Book Reviews

Leube, both of whom are former stu dents of Hayek, had to winnow through essays, occasional papers, books, speeches and polemical ex ercises that are numbered literally in the hundreds. Hayek has spent a long working lifetime in pushing his investiga tions into many fields outside of for mal economics. He has been an epistemologist, a student of law, a 634 theorist of government, a student of science, an historian and, finally, a psychologist. In giving us relevant samples of all the many Hayeks, Nishiyama and Leube have exercised excellent judg ment. The book jacket copy, ob viously written by someone who knows what Hayek is all about, speaks of the "two fundamental ideas-the limitation of knowledge and the spontaneous formation of systems"-that unify Hayek's work. Individuals, as Hayek says, can't know everything, but the market can be trusted to coordinate a thou sand subjective valuations in a price.

Thus "spontaneity" is regulated without the coercion that people, as individuals, can never stomach for very long. As Campbell points out, one of Hayek's earliest interests was psy chology. Indeed, Hayek once debated THE ESSENCE OF HAYEK 635 the idea of becoming a professional in that field. Since Austrian eco nomics, as developed by Carl Men ger, Eugen Bohm-Bawerk and Lud wig von Mises, eschews "macro economic" preoccupation with sta tistical aggregates and concentrates on the subjective nature of individ ual choice, Hayek managed to find plenty of room for the contemplation of human vagaries even within the so-called dismal science. The Human Nature It was knowledge of human nature that made Hayek's The Road to Serf dom, written in wartime England, the great book that it was and is. John Maynard Keynes, Hayek's friendly enemy in the cloisters of Cambridge, had assumed that indi viduals could be handled in the mass by a dedicated bureaucracy once a group consensus could be estab lished. In wartime, with an enemy at the gates, this can be done. But what is possible in a war crisis is not possible in times of peace. Human nature will out. Individuals have thousands of varying desires of their own, and they make their separate plans accordingly. If a master plan ner presumes to thwart them, re sentments will multiply to the breaking point. The central plan ners, to carry out their assumed mis sion will feel constrained to bring in the strong-arm boys to knock recal citrants into line. So the "worst"

must eventually get on top. A planned society is not possible with out a bureaucracy of thugs. Orwell had not yet written 1984 when Hayek presented his analysis of sta tist controls to Keynes, who, in praising The Road to Serfdom as a "grand" book, uttered a feeble pro test that people ought to respect the judgment of a disinterested elite. To Hayek, words have conse quences. Most idea people-the "scribblers" who, in Keynes's the ory, have usually to wait a genera tion to see their doctrines picked up are not normally action-oriented. But Hayek, in addition to being a scribbler, has also been a great "doer." Where would England's Margaret Thatcher be today if An tony Fisher, a British RAF pilot who made some money as a chicken farmer by outguessing the control lers, hadn't gone to Hayek to seek advice about a possible career in pol itics? John B. Wood, in a book called The Emerging Consensus put out by the Institute of Economic Affairs in London, gives us an anecdotal re cital of how Fisher's visit to Hayek in 1945 resulted in the "spontaneous formation of systems."

Hayek told Fisher to play politics at one remove, urging him to use his money and influence to change the climate of opinion in an England that needed a whole new line of thought. Taking Hayek with high seriousness, Fisher decided to set up 636 THE FREEMAN October a research organization in London. He found his director in the ener getic Ralph Harris, who doubled as secretary and, later, as president of the Mont Pelerin Society, which had also come into being to advance the freedom philosophy because of the word spread by Hayek. The pam phlets, books and research material put out by Ralph Harris's Institute of Economic Affairs played a great part in the education of Margaret Thatcher, who acknowledged it by making Harris a member of the House of Lords. Changing Opinion John Wood says the Fisher-Harris lEA is a "good illustration of the so cial philosophy with which it is now identified, namely, that most crea tive developments in society result from harnessing the spontaneous forces generated by individuals."

The words could be adapted to de scribe Leonard Read's FEE in Amer ica. Tony Fisher has more recently been exercising his spontaneity by starting new research institutions in cities around the world. One ofthem, the Fraser Institute of Vancouver, has been credited with killing rent controls in Canada and helping to send a conservative majority to the capital in Ottawa. As a "doer," Hayek was responsi ble for a notable Mont Pelerin meet ing that was devoted to exploding the myth that the industrial revolution in Britain has impoverished two or three generations of British work ers. Hayek's contributory essay, "History and Politics," reprinted in The Essence of Hayek, is a most ef fective refutation of the notion, spread by Marx and Engels, that a steady proliferation of the tools available to workers can only result in their degradation as the capital ists seize the product. The industrial revolution enabled many more peo ple to come to birth in England, and to achieve steadily improving stan dards of living.

