The Fatal Conceit
By F.A. Hayek
Synopsis: This book was written in the twilight of Nobel Prize-winning economist Friedrich A. Hayek’s life, and it represents his criticism of socialism. His main critique is that the system of socialism requires a departure from the very concepts that have made the greatness of our civilization possible. Our civilization, Hayek says, was built upon traditions that have solidified rules such as private property rights, contract, trade, family values, etc. Socialism’s departure from these building blocks would only bring destruction, and not improvement, of the extended order of civilization that man has achieved.
Strong Points: This book lays out a very interesting, and foundational, argument against the validity and feasibility of socialism. The main idea, that the departure from traditional values which lead to successful societies is the great failure of socialism, is present throughout the book. But other elements are touched on, such as the idea that no planning body is capable of assimilating all of the necessary information requisite to make decisions for an economy; that it takes individuals, acting in their own capacities with their own knowledge and skills being applied to their particular circumstances in order to make optimal decisions. While meandering, the book does provide a staggering challenge to the efficacy of socialism. If a person makes an honest reading of this book, they would be compelled to agree that the task of socialism is an impossible one and its problems insurmountable. Also, in one of the appendices is found an interesting critique of John Stuart Mill as having ideas that contributed to the false notions accepted in socialism. (This provides interesting insight into the reason that Brigham Young may have had for having a distaste for J.S. Mill.)
Weak Points: A major flaw in the book was Hayek’s uncritical and out-of-hand acceptance of evolution theory as a foundation for his work, and he kept referring back to it throughout. While the conclusions he reached were nonetheless correct, his underlying premises were fallacious: the idea that man evolved and along with that, slowly, his values system formed by long processes of trial and error to establish the successful formula. Believers in Christ, however, know that man was given his value system explicitly in the beginning (called commandments), and that his conscience is a Divinely-designed aid in following correct values. Throughout the book, evolution theory is used as a conceptual basis for the development of behaviors and traditions that become necessary to have a successful civilization and market economy. But if one takes these concepts and thinks of them in terms of the spirit overcoming the natural man, and keeping the commandments of God as leading to these successes, then the basic idea is preserved, and becomes an interesting observation. Hayek is correct that proper behavior is necessary for civilization – this thesis, incidentally, is corroborated by the message of the Book of Mormon. He is merely incorrect in how that behavior came to be. Another bothersome thing was that foreign language quotes featured at the beginning of chapters were sometimes not translated.
Interesting: 2.9/5
Must Read: 3/5
Overall: 3/5
Pages: 180
Selected Quote: “The main point of my argument is, then, that the conflict between, on one hand, advocates of the spontaneous extended human order created by a competitive market, and on the other hand, those who demand a deliberate arrangement of human interaction by central authority based on collective command over available resources is due to a factual error by the latter about how knowledge of these resources is and can be generated and utilised. As a question of fact, this conflict must be settled by scientific study. Such study shows that, by following the spontaneously generated moral traditions underlying the competitive market order (traditions which do not satisfy the canons or norms of rationality embraced by most socialists), we generate and garner greater knowledge and wealth than could ever be obtained or utilised in a centrally-directed economy whose adherents claim to proceed strictly in accordance with ‘reason’. Thus socialist aims and programmes are factually impossible to achieve or execute; and they also happen, into the bargain as it were, to be logically impossible.
“This is why, contrary to what is often maintained, these matters are not merely ones of differing interests or value judgments. Indeed, the question of how men came to adopt certain values or norms, and what effect these had on the evolution of their civilisation, is itself above all a factual one, one that lies at the heart of the present book, and whose answer is sketched in its first three chapters. The demands of socialism are not moral conclusions derived from the traditions that formed the extended order that made civilisation possible. Rather, they endeavor to overthrow these traditions by a rationally designed moral system whose appeal depends on the instinctual appeal of its promised consequences. They assume that, since people had been able to generate some system of rules coordinating their efforts, they must also be able to design an even better and more gratifying system. But if humankind owes its very existence to one particular rule-guided form of conduct of proven effectiveness, it simply does not have the option of choosing another merely for the sake of the apparent pleasantness of its immediately visible effects. The dispute between the market order and socialism is no less than a matter of survival. To follow socialist morality would destroy much of present humankind and impoverish much of the rest.” (p. 7).