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I

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the fall of the Berlin Wall in 1989

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and the rapid collapse of communist
regimes throughout Eastern Europe and

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the former Soviet Union

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surprise most Western scholars

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and soviet experts for some however

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it confirmed what they had suspected all
along

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that communism was a vision of society

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ultimately doomed to failure one thinker
in particular had spent a lifetime

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trying to show why communism

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couldn't work and why trying to force it
to work

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would prove disastrous before he was
finally vindicated

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Friedrich August von hayek was dismissed

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ridicule and ignored yet in the end

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even defenders have socialism came to
concede that he was writing

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door markable degree IX personal and
professional fortunes

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and the intellectual battles and pretty
found himself

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are also the story of the 20th century

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in his 25 books and hundreds of articles

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hired articulated an elaborate and
inspiring vision love the free society

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his insights continue to shape how we
think about the social and economic

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problems of our time

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Liberty fun proudly presents a profile

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in Liberty life and booked %uh friedrich

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August on higher

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good descended from

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Austrian nobility Friedrich August von
hayek was born in 1899 in Vienna

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the heart the austro-hungarian empire
and one of the leading intellectual

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capital serve Europe I experiments were
deeply enmeshed in that world

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his father was a doctor and in Daman &
Partners

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his maternal grandfather had served as
president to los tres

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statistical Commission I it's two
brothers were both become professors and

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political scientists

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Hansson anatomy and Eric and chemistry

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his cousin Ludvig vid in style and would
become famous

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as a philosopher

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IX first intellectual interest was in
the sciences

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especially bite me as a child he helped
his father

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categorize help I'm plans in addition to
scientific pursuits

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he took up photography in the theater
and physical interest such as

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team sailing and mountain climbing in
his teens

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higher turned to the study of human
learning and behavior

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and for a time he considered becoming a
psychiatrist

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in June 1914

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a single occurrence set in motion a
series of events that would recast the

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world

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and the life but young hayek Archduke
Ferdinand of Austria Hungary was

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assassinated

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setting the stage for the war to end all

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the

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way

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on

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no World War ones affects with
devastating to the old order

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the long-standing austro-hungarian down
as they are the haps words was out of

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power

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in russia the romanov dynasty had been
destroyed

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and communism was the new social order
hayek like many young Europeans after

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the war was drawn under socialism

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for hire the appeals socialism lay in
its attempt to solve social

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Hills by applying scientific principles
to government planning

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and control of the economy iraq was ball
towards the Fabian variety of socialism

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which favored peaceful gradual
government interventions

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rather than the sweeping and violent
revolutions advocated by Marxist

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socialist

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animals captured Marxist socialism. the
country then I counted

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socialist minutes marxist title doctrine

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form and the Vienna socialists

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maxis fam more books than than most
other places

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doesn't depend higher kantor the
University of Vienna

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a major center of intellectual activity
the war had created poor material

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conditions

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but the school was still a vibrant and
exciting place

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it was here at the university that Hayek
was first introduced to the Austrian

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School of economics

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this group of scholars extended the
inside so the 18th century economist

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Adam Smith regarding the workings of the
free market economy

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in his classic work The Wealth of
Nations

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Smith had sought to explain the
tremendous growth in commerce that had

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taken place in the West

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doing the 17th and 18th centuries in
opposition to the dominant views of his

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day

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Smith saw that a prosperous economy
arises not from the actions of

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governments

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but through the voluntary actions are
buyers and sellers

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in the marketplace in Smith's
understanding

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no one person or group dictates what the
supply and demand of goods will be

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rather each person act in his or her own
interest

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as long as exchanges are allowed to be
free involuntary

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neither buyer nor seller will trade
unless they both stand to gain from the

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transaction

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according to Smith the ultimate
consequence of all these various

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exchanges

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is approaching and orderly economy Adam
Smith was also the first to point out

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the fundamental importance all the
division of labor as part of a

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prosperous economy

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through division of labor the particular
knowledge and skills of individual men

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and women

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contribute to the creation of a vast
number of goods

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this inside continues to be of central
importance to our understanding

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a well ordered society Smith's inside 3
extended by the Austrian School

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economists

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beginning with the publication of chrome
angers path-breaking book

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principles of economics the central
point of members work which was

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published in 1871

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was that the value of any given product
is the German

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month by the amount of labor that went
into making it or by the costs of

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production

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but by the individual desires are the
buyer

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and of the seller each consumer
determines how much of his property he

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is willing to give in exchange for
someone else's product or service

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likewise eat producer determines how
much he or she will accept for their

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product or service

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trade will only take place if it
benefits both parties

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intern exchange and only those
individuals involved in the exchange

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have complete knowledge of the benefits
they seek and what they are willing to

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give an exchange

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this emphasis on the individual and
subjective nature of economic

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information

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which was begun by mango and continued
by the Austrian School economists

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would prove to be the bedrock a high x
homework

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the Austrian School convinced tire that
there can be order

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such as the order that exists in markets
without a centralized designer

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this idea open the door to his own
insights regarding spontaneous order

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the division of knowledge and the role
of prices

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in conveying vital information and the
rule of law

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these ideas would set him on a collision
course with the dominant political

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trends at the 20th century

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in 1921 hayek received his doctorate in
law

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and two years later was granted a
doctorate in political economy

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while at the University of Vienna he had
studied philosophy

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law and economics it was shortly after
taking his formal degree

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in political economy that high akhmed
Ludvig via meese's

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for the first time missus was director
of the Austrian chamber of industry

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and one of the leaders of the Austrian
school's second generation of scholars

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he would have a deep influence on high x
work

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so they came to him was a letter of
introduction

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perform regionals Mills teacher which is
Katniss a promising

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Commons museum promising new columns
have never seen you have my lectures

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when and became became vacant

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and South rules meese's book socialism

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had a significant impact on high x
economic thought

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in it meese's attempted to show that in
economic terms

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a socialist state was technically
impossible

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meese's argue that since socialism
denied a system Obama and Terry

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exchangers

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the relative prices that provided
signals for decision-making were missing

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without these signals coordination other
activities with then the economy

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is impossible

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in 1924 hike began attending missus
private seminars

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these events were considered the center
economic debate

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Indiana it has come to him s a

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young student no comments just swallows
his fields completely

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as is a as it was I came to him

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holiday was NDK crash may have meant to
cause

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push to my list actually more critical
fashion

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and to paying for 10 years in close
contact with him and miss him conclusion

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sure the whole Ince

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but whose arguments for Nepal was
perfectly convincing feels good stewards

