the end of truth

  To carry out a comprehensive plan, a government needs a unified group willing to impose it; such a group is most easily formed from the docile and gullible around a common enemy, and rewards ruthlessness. A planned society must also persuade people that its ends are their own, so propaganda reaches into science and history, and words such as freedom and justice change their meaning.

• Chapters 12–13: the socialist roots of Nazism and totalitarians in our midst

  Hayek traces the German ideas of organization, the national economy and the subordination of the individual through writers such as Werner Sombart, Johann Plenge and Oswald Spengler, and argues that National Socialism drew on them. He warns that similar admiration for organization and contempt for commerce were growing among English intellectuals, scientists and business monopolies.

• Chapters 14–15 and Conclusion: ideal ends and international order

  Hayek argues that moral responsibility requires freedom of choice in economic matters, and that the virtues of independence, self-reliance and tolerance of others are weakened by collectivism. For the post-war world he proposes a federation of states bound by common rules rather than international planning bodies with vast discretion, and closes by calling for a renewed effort to build a society of free persons.

Characters

• F. A. Hayek, author

  Economist at the London School of Economics writing as an émigré who had watched collectivist ideas grow in Central Europe.

• The socialists of all parties, audience

  The book's dedicatees: readers across the spectrum whom Hayek credits with good intentions and seeks to persuade.

• Alexis de Tocqueville, authority

  Quoted on the difference between democracy, which seeks equality in liberty, and socialism, which seeks equality in restraint.

• Werner Sombart and Johann Plenge, objects of analysis

  German writers whose ideas of organization and the national community Hayek traces into National Socialism.

• H. G. Wells and E. H. Carr, contemporary opponents

  English writers whose proposals for planning or new rights Hayek cites as examples of contradictory hopes.

Lessons

• General rules versus particular commands

  Hayek's key distinction is between a government that lays down general rules known in advance and one that directs particular people toward particular goals. The first lets individuals use their own knowledge and plan their lives; the second requires officials to decide case by case. He calls the first the rule of law.

  • What examples of state regulation does Hayek accept, and why do they not violate the rule of law in his view?
  • Why does he say that formal rules must be framed without knowing whom they will help or hurt?
  • Can you think of a law that would pass Hayek's test and one that would fail it?

• Knowledge is scattered among many people

  No central planner can know all the local circumstances of millions of producers and consumers. Prices and competition, Hayek argues, coordinate this dispersed knowledge without anyone having to grasp the whole. This idea, developed further in his 1945 essay The Use of Knowledge in Society, underlies his doubt about central direction.

  • Why does Hayek think the complexity of a modern economy makes central planning harder, not easier?
  • What does a price communicate, according to Hayek?

• Means and ends cannot be separated

  Hayek argues that economic control is not control of a separate, lesser part of life. Whoever controls the means of satisfying our needs also decides which needs are met. He answers those who said they wanted planning only of material things.

  • What does Hayek mean when he says that economic control is control of the means to all our ends?
  • How does his chapter Who, Whom? connect planning with questions of power?
  • Do you find his argument persuasive, or is there a sphere of economic life that can be planned without touching other freedoms?

• Good intentions and unintended results

  Hayek does not accuse his opponents of wanting tyranny. He argues that the logic of comprehensive planning would pull even well-meaning governments toward coercion. His critics answered that he exaggerated this logic and underrated democratic checks. The book invites careful thought about how institutions shape outcomes regardless of motives.

  • Why does Hayek dedicate the book to the socialists of all parties?
  • What did critics such as Herman Finer and Barbara Wootton argue in reply?
  • Is it fair to judge a policy by where its logic leads rather than by what its supporters intend?

Context

Hayek wrote during the Second World War, when British government directed much of the economy and many writers across parties expected peacetime planning to continue. The Beveridge Report of 1942 proposed comprehensive social insurance, and in the United States New Deal agencies had expanded federal economic powers. Hayek, an Austrian who had lived in Britain since 1931, believed English opinion misunderstood National Socialism as a reaction of capitalism and saw it instead as an outgrowth of collectivist ideas he had watched develop in Germany. In the 1930s he had also taken part in the socialist calculation debate over whether a planned economy could calculate rationally.

