The Origins of Neoliberalism Part IV: A Map of Hayek’s Delusion

A recent podcast with Philip Pilkington expanding on a recent piece discussing Hayek and the foundations of neoliberalism got very positive comments, and also covered more ground than his post on this topic on Naked Capitalism, so we thought readers would enjoy it. Plus the Irish accents are a nice change of pace from bland standard ‘Murkican.

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  1. sillystuff

    It is the critics like this that are delusional. If the last century proves anything it is the dire consequuences of ctenral planning and collectivism. From Lenin to the Nazis to Stalin to Mao the results are not debatable.

    This is a crude, sophmoric attempt to deconstruct Hayek.

    Why cannot you discuss idea? Why the personal attacks? why are terms like “delusional” bandied about?

    Because you are Marxists, that is why. YOu cannot argue issues soberly and rationally. People who disagree with you are somehow evil.

    1. Philip Pilkington

      I’m a Marxist? Haha… news to me. I think we can reformulate one of your “points” and hold it up to you like a mirror:

      “YOu cannot argue issues soberly and rationally. People who disagree with you are somehow Marxists and thus evil.”

      1. screenname22

        And you proved his point by, as per usual, not responding to the points but attacking the person making them.

        Phil is a collectivist. Phil is a collectivist. He does not deny this, merely that he is a “Marxist”. The distinction is irrelevant; it is only a matter of degree.

        Phil wants to use violence to enforce his vision of how the world should work, just like Hitler, just like Stalin, just like Marx, just like Keynes. The problems are collectivism, sophistry and violence, and the solutions are freedom, epistemology and the non-aggression principle.

        Go ahead, IP ban me again. You cannot silence the truth.

        1. Jan

          Paul Samuelson wrote about the lifelong work of Friedrich Hayek:
          “There were good historical reasons for fading memories of Hayek within the mainstream last half of the twentieth century economist fraternity. In 1931, Hayeks Prices and Production had enjoyed an ultra-short Byronic success. In retrospect hindsight tells us that its mumbo-jumbo about the period of production grossly misdiagnosed the macroeconomics of the 1927-1931 (and the 1931-2007) historical scene.
          So you might say Hayek as an economist fell into what physicists call a black hole. Wisely, libertarian Hayek turned away to weighty constitutional and philosophical interests.
          Hayeks (1941) The Pure Theory of Capital was not stillborn. But it was a pebble thrown into the pool of economic science that seemingly left nary a ripple. Hayeks grave defeats in the early 1930s predisposed him in the World War II years to write what he entitled, The Road to Serfdom (1944)…
          Hayek himself, naively, diagnosed the fall of his 1931 opus as due to the fact that his period-of-production mutterings there did not do full justice to the not-yet-completed Austrian theory of capital (Menger, Böhm et al.). Therefore, heroically but hopelessly, he wasted years on a task that he was grossly under-equipped to handle.The Road to Serfdom,
          hindsight confirms how inaccurate its about the future turned out to be.Sweden and other Scandivanian places have somewhat lowered the fraction of GDP they use to devote through government. But still they are the most socialistic by Hayeks crude definition.Where are their horror camps? Have the vilest elements risen there to absolute power?When reports are compiled on measurable unhappiness do places like Sweden,Denmark,Finland,Norway best epitomize serfdoms?No.Of course not!”
          Paul Samuelson-Journal of Economic Behavior & Organization 69, pp

      2. screenname22

        “A sophism is a specious argument used for deception. For example, sophisms can use obscure words and complicated sentence structures to intimidate the opponent into agreement to avoid feeling foolish or can manipulate the opponent’s prejudices and emotions to overcome their logical faculties.”

        Sound like anyone we know?

      3. jake chase

        I don’t see how you can blame Hayek for kleptocratic capitalism. He makes it very clear in Road to Serfdom that laws of universal application are fundamental to a functioning market economy. Today’s market state has not only abandoned law enforcement and permitted corporate predators to act as they please, it has also provided a financial backstop to failed institutions that flauted existing law. If Hayek had this in mind he certainly didn’t say so in 1944.

        And who cares about his psychic motivation? The book stands on its own legs. His fundamental idea was to limit power because power corrupts. If you disagree with that you haven’t learned very much about how things work, IMHO.

        1. rotter

          What “Hayek would have wanted” is irrelevant. His name and work are constantly evoked by “kleptocratic capitalism” in defense of globalism, modern kleptocapitalism. Marx predicted reasonably well the cannabalistic era of capitalism we are suffering through. I KNOW DAMN WELL you are not willing to separate some notion of “what Marx would have wanted” from the actions of Beria or of Stalin.

      4. rotter

        anyone who disagrees with Hayek, on any point at all, no matter how trivial, is a Marxist animal, you hater of freedom you.

      5. Jan

        Very nice analyze Philip!What drew much incredulity was Hayek’s strange choice of Nazi Germany as the type of serfdom produced by economic planning.He had little else to say against it except that it practiced planning,and the spread of planning ideas in Britain to the influence of Germans such as Sombart,Plenge,Lensch,and Mueller van Bruck.Most of his readers had never heard of them.The British Left and U.S liberals were,reasonably enough,offended by the suggestion that they got their policies from these sorry bunch!
        Winston Churchill read Road to Serfdoom during the 1945 election told electors electors, that Labour would “bring in a Gestapo”, which helped him lose the election. He later told Hayek, “You are absolutely right, but that will never happen in Britain.”

        Greg Grandin Professor at New York University in
        Counterpunch sings of Friedman, Hayek, Pinochet,: “Friedrich von Hayek, the Austrian émigré and University of Chicago professor whose 1944 Road to Serfdom dared to suggest that state planning would produce not “freedom and prosperity” but “bondage and misery,” visited Pinochet’s Chile a number of times. He was so impressed that he held a meeting of his famed Société Mont Pélérin there. He even recommended Chile to Thatcher as a model to complete her free-market revolution
        Hayek glimpsed in Pinochet the avatar of true freedom, who would rule as a dictator only for a “transitional period,” only as long as needed to reverse decades of state regulation. “My personal preference,” he told a Chilean interviewer, “leans toward a liberal dictatorship rather than toward a democratic government devoid of liberalism.”
        In a letter to the London Times Hayek, defended the junta, reporting that he had “not been able to find a single person even in much maligned Chile who did not agree that personal freedom was much greater under Pinochet than it had been under Allende.” Of course, the thousands executed and tens of thousands tortured by Pinochet’s regime weren’t talking”

    2. Klassy!

      Sillystuff, were you intending to perfectly illustrate Mr. Pilkington’s point about kneejerk reactions?
      I do not expect a reply as I’m sure you are off to defend the honor of Hayek somewhere else on the internet. It is lonely work, but you soldier on, armed only with the words “collectivism”, “Marxist”, and “central planning”.