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in 1927 hi again missus call founded the
Austrian

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Institute for business cycle research

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the board included prominent economists
young hired the institute's director

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was beginning to solidify his reputation

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as a world-class economist in 1929

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hike began his first teaching position
at the University of Vienna

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that year also saw the publication of
his first book

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monetary theory and the trade cycle

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in this work I expanded on the Austrian
schools theories by developing the idea

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that the prices of goods and services

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including the interest rates are
information signals which are vital to

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the independent plans have consumers

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and producers the main point of Hayek's
book was the usually these information

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signals make possible harmonious

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and spontaneous overall adjustments
within the economy

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however government intervention in the
economy can cause faults or distorted

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signals

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which can ultimately lead to economic
ruin

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the core of the argument was simple in a
well-ordered economy

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prices convey knowledge and for the
economy to function properly

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that knowledge was not be distorted by
government intervention

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this basic idea what said hi again
direct confrontation with two major

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trends and economic thinking

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socialism and Keynesianism

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for higher economic knowledge is
dispersed among individuals

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this division of knowledge as it would
later be called

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makes the central planning desired by
socialists

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impossible if prices are a wave
coordinating the plans have individuals

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those plans can only be known by those
individuals

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then any order provided by central
planning

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would simply be arbitrary and most
likely destructively economic prosperity

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high x insides were also directly at
odds with government policies designed

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to enhance consumption

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either through monetary inflation or
through government spending

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these policies with a very hard John
Maynard Keynes

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more moderate interventionism

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with his first book hi a cadre buff the
two most dominant trends and economic

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fought

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in England higher could come to the
attention of Lionel Robbins

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who soon to head the prestigious London
School of Economics

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or LOC the other see was looking for
someone

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intellectually capable of taking on John
Maynard Keynes

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at the University of Cambridge

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robbins invited hired to come to England
and give a series of four lectures

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hike literally swept the audience of its
feet

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and he put forward a view the Great
Depression that

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seem to be both accurate and complete

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higher was invited to become a professor
at the LOC

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and in 1931 he and his family moved to
London

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soon hi again robbins by now a good
friend

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were emulating missus by holding their
own private seminars

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these lively gatherings attracted many
international economists

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it was during his time at the LSC that
higher clay down the bases for his

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larger theory of spontaneous order

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working out the implications of his idea
that prices are

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information signals he began to extend
this insight into the workings of

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society in general

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is the idea that there can be great
orderliness

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in a society even though there is no one
doing the

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ordering to achieve this orderliness
however

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it was essential that prices be allowed
to fluctuate without interference

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societies cannot be organized

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without the signals that come through

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a free enterprise system using

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prices and profits hike thought that
prices and profits

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primarily convey information

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high x they reopen permission or
knowledge was groundbreaking

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markets as a system see utilize Asian of
knowledge

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are which nobody can process as a whole
which in this was a market situation

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leads people to

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a mmm it in each of people whom settled
New

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me usual facilities which include bank
information

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all this condensed in abstract signals

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and that are all sit a hellhole modern

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length and production could you advise
own thanks to his mechanism

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is he believes the base is not only of
my economic but as much

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my political views his sim

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most important contribution is to extend

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the paradigm or idea about the Smiths
about the

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divisional labor and may keep getting to
division all

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knowledge you need the market because
you need a way in which people can

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ken benefit can capitalize on what they
know that's different from other people

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and in the cut and in the end the corset
this capitalizing on their specialized

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knowledge

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they share this knowledge with other
people this linking up the dispersed

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nature of knowledge

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with the theory of spontaneous order lay
at the core of Hayek's distrust of

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central planning

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in his view no central planner could
gather together enough knowledge to

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create the same order and richness that
occurs spontaneously

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in a pre-market if

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00:16:16,390 --> 00:16:20,100
production had been directed by a
central planning agency would they have

251
00:16:20,100 --> 00:16:24,449
directed in the Internet technology
which is so revolutionizing human life

252
00:16:24,449 --> 00:16:27,880
hike argued that central planning
authorities don't

253
00:16:27,880 --> 00:16:30,910
develop that sort of planning ability
that their

254
00:16:30,910 --> 00:16:36,000
inevitably bureaucratic and they prevent
the noon the creative in the divers from

255
00:16:36,000 --> 00:16:36,990
emerging

256
00:16:36,990 --> 00:16:41,270
in there what you wanna do is have a
society in which individuals are free to

257
00:16:41,270 --> 00:16:41,920
do

258
00:16:41,920 --> 00:16:46,89
as much as what they want whatever they
want to do as long as they're not

259
00:16:46,89 --> 00:16:48,000
physically harming someone else

260
00:16:48,000 --> 00:16:52,610
to hayek central control over individual
economic decisions

261
00:16:52,610 --> 00:16:57,160
leads inevitably to control over what
individuals are allowed to do

262
00:16:57,160 --> 00:17:00,679
and the ideas they are allowed to
develop

263
00:17:00,679 --> 00:17:03,720
have to impose on the issue in its
tighter

264
00:17:03,720 --> 00:17:07,150
a ninety Kadapa dist he placed a
beautiful quote

265
00:17:07,150 --> 00:17:10,929
at the beginning of every chapter of The
Road to Serfdom had

266
00:17:10,929 --> 00:17:14,890
and there's a quote by Belloc he placed
at the beginning of a chapter

267
00:17:14,890 --> 00:17:18,540
where he says between hunched let me see
if memory serves

268
00:17:18,540 --> 00:17:21,970
exact frumpy look the control up the
production

269
00:17:21,970 --> 00:17:26,10
love wealth is the control of human life
itself just

270
00:17:26,10 --> 00:17:29,920
does command all you with us metric in
Dayton trekked in

271
00:17:29,920 --> 00:17:34,80
these insights led high again to a
prolonged debate with the socialist

272
00:17:34,80 --> 00:17:35,740
thinkers have his day

273
00:17:35,740 --> 00:17:41,210
a complicated I love that became known
as the Socialist calculation debate

274
00:17:41,210 --> 00:17:46,490
on his side higher extended ministers
earlier argument that socialism was

275
00:17:46,490 --> 00:17:48,570
technically impossible

276
00:17:48,570 --> 00:17:51,730
both hayek and missus great
accomplishment

277
00:17:51,730 --> 00:17:56,480
was to turn the question of socialism
from a moral question

278
00:17:56,480 --> 00:17:59,559
to a practical question it wasn't

279
00:17:59,559 --> 00:18:02,639
whether individuals are good enough for
socialism