Hayek, in another notable essay reprinted here, insists that he is an "Old Whig," not a conservative. One of the traits of the conservative at titude, he says, "is a fear of change, a timid distrust of the new as such." If Hayek is speaking of some of the Tories who make things difficult for Margaret Thatcher, he is, of course, correct. But the term "Whig" would never be understood in America, where the Whigs in nineteenth cen tury history were the supporters of government largesse. Hayek is fearful of the political fu ture as long as "the ordinary rep resentative cannot say 'no' to any large number of his constituents, however unjust their demands, and still hope to retain his seat." Hayek wrote these words in 1976. They still hold in 1985. But Reagan has read Hayek, and that, conceivably, could make a difference. We shall see. ® 1985 OTHER BOOKS 637 MARXISM: PHILOSOPHY AND ECONOMICS by Thomas Sowell (William Morrow and Company, Inc., 105 Madison Ave., New York, NY 10016), 1985 281 pages _ $15.95 cloth Reviewed by Kenneth L. Marcus THOSE who would defend freedom against its opposites must avoid the pat generalizations and hackneyed misconceptions that have colored both apologies for and attacks upon the work of Karl Marx and Friedrich Engels. In his slim, tightly woven but thorough exposition, Thomas Sowell cuts through the labyrin thine rhetoric of Marx and Engels to provide a scholarly but concise and accessible interpretation of Marxian theory.

Reserving criticism for his final chapter, Dr. Sowell simply and sys tematically presents the philosophy, economics, historical theory and po litical strategy of Marxism. He em phasizes that Marx must be under stood in terms of his dialectics, thus avoiding the pitfalls of earlier analysts. Dialectics refers to the process by which things change and develop. "What Marxian theory derived from Hegel," Sowell tells us, "was that the way to understand the world was not to see it as a collection of things but as an evolving process. An acorn or a caterpillar could not be understood as a fixed and isolated thing, with out seeing that it was a transitory stage of an ongoing process that would eventually turn one into an oak tree and the other into a butterfly." Marx was essentially interested in human development and wanted to establish the social environment where human beings might best re alize their potential. Under the "ex ploitative" conditions of capitalism and the division of labor, Marx claimed, people can develop them selves only partially. Standing all day in a factory and working in front of a machine does not encourage a person to develop and express his or her personal creativity.

Marx's theory of history tries to explain the transformations of whole societies. Changing technologies bring changes in economic relation ships and ultimately in political structures and ideologies. Society is not completely determined by its modes of production, but economic development provides the tenden cies which society will follow. Capitalism is viewed as a neces sary stage in socio-economic devel opment, but one which will eventu ally be "negated" or replaced. It offered wider potentialities for man kind than earlier systems and pro vided a rapid increase in production, but it leads to continual, periodic 638 THE FREEMAN October crises which will ultimately hasten its development into a higher form of society. The form the revolutionary move ment would take was seen by Marx and Engels as crucial to the devel opment of the post-revolutionary so ciety. A democratic regime would be possible only if the bourgeois rule were overthrown by a mass move ment of workers, but a small con spiracy of professional revolution aries would imply dictatorial rule after the revolution.

Dr. Sowell sees the modern prac tice of communism as being, in a sense, a betrayal of Marx's thought, but not one which should have been wholly unpredictable. For one thing, Marxism is, in Sowell's words, "a mighty instrument for the acquisi tion and maintenance of political power." And it is not entirely clear whether Marx himself would not have committed the atrocities of a Joseph Stalin or a Pol Pot. Nevertheless, Dr. Sowell, who himself now holds a distinctly free market outlook, remembers the at traction which Marxist doctrine once held for him and continues to hold for countless students and intellec tuals. He tells us, "What Marx ac complished was to produce such a comprehensive, dramatic, and fas cinating vision that it could with stand innumerable empirical con tradictions, logical refutations and moral revulsions at its effects." Dr. Sowell, too, is dramatic and comprehensive, and his book is clearly written and devoid of jar gon. It is ideally suited as an intro duction to Marxism, but it delves deeply enough to recommend itself to more learned scholars. The last chapter spells out the tragic flaws in Marx's reasoning and is especially worth reading. Dr. Sowell has pro vided a valuable work which will en able us to base our acceptance of free enterprise and our rejection of com munism on careful study and deliberation. ® THE ESSENTIAL ROYSTER: A VERMONT ROYSTER READER selected by Edmund Fuller (Algonquin Books of Chapel Hill, P.O.