      1. screenname22

        Allow me to respond for him:

        Sillystuff brought up several legitimate points that were in no way knee-jerk reactions. Here, let me point them out for you since you missed them:

        “Why the personal attacks?”
        “Why are terms like “delusional” bandied about?”

        I’ll add a third, inferred from his comments:

        “Do you, phil, support the idea of central planning? It seems clear by your body of work that you do. How can you justify this in the face of the massive failure of central planning over the last century, not to mention the mind-boggling loss of life that resulted, well-understood to be in the hundreds of millions of human beings?”

        If you need sources on this I can happily provide them, but like sillystuff says, the results are incredibly clear for any with the courage to see.

        Real Eyes
        Real Lies

        1. JEHR

          screenname22, could you please define your term “central planning.” If by that you mean communist 5-year plans that took place in Russia under Stalin then that is one kind. If you mean passing a budget in parliament looking forward to planning the next few years’ economy and environmental concerns, then that is another kind of “central planning.”
          If you would define your terms then I, perhaps, could follow you and maybe even sympathize with you.

          1. screenname22

            Thanks for the thoughtful response, JEHR, I’d be happy to discuss the definition of central planning with you! Here’s what Wikipedia has to say:


            “Economic planning refers to any directing or planning of economic activity outside the mechanisms of the market. Planning is an economic mechanism for resource allocation and decision-making held in contrast with the market mechanism, where planning refers to a direct allocation of resources. Most economies are mixed economies, incorporating elements of markets and planning for distributing inputs and outputs. The level of centralization of decision-making in the planning process ultimately depends on the type of planning mechanism employed; as such planning need not be centralized and may be based on either centralized or decentralized decision-making.”

            In the case of modern-day western economies, two of the most important and vital components of commerce are 100% centrally planned by government-granted monopolies: money supply and interest rates, not to mention what people are “allowed” to use as money in the first place. When these things are not freely chosen by market participants, you have central economic planning, and all of the misallocation of resources that go along with it.

            All of this is enforced at the point of a gun. Nobody would use “dollars” if they were not “legally required” to, which means that if they don’t, they will be kidnapped and caged.

            This is the grim reality. Tinkering around the edges will not solve anything. Taking violent coercion out of economic activity will, but very, VERY few people have any interest in discussing the violence that underpins the whole system.

            Psychologically, I believe this is because most people are, from a very young age, told by adults that they must submit and obey to arbitrary rules “for their own good” with threat of punishment should they “disobey”. This totalitarian environment normalizes the violence so that as adults, they have a very difficult time seeing it, or at the very least objecting to its use. Bullying children consistently from an early age conditions them to accept being bullied as adults. People like Phil are delighted that finally it is THEIR turn to be the bully, and so when people like myself and sillystuff come along and point out that bulling is EVIL, their cognitive dissonance kicks in, their defenses go up, and the lash out.

            I’d love to hear your thoughts on the subject.

          2. screenname22

            A few other vital aspects of the economy that are centrally planned:

            * At what age one is allowed to work
            * What percentage of income one is allowed to keep
            * How much “tax” a business must charge or a customer must pay
            * What structures are to be allowed where, and how they are to be built
            * (as mentioned before) what people are allowed to use as money
            * Who gets to print the money, and how much
            * How food is to be produced, whom it may be sold to, and at what price

            I could go on and on and on. Just because this is the only economic system that most people alive today are personally familiar with does NOT mean that it is good or right or just or necessary or beneficial. A study of history clearly shows that centrally-planned economies simply do not work, whereas economies free of violent coercion and arbitrary rules flourish. This is because only individuals are in a position to know the best way to apply economic resources; there is absolutely no substitute for millions of industrious individuals pursuing their own desires free of violent coercion.

            Only people who suffer from the delusion, usually inflicted in childhood, that people are evil and must be controlled “for their own good” can possibly endorse central planning or the use of violence to solve problems. I suspect that this is the case with Phil (and most people alive today, unfortunately).

          3. MRW

            In the case of modern-day western economies, two of the most important and vital components of commerce are 100% centrally planned by government-granted monopolies: money supply and interest rates, not to mention what people are “allowed” to use as money in the first place. When these things are not freely chosen by market participants, you have central economic planning, and all of the misallocation of resources that go along with it.

            Hunh? This makes absolutely no sense.

            “What people are “allowed” to use as money in the first place” is a country’s unit of account. Market participants don’t choose these.

            “Money supply and interest rates” are central bank operations. Market participants don’t choose these.

            What about the real resources of a country: it’s people, physical resources, and industrial sectors? You ignore those for financial indices?

        2. marcos

          screname22 errs in confusing economic regulation with economic planning.

          Planned economies are extensively regulated but not all economies that are regulated are planned.

        3. leeskyblue

          Young man,

          First, you used the term “epistemology” wrong. It is simply the study of how humans acquire knowledge. It could be based upon feelings or anything else. As long as the study is given order and structure, it is an epistemology. It is NOT only your particular philosophy, and you don’t have to agree with every other one.

          Were this the only lapse in your comments, it might be minor, except that everything else you said is just as removed from careful thought and reason.

          ” A study of history clearly shows that
          centrally planned economies simply do not work,
          whereas economies free of violent coercion
          and arbitrary rules flourish.”

          On the contrary, laissez faire economists and historians genrally, say that economies through history have ALWAYS been “mixed”.
          THAT is what “history proves”. A study of history shows that freedom can be maximized under some systems of checks and balances, which always have included government. Clearly, some some work better than others, but that is “history”. You may assert what fancies or supppostions you wish, but it isn’t “history”. I see no evidence here that you really examined and honestly challenged that premise, or for that matter anything else you have asserted.

          You offer no argument, your lists wildly overgeneralize, offer no argument or evidence of serious thought. That is why you are being characterized. Along with your unsupported and unargued assertions, you offer a great deal of personal attack, sarcasm and bullying.

          You said, “small minds discuss people.”
          I wouldn’t be so unkind to you — on the contrary, you are evidently a kid, which means you are not the equal of adults until you acquire some life experience.

    3. lucky

      “If the last century proves anything it is the dire consequuences of ctenral planning and collectivism. From Lenin to the Nazis to Stalin to Mao the results are not debatable.”

      So there is nothing in between Hayek and the above?

          1. Philip Pilkington

            If you don’t get it after listening to the interview and reading the pieces, you’re never gonna get it. If you don’t see that you’ve started saying on here precisely what I said that you people always say, you’re never gonna get it.

