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Word Gems exploring self-realization, sacred personhood, and full humanity
F.A. Hayek The Road To Serfdom The Prospects Of International Order
IN no other field has the world yet paid so dearly for the abandonment of nineteenth-century liberalism as in the field where the retreat began: in international relations. Yet only a small part of the lesson which experience ought to have taught us has been learned. Perhaps even more than elsewhere current notions of what is desirable and practicable are here still of a kind which may well produce the opposite of what they promise. That there is little hope of international order or lasting peace so long as every country is free to employ whatever measures it thinks desirable in its own immediate interest, however damaging they may be to others, needs little emphasis now. Many kinds of economic planning are indeed practicable only if the planning authority can effectively shut out all extraneous influences; the result of such planning is therefore inevitably the piling-up of restrictions on the movements of men and goods. It is neither necessary nor desirable that national boundaries should mark sharp differences in standards of living, that membership of a national group should entitle to a share in a cake altogether different from that in which members of other groups share. If the resources of different nations are treated as exclusive properties of these nations as wholes, if international economic relations, instead of being relations between individuals, become increasingly relations between whole nations organized as trading bodies, they inevitably become the source of friction and envy between whole nations. It is one of the most fatal illusions that, by substituting negotiations between states or organized groups for competition for markets or for raw materials, international friction would be reduced. This would merely put a contest of force in the place of what can only metaphorically be called the "struggle" of competition and would transfer to powerful and armed states, subject to no superior law, the rivalries which between individuals had to be decided without recourse to force. Economic transactions between national bodies who are at the same time the supreme judges of their own behavior, who bow to no superior law, and whose representatives cannot be bound by any considerations but the immediate interest of their respective nations, must end in clashes of power. If we were to make no better use of victory than to countenance existing trends in this direction, only too visible before 1939, we might indeed find that we have defeated National Socialism merely to create a world of many national socialisms, differing in detail, but all equally totalitarian, nationalistic, and in recurrent conflict with each other. The Germans would appear as the disturbers of peace, as they already do to some people, merely because they were the first to take the path along which all the others were ultimately to follow. The problems raised by a conscious direction of economic affairs on a national scale inevitably assume even greater dimensions when the same is attempted internationally. The conflict between planning and freedom cannot but become more serious as the similarity of standards and values among those submitted to a unitary plan diminishes. There need be little difficulty in planning the economic life of a family, comparatively little in a small community. But, as the scale increases, the amount of agreement on the order of ends decreases and the necessity to rely on force and compulsion grows. In a small community common views on the relative importance of the main tasks, agreed standards of value, will exist on a great many subjects. But their number will become less and less the wider we throw the net; and, as there is less community of views, the necessity to rely on force and coercion increases. So long as it is a question of helping people whose habits of life and ways of thinking are familiar to us, of correcting the distribution of incomes among, or the working conditions of, people we can well imagine and whose views on their appropriate status are fundamentally similar to ours, we are usually ready to make some sacrifices. But one has only to visualize the problems raised by economic planning of even an area such as western Europe to see that the moral bases for such an undertaking are completely lacking. Who imagines that there exist any common ideals of distributive justice such as will make the Norwegian fisherman consent to forego the prospect of economic improvement in order to help his Portuguese fellow, or the Dutch worker to pay more for his bicycle to help the Coventry mechanic, or the French peasant to pay more taxes to assist the industrialization of Italy? The English people, for instance, perhaps even more than others, begin to realize what such schemes mean only when it is presented to them that they might be a minority in the planning authority and that the main lines of the future economic development of Great Britain might be determined by a non-British majority. How many people in England would be prepared to submit to the decision of an international authority, however democratically constituted, which had power to decree that the development of the Spanish iron industry must have precedence over similar development in South Wales, that the optical industry had better be concentrated in Germany to the exclusion of Great Britain, or that only fully refined gasoline should be imported to Great Britain and all the industries connected with refining reserved for the producer countries? Planning on an international scale, even more than is true on a national scale, cannot be anything but a naked rule of force, an imposition by a small group on all the rest of that sort of standard and employment which the planners think suitable for the rest. If anything is certain, it is that Grossraumzuirtschaft of the kind at which the Germans have been aiming can be successfully realized only by a master-race, a Herrenaolk, ruthlessly imposing its aims and ideas on the rest. It is a mistake to regard the brutality and the disregard of all the wishes and ideals of the smaller people shown by the Germans simply as a sign of their special wickedness; it is the nature of the task they have assumed which makes these things inevitable. To undertake the direction of the economic life of people with widely divergent ideals and values is to assume responsibilities