[108303] in Cypherpunks
H-WEB: N Chomsky on Hayek & 'inevitable' Dictatorship
daemon@ATHENA.MIT.EDU (Robert Hettinga)
Thu Feb 11 15:35:25 1999
Date: Thu, 11 Feb 1999 15:08:23 -0500
To: cypherpunks@cyberpass.net
From: Robert Hettinga <rah@shipwright.com>
Reply-To: Robert Hettinga <rah@shipwright.com>
--- begin forwarded text
Date: Thu, 11 Feb 1999 12:58:02 EST
Reply-To: Hayek Related Research <HAYEK-L@MAELSTROM.STJOHNS.EDU>
Sender: Hayek Related Research <HAYEK-L@MAELSTROM.STJOHNS.EDU>
From: Hayek-L List Host <HayekList@AOL.COM>
Subject: H-WEB: N Chomsky on Hayek & 'inevitable' Dictatorship
To: HAYEK-L@MAELSTROM.STJOHNS.EDU
>> Hayek On The Web << -- Chomsky / Inevitable Dictatorship
Chomsky on Hayek, Chicago School, etc.
on the web at:
http://www.zmag.org/chomforhayek.htm
>From the Chomksy Forum:
"You ask about my reaction to Hayek's assertion "that collective governments
designed originally to even out conditions in society lead, inevitably, to
dictatorship." [sic] If someone said that, my reaction would be to ignore it,
and to turn to something more serious -- like comic strips maybe. Similarly,
one should ignore any other silly comment given without argument, evidence, or
apparently familiarity with the world. Just which "collective governments"
were "designed originally to even out conditions..."? What is the argument --
historical, logical, whatever -- that they lead (regularly, inevitably,
whatever you like) to dictatorship?
Presumably he has in mind Bolshevism -- which STARTED as dictatorship -- it
didn't "lead to dictatorship. And it didn't have that goal. There is no
reason to react to ridiculous and ignorant pronouncements. You also ask about
my reaction to Friedman's claim (1) that attempts to organize a complex
economy can only lead to disaster, and (2) that "it is only through the
spontaneous coordination of supply and demand that goods and services can have
any hope of being distributed properly." Since neither of these statements is
based on fact or logic, the reaction should be the same.
The second part is radically ahistorical. Ideas of "spontaneous
coordination," etc., were abandoned a century ago, because it was clear that
they were leading to complete disaster. That's the background for the
abandonment of a (brief) experiment withlaissez-faire in England, and for the
"corporatization of America" that took place under business initiative in the
latter part of the 19th century in reaction to massive market failures
(similar developments took place elsewhere, for similar reasons). The shift
from some sort of "proprietary capitalism" to administered markets is familiar
to all economic historians. Since then, ideas of the kind you mention are the
province of ideologues, including those who work with mathematical "models"
that are about as useful as a model of planetary motion that leaves out the
effects of the sun, because they are too complicated. On the first part, he
could be right. No one knows. These are matters that you learn about by
experiment, since we are working in areas of very great ignorance. Historical
experience, for the little that it is worth, is that "command economies" have
been quite successful, by and large. Take recent US history. The depression
of the '30s convinced any last holdouts that anything resembling "capitalism"
was impossible. It's well known that the New Deal had little impact, but the
war did. Large-scale coordination and control by the state (implemented by
the corporate executives who flocked to Washington to manipulate the levers of
power) led to a real economic miracle, not only overcoming the depression, but
more than tripling US industrial production and laying the basis for the
state-capitalist regime of the postwar period, relying very heavily on state
intervention to socialize costs and risk. Same was true in England, an
enormous economic success during the war. These were not complete "command
economies" (nothing ever is), but they had a substantial measure of state
coordination and control, and were remarkably efficient. Should we like them?
Surely not. Nor should we fall in love with the Stalinist or Nazi models,
both of them significant economic successes by comparative standards. Or the
Japanese model. Japan had the world's highest growth rate from mid-19th
century to the 1990s, but hardly in a pretty society (it had some of the worst
inequality of the world during the period of its great pre-WWII expansion, for
example).
The Austrian/Chicago schools had nothing to do with the dismantling of Bretton
Woods. That had other causes (there's good literature on this, if you are
interested -- including quite mainstream economics). But it's true that the
ideologies were invoked later to "justify" what was being done for other
reasons. Bear in mind, however, that no one even close to power (in
government, corporations, etc.) has any use for these ideologies. They are
weapons to wield against the powerless.That's not to deny, incidentally, that
one can learn from Chicago school economics, or even that one should disregard
their proposals (for example, Friedman's ideas about negative income tax might
have merit). And Hayek is worth reading too, despite the irrationality. On
"pathological," I think I used the term in reference to the principles
articulated by Nobel Laureate James Buchanan: that every "any person's ideal
situation is... mastery over a world of slaves." What I wrote is that Adam
Smith would have regarded this as "pathological"; rightly. The ideological
institutionswouldn't discuss this; even they'd recognize it as pathological,
not for the ears of the public. But less nutty ideas that are prevalent, as
ideological weapons, are also pathological, in my view. Value judgments
aside, on intellectual grounds they are a disgrace, and would not be tolerated
in domains that have any intellectual standards.
Noam Chomsky"
Hayek On The Web is a regular feature of the Hayek-L list.
--- end forwarded text
-----------------
Robert A. Hettinga <mailto: rah@philodox.com>
Philodox Financial Technology Evangelism <http://www.philodox.com/>
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'