            “If you’re trapped in the dream of the Other, you’re fucked.” — Gilles Deleuze

          2. screenname22

            Just as I suspected, “If you don’t know then I’m not going to tell you!”

            How does anybody take this guy seriously? He cannot come up with a single, logical, rational argument on any subject whatsoever.

            Beware the sophists, people. Their aim is only to deceive and enrich themselves, not to work towards the truth.

          3. Philip Pilkington

            Haha… yeah, I made a fortune out of this interview. Excuse me while I light up a Cuban…

          4. screenname22

            Enrichment does not necessarily mean financial enrichment – you’ve failed yet again to make a valid argument, Phil. In this case, I’d guess that the enrichment you receive is the endorphins that are released when you feed your confirmation bias. And boy oh boy how you feed it…

  2. craazyman

    every single one of them is delusional. :)

    you can reduce the visual fragments of the world, as Cezanne famously said, to the cylinder, the sphere and the cone. you can even abstract their essence, once removed, to the point, line and plane.

    But you cannot reduce the fragments of the universal mind to algebraic equations and Cartesian properties and manipulate them in a depthless 2-dimensional facade of reason.

    ecce homo. insanitus.

  3. The Dork of Cork.

    Bland Irish accents of the Pale or at least our dysfunctional University system ……………..

    I am not sure Ireland is a real place so therefore their accents are by default not real either.

        1. The Dork of Cork.

          Only joking lads…………

          The entire RoC video should be seen for context.

          PS.I generally agree with at least some of what Phil said.


          The role of Bomber command & influence in the UK, even pre war (planning for centralization) can be seen in this video.


  4. The Dork of Cork.

    Public transport buses in Naples are sitting idle in their depots today

    Azienda Napoletana Mobilità

    30/01/2013 Service unsecured
    We inform our esteemed clientele that the 1/30/2013 morning, low fuel, the service is not guaranteed.

    We inform our esteemed clientele that due to unavailability of fuel irregularities of Phlegraean area, Chiaia, Vomero. We apologize for any inconvenience

    Dork – because Italy is not a nation state it cannot go to war.
    Well the caveat is its Naples ………………but
    It cannot buy up all the available oil for public transport at the expense of lets say private cars running low.
    Creating even more shortages.

    In other words rationing seems impossible in the EU market state construct.

    We are headed toward epic breakdown me thinks.

    Even though the UK is the ultimate market state its fat controllers will return to nation state like conditions to preserve their claims.

    But Modern Hayekian Europe is kind of funny in a sick sort of way.

    Southern Italy is hilarious.

  5. Gerald Muller

    The Austrian school may have its excesses. However, I have rarely read a book that so systematically and convincingly destroys Socialism as that of the same title by Ludwig von Mises. And that was written 90 years ago!
    The central idea of putting liberty above everything else is not an idea that should, be rejected per se. It needs, however, fences to avoid excesses like those of Russia under Yeltsine

    1. screenname22

      Q: What’s the difference between a Minarchist and an Anarchist?

      A: About six weeks.

      Humans don’t need fences, friend. We are not livestock. Keep reading. Don’t give up. Thank you for embracing liberty!

    2. F. Beard

      Liberty?! Von Mises supported a government backed gold standard that would enslave us to usurers and money hoarders.

      A true libertarian would recognize that government money MUST only be inexpensive fiat, not some easily cornered scarce commodity.

      1. screenname22

        True libertarians recognize that people should be allowed to use whatever the hell they want as money.

        True libertarians do not discount an entire body of work based on a handful of opinions of its author.

        True libertarians recognize all taxation as theft, and thus the enslavement and dare I say EVIL is irrespective of what is stolen.

        1. F. Beard

          Yes, people should be allowed to use anything for private debts but as for government debts inexpensive fiat is the ONLY ethical choice else some private interest is profiting off the taxation authority and power of govertnment.

          1. screenname22

            There is NO ethical choice for government debts, because at their core all government debts are based on violent coercion. You cannot get love from rape. You cannot get charity from theft. Pointing guns at people and demanding pieces of paper is no more ethical than pointing guns at people and demand gold or anything else. This tune is getting old, Beard. Wake up and smell the violence, and try concentrating on that for awhile.

            Oh and give up on the sky ghosts.

          2. screenname22

            You’re the one who keeps bringing up a gold standard, friend, I haven’t mentioned it once. I keep saying people should be free to exchange whatever they want of value to use as “money”, so long as it is agreed to freely by both parties. It’s as simple as that. People don’t need governments to have money, and they never did. Like all good ideas, government usurps it for its own ends after the free market has created it. Money is just an object of value that is acceptable to a provider of goods/services in exchange for said goods/services. It is not necessary for commerce, as barter is always an option (for both goods as well as services), but money is merely a convenience created spontaneously by free markets and then taken over by governments.

          3. jonboinAR

            @Screenname: What you’re either not realizing or not admitting is that private ownership of property is based on violence. The only thing that prevents me, ultimately, from walking into your yard and picking the apricots from your tree is the threat that either directly, yourself, or indirectly, via a cop, you will shoot, mace, handcuff, incarcerate me. “Government” is why you don’t have to shoot me yourself. Would you prefer the latter? I fear it more as being more chaotic and arbitrary. In any case, it seems to me that all imposition of order whether done by an individual, a small group of related people, or some kind of state is done with the implicit threat of violence. Saying that the state imposed order is violent at its heart does not distinguish it from any other sort of order as far as I can see.

        2. MRW

          True libertarians recognize that people should be allowed to use whatever the hell they want as money.

          OK, I choose toilet paper. Now, will you accept that?

          1. MRW

            You’re the seller. I’m the libertarian who’s deciding what money is, and I decide toilet paper.

          2. screname22

            Doesn’t work that way, friend; only the seller of goods and services gets to decide what he or she will accept for said goods and services. This is the whole point: you don’t get to tell me what I must accept as payment, just as I do not get to tell you what you must accept. You want to accept dollars/toilet paper? Grand! Best of luck to you sir. I, on the other hand, do not particularly value 75% cotton / 25% linen rectangles. Now, if you’ve got something a bit more tangible that I value, I might be interested. I would also be fine with barter. That’s the whole point; the possibilities are endless when we take the gun out of the picture!

        3. F. Beard

          True libertarians recognize all taxation as theft, and thus the enslavement and dare I say EVIL is irrespective of what is stolen. screenname22

          Then true libertarians are at odds with the Bible (e.g. Romans 13:1-7).

          1. screenname22

            Absolutely! True libertarians are at odds with ALL works of fiction, religious or economic. Ancient sky ghosts are no place to look for answers to real-world problems.