Box 2225, Chapel Hill, NC 27515), 1985 345 pages • $18.95 Reviewed by Robert M. Thornton REVIEWING this collection of essays and lectures is difficult because Royster-former editor of The Wall Street Journal-writes wisely and el oquently on so many subjects George Washington and Martin Lu ther, our duty to posterity and re spect for the Constitution, foreign policy and the military, inflation and the State, politics and politicians (from FDR to RR), public morality and education, modern technology and the Promethean Gift, criminal 1985 OTHER BOOKS 639 trials and the use of words. His "purely personal" columns on mar riage, grandchildren and the cele bration of anniversaries are a de light-touching but not cloying, filled with sentiment but not sentimental. Let me dwell briefly on what Roy ster says about journalism, his own field of endeavor for fifty years and an increasingly controversial sub ject during the past decade or two.

Our Founding Fathers believed in the revolutionary idea of freedom of the press. They would be surprised, however, and perhaps disturbed by "what has evolved in the succeeding two centuries from their views of what constitutes freedom of the press." Certainly "they did not en vision a press of very nearly unre strained license." Royster quotes Blackstone: "The liberty of the press is indeed essen tial to the nature of a free state; but this consists in laying no previous re straint upon publications, and not in freedom from censure for criminal matter when published. Every free man has an undoubted right to lay what sentiments he pleases before the public: to forbid this is to destroy the freedom of the press; but if he publishes what is improper, mischie vous or illegal, he must take the con sequences of his own temerity." There, declares Royster, "is the whole of the law and the philosophy of the press as it appeared to Englishmen of the eighteenth century, including our own revolutionists."

Royster believes the American press occupies a unique position to day and by the word press he refers not just to "the newspapers of mass circulation but to the whole of the press in all its multiplicity and di versity." This "American press," he writes, "can publish what it will. It can seize upon secrets stolen from government archives and broadcast them to the world. It can strip the privacy of councils and grand juries, it can pillory those accused of crimes before they are tried. It can heap cal umnies not only upon elected gov ernors but upon all whom chance has made an object of public attention. It can publish the lascivious and the sadistic. It can advance any opinion on any subject, including the opinion that all our government is corrupt and that the whole ofthe social order proclaimed in 1776 should be swept away and another put in its place." Royster believes that "freedom of the press is not some immutable right handed down to Moses on Mt.

Sinai. It is a political right granted by the people, in a political docu ment, and what the people grant they can, if they choose, take away." Beca use he cherishes the precious right of free speech, Royster warns his fellow journalists not to abuse it because "there is no liberty that can not be abused and none that cannot be lost." (t College division: 1985-1986FREEDOMESSAY CONTEST for high school and college students Write now for guidelines and information! Ideas determine the course of human freedom. Here is an opportunity for students to express their own ideas on liberty in FEE's essay contest, Foundations of a Free Society. Essays should present the positive case for individual responsibility and choice ina free economy. First prize essays will be published in The Freeman. Award winners and runners-up will receive fellowships for a FEE seminar. Cash awards will be made as follows: First Prize-$2000 Second Prize-$1000 High school division: First Prize-$1000 Second Prize-$500 Teachers and professors instrumental in the submission of recognized essays will receive a $100 award.

The deadline is January 15, 1986. Please write: Freedom Essay Contest The Foundation for Economic Education Irvington-on-Hudson, New York 10533 the Freeman VOL. 35, NO. 11 • NOVEMBER 1985 For a Moral RevolutionA Page on Freedom, No. 25 To relieve the crisis confronting us. Spruille Braden 643 America's Two Elites Kenneth McDonald 644 The elite that produces versus the elite that controls. Living in Two Chinas Dean Russell 648 The prospect for peace between Taiwan and the mainland. Interventionist Liberalism and the Fast Lane The new liberalism lacks staying power. Charles R. La Dow 655 Should American Business Give Up Smoking? Gary North 658 Involving consumer preference and freedom to trade. Classical Liberalism Reconsidered A Symposium 667 Comments upon the republication of Ludwig von Mises' Liberalism. Declarative Law Joseph S. Fulda 684 Let the law describe responsibilities rather than command action.