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on December 18, 2007
I first read The Fatal Conceit back in 1991, after reading Hayek's The Road to Serfdom. I reread the book in 2007 while commuting back and forth to California's state capital in my capacity as a state assemblyman. Needless to say, the book's profound critique of socialism means much more to me now as a 45-year-old lawmaker and front row eyewitness to daily attempts to incrementally enact socialism in the Golden State.

The Fatal Conceit's title captures the essence of the socialist/progressive/liberal impulse, born of a feeling of moral and intellectual superiority, to bring order to the free market, and in so ordering, destroy the very thing (capitalism), that allows modern civilization. Hayek writes of socialism in the introduction entitled "Was Socialism a Mistake?":

"...The dispute between the market order and socialism is no less than a matter of survival. To follow socialist morality would destroy much of present humankind and impoverish much of the rest.

"All of this raises an important point about which I wish to be explicit from the outset. Although I attack the presumption of reason on the part of socialists, my argument is in no way directed against reason properly used. By `reason properly used' I mean reason that recognizes its own limitations and, itself taught by reason, faces the implications of the astonishing fact, revealed by economics and biology, that order generated without design can far outstrip plans men consciously contrive..."

What a simple observation of the truth, "...order generated without design can far outstrip plans men consciously contrive..." Capitalism, spontaneously generated through centuries of human interaction, has proven the best way to conduct the economics of mankind. But socialists to try to "improve" upon something that no person invented, and, in so doing, ruin a healthy economy. Hayek admits that capitalism can look bleak to individuals who, through hard luck or laziness, can't make it - but he convincingly argues that helping the poor by enacting socialism out of a moral impulse "...would destroy much of present humankind and impoverish much of the rest."

This brings me to present day California with its burgeoning budget deficit brought on by chronic overspending on social programs twined with a tax regime regarded by The Tax Foundation as the 47th worst business tax climate in America. Very soon this system will collapse. The socialists/progressives/liberals who run the legislature are already proposing more taxes and more social welfare spending. Should California become America's tax dungeon by edging out Rhode Island to claim the worst business climate in the nation, the negative impact on the working class will dwarf all the combined intended good of every social welfare program enacted and yet conceived by the left as the paying jobs of the capitalists flee the state. Gazing at California, Hayek would surely shake his head sadly.

The Fatal Conceit should be required reading for every elected official in America, beginning with California.

Reviewer: Chuck DeVore is Vice President of Policy at the Texas Public Policy Foundation. He served in the California State Assemblyman from 2004 to 2010. Before his election, he was an executive in the aerospace industry. He was a Special Assistant for Foreign Affairs in the Department of Defense from 1986 to 1988. He is a lieutenant colonel in the U.S. Army (retired) Reserve. DeVore is the author of "The Texas Model: Prosperity in the Lone Star State and Lessons for America," the co-author of "China Attacks," and author of the novel "Twilight of the Rising Sun."
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on October 14, 2002
Friedrich von Hayek (1899-1992) was one of the twentieth century's seminal thinkers. He was an economist in the Austrian tradition and studied under Ludwig von Mises. (Although he is often grouped with von Mises, he was not the consistent libertarian that von Mises was.) THE FATAL CONCEIT was Hayek's final work, and was put together from a manuscript by the late W. W. Bartley, III (who is named as "editor" of the work.) This book is timely in that it was written at the tail end of the communist age and provided Hayek with an opportunity to reflect on the failure the socialist revolution.
As Hayek shows, the central problem with socialism is that it based on the false idea of "constructive rationalism," the belief that man can order society based purely on reason (and therefore planning). However, social progress is based in large part on tradition, or -- as Hayek describes it -- "between instinct and reason." This progress is inherently evolutionary and proceeds by slow steps. As such it integrates all the knowledge that is dispersed in society.
The theory presented in this book is a mix of liberalism and conservatism. In many ways it is the application of evolutionary theory to social though. As he daringly says: "morals, including, especially, our institutions of property, freedom and justice, are not a creation of man's reason but a distinct endowment conferred upon him by cultural evolution." This certainly won't endear him to either religious thinkers or Randian libertarians.
Hayek proceeds to discuss the benefits of private property, free enterprise and trade from this evolutionary perspective and shows socialized planning is inevitable destructive of social progress.
Hayek provides an excellent refutation of the central errors of socialism. The reader might want to compare his approach with that of von Mises in THE ANTI-CAPITALISTIC MENTALITY and PLANNED CHAOS, which covers similar territory from a somewhat different approach.
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on August 4, 2010
Most of the reviews come from those who, I'd guess, were on the right of the political spectrum well before they encountered Hayek. I read Hayek in college, and then again 40 years later, after a lifetime on the left, and have another point of view.