280
00:18:02,640 --> 00:18:05,799
it's a question of whether or not
socialism

281
00:18:05,799 --> 00:18:09,90
can practically be the way a society can
be organized

282
00:18:09,90 --> 00:18:12,889
higher argued that without really
adjusting prices based in private

283
00:18:12,890 --> 00:18:13,799
property

284
00:18:13,799 --> 00:18:17,950
there were no signals for socialist
planners to use in calculating

285
00:18:17,950 --> 00:18:21,240
the relative values of goods and
services

286
00:18:21,240 --> 00:18:25,140
and there was no information for
deciding which production methods were

287
00:18:25,140 --> 00:18:26,640
most efficient

288
00:18:26,640 --> 00:18:30,799
but scholars influenced by socialist
ideas were not persuaded by the

289
00:18:30,799 --> 00:18:33,260
arguments have higher core missus

290
00:18:33,260 --> 00:18:36,429
perhaps the most vocal critic of the
Austrian School

291
00:18:36,429 --> 00:18:40,110
was Oscar longer a prominent police
socialist

292
00:18:40,110 --> 00:18:44,659
according to longer meese's had provided
a service to the socialist

293
00:18:44,660 --> 00:18:47,790
by pointing out the need for a more
careful system %uh

294
00:18:47,790 --> 00:18:51,770
economic accounting that would guide
production resources

295
00:18:51,770 --> 00:18:56,429
in a socialist economy rather than
pointing out the impossibility a

296
00:18:56,429 --> 00:18:58,20
socialist calculation

297
00:18:58,20 --> 00:19:02,590
said longer the Austrians had merely
pointed to a problem the socials

298
00:19:02,590 --> 00:19:05,299
thinkers but certainly Sol

299
00:19:05,299 --> 00:19:09,420
learns socialists always operated on
Steam to

300
00:19:09,420 --> 00:19:12,700
the acid international each

301
00:19:12,700 --> 00:19:16,400
can common society from a bomb

302
00:19:16,400 --> 00:19:20,650
and the what Oscar line it it for
example was only two

303
00:19:20,650 --> 00:19:24,330
switch the lead from say King sometime
pros and all those

304
00:19:24,330 --> 00:19:27,460
but novel into spots all over days past

305
00:19:27,460 --> 00:19:31,49
into the enlightened economists that
could run

306
00:19:31,49 --> 00:19:35,540
and operate the economy from a bomb
despite having missed the real point of

307
00:19:35,540 --> 00:19:37,520
Hayek's criticism

308
00:19:37,520 --> 00:19:41,150
longer arguments were persuasive with
both academics

309
00:19:41,150 --> 00:19:45,610
and the general public public opinion
was firmly on the side of more

310
00:19:45,610 --> 00:19:46,850
government control

311
00:19:46,850 --> 00:19:50,20
over economic life and firmly against

312
00:19:50,20 --> 00:19:54,910
iraq's ideas equally formidable in the
arena

313
00:19:54,910 --> 00:19:59,630
both academic and political opinion
would be the ideas of John Maynard

314
00:19:59,630 --> 00:20:01,380
Keynes

315
00:20:01,380 --> 00:20:05,179
rather than advocating the complete
nationalization of the economy

316
00:20:05,179 --> 00:20:09,760
as the socialist-led gains and his
followers contended that the government

317
00:20:09,760 --> 00:20:13,650
should stimulate economic growth through
monetary inflation

318
00:20:13,650 --> 00:20:19,000
and through spending on public projects
this round directly counter to high x

319
00:20:19,000 --> 00:20:21,380
contention that government intervention

320
00:20:21,380 --> 00:20:26,200
distorts the information conveyed by
prices

321
00:20:26,200 --> 00:20:29,320
higher argued that although under Cain's
approach

322
00:20:29,320 --> 00:20:33,700
there may be indeed short term
stimulation of the economy

323
00:20:33,700 --> 00:20:38,490
prices will no longer transmit accurate
information between producers and

324
00:20:38,490 --> 00:20:40,470
consumers

325
00:20:40,470 --> 00:20:43,710
this would result in the wrong things
being produced

326
00:20:43,710 --> 00:20:47,269
in the wrong quantities at the wrong
time

327
00:20:47,269 --> 00:20:54,220
or what Austrian School economist
referred to as Mel investment

328
00:20:54,220 --> 00:20:58,720
the debate between Hayek and Keynes
would continue until canes death at the

329
00:20:58,720 --> 00:21:01,929
age is 63 in 1946

330
00:21:01,929 --> 00:21:08,130
and it was a debate that at the time IAC
appeared to lose decisively

331
00:21:08,130 --> 00:21:13,139
beginning in the early nineteen thirty's
Keynes and Hayek sparred publicly on

332
00:21:13,139 --> 00:21:17,600
how to break the Great Depression that
held the world in its grip

333
00:21:17,600 --> 00:21:21,590
a central issue was work role the
government should play in attempting to

334
00:21:21,590 --> 00:21:22,980
increase implement

335
00:21:22,980 --> 00:21:26,370
and stabilize the economy for high-tech

336
00:21:26,370 --> 00:21:29,389
it was a matter of letting this system
which had been

337
00:21:29,389 --> 00:21:33,469
actively discord noted through
government inflation at the money supply

338
00:21:33,470 --> 00:21:37,419
recover naturally artificial
intervention

339
00:21:37,419 --> 00:21:41,429
only postponed and aggravated the
necessary correction

340
00:21:41,429 --> 00:21:46,590
canes vehemently disagreed Keynes's view
was that now was the purpose of

341
00:21:46,590 --> 00:21:47,689
government to

342
00:21:47,690 --> 00:21:50,730
get the economy rolling again to prime
the pump

343
00:21:50,730 --> 00:21:54,760
for there to be government work projects
for there to be government transfer

344
00:21:54,760 --> 00:21:55,408
payments

345
00:21:55,409 --> 00:21:58,580
whatever could be done to get the
economy moving again

346
00:21:58,580 --> 00:22:02,689
underlying these disputes was another
point of disagreement between these two

347
00:22:02,690 --> 00:22:04,360
great thinkers

348
00:22:04,360 --> 00:22:09,389
I have concentrated on individual
transactions between buyers and sellers

349
00:22:09,389 --> 00:22:15,49
gains however argued that the important
figures were economic aggregates

350
00:22:15,49 --> 00:22:19,470
sector's total unemployment and gross
national product

351
00:22:19,470 --> 00:22:24,769
higher kill that aggregate figures only
hide important economic information