which commit one to the use of force; it is to assume a position where the best intentions cannot prevent one from being forced to act in a way which to some of those affected must appear highly immoral. I believe the standards of decency and fairness, particularly with regard to international affairs, to be as high, if not higher, in England than in any other country. Yet even now we can hear people in England arguing that victory must be used to create conditions in which British industry will be able to utilize to the full the particular equipment which it has built up during the war, that the reconstruction of Europe must be so directed as to fit in with the special requirements of the industries of England, and to secure to everybody in the country the kind of employment for which he thinks himself most fit. The alarming thing about these suggestions is not that they are made but that they are made in all innocence and regarded as a matter of course by decent people who are completely unaware of the moral enormity which the use of force for such purposes involves. [footnote: If anyone should still fail to see the difficulties, or cherish the belief that with a little good will they can all be overcome, it will help if he tries to follow the implications of central direction of economic activity applied on a world scale. Can there be much doubt that this would mean a more or less conscious endeavor to secure the dominance of the white man, and would rightly be so regarded by all other races? Until I find a sane person who seriously believes that the European races will voluntarily submit to their standard of life and rate of progress being determined by a world parliament, I cannot regard such plans as anything but absurd. But this does unfortunately not preclude that particular measures, which could be justified only if the principle of world direction were a feasible ideal, are seriously advocated.] Perhaps the most powerful agent in creating the belief in the possibility of a single central direction by democratic means of the economic life of many different peoples is the fatal delusion that if the decisions were left to the "people," the community of interest of the working classes would readily overcome the differences which exist between the ruling classes. There is every reason to expect that with world planning the clash of economic interests which arises now about the economic policy of any one nation would in fact appear in even fiercer form as a clash of interests between whole peoples which could be decided only by force. On the questions which an international planning authority would have to decide, the interests and opinions of the working classes of the different people will inevitably be as much in conflict, and there will be even less of a commonly accepted basis for an equitable settlement than there is with respect to different classes in any one country. To the worker in a poor country the demand of his more fortunate colleague to be protected against his low-wage competition by minimum-wage legislation, supposedly in his interest, is frequently no more than a means to deprive him of his only chance to better his conditions by overcoming natural disadvantages by working at wages lower than his fellows in other countries. And to him the fact that he has to give the product of ten hours of his labor for the product of five hours of the man elsewhere who is better equipped with machinery is as much "exploitation" as that practiced by any capitalist. Indeed, if it comes to be regarded as the duty of the international authority to bring about distributive justice between the different peoples, it is no more than a consistent and inevitable development of socialist doctrine that class strife would become a struggle between the working classes of the different countries. There can be no doubt about the urgent need for amelioration of economic conditions in this region, from humanitarian and economic considerations as well as in the interest of the future peace of Europe, nor that this can be achieved only in a political setting different from that of the past. But this is not the same thing as to wish to see economic life in this region directed according to a single master-plan, to foster the development of the different industries according to a schedule laid down beforehand in a way which makes the success of local initiative dependent on being approved by the central authority and being incorporated in its plan. One cannot, for example, create a kind of Tennessee Valley Authority for the Danube Basin without thereby determining beforehand for many years to come the relative rate of progress of the different races inhabiting this area or without subordinating all their individual aspirations and wishes to this task. There exists no basis which allows us to decide whether the claims of the poor Rumanian peasant are more or less urgent than those of the still poorer Albanian, or the needs of the Slovakian mountain shepherd greater than those of his Slovenian colleague. But if the raising of their standards of life is to be effected according to a unitary plan, somebody must deliberately balance the merits of all these claims and decide between them. And once such a plan is put into execution, all the resources of the planned area must serve that plan-there can be no exemption for those who feel they could do better for themselves. Once their claim has been given a lower rank, they will have to work for the prior satisfaction of the needs of those who have been given preference. To attempt such a thing in a region peopled by small nations, each of which believes equally fervently in its own superiority over the others, is to undertake a task which can be performed only by the use of force. What it would amount to in practice is that the decisions and power of the large nations would have to settle whether the standards of the Macedonian or the Bulgarian peasant should be raised faster, whether the Czech or the Hungarian miner should more rapidly approach Western standards. It does not need much knowledge of human nature, and certainly only a little knowledge of the people of Central Europe, to see that, whatever the decision imposed, there will be many, probably a majority, to whom the particular order chosen will appear supreme injustice and that their common hatred will soon turn against the power which, however disinterestedly, in fact decides their fate. What these dangerous idealists do not see is that where the assumption of a moral responsibility