The term 'socialism' as used in political discourse generally begs definition, and is used carelessly rather than precisely by both sides of the debate. Consider, for instance the conflation of the manifestly wildly disparate New Deal and Soviet Communism. Those supporting the New Deal, which preserved democracy and capitalism during economic catastrophe with government intervention, too often had a wistful, credulous view of the Soviet Union. The right extended a realistic view of Soviet tyranny to define even the mildly US left as not merely mistaken, but advocates of tyranny and treason. Hayek is more precise. He views socialism as any government interference in the free market, and argues that, at whatever level it is conducted and imposed, the results are for the worse. He states that the plight of those in need, while acknowledging its reality, is poorly, if at all, mitigated by dirigiste government action, if not worsened and perpetuated. His arguments are logical, historically informed and presented in clear prose that's a delight to read.

My differences with him begin with his acceptance of the necessity of government protection of private property and of citizens against violence. I'd argue that unregulated capitalism, much as unrestricted government, can result in appropriation of property by the strong at the expense of the weak, and that there are many forms of violence, many of which are characteristic of unrestricted business activity. The proper role of government in economic life, therefore, becomes a matter of debate, rather than an a priori rejection. He, too, doesn't consider the negative externalities consequent to many economic decisions in free-market environments, the costs of which are oft borne by others--too, perhaps, a form of theft--and that bringing those externalities into economic decision is not only a reasonable sphere of government activity, but even in service of a free market approach, in that the real costs of the decisions become part of them.

Hayek is essential reading for a lefty. He requires engagement on a level other than simple dismissal; he doesn't merely call names or indulge in superficial, supercilious rhetoric. Amongst other things, exposure to his thought tempered my youthful confidence in government dirigism as the only just and practical response to human need, and my prejudice that government always works more effectively and more to the good of the people than does capitalism. I don't go along with his entire corpus. But lefties, as well as those on the right, have much to learn from Hayek, and ignore him at their peril.
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on January 11, 2009
I was hesitant to purchase this book because the title led me to believe that this was just a rehash of The Road To Serfdom. Instead, it turns out to be a philosophical work that in my opinion would be more accurately titled The Extended Order as opposed to The Fatal Conceit.

The book mostly deals with the concept of the extended order, which is basically the idea that in addition to our genes, our morals and politics come from an evolutionary process which is much too complicated to be intentially created by the human mind. This is an epistemological view that argues against the idea of system building in both morals and politics (specifically socialism which seems to be broadly defined as any top-down political and moral construction).

I would have liked to see the concept of the extended order flushed out into a more concrete moral and political philosophy, but this has been done (at least the political) in his earlier writings (Constitution of Liberty among others). Because of this, I'm not sure this book has as broad an appeal as some of his earlier classics, but as a Hayek fan who likes philosophy, I thoroughly enjoyed the book.
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on September 13, 2003
_The Fatal Conceit_ written by economist F. A. Hayek is a firm rejection of economic planning and socialism in favor of classical liberalism and private ownership of "several property" from an agnostic evolutionary perspective. Hayek argues that morality cannot be founded based upon reason alone but that its foundation must be found within the traditional structures that make up society. He argues this from an evolutionary perspective claiming that morality has evolved and therefore been selected for and therefore that it is naive of us to believe that through reason alone we can determine what is ethical. This is in agreement with a religious perspective that would claim that the morality-bearing tradition has been handed down to man from a source which involved an encounter with the Divine (of course, the religious perspective would deny evolution but would arrive at the same conclusion based upon revelation). Hayek, himself an agnostic, discusses these issues in his book and shows how religion can serve as a guardian of tradition. One specific tradition that exists within Western culture is that of private ownership of "several property". Hayek argues that socialism rests on a conceit and is often rooted in an irrational longing for a primitive time (primitivism). Hayek shows how many philosophers and economists including Aristotle, Thomas Aquinas ("the just wage theory"), Karl Marx, Keynes, and Einstein advocated some form of socialism and shows the errors in various aspects of their thinking. Hayek is particularly harsh to Keynes who spoke against the traditional value assigned to saving money, which Hayek feels is absurd. Hayek then shows how socialism is presented as a trade-off; however, involved in this trade-off is the substantial loss of liberty, a value all people should hold dear. Hayek demonstrates how language itself has become infested with words which take on socialistic meanings, and Hayek shows that the very word "liberal" has come to mean the exact opposite of its original intention, i.e. a lover of liberty. Hayek roundly refutes the Malthusian theory of population growth and argues against the over-population scare which is used by the Club of Rome to advance their population control agenda. Hayek shows that in regions which become industrialized and modernized the population growth decreases. This means as more and more regions trade in their premodern existence for an industrialized one the population growth in these regions will go down. The final chapter concludes with a discussion of the role of religion in preserving the traditional system of morality and Hayek's own agnostic philosophy. Hayek argues that it is naive of some to view religion as a conspiracy of the priestly caste to maintain their power, and he shows the value that religious beliefs may have. While I agree with this assessment in Hayek's discussion of religion, I disagree with his agnosticism and failure to recognize a personalized God. Hayek ends with several appendices which discuss various other approaches to economic liberty. In sum this book presents an excellent refutation of the "socialist superstition" which continues to haunt the minds of the intellectual elite to this day.
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on January 9, 1997
This soberly written book by a Nobel Laureate economist is a summary of the author's thoughts on socialism, knowledge in society, and the evolution of society and what he calls the "extended order" (roughly the interconnected system of transactions that make up the economy). The main argument about cultural evolution is more tantalizingly interesting than conclusively thought out, but anybody interested in history, sociology, economics, politics or even evolution and ethnic differences in modern societies should find fascinating ideas here. My personal opinion is that the work can be fruitfully coupled with several of Thomas Sowell's books, but I'm sure other people will have other perspectives on the work just as interesting.