          2. F. Beard

            It’s good of you to admit that. Put in such stark terms, Christians will, of course, choose the Bible over Ayn Rand and her mentor von Mises.

        4. F. Beard

          True libertarians do not discount an entire body of work based on a handful of opinions of its author. screenname22

          The Austrians also worship deflation (“to purge the malinvestments”) and despite recognizing that “fractional reserve lending” is unjust fail to realize that it cheats debtors too. They are thus blind to the justice of a unversal bailout of both non-debtors and debtors alike with new full legal tender fiat preferring instead to let an unjust bust “cure” the evils of the unjust boom as if two wrongs make a right.

          1. F. Beard

            And you, friend, are probably an unwitting tool of monarchists, bankers and racists.

            I used to consider myself an Austrian until I discovered they worship gold rather than liberty. They are also lazy and wicked in their desire for unearned gains via money hoarding.

          2. screenname22

            You keep using the word “worship”, and “wicked”. I think you may be the one who is indoctrinated, but by religion, not monarchs or bankers.

            And I really don’t give a crap about gold, or what “Austrians worship”. I care about ideas. I care about violence. I care about freedom.

  6. jsmith

    Hayek, Mises, whatevah!!

    I came to this thread to talk about VIOLENCE, MAN, VIOLENCE!!!


    And how like violence is like used to theft something from someone which is like evil always or sometimes but it’s really just violence like all the way down until you get to like the theft which is violence and like centrally planned like all good thefts of violence are in an evil world today and like in the past evil years where there was like much evil and violence and taxes and IP bans and Marxists who violently thieve on free IT guys who just like want to be like violence free with their own money or something safe from theft…

    (takes breath)


      1. screenname22

        Hey everyone, lets learn about logical fallacies! This particular one is an old chestnut, called the Straw Man here in the states.

        A straw man or straw person, also known in the UK as an Aunt Sally, is a type of argument and is an informal fallacy based on misrepresentation of an opponent’s position. To “attack a straw man” is to create the illusion of having refuted a proposition by replacing it with a superficially similar yet unequivalent proposition (the “straw man”), and to refute it, without ever having actually refuted the original position. This technique has been used throughout history in polemical debate, particularly in arguments about highly charged, emotional issues.

        I’d love to respond to actual arguments!

        1. jonboinAR

          What he was using was irony of the broad sort we call sarcasm. I thought it was pretty funny. I even liked it after watching the Monty Python clip which would be normally pretty hard to follow.

      2. screenname22

        Note as well that Phil enthusiastically endorses this type of logical fallacy (among many, many others), which is how you can tell he’s a sophist.

        1. Demosthenes

          We’re just delighted to see someone accurately lampoon a jerk.

          Let me point out that you have not adequately responded to Phil’s multi-part analysis of Hayek. You’ve come in with criticisms of his work, to which you require the author to respond on the spot, but you haven’t actually demonstrated any flaws in any part of any of the articles. The only analysis you bring is simple red-baiting and attacks on the author’s supposed “collectivism.” And, buddy, “Taxes are theft!” sounds like sophistry to me.

          I’ll go pay my taxes and enjoy police protection. You can go ahead and move to Somalia and pay no taxes. There you just might find out what real thievery is like.

          1. screname22

            Phil didn’t raise any actual points in his interview; he never does. Perhaps you could distill his main point, or points, down for me and I’d be happy to refute them. I doubt you are so inclined, however.

            Of course taxes are theft; they are involuntary. If you don’t want to pay them, too bad buddy; kidnapping or murder for you. That’s theft, plain and simple, not sophistry. You only think its not because you convince yourself that it is voluntary, when I assure you it is not. And the cops cannot protect you; they can only show up after the fact and maybe take a few notes, if you’re lucky. You’re being quite naive. When seconds count, the cops are just minutes away…

            And I’m not the one calling people names. That’s you and Phil. Yet somehow, I’m the jerk?

            Finally, I bet you don’t know thing one about Somalia. Here, educate yourself if you’re interested, which I highly doubt:



        2. rotter

          employing any old type of logical fallacy is not “sophistry”. Not everyone who diagrees with you is a “sophist”…now, young feller, can you tell me what a shopist REALLY is? this is your chance to look it up.

  7. David Lentini

    Great interview, Philip. But why not just come out and say that the end result of neoliberalism is corporatism, resulting from the degeneration of the free market into a few powerful monopolies that hijack the state for their self-preservation?

  8. skippy

    @screenname22… are you or are you not a devote of Hayek / Friedman? What did you mentally ingest to formulate your thoughts?

    1. screname22

      I am a devotee of no man. I am a devotee of the truth at all costs, even if the truth is that everything I once believed, and everything that everyone I know believes now, is false. I would rather be wrong and know it than think that I am right and not be. As such, everything that I think I know is on the table for being refuted, which is why I come here by the way, ESPECIALLY those beliefs that I believe strongly and am passionate about. Failure to constantly critically examine one’s most highly cherished beliefs results in people believing things that aren’t true, forever. Down that path lies, well… Phil.

      If I had to hold up one person as a paragon of truth, intellect, wisdom and knowledge, I’d have to say my go-to guy would be Socrates. Read the Trial and Death of Socrates for some riveting stuff, though like many he failed to condemn the evil of the State – perhaps his one failing, or perhaps his ironic revenge on humanity for being murdered by the state. After that, in my opinion, philosophy and truth were basically snuffed out for at least fifteen hundred years… Adam Smith had some good ideas, and the Austrians started putting the pieces back together a bit later. They, of course, didn’t get it all right either, but I think lots of them were on the right path: Mises, Rothbard, Hoppe… Pugsley’s Alpha Strategy looks at things a bit differently and is free online, check it out:

      I do like Ayn Rand, who has the second most popular book ever written after the Bible, but she couldn’t quite figure out the State… more recently I like Lew Rockwell, though his religious views are of course fantastical.

      Today I’d say that Stefan Molyneux is the greatest philosopher currently living. I think he would agree with pretty much everything I’ve been saying on these boards. Go listen to one of his thousands of podcasts, youtube videos, or call into his Sunday show and debate him live. Does Phil offer such a chance to his ideological adversaries? I think not.

      Finally, look at Lloyd DeMause’s This is where the real answers are: treating children like human beings. Ultimately, like all violence among adults, the state is merely a manifestation of childhood trauma. This is why people have such a hard time having a rational conversation about it; when people are talking about the state, what they’re really talking about are their parents.

