[inline:01]The monster of the 20th century was the state. In the 1920s and ’30s the Austrian economist and philosopher Friedrich von Hayek saw the power of this Leviathan expand in his native Central Europe. Two brands of socialism – communism and national-socialism – were eradicating the freedoms of individuals and replacing the existing spontaneous order by the imposed order of the state.
In 1931 Hayek, who called himself a liberal (in the original “classical” meaning of the word as a philosophy defending freedom), left Vienna for London. Though Hitler did not annex Austria until 1938 Hayek realised that the pattern which applied to Germany also applied to his home country: “By the time Hitler came to power liberalism was to all intents and purposes dead in Germany. And it was socialism that had killed it.”
In 1944 Hayek published his book “The Road to Serfdom.” It was a warning to the West. Not only did he state an obvious truth which only so-called “progressive intellectuals” failed to see – namely that communism and fascism were “the outcome of the same tendencies” rather than “opposite poles” – but he also stressed that social-democracy, which had begun to take over the Western democracies, was basically of the same nature as communism and fascism. Hayek wrote that post-war Britain was eerily beginning to resemble pre-war Central Europe. He said he was living through “an experience as near as possible to twice living through the same period – or at least twice watching a very similar evolution of ideas.” Fundamental to these ideas was the notion that the state should take care of the lives of individuals, not these individuals themselves.
To defend freedom and classical liberal thought Hayek founded the Mont Pelerin Society. He was joined by like-minded scholars, many of whom, such as Karl Popper, Ludwig von Mises, Michael Polanyi, were fugitives from Central Europe who had found refuge in the Anglo-Saxon countries in the 1920s and ’30s.
Today the MPS is still a Cassandra of free society. Its members are convinced that, despite the implosion of communism, the West is still on the road to serfdom. “Leviathan is alive and growing,” MPS president Victoria Curzon-Price told a regional meeting of the society in Reykjavik earlier this week (21-24 August). Dominant beliefs and misconceptions about the free market are determining the policies of many governments. One of these misconceptions concerns voluntary exchange, which, though always a positive sum game for both partners involved, is seen by most politicians to be an injustice if it occurs between two “unequal” partners. Hence governments interfere to ensure that voluntary exchange becomes a deal between “equal” protagonists by reducing the so-called “strong” party. The result is two weak partners and a state which by definition must be strong in order to ensure that all partners engaging in economic relations always remain on equal footing. Curzon-Price sees this as the main idea behind the harmonisation and intervention policies of the European Union.
Another way in which the state aims to expand its powers is by “taking care of all our fears” for what can befall us during our lives. This is the concept of the nanny state, which, in order to exist and expand, keeps us afraid and constantly invents new fears against which it can “protect” us.
The Brussels Journal interviews Prof. Victoria Curzon-Price
[inline:02]Paul Belien: Can you tell us what the Mont Pelerin Society actually is?
Victoria Curzon-Price: The Mont Pelerin Society is an academy of people interested in classical-liberal thought. We meet regularly to keep this body of thought, which dates back 250 years, to bring it up to date and make it a living and interesting body of thought. We do this because we believe that it is essential for preserving our freedom.
PB: The Mont Pelerin Society was founded by Friedrich Hayek. After the second world war he wrote “the Road to Serfdom” warning the world against socialism. Socialism was been discredited 15 years ago. You are convinced that we are still on the road to serfdom. Why?
VCP: I think that we are still on the road to serfdom because although communism and hardcore socialism are dead there still are many forms of soft socialism around. They derive their justification from forms of Marxist thinking, perhaps unconscious Marxist thinking.
PB: What kind of ideas are you thinking of?
VCP: For instance many people think that free and voluntary exchange is unequal and therefor it is unfair. This leads to all sorts of ideas about exploitation, it leads to ideas that you need legislation to protect the worker against the employer, to protect the consumer against powerful multinationals, etcetera. The idea that free and voluntary exchange is unequal and therefor unfair is wrong. Free and voluntary exchange is mutual benefit as long as there is competition. Competition is essential. This is one of these ideas that generates a lot of legislation which is not useful.
PB: Certainly the European Union institutions seem convinced of the need to make partners in economic exchange more equal.
VCP: Yes, they are very anxious to harmonise things across Europe. Tax legislation, work regulation, health regulation, all sorts of things. It is exactly the same idea that if you have unequal conditions you cannot have fair trade.
PB: Are these people only influenced by Marxism or is there something else?
VCP: Marxism is one thing, but the state – you can call him Leviathan – likes to reassure the population and get the consent of the governed by the fact that it is there helping them along in life. Leviathan plays on our fears. Modern life is full of fears. We fear unemployment, we fear sickness, we fear old age, we fear all sorts of things – being mugged in the street – and Leviathan comes along and says: “Don’t worry, I can help.” So we give the state an ever bigger and bigger mandate. However, Leviathan is not a disinterested party. He is quite anxious to keep feeding our fears. So that he can think up new fears and new mandates.
PB: Many people would actually like somebody to take care of their fears, wouldn’t they?
VCP: Well, if they do so they are sacrificing their freedom. In my opinion people who live a responsible life can handle most of these fears. There are of course rational fears and irrational fears. But a lot of the fears that we have of the future, the uncertainty, can actually by handled with insurance and private contracts.