352
00:22:24,769 --> 00:22:28,200
which is necessarily individualized and
dispersed

353
00:22:28,200 --> 00:22:33,389
hayek reviewed Keynes's treatise on
money which is just coming out

354
00:22:33,389 --> 00:22:37,928
just slamming and then canes responded
with a review of

355
00:22:37,929 --> 00:22:43,29
high x own book prices and production
which keen's thoroughly demolished

356
00:22:43,29 --> 00:22:46,880
in the Canes debate as in the socialist
calculation debate

357
00:22:46,880 --> 00:22:52,210
hired press the notion that government
economic planning was inherently doomed

358
00:22:52,210 --> 00:22:58,10
by the knowledge problem no bureaucrat
or central planner good ever possess

359
00:22:58,10 --> 00:23:00,809
enough knowledge of the individual needs

360
00:23:00,809 --> 00:23:06,10
the design and efficiently functioning
and prospering economy

361
00:23:06,10 --> 00:23:10,730
for higher-tech the myriad calculations
government planners would require in

362
00:23:10,730 --> 00:23:12,919
order to address the situation

363
00:23:12,919 --> 00:23:16,10
made complete and current knowledge
unachievable

364
00:23:16,10 --> 00:23:19,720
in addition and perhaps more important

365
00:23:19,720 --> 00:23:24,419
the kinds of information necessary for
successful planning are impossible to

366
00:23:24,419 --> 00:23:25,399
centralize

367
00:23:25,399 --> 00:23:28,830
this information consists of
non-scientific

368
00:23:28,830 --> 00:23:32,370
personal particular knowledge or what
higher

369
00:23:32,370 --> 00:23:36,570
called knowledge of time and place

370
00:23:36,570 --> 00:23:39,610
his alternative was the spontaneous
order

371
00:23:39,610 --> 00:23:44,590
a free market which efficiently and
accurately made these calculations

372
00:23:44,590 --> 00:23:48,590
every day what happens in a modern
society

373
00:23:48,590 --> 00:23:51,840
is the absolutely unpredictable result

374
00:23:51,840 --> 00:23:56,870
of millions have individual decisions
going on all the time

375
00:23:56,870 --> 00:24:00,239
I think that's a very interesting idea
and its

376
00:24:00,240 --> 00:24:03,370
powerful because it's so
counter-intuitive

377
00:24:03,370 --> 00:24:08,830
the higher canes debate took a decisive
turn in 1936 with the publication of

378
00:24:08,830 --> 00:24:10,139
Cain's famous book

379
00:24:10,139 --> 00:24:13,678
the general theory unemployment interest

380
00:24:13,679 --> 00:24:19,669
and money this work one of the most
influential books on economic policy in

381
00:24:19,669 --> 00:24:21,200
the 20th century

382
00:24:21,200 --> 00:24:26,289
defined canes attack on classical
liberal economics

383
00:24:26,289 --> 00:24:29,639
but despite its significance higher did
not

384
00:24:29,639 --> 00:24:34,309
mount the public counterattack he
thought that Cain's latest theory would

385
00:24:34,309 --> 00:24:35,710
not succeed

386
00:24:35,710 --> 00:24:40,29
and he knew of Cain's habit are
frequently changing his mind

387
00:24:40,29 --> 00:24:44,809
hike would later admit that his failure
to publicly respond to the general

388
00:24:44,809 --> 00:24:45,460
theory

389
00:24:45,460 --> 00:24:50,490
was a serious miscalculation he would
not get another opportunity to publicly

390
00:24:50,490 --> 00:24:54,450
debate canes on these issues

391
00:24:54,450 --> 00:24:57,870
the greatest boost the Canes the reviews
came in america

392
00:24:57,870 --> 00:25:02,350
where voters turned out the state hoover
all the dynamic roosevelt

393
00:25:02,350 --> 00:25:06,49
roosevelt initially gave chains ideas

394
00:25:06,49 --> 00:25:10,379
half-hearted support still hoping to
balance america's budgeting

395
00:25:10,380 --> 00:25:16,90
but will economic situation worsening
FDR embraced canes ideas

396
00:25:16,90 --> 00:25:23,90
and dramatically expanded the role of
government in american life

397
00:25:23,389 --> 00:25:27,289
the late nineteen thirties and early
nineteen forties were difficult times

398
00:25:27,289 --> 00:25:28,399
for higher-tech

399
00:25:28,399 --> 00:25:32,229
in addition to losing the popular
verdict on his ideas

400
00:25:32,230 --> 00:25:37,230
hayek watched as the clouds have major
conflict gathered across Europe

401
00:25:37,230 --> 00:25:41,700
one of the most prolific social forces
of the century was about to plunge the

402
00:25:41,700 --> 00:25:43,190
world into its second

403
00:25:43,190 --> 00:25:47,830
global war I it was especially
frustrated

404
00:25:47,830 --> 00:25:50,970
by what he saw as his colleagues
misperception

405
00:25:50,970 --> 00:25:56,769
what was unfolding external circumstance
of environment

406
00:25:56,769 --> 00:26:01,429
made it necessary for me to explain
claim to my English colleagues

407
00:26:01,429 --> 00:26:05,490
firmly believe said paid German
capital's

408
00:26:05,490 --> 00:26:08,840
started reactions promising

409
00:26:08,840 --> 00:26:12,668
socialist developments said to wear long
johns interpretations

410
00:26:12,669 --> 00:26:16,940
to 'em moved an outspoken opponent of
the nazis

411
00:26:16,940 --> 00:26:21,49
hired charge that the evils of National
Socialism

412
00:26:21,49 --> 00:26:25,389
worlders same variety is the heirs of
Marxist socialism.

