Hayek on health care, social safety nets and public housing



I am often asked about Hayek's views on universal health care and other elements of state-provided social security. This puzzles me because Hayek wrote about these topics without ambiguity in his best known and best selling work, The Road to Serfdom
    I therefore reproduce the following passage, taken from The Road to Serfdom, Text and Documents, The Definitive Edition, by F. A. Hayek, edited by Bruce Caldwell, University of Chicago Press, 2007

I commend everyone -- not least those who claim to be Hayekians -- to read the master's own words. Indeed, I urge you to read the whole book, not merely the abridged and re-interpreted and too often mistaken accounts of this most important contribution to today's political and economic debate.

The Road to Serfdom, pp 148-149 
“There is no reason why in a society which has reached the general level of wealth which ours has attained [NW note: Hayek was writing not in prosperous post-war America, but in war-torn, austerity-ridden Britain in 1943] the first kind of security should not be guaranteed to all without endangering general freedom. .... [T]here can be no doubt that some minimum of food, shelter, and clothing, sufficient to preserve health and the capacity to work, can be assured to everybody. ... Nor is there any reason why the state should not assist the individual in providing for those common hazards of life against which, because of their uncertainty, few individuals can make adequate provision. 
    "Where, as in the case of sickness and accident, neither the desire to avoid such calamities nor the efforts to overcome their consequences are as a rule weakened by the provision of assistance – where, in short, we deal with genuinely insurable risks – the case for the state’s helping to organize a comprehensive system of social insurance is very strong. There are many points of detail where those wishing to preserve the competitive system and those wishing to super-cede it by something different will disagree on the details of such schemes; and it is possible under the name of social insurance to introduce measures which tend to make competition more or less ineffective. But there is no incompatability in principle between the state’s providing greater security in this way and the preservation of individual freedom. 
    "To the same category belongs also the increase of security through the state’s rendering assistance to the victims of such ‘acts of God’ as earthquakes and floods. Wherever communal action can mitigate disasters against which the individual can neither attempt to guard himself nor make provision for the consequences, such communal action should undoubtedly be taken.

            “There is, finally, the supremely important problem of combating general fluctuations of economic activity and the recurrent waves of large-scale unemployment which accompany them.  This is, of course, one of the gravest and most pressing problems of our time.  But, though its solution will require much planning in the good sense, it does not — or at least need not — require that special kind of planning which according to its advocates is to replace the market.  

    "Many economists hope, indeed, that the ultimate remedy may be found in the field of monetary policy, which would involve nothing incompatible even with nineteenth-century liberalism.  Others, it is true, believe that real success can be expected only from the skillful timing of public works undertaken on a very large scale.  This might lead to much more serious restrictions of the competitive sphere, and, in experimenting in this direction, we shall have to carefully watch our step if we are to avoid making all economic activity progressively more dependent on the direction and volume of government expenditure.  But this is neither the only nor, in my opinion, the most promising way of meeting the gravest threat to economic security.  

    "In any case, the very necessary effort to secure protection against these fluctuations do not lead to the kind of planning which constitutes such a threat to our freedom.”

To read extracts from Keynes Hayek, click HERE



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