Friedrich A. Hayek

Hayek is a major economist and political thinker of the twentieth century. 
He also contributed to the fields of systems thinking, jurisprudence, neuroscience and the history of ideas.

Here you can download a condensed version of The Road to Serfdom, a book by Friedrich A. Hayekas it appeared in the april 1945 edition of Reader’s Digest.

From the Book

In a foreword to The Road to Serfdom John Chamberlain, book editor of Harper’s, writes: 

‘This book is a warning cry in a time of hesitation.   It says to us: Stop, look and listen.   Its logic is incontestable, and it should have the widest possible audience.’

Professor Hayek, with great power and rigour of reasoning, sounds a grim warning to Americans and Britons who look to the government to provide the way out of all our economic difficulties.  

He demonstrates that fascism and what the Germans correctly call National Socialism are the inevitable results of the increasing growth of state control and state power, of national ‘planning’ and of socialism.

A focal point of The Road to Serfdom was to offer an explanation for the rise of Nazism, to correct the popular and erroneous view that it was caused by a character defect of the German people. Hayek differs, saying that the horrors of Nazism would have been inconceivable among the German people a mere fifteen years before Adolf Hitler’s rise to power. 


(Jacket notes written by Hayek for the first edition)

Is there a greater tragedy imaginable than that in our endeavour consciously to shape our future in accordance with high ideals we should in fact unwittingly produce the very opposite of what we have been striving for?

The contention that only the peculiar wickedness of the Germans has produced the Nazi system is likely to become the excuse for forcing on us the very institutions which have produced that wickedness.

Totalitarianism is the new word we have adopted to describe the unexpected but nevertheless inseparable manifestations of what in theory we call socialism.

In a planned system we cannot confine collective action to the tasks on which we agree, but are forced to produce agreement on everything in order that any action can be taken at all.

The more the state ‘plans’ the more difficult planning becomes for the individual.

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.

What our generation has forgotten is that the system of private property is the most important guarantee of freedom, not only for those who own property, but scarcely less for those who do not.

We shall never prevent the abuse of power if we are not prepared to limit power in a way which occasionally may prevent its use for desirable purposes.

We shall all be the gainers if we can create a world fit for small states to live in.

The first need is to free ourselves of that worst form of contemporary obscurantism which tries to persuade us that what we have done in the recent past was all either wise or unavoidable. We shall not grow wiser before we learn that much that we have done was very foolish.

From the Preface

(condensed version, published in the Reader’s Digest, April 1945 edition)

The author has spent about half his adult life in his native Austria, in close touch with German thought, and the other half in the United States and England. In the latter period he has become increasingly convinced that some of the forces which destroyed freedom in Germany are also at work here.

The very magnitude of the outrages committed by the National Socialists has strengthened the assurance that a totalitarian system cannot happen here. 

But let us remember that 15 years ago the possibility of such a thing happening in Germany would have appeared just as fantastic not only to nine-tenths of the Germans themselves, but also to the most hostile foreign observer.

There are many features which were then regarded as ‘typically German’ which are now equally familiar in America and England, and many symptoms that point to a further development in the same direction: the increasing veneration for the state, the fatalistic acceptance of ‘inevitable trends’, the enthusiasm for ‘organization’ of everything (we now call it ‘planning’).

preceding period but a necessary outcome of those tendencies. Yet it is significant that many of the leaders of these movements, from Mussolini down (and including Laval and Quisling) began as socialists and ended as fascists or Nazis.

The character of the danger is, if possible, even less understood here than it was in Germany.   The supreme tragedy is still not seen that in Germany it was largely people of good will who, by their socialist policies, prepared the way for the forces which stand for everything they detest.    Few recognize that the rise of fascism and Marxism was not a reaction against the socialist trends of the 

In the democracies at present, many who sincerely hate all of Nazism’s manifestations are working for ideals whose realization would lead straight to the abhorred tyranny. Most of the people whose views influence developments are in some measure socialists. 

They believe that our economic life should be ‘consciously directed’, that we should substitute ‘economic planning’ for the competitive system. 