      Sounds fantastical, I know. Hard to believe. Impossible, even. Look, frankly I wish people like Phil were right; that we could just adjust a knob here, tweak something there, and that everything would be hunky-dory. That the state was this benevolent force for good, helping humanity achieve what would otherwise be impossible, and we just have to get the formula exactly right. That would be a HELL of a lot easier than getting rid of the state and changing how children are treated, but unfortunately this is what the evidence points to as being the only way out of this horrifying cycle of violence. Did you know that half a BILLION people were slaughtered in the past century by governments? Private murders don’t hold a candle to that scale of violence.

      1. jonboinAR

        You said: “Private murders don’t hold a candle to that scale of violence.

        No, you’re right. They’re not the same scale, but many things a state does will be on a larger scale than the private acts we usually see as state acts are those of a large group combined. That could be changing as corporations gain more power, but I don’t necessarily see that as a good thing. I don’t see where your implicit argument that private acts are somehow less arbitrary in their nature than public/governmental one holds.

        When people hold up Somalia to you as a negative example it’s to show that when you remove the “official” state what you end up with is warlords running rampant, a bunch of little, private, but more murderous, generally, and more arbitrary imposers of will by force.

        I just don’t see where reducing the state’s influence too much usually represents an improvement in conditions for most people. I’m kinda old. My grandfather lived in the very early part of the 20th century. This was during a time that the US central government was a bit more modest in its reach than now. He was sent into the mines in PA as a child. When he grew up he espoused communism. He didn’t find the “free-market” to do a damn thing for him, his family, or any of his friends.

        Me, I’m more a mixed-economy fan, as in the US in the ’50’s and ’60’s. Seemed to work OK.

      2. rotter

        “i am a devotee of no man” BWAAAHAHAAAA……..

        i am a devotee of no man, like the night moon i come, and the the summer breeze i blow. i am like a mighty shadow cast over your timid conscience. some call me screenname22 (and i really do have 21 others) bow down to me, (and my copy of the road to serfdom, stolen from the Nassau county public library) and despair!

    2. screname22

      As Socrates said, true knowledge is only achieved through self-knowledge. Examining one’s prior beliefs, biases, history, and yes, childhood, are prerequisites to having an ability to discover the truth when it is in conflict with these things.

      I appreciate your question and your seeming curiosity. It is a rare thing indeed on these boards. I highly encourage you to check out the sources I referenced, especially Molyneux.

      1. skippy

        Information asymmetry refutes the ideology of – freewill – in toto, in addition, the authors you sight plucked axioms out of the thin air or some dark cavity. For instance, the Von Mises institute uses a Coat of Arms (sign of violence’s application) and the usage of Von it self denotes heredity (self imposed – gifted authority via violence).

        Rand, Ludwig von Mises were from some sort of wealth – better off than most back ground, Rothbard was the son of ex USSR emigrants. All the influences on their lives came from religion and wealth see:


        Influences Kant, Bastiat, Böhm-Bawerk, Brentano, Husserl, Menger, Say, Turgot, Weber, Wieser, Wicksell, Lord Overstone[1]


        Influences Aristotle, Aquinas, Böhm-Bawerk, Hazlitt, La Boétie, Burke, Chodorov, Hayek, Wilder Lane, Laozi, Locke, Mencken, Menger, Mises, Molinari, Nock, Oppenheimer, Rand, Say, Schumpeter, Spencer, Spooner, Tucker, Turgot, Harper[1]

        Skip here… Seriously… look into every single individuals history, its a cult of business, laid on a foundation of religious axioms, all backed by money. It is a cult and nothing more, a cult of wealth accumulation and egregious wealth is quite violent. Wars are fought over it, the nation state – historically – was little more than the political arm of the wealthy. Only for a brief few moments in history has most nation states looked out for their citizens – well being – as a_hole_and not a line item in some market analyses.

        Personally I would not travel further back than 100 years in extreme cases and more like 50ish, to seek relevant data, to formulate and opinion on social constructs ie the environment and data base keeps changing to fast .

        Skippy… Market fundamentalism is just bastardized religious theocracy for the wealthy… own it.

        1. Glenn Condell

          ‘Market fundamentalism is just bastardized religious theocracy for the wealthy’

          To paraphrase Mandy Rice Davies they would think that, wouldn’t they? In fact, most of them probably don’t drink the Kool Aid themselves, being cluey enough to know the score, they just retail it as a self-protecting Cliff’s Notes cum opiate for the increasingly ill-educated, uninformed and impoverished people. Some of whom seem to have joined us today.

          1. skippy

            7 bloody campaign months[!!!] and 3-ish more months of rain and possibly fire… WTF(???}.

            Skippy.. into the breach…

        2. casino implosion

          “…Market fundamentalism is just bastardized religious theocracy for the wealthy… own it…”

          Skippy FTW

  9. jsmith


    (takes another breath)

    And like then there is like my Aunt Sally another victim of violent worzel theft in like the US AND the UK and who just wants like money to be worzel but she pays taxes and it’s violent but in IT there’s the sweat on my brow and the violence in between sophistry and like stupidity and like when like the state or Marx or IT guys use violence to like try and steal like the taxes and thoughts of other like free people and then use their OWN money and like words to violently steal like other people’s money and blogposts and stuff it’s just like Lenin hijacking like the gun of freedom and creating the logical fallacy argumentum ad infintum stultus which means violencio stealio tu dinero or like something equally as violent which like my Aunt…

    (takes breath)


  10. The Dork of Cork.

    I am sympathetic towards Hayek in so far he perhaps saw the machine like so much of his generation…….

    But his ideas simply don’t work for complex systems.

    See the above Naples public transport debacle as the public transport breaks down for lack of tokens for fuel as the cities are jammed with cars burning much more fuel / real resources.

    The euro market state seems unable to spend money into existence to sustain basic utilities.

    As for the Dyson interview
    at 24.00
    In 1933 we (me at 11) saw the war coming.

    In 1936 Bomber command was formed.

    There was a major push towards better organization in the second world war.
    They attempted to pick the right guys for the right job unlike perhaps the great war where both the Baldrics and Blackadders died in the trenches.

    CP Snow picked Dyson for the bomber command job.
    The Young Patrick Moore was a navigator etc etc

    I think the reduction of oil inputs through rising $ price functions as almost a collection of U boats sinking half the Atlantic ships……

    The Austrian school has nothing to give under such a scenario.

    “you got your ration and that was enough”

    People like a purpose in their lives.
    The war was the best years of life for most.

    Such a critical mass of guys training in Canada ………….coming back (some not)
    Doing post war stuff of various kinds setting off a technological & social firestorm

    That singularity has been spent now………
    What remains ?

    Memories of Tommy

  11. from Mexico

    Some very interesting insights.

    My main contention, however, is this: Pilkington is most adamant in proclaiming that “there were huge differences” between neoliberal and classical liberal theory. He thus fails to identify and articulate the internal incoherency that lies not only at the heart of neoliberalism, but of liberalism as well.