413
00:26:25,389 --> 00:26:30,19
that resulted from the location of the
Liberty and the dehumanization of those

414
00:26:30,19 --> 00:26:30,759
who did not

415
00:26:30,759 --> 00:26:33,799
the the bureaucrats preconceived idea

416
00:26:33,799 --> 00:26:37,990
love what society should look like
fascism was not

417
00:26:37,990 --> 00:26:41,19
as the marxist then left does tried to
research

418
00:26:41,19 --> 00:26:44,179
the result of capitalism it was it's
very

419
00:26:44,179 --> 00:26:49,880
and purposes high XD concerned about the
events it is time were leading him to

420
00:26:49,880 --> 00:26:51,480
apply his ideas

421
00:26:51,480 --> 00:26:57,120
to a broader social context world war
two had the effective change in high x

422
00:26:57,120 --> 00:26:58,939
focuses interest

423
00:26:58,940 --> 00:27:03,450
and whereas during the nineteen thirties
he had been primarily a technical

424
00:27:03,450 --> 00:27:04,340
economist

425
00:27:04,340 --> 00:27:08,519
participate in the technical economic
debates have the day

426
00:27:08,519 --> 00:27:13,380
from the nineteen forties on word in his
career he lived until 1992 so that's a

427
00:27:13,380 --> 00:27:14,399
half-century

428
00:27:14,399 --> 00:27:18,668
he basically moved into the area of
social philosophy

429
00:27:18,669 --> 00:27:22,350
and I think that it's here that his
greatest contributions were

430
00:27:22,350 --> 00:27:27,949
in 1944 Hayek was made a Fellow of the
British economy

431
00:27:27,950 --> 00:27:33,129
that same year a pivotal event but again
propel higher conder the international

432
00:27:33,129 --> 00:27:34,199
stage

433
00:27:34,200 --> 00:27:37,730
the publication in England I V is most
famous book

434
00:27:37,730 --> 00:27:43,539
the Road to Serfdom this was a hugely
popular broadside in which I

435
00:27:43,539 --> 00:27:47,320
made the claim that even mild government
intervention

436
00:27:47,320 --> 00:27:51,529
could ultimately lead to a totalitarian
state

437
00:27:51,529 --> 00:27:54,639
higher had grave concerns about
communism

438
00:27:54,639 --> 00:27:59,918
and russia's role in the world but he
was also targeting socialism closer to

439
00:27:59,919 --> 00:28:01,179
home

440
00:28:01,179 --> 00:28:04,899
there was quite a bit of central
planning at that time

441
00:28:04,899 --> 00:28:08,750
you think that's what the Labour
government Labour government came in

442
00:28:08,750 --> 00:28:12,460
immediately after the the end to the the

443
00:28:12,460 --> 00:28:18,539
love the European more war against
hitter and

444
00:28:18,539 --> 00:28:22,9
much will they wanted to do they wanted
to introduce

445
00:28:22,9 --> 00:28:25,799
is a former socialism IX the Ceres

446
00:28:25,799 --> 00:28:28,830
in the Road to Serfdom was simple enough

447
00:28:28,830 --> 00:28:33,399
even piecemeal planning leads to
unintended consequences that require

448
00:28:33,399 --> 00:28:34,889
even more planning

449
00:28:34,889 --> 00:28:38,360
and eventually can lead to attempts at
central planning

450
00:28:38,360 --> 00:28:43,580
and totalitarianism government errors
would be compounded when the same

451
00:28:43,580 --> 00:28:45,59
planners who made them

452
00:28:45,59 --> 00:28:50,80
then tried to set them right leading to
even more government intervention

453
00:28:50,80 --> 00:28:55,519
ultimately the people in a society would
be made to fit the bureaucrats plan

454
00:28:55,519 --> 00:28:59,919
rather than the other way around a free
government goes along and

455
00:28:59,919 --> 00:29:03,250
enforces but a mistake it is made

456
00:29:03,250 --> 00:29:07,450
there's no automatic a fictional
independent he made it

457
00:29:07,450 --> 00:29:10,529
crystal clear to anybody who who was
willing to

458
00:29:10,529 --> 00:29:14,240
open up their minds that you couldn't
possibly

459
00:29:14,240 --> 00:29:17,350
gather enough information in a Central
Bureau

460
00:29:17,350 --> 00:29:20,480
to direct a vastly complex economic
system

461
00:29:20,480 --> 00:29:24,220
you can barely do it for a simple
village economy but at least there

462
00:29:24,220 --> 00:29:28,690
they wouldn't be agree just errors even
well-intentioned states would eventually

463
00:29:28,690 --> 00:29:33,879
claim the power to make any decision
necessary for the state's well-being

464
00:29:33,879 --> 00:29:39,100
and since morality what at some point be
sacrificed to state effectiveness

465
00:29:39,100 --> 00:29:42,178
those who founded easy to make such
trade-offs

466
00:29:42,179 --> 00:29:46,509
would ultimately rise to the top this
further in danger

467
00:29:46,509 --> 00:29:51,789
Liberty I think people wet in the west

468
00:29:51,789 --> 00:29:56,340
there don't understand his point where

469
00:29:56,340 --> 00:29:59,789
the cost a they thought they have
already got

470
00:29:59,789 --> 00:30:04,330
to the worst politicians in the wallet

471
00:30:04,330 --> 00:30:08,220
but def daily pundit China they were
really low how

472
00:30:08,220 --> 00:30:12,970
or informs the maturing how the Geo
worst

473
00:30:12,970 --> 00:30:17,450
get on the top reaction to the Road to
Serfdom was swept

474
00:30:17,450 --> 00:30:22,950
on both sides of the fence one lecturer
told an American audience that hayek

475
00:30:22,950 --> 00:30:28,379
statement about state intervention
leading inevitably to totalitarianism

476
00:30:28,379 --> 00:30:34,29
was so obviously untrue the higher could
not really have mended

477
00:30:34,29 --> 00:30:39,49
many others expressed a different view
one washington Post writer has sent

478
00:30:39,49 --> 00:30:43,299
suggested that the book was the first
shocked in the intellectual battle

479
00:30:43,299 --> 00:30:46,840
but would turn the tide in favor of
conservatism

480
00:30:46,840 --> 00:30:50,129
and many believe it had the ultimate
affect higher

481
00:30:50,129 --> 00:30:53,199
hope to accomplish the Road to Serfdom

482
00:30:53,200 --> 00:30:56,379
was not the prediction it was a warning

483
00:30:56,379 --> 00:30:59,689
it it was a warning that the Eve we

484
00:30:59,690 --> 00:31:04,259
embarked on a certain wrote there would
be unintended consequences

485
00:31:04,259 --> 00:31:08,580
the Road to Serfdom has been published
in more than fifteen languages

486
00:31:08,580 --> 00:31:13,39
and has been inactive Brent somewhere in
the world since 1944

487
00:31:13,39 --> 00:31:18,80
although ban behind the Iron Curtain
numerous typewritten copies were in

