Quotation of the Day…

by Don Boudreaux on February 23, 2014

in Complexity & Emergence, Hayek, Hubris and humility, Man of System

… is from page 183 of F.A. Hayek’s 1938 essay “Freedom and the Economic System,” which is reprinted as chapter eight of the 1997 collection, edited by Bruce Caldwell, Socialism and War:

[Government planning of an economy] always involves a sacrifice of some ends in favour of others, a balancing of costs and results, and this presupposes a complete ranging of the different ends in the order of their importance.  To agree on a particular plan requires much more than agreement on some general ethical rule; it requires much more than general adherence to any of the ethical codes which have ever existed; it requires that sort of complete quantitative scale of values which manifests itself in the actual decisions of every individual but on which, in an individualist society, agreement is neither necessary nor present.

This point is profound and of the highest importance.  One question about it is this: when does it kick in?  Does the point that Hayek makes here kick in – become relevant – only when government attempts literally to centrally plan an entire economy in the way fancied by many socialists up through the first half of the 20th century?  Or does it kick in whenever government attempts any overriding of individual choices for collective ends (say, in raising taxes to build a municipal park)?  If not the latter or only the former, when?

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