involves that one's moral views should by force be made to prevail over those dominant in other communities, the assumption of such responsibility may place one in a position in which it becomes impossible to act morally. To impose such an impossible moral task on the victorious nations is a certain way morally to corrupt and discredit them. Any international economic authority, not subject to a superior political power, even if strictly confined to a particular field, could easily exercise the most tyrannical and irresponsible power imaginable. Exclusive control of an essential commodity or service (as, for example, air transport) is in effect one of the most far-reaching powers which can be conferred on any authority. And as there is scarcely anything which could not be justified by "technical necessities" which no outsider could effectively question-or even by humanitarian and possibly entirely sincere arguments about the needs of some specially ill-favored group which could not be helped in any other way-there is little possibility of controlling that power. The kind of organization of the resources of the world under more or less autonomous bodies, which now so often finds favor in the most surprising quarters, a system of comprehensive monopolies recognized by all the national governments, but subject to none, would inevitably become the worst of all conceivable rackets-even if those intrusted with their administration should prove the most faithful guardians of the particular interests placed in their care. The controller of the supply of any such raw material as gasoline or timber, rubber or tin, would be the master of the fate of whole industries and countries. In deciding whether to allow the supply to increase and the price or the income of the producers to fall, he would decide whether some country is to be allowed to start some new industry or whether it is to be precluded from doing so. While he "protects" the standards of life of those he regards as specially intrusted to his care, he will deprive many who are in a much worse position of their best and perhaps only chance to improve it. If all essential raw materials were thus controlled, there would indeed be no new industry, no new venture on which the people of a country could embark without the permission of the controllers, no plan for development or improvement which could not be frustrated by their veto. The same is true of international arrangement for "sharing" of markets and even more so of the control of investment and the development of natural resources. If anything is evident, it should be that, while nations might abide by formal rules on which they have agreed, they will never submit to the direction which international economic planning involves-that while they may agree on the rules of the game, they will never agree on the order of preference in which the rank of their own needs and the rate at which they are allowed to advance is fixed by majority vote. Even if, at first, the peoples should, under some illusion about the meaning of such proposals, agree to transfer such powers to an international authority, they would soon find out that what they have delegated is not merely a technical task but the most comprehensive power over their very lives. There is so much "realism" in this that by thus camouflaging the planning authorities as "international" it might be easier to achieve the condition under which international planning is alone practicable, namely, that it is in effect done by one single predominant power. This disguise would, however, not alter the fact that for all the smaller states it would mean a much more complete subjection to an external power, to which no real resistance would any longer be possible, than would be involved in the renunciation of a clearly defined part of political sovereignty. The views of Professor Carr, who in this sphere even more than in that of internal policy is representative of the trend toward totalitarianism in England, have already made one of his professional colleagues ask the very pertinent question: "If the Nazi way with small sovereign states is indeed to become the common form, what is the war about?" Those who have observed how much disquiet and alarm some recent utterances on these questions in papers as different as the London Times and the New Statesman have caused among our smaller Allies will have little doubt how much this attitude is even now resented among our closest friends, and how easy it will be to dissipate the stock of good will which has been laid up during the war if these advisers are followed. It means merely that there must be a power which can restrain the different nations from action harmful to their neighbors, a set of rules which defines what a state may do, and an authority capable of enforcing these rules. The powers which such an authority would need are mainly of a negative kind; it must, above all, be able to say "No" to all sorts of restrictive measures. What we need and can hope to achieve is not more power in the hands of irresponsible international economic authorities but, on the contrary, a superior political power which can hold the economic interests in check, and in the conflict between them can truly hold the scales, because it is itself not mixed up in the economic game. The need is for an international political authority which, without power to direct the different people what they must do, must be able to restrain them from action which will damage others. And, even more than in the national sphere, it is essential that these powers of the international authority should be strictly circumscribed by the Rule of Law. The need for such a supernational authority becomes indeed greater as the individual states more and more become units of economic administration, the actors rather than merely the supervisors of the economic scene, and as therefore any friction is likely to arise not between individuals but between states as such. Federalism is, of course, nothing but the application to international affairs of democracy, the only method of peaceful change man has yet invented. But it is a democracy with definitely limited powers. Apart from the more impracticable ideal of fusing different countries into a single centralized state (the desirability of which is far from obvious), it is the only way in which the ideal of international law can be made a reality. We must not deceive ourselves that, in the past, in calling the rules of international behavior international law, we were doing