488
00:31:18,80 --> 00:31:19,720
constant circulation

489
00:31:19,720 --> 00:31:23,59
in countries where liberty is not the
norm

490
00:31:23,59 --> 00:31:27,49
IX warnings were especially poignant
boss hayek

491
00:31:27,49 --> 00:31:30,168
and his critics have net and have never

492
00:31:30,169 --> 00:31:33,600
living under a surf term

493
00:31:33,600 --> 00:31:37,299
a $2,200 Terry G regime bad hayek

494
00:31:37,299 --> 00:31:41,149
has a much better I'm standing up this
abyss

495
00:31:41,149 --> 00:31:44,360
kind of society that 11 live under

496
00:31:44,360 --> 00:31:48,469
the book's popularity prove both a
blessing and a curse

497
00:31:48,470 --> 00:31:53,559
it did get high x message out has large
numbers of the Road to Serfdom were sold

498
00:31:53,559 --> 00:31:56,480
during a frenzied book tour in America

499
00:31:56,480 --> 00:32:00,840
hike became genuinely famous in both the
United States and Great Britain has

500
00:32:00,840 --> 00:32:01,549
result

501
00:32:01,549 --> 00:32:05,809
are the Road to Serfdom any became known
as the most prominent

502
00:32:05,809 --> 00:32:09,809
classical liberal or libertarian or
rented

503
00:32:09,809 --> 00:32:15,330
intellectual or scholar in the world but
the enormous popular appeal the Road to

504
00:32:15,330 --> 00:32:16,100
Serfdom

505
00:32:16,100 --> 00:32:20,840
mask a widely-held academic disdain for
its author

506
00:32:20,840 --> 00:32:24,360
he had dared to disagree with the
prevailing confidence of

507
00:32:24,360 --> 00:32:28,219
academics in socialism and I think that
was one of his outstanding

508
00:32:28,220 --> 00:32:29,779
characteristics

509
00:32:29,779 --> 00:32:34,379
was that he was willing to take
unpopular views and persevere with them

510
00:32:34,379 --> 00:32:37,998
even when he would be ridiculed in
criticized by his

511
00:32:37,999 --> 00:32:42,29
colleagues and peers for doing so I
think it's probably one of the

512
00:32:42,29 --> 00:32:46,360
keep best examples a well-reasoned
argumentation i've seen

513
00:32:46,360 --> 00:32:50,360
you know n in the 20th century but it
was considered unscientific polemic

514
00:32:50,360 --> 00:32:54,258
he'd had such a rough handling I mean he
was not widely

515
00:32:54,259 --> 00:32:59,759
welcomed I would ask academics to meet
him in some would do so

516
00:32:59,759 --> 00:33:04,120
but some academics academics which are
not I would be dead

517
00:33:04,120 --> 00:33:08,449
I occurred known that he would suffer as
the result of writing the book

518
00:33:08,450 --> 00:33:12,399
just came in a sacred just a2 end of
sync I eat

519
00:33:12,399 --> 00:33:15,610
into Chacin Flushing New Moon DVD

520
00:33:15,610 --> 00:33:21,320
Angeles stated you can pass academic
community event largely a similar issues

521
00:33:21,320 --> 00:33:27,149
fr I connection two-story high and yours

522
00:33:27,149 --> 00:33:30,268
wes is a self-taught man a petition
stand

523
00:33:30,269 --> 00:33:34,279
gotten even among academics labor was
elected

524
00:33:34,279 --> 00:33:38,279
overwhelmingly in the general elections
have 1945

525
00:33:38,279 --> 00:33:41,759
and proceeded to move in exactly the
opposite direction

526
00:33:41,759 --> 00:33:46,139
to that which I could recommended many
industries were nationalized

527
00:33:46,139 --> 00:33:49,629
a vast welfare state was established

528
00:33:49,629 --> 00:33:54,799
on the world stage free-market ideas
were rapidly losing ground to Keynesian

529
00:33:54,799 --> 00:33:56,279
theories

530
00:33:56,279 --> 00:33:59,809
this was in part the result of the
popular perception that

531
00:33:59,809 --> 00:34:04,730
economic planning during the war at
successfully mobilize resources

532
00:34:04,730 --> 00:34:07,860
and could do so in times of peace

533
00:34:07,860 --> 00:34:11,609
hired however argue that equating a
peacetime economy you

534
00:34:11,610 --> 00:34:15,100
wartime planning was a fundamental hair

535
00:34:15,100 --> 00:34:20,350
but the tied up academic opinion was
solidly against them

536
00:34:20,350 --> 00:34:26,100
higher recognize the need to preserve
the ideas of classical liberalism

537
00:34:26,100 --> 00:34:30,310
so he decided to create and
International Society of scholars

538
00:34:30,310 --> 00:34:35,119
to encourage renewed exploration into
the political economic and cultural

539
00:34:35,119 --> 00:34:36,510
foundations

540
00:34:36,510 --> 00:34:40,659
a free society this gathering became
known as

541
00:34:40,659 --> 00:34:44,40
the mount color in society tag

542
00:34:44,40 --> 00:34:49,310
felt like a.m. that the whole world was
going socialist

543
00:34:49,310 --> 00:34:52,770
in mediately after world war two

544
00:34:52,770 --> 00:34:58,259
and he felt like there was a desperate
need to to at least establish some

545
00:34:58,260 --> 00:35:02,720
connections between those who still held
to ask a liberal notions

546
00:35:02,720 --> 00:35:06,669
and so he got the ball player on society
organized in 1940 Salem

547
00:35:06,670 --> 00:35:11,40
went that I had to yet dusty said
courses some dogs

548
00:35:11,40 --> 00:35:14,610
hayek through this grand assembly or
gathering

549
00:35:14,610 --> 00:35:17,619
overcame the isolation of individuals

550
00:35:17,619 --> 00:35:22,000
and United liberal scholars from history
political science

551
00:35:22,000 --> 00:35:25,200
economics the and philosophy he could

552
00:35:25,200 --> 00:35:28,850
all of whom felt motivated to defend the
free society

553
00:35:28,850 --> 00:35:32,750
it to Sam Capac that the Alan them axe
your

554
00:35:32,750 --> 00:35:37,140
Delphi Heights is for police to treat in
1947

555
00:35:37,140 --> 00:35:40,270
the group met in a small town in the
Swiss Alps

556
00:35:40,270 --> 00:35:43,710
the first conference lasted ten days

557
00:35:43,710 --> 00:35:48,300
that first meeting and the larger one
that followed at the 1949

558
00:35:48,300 --> 00:35:51,500
brought together intellectuals from a
world

559
00:35:51,500 --> 00:35:54,869
still devastated by the recent war

560
00:35:54,869 --> 00:35:58,990
this meeting was the first time that
Germans had met with american

561
00:35:58,990 --> 00:36:03,140
which since the war that some Hollanders

562
00:36:03,140 --> 00:36:07,859
neverland people had met with german
bitch Shin said been in concentration