Composition

Hayek wrote the book between about 1940 and 1943, partly while the London School of Economics was evacuated to Cambridge. Routledge published it in London in March 1944. Several American publishers declined it before the University of Chicago Press brought it out in September 1944. A condensed version appeared in Reader's Digest in April 1945 and a cartoon version in Look magazine. Hayek added a preface for the 1956 American paperback edition.

Reception

The book was an immediate success in both countries and made Hayek widely known. John Maynard Keynes wrote to him in 1944 expressing deep moral agreement with the book while doubting where Hayek drew the line between acceptable and unacceptable planning. George Orwell, reviewing it in 1944, found truth in its warnings but feared the power of private monopoly. Herman Finer replied with Road to Reaction (1945) and Barbara Wootton with Freedom under Planning (1945), both arguing that democratic planning need not lead to tyranny. Later readers have continued to divide: some treat the book as a classic defence of the free society and the rule of law, others as overstating the danger of the post-war welfare states, which Hayek himself distinguished from comprehensive central planning.

Comparisons

• freedom-and-the-law

  Leoni, a fellow member of the Mont Pelerin Society, pushes Hayek's contrast between general rules and discretion further, comparing legislation itself to central planning and preferring law discovered by judges.

• the-wealth-of-nations

  Smith's account of the division of labour and of the statesman who should not attempt to direct private capital anticipates Hayek's argument that dispersed knowledge is coordinated by markets rather than by a central authority.

• animal-farm

  Orwell reviewed Hayek in 1944 and published his fable of a revolution captured by the pigs a year later; Napoleon's rise dramatizes the claim of Why the Worst Get on Top that ruthlessness is rewarded under concentrated power.

• orwell-politics-and-the-english-language

  Hayek's chapter The End of Truth, on how words like freedom change meaning under propaganda, parallels Orwell's essay on political language as a means of defending the indefensible.

• the-communist-manifesto

  Marx and Engels call for centralizing credit, transport and production in the hands of the state; Hayek's book is in large part an argument that such centralization would destroy the freedoms its supporters hoped to gain.

• on-liberty

  Mill defends individual liberty against the pressure of opinion and law, but in his later work was sympathetic to cooperative socialism; Hayek draws on the same liberal tradition while arguing that economic and personal freedom stand or fall together.

Quotes

For Students

A reading companion for classical Christian high school students. See the student guide.

Reading Guide

Watch for

• The dedication to the socialists of all parties and the courteous tone Hayek takes toward his opponents.
• The two meanings of planning in Chapter 3, and the forms of regulation Hayek accepts.
• The definition of the rule of law in Chapter 6 and the contrast between formal rules and particular commands.
• The argument of Chapter 10 about the kind of people a planning regime promotes.
• Chapter 11's account of how words change meaning under propaganda.

Key terms and names

Central planning

Direction of a whole economy's production and distribution by a single authority according to a chosen plan, which Hayek opposes.

Rule of law

In Hayek's sense, government bound by general rules announced in advance, so that individuals can predict how coercive power will be used and plan their own affairs.

Competition

The process by which many independent producers and buyers adjust to one another through prices; Hayek sees it as a method of coordinating scattered knowledge.

Collectivism

Hayek's general term for doctrines that organize society toward a single social goal, of which socialism, fascism and National Socialism are forms.

Security

Hayek distinguishes limited security (a guaranteed minimum for all) from absolute security of a particular position or income; he supports the first and opposes the second.

Who, whom?

Lenin's phrase, borrowed as a chapter title, for the question of which people will direct the lives of which others once the state takes charge of distribution.

Seminar Questions

1. Comprehension To whom does Hayek dedicate the book, and why is that dedication surprising?
2. Comprehension What two meanings of planning does Hayek distinguish, and which does he support?
3. Comprehension What kinds of social security does Hayek accept in Chapter 9, and what kind does he reject?
4. Interpretation Why does Hayek think a democratic assembly will find it hard to agree on a comprehensive economic plan, and what does he expect to happen next?
5. Interpretation Explain the argument of Why the Worst Get on Top. What assumptions about human nature does it rely on?
6. Interpretation Keynes told Hayek that he agreed with the book morally but that the question was where to draw the line. How does Hayek's own book try to draw it?
7. Big Question Is economic freedom a condition of political and personal freedom, or can the two be separated?
8. Big Question How much should a community provide for its members' security, and at what point, if any, does security cost freedom?