    Throughout the 19th and 20th centuries, history has consistently shown that neither liberalism nor neoliberalism, in practice, has ever led to a weak state. Quite the opposite, they have always resulted in a strong state, a strong state which intervenes into the economy and the polity so that they serve only the interests of a politically powerful economic elite.

    Pilkington’s analysis therefore lacks the radical and devastating critique of liberalism that we find in the writings of folks like Karl Marx, Hannah Arendt, Reinhold Niebuhr, Martin Luther King, and Jonathan Schell, critiques which by their very nature must come from outside the confines of the church of economics, a congregation which Pilkington seems fairly well ensconced within. And the absence of this critique of liberalism may explain why he cannot see the glaring differences between the philosophies of Hannah Arendt and Hayek, or why he asserts that “the nature of the planning system in Europe and the US was fundamentally the same,” the difference being that “in America a lot of the planning took place by the military-industrial complex, that’s how it was sold to people, it was sold as part of the Cold War.”

    Now I fully agree that both the US and Europe had strong states. The idea of laissez-faire and a weak state are nothing but liberal/neoliberal canards. But, and this is especially true in the case of northern Europe and the Scandanavian countries, the similarities end there. By acknowledging the existence of a strong state, and insisting it be brought under democratic control, and not allowing it to fall under the control of the military-industrial complex, a very different outcome has been achieved than in the US.

    The point then is this: all the debate about a strong state vs. a weak state is a false debate. It’s a bunny trail. The true debate is over the purpose for state planning, and who its beneficiaries will be. But in Pilkington’s discourse, we keep getting led off on the bunny trail — the debate over state planning vs. decentalized planning. Now compare that to Martin Luther King’s “Why I Am Opposed to the War in Vietnam,” where no such vagueness or equivocation exists:

    There is…a very obvious and almost facile connection between the war in Vietnam and the struggle I and others have been waging in America. A few years ago there was a shining moment in that struggle. It seemed that there was a real promise of hope for the poor, both black and white, through the Poverty Program. There were experiments, hopes, and new beginnings. Then came the build-up in Vietnam. And I watched the program broken as if it was some idle political plaything of a society gone mad on war. And I knew that America would never invest the necessary funds or energies in rehabilitation of its poor so long as adventures like Vietnam continued to draw men and skills and money, like some demonic, destructive suction tube. And you may not know it, my friends, but it is estimated that we spend $500,000 to kill each enemy soldier, while we spend only fifty-three dollars for each person classified as poor, and much of that fifty-three dollars goes for salaries to people that are not poor. So I was increasingly compelled to see the war as an enemy of the poor, and attack it as such.

    So what does this all mean? It means that what Hayek advocated was a return to a pre-WWII Britain and a pre-WW II United States. Or in other words, to liberalism. But like Pilkington says, by the end of WWII the milk had already been spilled, and it was going to be difficult to get it back into the bottle again. So the lords of capital and their paid liars and bumsuckers — Hayek and the rest of the Chicago Boys being the perfect examples of the latter — embarked on a massive and well orchestrated campaign using the tools of propaganda and state violence, pitting a system of dogmatic theory against the skeptical testimony of human experience.

    It will be interesting to see if they will be able to put the milk back into the bottle. WWII profoundly reshaped American society. In the outstanding PBS special, A Class Apart, we see how these changes affected Mexican Americans.

    David Montejano touches on the same theme in Anglos and Mexicans in the Making of Texas, 1836 to 1986:

    Social conflict and national crises provided the necessary impulse for the decline of old race arrangements. World War II, in particular, initiatied dramatic changes on the domestic front. The need for soldiers and workers, and for positive international relations with Latin America, meant that the counterproductive and embarrassing customs of Jim Crow had to be shelved, at least for the duration of the emergency. In more lasting terms, the war created a generation of Mexican American veterans prepared to press for their rights and privileges. The cracks in the segregated order proved to be irreparable.

    The cracks did not rupture, however, until blacks in the South and Mexican Americans in the Southwest mobilized to present a sharp challenge to below in the 1960s.

    So will the forces of conservatism — the liberals and neoliberals — succeed in putting all these people, but most especially the workers, “back in their places”?

    1. Philip Pilkington

      I’d tend to agree with all that (except that I have a less sanguine view of the Scandanavian countries’ planning systems). And I think it shows in my scepticism toward the dichotomy planning/market. The market is, I think, always already planning. Any confusion you get in the interview, and there is some, is purely due to the language used. This dichotomy has been built into our language at a fundamental level, and so you have to tie yourself in knots and engage in countless qualifications to break through it. It’s easier to do in writing than in speech.

  12. Paul Tioxon

    Well, to listen to the Grievous Angel at the Dark End of The Street is more than I could hope for on NC. And the blessed brogue of that Sainted Isle melts my heart. Phillip, you seem to rightly hold Hayek with the bottomless well of beneath contempt, that the $2 whore of a Bush League, pseudo-intellectual deserves. He composed his fairy tale of the liberty killing power of the state, based on the existence of any state, and its reason to exist in and of itself, with a monopoly on violence, institutionalized in the form of police and army. Hayek, in his childlike tantrum of being told to live by rules and do what the law says, and not whatever he feels like, decides that the structures of the social order should be torn to pieces, so that we can all be free. I think he was the first, you know, man, like the first yippee or beatnik or something. The Road To Serfdom is his generations HOWL. He saw the richest families of his generation destroyed by the madness of taxation and civilization. Far OUT. He was, like totally fighting the gestapo brain police with their plans and stuff.

    When I first looked at the road to serfdom, the clearest explanation on the popularity of his ideas was the fact that READERS DIGEST printed a huge summary of the work and then printed a million copies which were distributed through the various conservative organizations, such as local chambers of commerce. In Hayek, the right wing capitalists (oh hope that does not make people think I’m a commie, a pinko or a fag or all three at once)found an articulate apologists who could say freedom over and over again, during WWII, just to make sure we wouldn’t lose freedom, after we won the war. It’s such a slippery slope to fight a war to the death, win and then just wind up becoming a totalitarian dictatorship anyway, even worse than the one we defeated. I just hate when that happens. It was a relief to have someone string together enough sentences with a denouncing of the nations and methods used to save us from certain destruction by our enemies. Too bad we choose the evil of planning by the government to overcome the planning of other governments to destroy us. Planning is clear the culprit here. Not panzer divisions and U-boats. Well, Hayekians, libertarians and neo-liberals, it is people that invade and kill other people, not plans. No Bans on Plans!