563
00:36:07,860 --> 00:36:08,740
camps

564
00:36:08,740 --> 00:36:12,20
there were many motional Eve ensure

565
00:36:12,20 --> 00:36:16,590
Xin Jin took place hayek served as
president of the month

566
00:36:16,590 --> 00:36:20,280
power in society in till nineteen sixty
then as

567
00:36:20,280 --> 00:36:23,430
honorary president until his death

568
00:36:23,430 --> 00:36:27,160
his vision of an ongoing formal
gathering of like-minded

569
00:36:27,160 --> 00:36:30,399
intellectuals was realized

570
00:36:30,400 --> 00:36:33,470
in 1955 Anthony Fisher

571
00:36:33,470 --> 00:36:38,299
home hi I could met almost ten years
before ask I it for advice on how to

572
00:36:38,300 --> 00:36:39,680
affect change

573
00:36:39,680 --> 00:36:42,740
in the direction of increased freedom

574
00:36:42,740 --> 00:36:45,919
Hayek said to him that he should
emphasize

575
00:36:45,920 --> 00:36:51,440
ideas that ideas were far more important
and practical political activity

576
00:36:51,440 --> 00:36:54,970
hayek famously said develop politics

577
00:36:54,970 --> 00:36:59,000
that was fish aside if his idea was to
go into politics and change things

578
00:36:59,000 --> 00:37:04,470
come klutz I have her

579
00:37:04,470 --> 00:37:08,959
apps option some five branches best
trends

580
00:37:08,960 --> 00:37:12,570
whole a synthesized call cell

581
00:37:12,570 --> 00:37:16,970
Kat tied up in government were counting
has since been States panama hats and

582
00:37:16,970 --> 00:37:18,470
scarves

583
00:37:18,470 --> 00:37:23,100
as a result of his conversations with
IAC Fisher founded the Institute of

584
00:37:23,100 --> 00:37:25,680
Economic Affairs in Britain

585
00:37:25,680 --> 00:37:29,850
Fisher was in session intellectual and
he was a simple well it was a

586
00:37:29,850 --> 00:37:35,339
basic practical farmer with dirt under
his nails what kinda stuff

587
00:37:35,340 --> 00:37:39,950
and so he eventually got round to a
meeting be in a few others and M

588
00:37:39,950 --> 00:37:43,169
putting up a small sum of money to get
the IAEA started I mean we were

589
00:37:43,170 --> 00:37:46,360
a child higher absolutely

590
00:37:46,360 --> 00:37:50,790
higher believe that resources should
support education

591
00:37:50,790 --> 00:37:54,960
the Institute for Economic Affairs would
be the first of many international

592
00:37:54,960 --> 00:37:57,590
think-tanks inspired by iraq

593
00:37:57,590 --> 00:38:02,130
organizations devoted to research and
publishing on liberty and free market

594
00:38:02,130 --> 00:38:04,330
economics

595
00:38:04,330 --> 00:38:09,200
in 1950 the University of Chicago
offered hired an appointment to the

596
00:38:09,200 --> 00:38:11,819
prestigious Committee on social thought

597
00:38:11,820 --> 00:38:15,570
which he accepted once again he found
himself

598
00:38:15,570 --> 00:38:19,890
in 10 the center's a economic thought
one of the really interesting things

599
00:38:19,890 --> 00:38:21,000
about hayek

600
00:38:21,000 --> 00:38:24,710
is that he was at the University of
Vienna he was at the London School of

601
00:38:24,710 --> 00:38:27,410
Economics who was at the University of
Chicago

602
00:38:27,410 --> 00:38:31,470
all tremendously vital place is
intellectually

603
00:38:31,470 --> 00:38:36,100
the University of Chicago had taken the
risk of burst publishing the Road to

604
00:38:36,100 --> 00:38:36,770
Serfdom

605
00:38:36,770 --> 00:38:42,30
in america and it was considered a
center for free market point

606
00:38:42,30 --> 00:38:46,250
the school was also located in the
country considered a ball work in the

607
00:38:46,250 --> 00:38:48,460
effort to contain communism

608
00:38:48,460 --> 00:38:52,180
the move to Chicago was a good win for
hayek

609
00:38:52,180 --> 00:38:55,730
his appointment to the Committee on
social thought at the University of

610
00:38:55,730 --> 00:38:56,570
Chicago

611
00:38:56,570 --> 00:39:01,280
the enabled him to cut back his teaching
and to do research in areas

612
00:39:01,280 --> 00:39:05,380
other than the economics he sometimes
commented that

613
00:39:05,380 --> 00:39:09,860
an economist who only knows economics
really doesn't know very much

614
00:39:09,860 --> 00:39:13,680
he had much more of a holistic approach
to knowledge and one that

615
00:39:13,680 --> 00:39:17,339
tried to bring together thoughts from a
number of disciplines

616
00:39:17,340 --> 00:39:21,590
announced in chicago the seminar on
scientific method and particulars

617
00:39:21,590 --> 00:39:25,320
differences international social
sciences

618
00:39:25,320 --> 00:39:28,970
and his attack just some of the most
distinguished members of effective

619
00:39:28,970 --> 00:39:32,89
Chicago engine decal for me

620
00:39:32,90 --> 00:39:37,370
and she will night and a few people it s
cross just sitting in my 70 discussing

621
00:39:37,370 --> 00:39:39,130
the scientific method

622
00:39:39,130 --> 00:39:43,150
and it was one of the most exciting
experiences in my life

623
00:39:43,150 --> 00:39:49,50
the years in Chicago were productive in
1952 hike published a book on knowledge

624
00:39:49,50 --> 00:39:50,40
and the mind

625
00:39:50,40 --> 00:39:53,390
entitled the sensory order hospital

626
00:39:53,390 --> 00:39:57,950
I had published a hutu serfdom in 1944

627
00:39:57,950 --> 00:40:02,210
I wanted to take leave from to solve
such as soldiers couldn't myself

628
00:40:02,210 --> 00:40:05,520
a professional college besides both

629
00:40:05,520 --> 00:40:08,750
that I thought I would do something
quite different than the term to my

630
00:40:08,750 --> 00:40:11,210
psychological ideas

631
00:40:11,210 --> 00:40:15,520
in the century order as in high-tech
social and economic thought

632
00:40:15,520 --> 00:40:20,50
multiple and dispersed connections make
the system work

633
00:40:20,50 --> 00:40:24,410
information is spontaneously ordered
through specific signals

