An Analysis of Friedrich Hayek’s The Road to Serfdom

• The Road to Serfdom will probably continue to sound an important warning against excessive government control. How seriously that warning will be taken will likely ebb and flow over time.

• The book will continue to have academic impact as the Austrian School of Economics, from where much of Hayek’s thinking developed, remains important in graduate study.

• Friedrich Hayek’s The Road to Serfdom is a foundational book in economics due to the boldness of its claim that socialism* will lead to similar outcomes to fascism,* and because many of the ideas in the book have been important in political policymaking.

What the future holds for Friedrich Hayek’s The Road to Serfdom can likely be divided into three different scenarios. The first is one in which the book is used to inspire resistance every time there are politicians who suggest more government planning* and increased government control. Since its original publication in 1944, successive generations have rediscovered the book, and this looks likely to continue. The second scenario is one where the book’s reputation suffers because of the economic crisis that began in 2007–8.* This crisis severely damaged the public’s faith in free-market* systems, and this disenchantment will probably linger. The third scenario is a mixture of the two, whereby the book’s critics see the book as being out of fashion, but a text that would become popular again when politicians start to propose excessive government planning.

“While in graduate school I encountered the writings of Friedrich Hayek and Ludwig von Mises, which shook me out of my then socialist beliefs.”

Robert Nozick, The Harvard Guide to Influential Books

It is also possible to imagine how the book’s core ideas might develop. The notion that economic planning is dangerous for democracy* and might eventually lead to the introduction of totalitarianism* could be detected in the debate about the introduction of universal health care insurance in the United States. As a 2013 report from the conservative American Enterprise Institute* stated in response to one of US President Barack Obama’s* public speeches on the subject: “The entire Obama press conference today played out like some Hayekian cautionary tale where a befuddled central planner complains about the complexity of real life.”¹

A second core idea about planning and international relations can be seen in the ongoing debate about the future of the European Union.* This has been portrayed as a clash between those who want to see a federal* union and those who prefer a union between free-trading nation states. Hayek expressed a preference for the latter structure, and anticipated this exchange in The Road to Serfdom.

In the future, it looks likely that Hayek’s ideas will be tied to the study and application of ideas from the Austrian School of Economics. In the United States, one of the key intellectual hubs of Austrian theory is George Mason University (GMU), which offers an “F. A. Hayek Program for Advanced Study in Philosophy, Economics, and Politics.”² Peter Boettke, a professor at GMU, suggests that the future of Austrian work will depend on following the example of the school’s founders: “My message to graduate students is to learn from Mises* and Hayek in the way that they approached their research and teaching in economics and political economy. And that means … your goal in writing papers should be to adopt arguments and make them your own and develop them in your unique intellectual context and engage your peers.”³

In the spirit of Boettke’s statement, the future of Hayek’s ideas depends on scholars developing bold ideas that engage active debate across a broad community. One possible candidate to carry out this work is Christopher Coyne, a professor at GMU whose work on institutions and entrepreneurship won him the Atlas Economic Research Foundation’s Hayek Prize in 2007.

The Road to Serfdom is significant both intellectually and historically. The fact that it is still read by influential policymakers and economists shows that it is still relevant.

Anyone reading The Road to Serfdom will start to appreciate the complexity of some of the most important questions in economics and politics—namely:

Though Hayek’s approach to these questions is certainly a product of his time, the questions themselves are still hugely important in modern-day public debate and conversation. In most societies, the question of how public resources should be allocated is at the very center of political debate, and The Road to Serfdom is one of the best introductions to the view that economic freedoms must be protected, even if the cost must be inequality.

Readers of The Road to Serfdom will also develop intellectual skills that can be applied beyond a historical understanding of the structure of the economy. They will develop debating and arguing skills regardless of their political persuasion. Those who support socialist programs may have the most to gain from reading the book, because it will force them to challenge their own beliefs and develop arguments to defend their views. But critics of socialism also have plenty to gain from reading The Road to Serfdom, because they will be exposed to Hayek’s radical viewpoint, which may again challenge or even change some of their most deeply held convictions

1 James Pethokoukis, “Obamacare, Meet Hayek,” American Enterprise Institute, http://www.aei.org/publication/obamacare-meet-hayek/, accessed March 8, 2015.

3 Peter Boettke, “Teaching Austrian Economics to Graduate Students,” Journal of Economics and Finance Education 10, no. 2 (2011): 22.