    1. Philip Pilkington

      Thanks. Yep, I agree. They should have locked that hippy’s ass up during the war. While Galbraith and Keynes were fighting the good fight and managing the war economy, Hayek was writing his childish Oedipal narrative in the LSE library.

  13. screname22

    That’s it for me folks – I’ve done my best to illuminate the truth of Phil’s sophistry while avoiding personal attacks, a claim that I think cannot be said of the author or other members of this community. I hope some find it useful, recognizing that many will resent the unvarnished truth when they hear it, as it is such a psychological threat to the experiences of most people. Consequently, I understand the human need to lash out and retaliate when one perceives they are being attacked, and thus do not take it personally or hold it against anyone, even Phil.

    If you’re interested in the truth, if you’re interested in breaking out of the cycle, read what I wrote. Examine your childhood and your own experiences. Acknowledge that if you spent a decade in government-run schools, you might just be a teensy bit biased. Recognize that overcoming biases – especially the confirmation bias and the normalcy bias – is essential to achieving the truth, as is the ability to recognize and reject logical fallacies. See the violence and the threats that swirl all around you, every day. Get angry – anger is a necessary component to coming to terms and healing.

    I have done what I can; the rest is up to you.

    1. Sufferin' Succotash

      Now see what you’ve done, you charter members of the Pol Pot Fan Club!
      You’ve driven him away!

    2. marcos

      I went to your schools
      I went to your churches
      I went to your institutional learning facilities
      And you’re trying to tell me
      That I’m crazy?

      The state needs to be only big enough to drown the largest corporation, a legal fiction of the state itself, in a bath tub.

  14. Glenn Condell

    Great to see Tom’s podcast getting a run here. He has interviewed Phil before, along with people like Keen, Wray, Varoufakis and recently Stephanie Kelton (impressive lady that one) and plays the intelligent layman sidekick role very well.

    There are some forays into socialism, sustainability, science and music, but the focus is on the GFC, how we got here and what to do about it. Add gentle humour, a nice Irish brogue and some fairly eccentric soundtrack selections and you have a rival to Melvyn Bragg for ‘Best Podcast to do the Ironing By’

    Tom you should try to talk to our host one day…

    1. Tom O'Brien

      Interview Yves? I think might just have to!

      Thanks for the nice words Glenn – I responded to your Andrew Kliman comment, I don’t know if you ever got that one…


      1. Glenn Condell

        Hi Tom, thanks, have read your reply now

        yes a synthesis is emerging for me (if not yet a full GUT of the GFC), but it seems that many of the proponents of the theories that make most sense to me don’t have much to say about any of the others.

        You point out that Kliman is not up to speed on MMT, and ISTM Varoufakis with his surplus recycling theory and Keen with his bank credit/debt angle and say Bill Black with his criminogenic Gresham’s Law dynamics (and Philip too I guess with his analysis of the intellectual shibboleths that have helped lead us to where we are), while all vastly enhancing my own apprehension of the whys and wherefores of the crisis tend in their variety to muddy rather than clarify the waters in my simian brain when I am asked by family or friends to briefly explain what I think has happened. I realise a pat answer won’t do for a topic so complex but still I think there ought to be more effort toward a synthesis of these rationales that surely complement rather than preclude each other. TINA to KISS for people like me I’m afraid.

        Unsure if I agree about the offshore havens (perhaps I just don’t understand) They are not ISTM a way of avoiding paying profits, just a way of secreting them away for a tiny clique of insiders. Quite apart from the share of profits to stockholders, creditors and and labour harmfully exiting the system, there is the matter of all the avoided tax liabilities embedded in that 32 trillion, funds that would have gone a long way to helping keep states afloat had they been available. Maybe Nicholas Shaxson who wrote Offshore might be good talent for the cast as well. And don’t forget David Malone (Golem XIV), he has been blogging up a storm lately.

        ‘Interview Yves? I think might just have to!’

        That would be grand.

        Hope you made enough in the ‘keep Tom drunk through Xmas fund’ to keep yourself in the state to which you’ve become accustomed…

  15. jsmith


    (yet another breath)

    And then like when you were a baby of freedom and like your mother nursed you on the nectar of peace but then like Marx raped your mother and taxed her breast and like violence shoved you into Commie lactose intolerance for freedom and then you looked into the liberty mirror and like all you saw was Mao staring back at your violence as he like gnashed his tax teeth against the logical fallacy of like violent circumcision with the fiat flames of currency of like hell burning for like centrally-planned like eternity…



    1. screname22

      I get it – I really do. I’m sorry that that was all you could glean from what I wrote.

      “A truth’s initial commotion is directly proportional to how deeply the lie was believed. When a well-packaged web of lies has been sold gradually to the masses over generations, the truth will seem utterly preposterous and its speaker, a raving lunatic. –Dresden James

  16. The Dork of Cork.

    You have to look at how fucked up his generation was.

    The state through war simply seized private assets.

    You simply produce state money and mobilize resources for war…….the second part was the hard bit ,requiring deep organization & bureaucracy.

    Soldiers created mayhem behind Flanders fields.

    I keep thinking of Ernst Jungers matter of fact account of the first world war.

    With his company using explosives to catch fish in a private pond and of course doing much much worse.

    Imagine what goes on in the heads of men whose life was in a factory until they are exposed to such apparent freedom all of a sudden ?

    How do you contain that ?

    As for Hayek – imagine what went on in his little head ?

    Later state planning = nuclear war planning.

    This can be seen in this British 1965 programme “war game” (never released to the public) and later in the early 1980s – “Threads”

    Imprisonment for civilians if they refused to Billet ?
    State = Force projected on your homestead.

    There is no way around this.

    But Nuclear war makes the state look impotent.

    see 14.30………….Doctor visits the local council house.

  17. skippy

    @The Dork of Cork.

    Whom does the nation state work for… eh.

    skippy… the legacy bondholders… not the spectator voters… shezzzzz

  18. Jim

    Screname22 stated on July 30th at 4:19P.M. that:

    “I am a devotee of no man. I am a devotee of the truth at all costs, even if the truth is that everything I once believed and everything that everyone I knew, believed know, is false.”

    Have you ever reflected on either the potential violence of truth or the large absence of solidarity in the pursuit of truth?

    Do you see truth as a reflection of a given objective order?

    Aren’t claims of truth claims of political power?

    I would really like to discuss these issues with you.

  19. Schofield

    How wonderful the Libertarian element in Neo-Liberalism succeeded in substantially deregulating the financial markets who then began to loot on an unprecedented scale which ended in a centrally planned bailout to stop the American economy going belly up! Then we have “sillystuff” and “screen name22” vehmently protesting at Phillip Pilkington’s suggestion that Friedrich Hayek’s Neo-Liberal ideology had something “utopian” and “delusional” about it! Have these two protesters not yet realized that human nature is ambivalent and as such Marxist-Leninism is as equally “utopian” and “delusional” as Neo-Liberalism because of the ambivalence?