Yet is there a greater tragedy imaginable than that, in our endeavour consciously to shape our future in accord- ance with high ideals, we should in fact unwittingly produce the very opposite of what we have been striving for?

From the Foreword


"Collectivists can neither ignore nor dismiss irrefutable evidence that free markets produce unprecedented wealth. 

Instead, they indict the free market system on moral grounds, charging that it is a system that rewards greed and selfishness and creates an unequal distribution of income. 

Free markets must be defended on moral grounds. 

We must convince our fellow man there cannot be personal liberty in the absence of free markets, respect for private property rights and rule of law. 

Even if free markets were not superior wealth producers, the morality of the market would make them the superior alternative.

Walter E. Williams
John M. Olin Distinguished Professor of Economics 

George Mason University, Fairfax, Virginia May 2005

Dowload the condensed book in pdf below

Friedrich August Hayek 

8 May 1899 – 23 March 1992, 

born in Austria-Hungary as Friedrich August von Hayek, was a British economist and philosopher best known for his defense of classical liberalism

In 1974, Hayek shared the Nobel Memorial Prize in Economic Sciences (with Gunnar Myrdal) for his "pioneering work in the theory of money and economic fluctuations and ... penetrating analysis of the interdependence of economic, social and institutional phenomena."

Hayek is a major economist and political thinker of the twentieth century. 

Hayek's account of how changing prices communicate information which enables individuals to coordinate their plans is widely regarded as an important achievement in economics. 

He also contributed to the fields of systems thinking, jurisprudence, neuroscience and the history of ideas.

Hayek served in World War I and said that his experience in the war and his desire to help avoid the mistakes that had led to the war led him to his career.

 Hayek lived in Austria, Great Britain, the United States and Germany, and became a British subject in 1938. 

He spent most of his academic life at the London School of Economics (LSE), the University of Chicago, and the University of Freiburg.

Continue reading in Wikipedia

In terms of Design

This is an interesting & timely example of how & why, in permaculture, design does not mean control, or even 'organizing' - although it might include control & organizing at any stage, the end aim is quite another.  

Indeed, a key objective of permaculture design is to design systems that are ultimately not controllable, ie. that self-regulate toward sustainability & the maximum fertility of the system.

From Class 2.1, About Design

The role of a successful design is to create a self-regulating system.  

It is only by returning responsibility & self-regulating functions that a stable life-system can evolve.

Policy of Responsibility 
(to relinquish power)

The role of beneficial authority (leader / designer) is to return function & responsibility to life & to people; 

if successful, no further authority is needed.

In terms of systems thinking, it is crucial to understand the precise mechanics of self-regulating systems: the mechanisms that provide 'the checks & balances' in a complex system.   

This is difficult to do because in a complex system, these mechanisms are, indeed, complex.

It is a lot easier to see & understand them if we have some developed pattern-recognition abilities, as we are less likely to confuse form with function, as what often happens in human designs is that we can name or classify something as one thing, when it actually does another, in practice.   

Or we make all sorts of assumptions by accepting the popular definitions of some elements of the system, instead of looking under the surface, in a systemic way, at how these elements actually operate in reality.

This is how, even "with the best of intentions", as Hayek remarks, what starts off as being 'socialist' (for the good of the society) & to limit economic oppression, actually ends up doing the opposite.

But one assumption that is not challenged in Hayek's work is the design of money, which is tacitly assumed (also in practically all conventional economics) to be a neutral system of measure of value & way to enable exchange of resources.   

In fact, as long as money continues to be designed in its current form, it is also a way to systematically funnel wealth from the rich to the poor, which will inevitably, in practice & with time, enslave the poor to the rich, though the mechanisms of debt & interest fees.

This is usually ignored, but it is an important detail that actually perverts in practice the great ideal of the 'free market', which is, in itself, a laudable aim & one very much in keeping with the Policy of Responsibility we try to hold to as permaculture designers (see above).  

Stella Strega-Scoz, Nov 2012

Stella Ne,
25 Nov 2012, 02:58