As for economics, the book works out the calculation argument against socialism, an economic argument that to people who have read austrian economics is perhaps the most impressive and thorough argument against communism or socialism ever articulated. If one supports socialist ideals, which Hayek, the author, did in his youth, one should really take this argument into serious consideration. It claims, a claim central to the evolutionary thesis, that socialism as such is simply a misguided attempt to correct a misunderstood system (the market economy) that solves problems (allocation of goods, coordination of economic activites etc.) unsolvable by any other means. Stimulating, original and well written, the book is strongly recommended.
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on May 12, 1998
This is a must-read for anyone interested in what mysterious forces are fueling our world.In his last book, The Fatal Conceit: The Errors of Socialism, published in 1988 (ironically, one year prior to fall of the Berlin Wall) , Hayek shoots one final poison arrow into the heart of socialist thought. Capitalism, or , what he prefers to call it, the spontaneous extended order of human cooperation , is to Hayek the liberator of humanity. He pits the advocates of the spontaneous extended order created by a competitive market against advocates who demand a deliberate arrangement of human interaction by central authority based on collective demand over available resources. (page 7) The "fatal conceit", which the title refers to, is the idea that the ability to acquire skills stems from reason. (page 21) Imitation and not insight or reason guide the spectrum of human nature and potential. Hayek's logic stems from his adherence to David Hume's conclusion that ' the rules of morality ... are not the conclusions of our reason. To Hayek and Hume, our morals were not the descendants of our human powers of reason. On the contrary, learning through imitation is considered the progenitor's of our insight, reason and understanding. (page 21) Our morals, Hayek believes, were naturally selected from pitting one tribe with one set of morals and behaviors against another with less beneficial Morals and behaviors. Only those tribes with the best morals, behaviors, and habits survived in nature. These survivors passed on their advantageous morals to the next generation through the children imitating their traditions. Our descendants did not consciously choose their morals, or fully appreciate or comprehend their benefits. Nature took care of selecting our morals for us.
Hayek's views on four key issues help elucidate some reasons why there is such a strong movement toward economic liberalization among many industrialized and even non-industrialized nations: the role of the state, government regulation, the ! function of the free markets, the problem of social cooperation, and the meaning of liberty and equality. I will also compare Hayek's views with Robert Heilbroner's central themes in his book "21st Century Capitalism." A better understanding of these issues help us better understand the era we are living in.
The Role of the State & Government Regulation
The major role of the state in Hayek's world was to protect the rights of its citizens from infringement:
"Governments strong enough to protect individuals against the violence of their fellows make possible the evolution of an increasingly complex order of spontaneous and voluntary cooperation" ( page 32) Such a complex order of spontaneous and voluntary cooperation is the mark of trade and capitalist beginnings. Hayek believed that since history only retains records of the activities of governments we are mislead to think that it was in the arena of government and not markets that the destinies of humanity lied. So we have mistakenly fallen under the impression that a powerful state is the hallmark of a successful, and prosperous extended order of cooperation. "The powerful
state is not the culmination of cultural evolution ; it as often marked its end." (page 33) Examples from history of powerful states extinguishing the light of voluntary cooperation include ancient imperial China, the Roman empire, and the Meso-American empires. Powerful governments are not conducive to spontaneous improvement. He believes that "sooner or later governments tend to suppress the freedoms they had earlier secured in order to enforce their own presumably greater wisdom and not allow 'social institutions to develop in a haphazard manner'." ( page 32) It is only the protection of private property, not any direction of its use by government, that provides the soil for the extended order to blossom in:
". . . No advanced civilization has yet developed without a government which saw it's chief aim in the protection of ! private property." (page 32)
Without such protection, meted out by judicial, police and military force, the prerequisite morals ( honesty, for example) of the extended order would cease to exist. The evolution of such "individualist laws" aim through time to make increasingly possible the existence of voluntary associations without I compulsory powers.' Such an evolution of rules, however, must, like the chaotic extended order it seeks to support, be a spontaneous one . ( page 37) Without an acceptance of an individual's right to dispose over a recognized private domain the dense network of commercial relations among different communities' would not develop. The prerequisite for the existence of such "property, freedom, and order, is the same: law in the sense of abstract rules enabling any individual to ascertain at any time who is entitled to dispose over any particular thing." ( page 29)
Hayek's role of government is of supreme importance precisely because it is a prerequisite to any further evolution of the extended order. The extended order cannot develop without the protection granted by government over private domain. Such an important role should never be seen as limited. But thinkers of all stripes call for more government regulation and a larger government role in society. Hayek would argue that any larger role, especially if called for by socialists , would lean towards those needs which our instincts and sentimental yearnings demand. He believes that such instincts and yearnings stem from the micro-cosmos of the tribe or even the family. This realm of the micro-cosmos is run by 'unmodified, uncurbed' rules which if ever applied to the macro-cosmos (or outer civilization) would destroy the extended order. (page 18)
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on July 5, 2005
Hayek is an amazing thinker, a dense writer and a rewarding read. Though the book is less than 150 pages, Hayek manages to make a fully thought out argument, reasoning that the complexity of the society that we live in is not fully comprehended, predictable or explainable. Hayek believes that our culture has evolved in such a way that the root causes of our interactions benefit us, but the underlying reasons have been lost throughout the generations.

