What Modern Democratic Socialists Can Learn from F.A. Hayek

Democratic socialism is considered a viable alternative, a “middle way” between unrestrained capitalism and the gulags of communism for many on America’s left. Some of the most prominent contenders for the Democratic presidential nominee, including Bernie Sanders, Elizabeth Warren, and Kamala Harris, have embraced this concept, which supposedly is so very different from the old Marxist socialism that killed tens of millions in the 20th century.

"Democratic Socialism" Is an Oxymoron

“Democratic socialists” look to role models of this system around the world, like Scandinavian countries, Iceland, Germany, or literally any other country from the Old Continent. One problem with this is that, in reality, none of these paradises are actually remotely close to being socialist. However, it is better, of course, to find friendly examples for the ideology you support aside from Soviet Communism, though it seems no one has told this to Bernie Sanders, who has traveled to and praised the Soviet Union, Cuba, and Venezuela in years gone by.

That “democratic socialism” is an oxymoron that has been duly noted over the years (including here at FEE). The decisions will be in the hands of the few within some planning board or a cabinet of experts, i.e., the exact opposite of the promised democracy.A system that is based on the public ownership of property, which is the definition of socialism, will always necessitate some form of central planning of what to do with that property. This means that that the decisions will be in the hands of the few within some planning board or a cabinet of experts, i.e., the exact opposite of the democracy and self-government by the people that democratic socialists are promising.

All of this was already explained three-quarters of a century ago, which shows that the idea of democratic socialism is not even a particularly novel one. Seventy-five years ago this month, The Road to Serfdom was released for the first time in the US. It had already published a few months earlier, in April 1944, in the UK, but it was in America that Friedrich August von Hayek’s most famous work would leave its greatest mark and become a classic of the 20th century.

Socialism to Totalitarianism

In the 250-page treatise, Hayek explains how socialism naturally leads to totalitarianism over time and how there is, in fact, no third way of peaceful socialism:

Few recognize that the rise of fascism and Marxism was not a reaction against the socialist trends of the preceding period but a necessary outcome of those tendencies.

The decisive question between the capitalist and socialist systems is who is in power. In the former, a system based on private property, everyone would be in charge of his own life, his own property, and what he or she wants to do with it. Indeed, noted Hayek, even the richest man on the planet would have very little power to tell someone else what to do. In a free society based on the rule of law, he would always need to resort to non-coercive means.

The results of this system were staggering. It resulted in “the marvelous growth of science,” individuals were freer than ever to pursue their own dreams, and “by the beginning of the twentieth century the working man in the Western world had reached a degree of material comfort, security and personal independence which 100 years before had hardly seemed possible.” But as that very material comfort increased, idealists and activists turned to new goals. In social justice and equality, they found their new ends that would need to be achieved.

Good Intentions Do Not Equal Good Results

That their intentions were good—and that the intentions of the socialists of today are good—is beyond doubt. And yet, good intentions are not enough. When Hayek wrote the book, Nazism wrecked the civilized world, and he thought that, accidentally, “many who sincerely hate all of Nazism’s manifestations are working for ideals whose realization would lead straight to the abhorred tyranny.” More centralization would ultimately lead to more power for the government.

Any society that wants to stay free, any society that wants to remain democratic, needs to see freedom for the individual and the community as its highest good and as the only goal the government should endow on its people. Once the individual becomes “merely a means to serve the ends of the higher entity called society or the nation,” or social justice, “most of those features of totalitarianism which horrify us follow of necessity.” Indeed, “what is promised to us as the Road to Freedom is in fact the Highroad to Servitude.”

Surely, democratic socialists would argue that this goes too far: One tax hike here and there and one nationalization or new regulatory package from time to time won’t eventually end in despotism. And yet, it wouldn’t just stay at these smaller policies. If those radicals have set out as their goal to achieve social justice, nothing will stop them but the achievement of this new highest goal, even if material equality turns out to be no more than equal poverty for all.

As market institutions are replaced one after another with centralized decision-making by the government, the less decision-making will stay for the individual and the voluntary community. More centralization would ultimately lead to more power for the government. And while socialists are busily trying to fix all the problems they have detected, they will inadvertently and increasingly trample the freedoms of individuals. The tyranny will arrive sooner or later.

The realization of the socialist program means the destruction of freedom.

As Hayek already argued 75 years before the age of Sanders, Warren, and AOC, “democratic socialism, the great utopia of the last few generations, is simply not achievable.”