  20. Jim


    What if you, Philip, the MMT theorists and Screaname22 all operate from the same concept of truth?

    1. jurisV

      Jim —

      Could you please “flesh” that out a bit. I’m not at your level of consciousness and am having a bit of cognitive dissonance with that question of yours. WTF are you talking about?

      I’ve seen Screename22, Screname22, and now you introduce Screaname22 and I’m a bit befuddled and suspicious. Are you related to one of those names or are you a random name generator — or maybe you’ve had more wine with your dinner than I ?

  21. Jim

    Juris V

    When MMT was launched a number of years ago the key theorists and their supporters proudly presented themselves as simply offering a description of the true nature of our monetary system. They insisted and insisted that it was only a description.

    In my opinion what MMT theorists attempted to do was to gain political legitimacy for their movement through the classic metaphysical maneuver of saying we(the genuine alternative to neoclassical thinking)need truth(our description of the monetary system) which will serve as ideological legitimacy for our emerging power.

    This same type of metaphysical maneuver is used by the Washington Consensus who also need truth (their supposedly objective description of the reality of the market)which serves as ideological legitimacy for their present domination.

    I have a sneaking suspicion the Screname22, representing a radical libertarianism, also has a similar conception of truth when he stated above “I am a devotee of the truth at all costs..,”although I have not yet been able to clarify this claim with him.

    In my opinion Phil is also basing his analysis on the capacity of the right description of the facts to reflect objective economic reality.

    And, in my opinion, classical Marxism also used a similar conception of truth when Marx argued that the truth is revolution through which the proletariat (expropriated and alienated and so embedded to see past the veils of interest that generate ideology to the truth)reconstitues the totality, of the human essence and surpasses the social division of labor and the dominion of men over other men.

    Truth as absolute objective correspondance is alive in all of these perspectives and that is a major reason, not often discussed) of why we are in crisis.

    1. John

      So if you dismiss all (or only these particular?) analytical frameworks as misguided, then under what analytical framework do you propose analyze and then solve the problem?

  22. Jim


    The basis for what I written above comes from a book called “Hermeneutic Communism” by Gianni Vattimo and Santiago Zabala.

    Their analysis is a critique of metaphysical realism, and especially the logical empiricism of analytical philsophy, the Washington Consense and scientific Marxism.

    The status quo is (“P” is true only if P) which is basically Aristotle’s correspondence theory of truth.

    The alternative is to be satisfied with “P” alone–to be satisfied with simply interpretation as a contribution to reality.

  23. Schofield

    Hey Jim you’re above my pay grade. I take the fairly straighforward view that consciousness was developed in human beings to help us cope with an ever-changing external environment and consciousness has us using perceptual frameworks or ideologies to help us in this ( memes I think was the trendy word used once upon a time ). I think you need to explain more simply to individuals at my grade how your use of consciousness differs from ours. You might be onto something who knows!

  24. digi_owl

    I think the last line may well be the most accurate. Trying to debate the followers seems to rapidly devolve to black/white, yes/no, good/evil style absolutism.

  25. Keynesian

    Professor T. V. Smith critiqued Hayek’s Road to Serfdom thesis as undemocratic.
    [quote]Professor T. V. Smith69 of the University of Chicago turned up the heat, calling Hayek’s argument “hysterical,” “alarmist,” and “overstrident.” “No country has yet wittingly or . . . unwittingly slipped into serfdom whose presuppositions are democratic,”70 he wrote. The point, wrote Smith, was “to distinguish harmful from helpful planning rather than to damn all planning. . . . The author is not opposed to planning. Like the rest of us, he is opposed only to planning which subverts freedom.”71 “The preparation for an electrocution and for an electrocardiograph is the same, up to a point,”72 Smith suggested. The difficulty was telling one from the other. Smith discerned a further flaw in Hayek’s reasoning: that it was hardly undemocratic to plan if democratically elected governments followed the electorate’s wishes that planning occur. “The greatest success of the Constitution . . . is that in a century and a half it has won the people from an ancient distrust of government to an acceptance of it as their friend,” wrote Smith. “A democratic government is the people themselves incorporated.”73 (Wapshott, Nicholas, Keynes Hayek: The Clash that Defined Modern Economics, Norton. Kindle Edition. p.204).[/quote]

    Neo-Liberals often argue, “Big government is bad.” Notice the ambiguity in that statement: they are never clear if the statement “Big government is bad” is true by definition, or true as a fact. Prima facie they appear to be making a factual statement, but they really mean it as a definition— big government is bad by definition. However, when they are challenged on a factual level—the need for regulation to prevent financial fraud, for example—they then argue in a circle: “We don’t need government to regulate and harm efficiency in the markets because government is…bad.” The opening remark, “Big Government is bad” is stated as a matter of fact, and when that fact cannot be supported, they return to arguing big government is bad by definition.

    The second linguistic trick often encountered when debating the role of planning in markets is that governments “interfere” with a natural equilibrium of production and consumptions. Hayek later abandoned this theory of market equilibrium, but still held to the non-interventionist thesis on which it is based. The word “interference” conceptually implies a balanced state of market forces into which government planning “interfere” with natural economic laws. The negation of “interference,” or “non-interference” means allowing a natural stasis. These two terms set up a false dilemma between natural market equilibrium, and an unnatural government caused dis-equilibrium.

    Yet in another contradiction to his belief in unalterable “natural economic laws,” Hayek argued that the field of economics was unlike the natural “sciences” such as chemistry.

    Anthropologist David Graeber discovered in his historical research of cultures that markets and currencies do not spontaneously exist, but are brought into existence as a side effect of emerging States. Government is always a dynamic component active within markets, “despite the dogged liberal assumption—again, coming from Smith’s legacy—that the existence of states and markets are somehow opposed, the historical record implies that exactly the opposite is the case. Stateless societies tend also to be without markets.”(Graeber, David, Debt: The First 5,000 Years, Kindle Loc: 1014-1016.).

  26. Kevin

    It is pure fantasy to “believe” in “democracy” in societies numbering hundreds of millions, gathered in immense urban conglomerations, subject to the propaganda of media owned by plutocratic interests, and in the enormously complex contexts modern industrialism.

    And isn’t it obvious that what rules are the immensely powerful and wealthy corporate commercial and financial interests–with ownership concentrated at their summit in fewer than 150 interlocking entities–with all this implies for the quality and content of a civilization?

Comments are closed.