more than expressing a pious wish. When we want to prevent people from killing each other, we are not content to issue a declaration that killing is undesirable, but we give an authority power to prevent it. In the same way there can be no international law without a power to enforce it. The obstacle to the creation of such an international power was very largely the idea that it need command all the practically unlimited powers which the modern state possesses. But with the division of power under the federal system this is by no means necessary. It prevents, or can be made to prevent, most forms of restrictionism. And it confines international planning to the fields where true agreement can be reached-not only between the "interests" immediately concerned but among all those affected. The desirable forms of planning which can be effected locally and without the need of restrictive measures are left free and in the hands of those best qualified to undertake it. It is even to be hoped that within a federation, where there will no longer exist the same reasons for making the individual states as strong as possible, the process of centralization of the past may in some measure be reversed and some devolution of powers from the state to the local authorities become possible. From Tennyson, whose much-quoted vision of the "battle of the air" is followed by a vision of the federation of the people which will follow their last great fight, right down to the end of the century the final achievement of a federal organization remained the ever recurring hope of a next great step in the advance of civilization. Nineteenth-century liberals may not have been fully aware how essential a complement of their principles a federal organization of the different states formed; but there were few among them who did not express their belief in it as an ultimate goal.'' It was only with the approach of our twentieth century that before the triumphant rise of Realpolitik these hopes came to be regarded as unpracticable and utopian. Least of all shall we preserve democracy or foster its growth if all the power and most of the important decisions rest with an organization far too big for the common man to survey or comprehend. Nowhere has democracy ever worked well without a great measure of local selfgovernment, providing a school of political training for the people at large as much as for their future leaders. It is only where responsibility can be learned and practiced in affairs with which most people are familiar, where it is the awareness of one's neighbor rather than some theoretical knowledge of the needs of other people which guides action, that the ordinary man can take a real part in public affairs because they concern the world he knows. Where the scope of the political measures becomes so large that the necessary knowledge is almost exclusively possessed by the bureaucracy, the creative impulses of the private person must flag. I believe that here the experience of the small countries like Holland and Switzerland contains much from which even the most fortunate larger countries like Great Britain can learn. We shall all be the gainers if we can create a world fit for small states to live in. While for its task of enforcing the common law the supernational authority must be very powerful, its constitution must at the same time be so designed that it prevents the international as well as the national authorities from becoming tyrannical. We shall never prevent the abuse of power if we are not prepared to limit power in a way which occasionally may also prevent its use for desirable purposes. The great opportunity we shall have at the end of this war is that the great victorious powers, by themselves first submitting to a system of rules which they have the power to enforce, may at the same time acquire the moral right to impose the same rules upon others. Neither an omnipotent superstate nor a loose association of "free nations" but a community of nations of free men must be our goal. We have long pleaded that it had become impossible to behave in international affairs as we thought it desirable because others would not play the game. The coming settlement will be the opportunity to show that we have been sincere and that we are prepared to accept the same restrictions on our freedom of action which in the common interest we think it necessary to impose upon others. There will probably exist a strong tendency to make any new international organization all-comprehensive and world-wide; and there will, of course, be an imperative need for some such comprehensive organization, some new League of Nations. The great danger is that, if in the attempt to rely exclusively on this world organization it is charged with all the tasks which it seems desirable to place in the hands of an international organization, they will not in fact be adequately performed. It has always been my conviction that such ambitions were at the root of the weakness of the League of Nations: that in the (unsuccessful) attempt to make it worldwide it had to be made weak and that a smaller and at the same time more powerful League might have been a better instrument to preserve peace. I believe that these considerations still hold and that a degree of co-operation could be achieved between, say, the British Empire and the nations of western Europe and probably the United States which would not be possible on a world scale. The comparatively close association which a federal union represents will not at first be practicable beyond perhaps even as narrow a region as part of western Europe, though it may be possible gradually to extend it. My point is that the need for some such other organization should not form an obstacle to a closer association of those countries which are more similar in their civilization, outlook, and standards. While we must aim at preventing future wars as much as possible, we must not believe that we can at one stroke create a permanent organization which will make all war in any part of the world entirely impossible. Not only would we be unsuccessful in such an attempt but we would thereby probably spoil our chances of achieving success in a more limited sphere. As is true with respect to other great evils, the measures by which war might be made altogether impossible for the future may well be worse than even war itself. If we can reduce the risk of friction likely to lead to war, this is probably all we can reasonably hope to achieve.
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