Running head: THE ROAD OF SERFDOM SUMMARY

The Road of Serfdom Summary

Anibal Vera Tudela
ECO 365
August 13, 2012
Gustavo E. Morles

THE ROAD OF SERFDOM SUMMARY

The Road of Serfdom Summary

The Road to Serfdom shows Frederic Hayek's thinking on totalitarian systems and how
they can influence democratic systems making them totalitarian systems. Visualize also how it
affects economic systems skewing the freedom to generate wealth and hence employment. The
author places the text in Nazi Germany in an oppressive environment conducted by the Social
Nationalist and explains in detail the services that can be protected from incurring totalitarian
systems (Hayek, 2001).
The author begins his text with an accurate criticism of socialism and how this system
centralizes power in the state regulating the activities of the individual and thus suppressing their
freedoms. Socialism by Karl Marx is the shift of power towards the working class because he
believes that capitalism uses economic freedom but only to benefit the rich (Marx, 1887). Hayek
analyzes the distribution of economic power on the grounds that capitalism, by giving economic
power to the private sector does give freedom to every individual, in contrast, socialism tends to
suppress these liberties under state control.
Hayek shows as an argument to the middle Ages known as Dark Ages, where the
economy depended on the feudal lords who controlled the economic activities and those who
decided and submitted to the people within his fief to their rules of imposition. Hayek, however,
been a reference to Christianity and indicates that with this individualism began to gain ground
against the feudal imposition. In this regard, Hamilton indicated that religion was an instrument
used to achieve the feudal lords to impose their wishes on the population (Hamilton, 2003).
Hayek also includes as a factor of suppression of freedom to planning at first by
socialism and national socialist regimes and later by capitalist nations like the United Kingdom
and the United States. Hayek criticized because it considers the planning of manipulation of the

THE ROAD OF SERFDOM SUMMARY

individual and therefore suppresses their freedom so necessary to achieve economic

development. Von Brabant shows an example of planned economies to countries that still have
fundamentalist socialist systems or totalitarian governments like Cuba or Saudi Arabia (von
Brabant, 1991).
The author navigates the concepts of economic liberalism, laissez-faire French term
coined which means letting go and offers the choice between planning and monitoring of laws,
indicates that while the former suppress freedoms the second sets the stage to act freely, suggests
that individuals need laws that allow only their development with freedom.
Hayek puts into consideration the current policies of capitalist countries like the United
States who considered fascist by the way they control the country's economy through
government intervention and planning which would prevent the free development of individuals
and generating potential crises and errors such as those generated with socialism to the point of
losing the individual character of capitalism.
Hayek proposes the creation of a new world starting over from the individual liberty of
the people creating the conditions for individual progress and not to planned progress. Hayek
also raises the creation of a new order that does not mean the continuation of previous years
imitating tyrants like Hitler or Castro, but that includes a free world with policies based on
freedom.

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4
References

Hamilton, B. (2003). Religion in the Medieval West (2nd ed.). London, United Kingdom: Arnold.
Hayek, F. (2001). The Road To Serfdom. Occasional Papers (April 1943 Readers Digest
Condensed Edition.). Retrieved from
http://www.iea.org.uk/sites/default/files/publications/files/upldbook351pdf.pdf
Marx, K. (1887). Capital, A Critique of Political Economy, Translated: Samuel Moore and
Edward Aveling, edited by Frederick Engels (4th ed.). Moscow, Russia: Progress
Publishers.
von Brabant, J. M. (1991). The Planned Economies and International Economic Organizations
(Rev ed.). Cambridge, United Kingdom: Cambridge University Press.