Faith Connections

• 1 Samuel 8:10-18 (Scripture)

  Samuel warns Israel that a king will take their fields, their produce and their sons for his service. Hayek's warning that control of economic life becomes control of life as a whole has often been compared to this passage.

• Galatians 6:5 (Scripture)

  Every man shall bear his own burden. Hayek's Chapter 14 argues that moral responsibility depends on freedom to make one's own choices, including economic ones.

• Pope Pius XI, Quadragesimo Anno (1931), 79-80 (Great Conversation)

  The encyclical's principle of subsidiarity, that a higher association should not take over what smaller communities can do, shares Hayek's suspicion of central direction while grounding it in the dignity of persons and families rather than economic knowledge.

Logic and Rhetoric

Central argument: A modern economy depends on knowledge dispersed among millions of people, which no central authority can gather. Comprehensive planning therefore requires agreement on a single ranking of all ends, which free people do not share. To carry out a plan, governments must give officials discretionary power over particular persons, abandoning the rule of law. Control of economic means becomes control of all ends, and power passes to those most willing to use it. Therefore comprehensive central planning, whatever its intentions, leads toward servitude, while a framework of general rules with a guaranteed minimum preserves freedom.

Rhetorical device: concession (granting an opponent's point to strengthen one's own). Hayek repeatedly grants that his socialist opponents mean well, that the state should regulate dangerous substances and working hours, and that a minimum income for all is desirable. By conceding so much, he narrows the dispute to comprehensive central direction and makes his warning harder to dismiss as hostility to all government.

Debate: Resolved: That comprehensive central economic planning is incompatible with the rule of law.

Writing Prompts

Essay: Hayek argues that comprehensive planning leads, against its supporters' intentions, toward servitude. Lay out his chain of reasoning, present the strongest reply of one of his critics, and judge which side better accounts for the history of the second half of the twentieth century.

Comparison with Animal Farm: Orwell reviewed The Road to Serfdom in 1944 and published Animal Farm in 1945. Compare Hayek's chapter Why the Worst Get on Top with Napoleon's rise to power on the farm, and argue whether the fable supports Hayek's analysis or suggests a different cause.

Medical Lens

The book is economic and political, but Hayek's line between acceptable and unacceptable state action passes through public health. He accepts as consistent with competition rules forbidding poisonous substances or requiring precautions in their use, limits on working hours and required sanitary arrangements, and he supports state-organized insurance against sickness and accident. His objection is to comprehensive central direction, not to such general protections.

• Ch. 3, Individualism and Collectivism

  Regulation of poisonous substances, working hours and sanitary arrangements accepted as compatible with a competitive system.

  Public Health Sanitation
• Ch. 9, Security and Freedom

  Support for a guaranteed minimum of food, shelter and clothing and for social insurance against sickness and accident.

  Public Health Sanitation

Creative Prompts

• Classroom

  Give students a list of ten government actions (a speed limit, a food-safety rule, a price ceiling on bread, a factory production quota, and so on). In groups, sort them into Hayek's general rules and particular commands, and defend the hard cases.

• Dialogue

  Write a radio debate in 1945 between Hayek and Barbara Wootton on whether a democratic Britain can plan its economy and remain free.

• Essay

  Hayek says the more the state plans, the harder it is for the individual to plan. Test the claim against one example from history or from your own community.

Further Reading

• The Road to Serfdom: Text and Documents, The Definitive Edition, F. A. Hayek, ed. Bruce Caldwell

  Includes the publication history, readers' reports and later prefaces.

• The Constitution of Liberty, F. A. Hayek

  Hayek's fuller account of the rule of law and the free society (1960).

• Freedom under Planning, Barbara Wootton

  A 1945 reply arguing that democratic planning and freedom can be reconciled.

• Road to Reaction, Herman Finer

  A sharp 1945 rebuttal by a political scientist at the University of Chicago.

• Hayek's Challenge: An Intellectual Biography of F. A. Hayek, Bruce Caldwell