Economics and sociology are virtually the same science as both are built around the interactions of people within a larger system (both stem from a system of thought called praxiology). The difference is that economics is focused on the interchange between people that effects monetary systems. Economics can not be separated from sociology, nor the other way around.

Because of this lack of understanding of our society as a whole, he argues that it is impossible for bureaucrats in their marbelized hallways to plan an economy for an entire nation. After all, he argues, who are these great minds that possibly plan out in detail the needs for a changing society?

Hayek uses the term "Rational Constructivism" to define the attempt to use reason to construct a society. He argues that this is impossible in what he calls "the extended order" - a large market economy where people interact in a non-direct way. For example, we interact with the makers of electronics, but we never meet them or speak to them directly. Our only interaction is by purchasing the products that they produce. The interaction within an extended order is unpredictable or unknowable to us, thereby discrediting the notion a person or group of people who can plan an economy exist.
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on March 3, 2008
Hayek argues brilliantly that primitive man was never free in the classical liberal sense of the term (and not even in the anarchist sense), but always collectivist (tribal). He could not have survived otherwise. He goes on to argue that man had developed instincts that facilitated the successful coordination of small groups. We see it today in extended families, characteristics that we know as altruism and group solidarity. However, modern civilization is not a tribal organization that can survive on these instinctual drives. Hayek used the term "the extended order of human cooperation" to distinguish man's modern civilization from his primitive existence in the tribal setting.

Hayek emphasizes that what truly differentiates man from animals is not our biology, but our traditions. We became man late in the game, not primarily through biological evolution, but through cultural evolution. The selection of traditions enabled the advancement of some groups over others allowing for their expansion. On this evolutionary process Hayek wrote: "We did not select these traditions; rather, they selected us."

Socialists are generally hostile to traditions in favor of embracing their instinctual drives toward altruism and group solidarity. But these qualities cannot sustain the extended order of human cooperation that developed, and is maintained, through the market process, itself protected by our adherence to the traditions of private property, trade, honesty, contract, saving, and rule of law.
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on July 17, 2000
Simply one of the most important books of our historical era.
_The Road to Serfdom_ and _The Fatal Conceit_ were the bookends of Hayek's career.
_The Road To Serfdom_ roughly started Hayek's fame and was the first word spoken (along with pioneers like Popper) against this "century of the state".
_The Fatal Conceit_ roughly concluded Hayek's career and long life, and stands as a fairly magnificent beacon at the end of the abject failure of the 50 year experiment in collectivism and plannerism, the end of the 100 million+ slaughter caused by socialism in our century, and indeed the final success of the "Austrian School" of economics and the tremendous prosperity we all now enjoy due to it (including handy features such as
Hopefully this beacon, this book, will shine for many centuries before it is forgotten and, once again, civilization slips away for awhile for another experiment in collectivism and planner-ism.
Just a superb book of macrohistorical importance, magnificently written; every chapter seems more important than ever (such as the warnings on "junk science" and the corruption of language).
It is the primary beacon marking the end of the "great socialist experiment disaster" of our century, written by the man who saw it coming, had to sit through it, and wrote the cure.
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