“But what spokesman of the present generation has anticipated the demise of socialism or the ‘triumph of capitalism’? Not a single writer in the Marxian tradition! Are there any in the left centrist group? None I can think of, including myself. As for the center itself—the Samuelsons, Solows, Glazers, Lipsets, Bells, and so on—I believe that many have expected capitalism to experience serious and mounting, if not fatal, problems and have anticipated some form of socialism to be the organizing force of the twenty-first century.
... Here is the part hard to swallow. It has been the Friedmans, Hayeks, von Miseses, e tutti quanti who have maintained that capitalism would flourish and that socialism would develop incurable ailments. Mises called socialism “impossible” because it has no means of establishing a rational pricing system; Hayek added additional reasons of a sociological kind (“the worst rise on top”). All three have regarded capitalism as the “natural” system of free men; all have maintained that left to its own devices capitalism would achieve material growth more successfully than any other system.”
Robert Heilbroner, “The World After Communism”, Dissent (Fall 1990), pp. 429–430.
Robert Heilbroner (1919-2005) was Norman Thomas Professor of Economics (emeritus) at the New School for Social Research and author of the best-seller The Worldly Philosophers, a book on the lives and ideas of The Great Economists. A socialist for most of his adult life, he famously wrote in a 1989 New Yorker article:
“Less than 75 years after it officially began, the contest between capitalism and socialism is over: capitalism has won...Capitalism organizes the material affairs of humankind more satisfactorily than socialism.”
Ludwig von Mises, Friedrich von Hayek and Milton Friedman stood almost alone for decades in insisting that a socialist economic system was impossible because of its inherent difficulties of social coordination -- the need to decide to “produce this and not that” -- and because of its threat to freedom – the planners’ need to compel economic actors to do that which they would not otherwise be willing to do. Mises contended that socialism provided no way for planners to gain the information on which to base rational economic decisions, Hayek stressed that only the rise and falling of prices emerging spontaneously in the markets of capitalism could serve as the basis for allocating resources and that socialism would come to be dominated by unthinking and dangerous bureaucrats, and Friedman became the intellectual leader in what became a growing movement to minimize the role of government in the economy as a threat to prosperity and freedom.
The message they sent is simple: There is no example of an economic system other than free market capitalism that provides both liberty and prosperity, and everywhere socialism has been tried, in whatever form, centralized or decentralized, it has degenerated into tyranny and poverty.
It is less than 20 years since the fall of the Soviet Union and it would appear that the warnings of these men about socialism and government involvement in the economy have already been forgotten. We have now embarked on a program of massive government intervention in many industries and almost complete government control of the financial sector. If the message of Mises, Hayek and Friedman is right, the course we are on cannot succeed and will set us back economically and politically for many years to come.
Posted by Doug Walker
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