Tuesday, May 19, 2009

Hayek 2: Freedom, spontaneity and accidents

November 6, 2005

Hayek's Chapter 2 in "The Constitution" is entitled "The creative powers of a free civilization". He wrote about the role of spontaneity, accidents and unpredictability of things and events, in the advancement of human civilization. Below are 4 good points from the chapter; my comments indicated by *.

(1) "The argument for liberty is not an argument against organization, but an argument against all exclusive, privileged, monopolistic organization, against the use of coercion to prevent others from trying to do better… Organization is likely to be beneficial and effective so long as it is voluntary. To turn the whole of society into a single organization built and directed according to a single plan would be to extinguish the very forces that shaped the individual human minds that planned it."

* The only monopolistic organization, a forced and non-voluntaryorganization where everyone is governed, is government. Voluntary organizations like private enterprises in a competitive environment are the chief engineers of innovation, of trial and error, of expansion and bankruptcy. The market system of exchange between suppliers and consumers (from hamburger to petroleum to labor) is the only system that encourages and thrives on voluntary exchange among people. Whereas governments have succeeded mainly in propagating a huge army of often unproductive politicians, bureaucrats and regulators, soldiers and armies (and created world wars, instigated civil wars), and developed an extensive system of welfarism and citizen dependence on government. Such welfarism of course, is not costless; the costs are born by voluntary organizations like private enterprises and productive citizens who pay lots of high taxes andfees, and/or stifled entrepreneurship for many others who were harrassed and intimidated by piles of bureaucratic regulations and permits that they must comply with.

(2) "Liberty is essential in order to leave room for the unforeseeableand unpredictable. Because every individual knows so little that we trust the independent and competitive efforts of many to induce the emergence of what we shall want when we see it."

* This is why the free-market system is superior compared to government-controlled and regulated system where politicians and planners, national and international, tend to think that they know everything that they cannot allow spontaneity and unpredictability, so they regulate many things to their liking and personal biases. The result is an extensive system of forced, not voluntary, collectivism; of forced equality.

(3) "Freedom means the renunciation of direct control of individualefforts that a free society can make use of so much more knowledgethan the mind of the wisest ruler could comprehend… Freedom grantedonly when it is known beforehand that its effects will be beneficial is not freedom. Freedom means that many things will be done which we do not like. Our faith in freedom rests on the belief that it will, on balance, release more forces for the good than for the bad."

* Not even the wisest of all politicians and lawyers, of all economists and businessmen, of all army generals and rebel commanders, would know the dreams and aspirations, whims and idiosyncracies of the people. We just have to respect spontaneity, opportunities and accidents, and that over the long-term, more beneficial results will outnumber the bad ones. That more innovations in cellphone, transporation and energy technologies will be initiated than innovations in firearms and nuclear weapons technology. That more research will be done in controlling malaria, HIV and bird flu, than research in poisonous and other destructive substances. So far, this is happening.

(4) "Man owes some of his greatest successes in the past to the factthat he has not been able to control social life. We are not far fromthe point where the deliberately organized forces of society may destroy those spontaneous forces which have made advance possible."

* Big, expansive, all-encompassing governments that regulate not only to whom we can buy or sell various products and services, what subjects can be taught in schools, but also regulate how much we can keep from our monthly income, how much we can give to our children as inheritance, are with us. There are just too many people around who think they got really bright ideas, so they confiscate other people's money (through government taxation) to fund their ideas. We just have to give them a good fight.

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