634
00:40:24,410 --> 00:40:28,620
and trial-and-error learning is an
important basis for the brains

635
00:40:28,620 --> 00:40:30,20
performance

636
00:40:30,20 --> 00:40:34,570
an earlier peoples brains different we
process information differently

637
00:40:34,570 --> 00:40:38,240
everything we do helps to build up a
personal

638
00:40:38,240 --> 00:40:42,939
classifying system that will differ in
some respect from somebody else's

639
00:40:42,940 --> 00:40:47,170
so I see this century order as being an
important issue that he needed to

640
00:40:47,170 --> 00:40:48,470
address for his

641
00:40:48,470 --> 00:40:51,970
critique of socialism in 1954

642
00:40:51,970 --> 00:40:55,549
hayek tackle jet another field history

643
00:40:55,550 --> 00:40:59,590
it was widely believed that the
industrial revolution had impoverished

644
00:40:59,590 --> 00:41:02,520
vast numbers are British Citizens

645
00:41:02,520 --> 00:41:05,850
higher challenge that claim in his
introduction to

646
00:41:05,850 --> 00:41:12,330
capitalism and the historians a
collection of essays by leading scholars

647
00:41:12,330 --> 00:41:17,20
for hayek the industrial revolution was
an example of spontaneous

648
00:41:17,20 --> 00:41:22,900
order in action vast unplanned changes
in the economy with the result of an

649
00:41:22,900 --> 00:41:26,890
untold number of individual economic
decisions

650
00:41:26,890 --> 00:41:30,299
based on subjective values

651
00:41:30,300 --> 00:41:34,410
hayek believe that an impartial
evaluation of the evidence

652
00:41:34,410 --> 00:41:37,549
which show that living standards
actually improved

653
00:41:37,550 --> 00:41:40,620
with industrialization contrary to the

654
00:41:40,620 --> 00:41:45,740
sentimental the use of historians to
romanticize the pre-industrial a job

655
00:41:45,740 --> 00:41:48,359
agriculture

656
00:41:48,360 --> 00:41:53,60
Hayek was now ready for his most
ambitious work to date

657
00:41:53,60 --> 00:41:56,710
in 1955 he visited Cairo

658
00:41:56,710 --> 00:42:01,410
where he lectured on the rule of law
these lectures form the basis for what

659
00:42:01,410 --> 00:42:03,839
some consider his best work

660
00:42:03,840 --> 00:42:07,770
the constitution of liberty published in
1960

661
00:42:07,770 --> 00:42:10,790
the don't think dusty for fastened to
fly height

662
00:42:10,790 --> 00:42:14,520
I would think the book the constitution
of liberty

663
00:42:14,520 --> 00:42:18,360
bass is the modern compendium liberal
ideas out

664
00:42:18,360 --> 00:42:22,320
fly high Tc 18 Ste bias

665
00:42:22,320 --> 00:42:26,440
near control nowhere is the importance a
free society

666
00:42:26,440 --> 00:42:29,450
for our civilization as well stated its

667
00:42:29,450 --> 00:42:34,339
as in this book at soul %uh the I was
Chris Borland C++

668
00:42:34,340 --> 00:42:38,210
PNT simple the for possible to fight

669
00:42:38,210 --> 00:42:41,660
the constitution of liberty is surely
the most important word

670
00:42:41,660 --> 00:42:45,109
that was written in this and the past
century and

671
00:42:45,110 --> 00:42:48,980
one can likely say the most important
work since John Stuart Mill

672
00:42:48,980 --> 00:42:52,80
orange the backside John Stuart Mill

673
00:42:52,80 --> 00:42:56,710
the constitutional liberty recast the
long-standing ideas have classical

674
00:42:56,710 --> 00:42:57,690
liberalism

675
00:42:57,690 --> 00:43:02,570
in modern terms hi concludes the
constitutional liberty with the word

676
00:43:02,570 --> 00:43:05,900
words that John Stuart Mill used to
preface his

677
00:43:05,900 --> 00:43:10,640
work on Liberty a century 24 on Liberty
a century before that the

678
00:43:10,640 --> 00:43:13,810
the Grand leading principal toward

679
00:43:13,810 --> 00:43:16,810
which every page in this book

680
00:43:16,810 --> 00:43:21,240
leads is the promotion of human
diversity in its richest potential

681
00:43:21,240 --> 00:43:26,979
according to hayek the role of the state
is to ensure freedom and human progress

682
00:43:26,980 --> 00:43:30,370
through the rule of law in making this
claim

683
00:43:30,370 --> 00:43:34,480
he was careful to define what law is not

684
00:43:34,480 --> 00:43:39,330
the call now Lord made me think through
some old law and medicines

685
00:43:39,330 --> 00:43:44,49
it is not the we love the rulers

686
00:43:44,50 --> 00:43:47,550
which is a governing the society about

687
00:43:47,550 --> 00:43:52,680
the metaphysical doctrines behind at the
law

688
00:43:52,680 --> 00:43:56,250
which is very good a regulating our
daily lives

689
00:43:56,250 --> 00:43:59,390
weekend to make a law we count me in

690
00:43:59,390 --> 00:44:04,490
the county discover loss

691
00:44:04,490 --> 00:44:09,250
for hayek law properly understood is
based on precedent

692
00:44:09,250 --> 00:44:13,940
a system of trial and error in which the
most effective social principals are

693
00:44:13,940 --> 00:44:17,650
passed down from one generation to the
next

694
00:44:17,650 --> 00:44:22,120
he saw some %uh the great traditions are
the anglo-american system

695
00:44:22,120 --> 00:44:25,230
to have evolved over generations in
terms of

696
00:44:25,230 --> 00:44:28,700
principles such as fair play justice

697
00:44:28,700 --> 00:44:35,200
private property contract many of
society's most important laws or rules

698
00:44:35,200 --> 00:44:39,549
are not the products have conscious
design according to hayek

699
00:44:39,550 --> 00:44:44,300
a sort of cultural evolution passes
along the most effective rules

700
00:44:44,300 --> 00:44:47,800
to be refined over time through custom
tradition

701
00:44:47,800 --> 00:44:50,820
and experience his theory above

702
00:44:50,820 --> 00:44:57,110
I'm spontaneous orders is extreme
importance

703
00:44:57,110 --> 00:45:00,950
languages it is a spontaneous orders

704
00:45:00,950 --> 00:45:04,580
nobody invented language no authority
ever

705
00:45:04,580 --> 00:45:08,370
said the rules for speaking a writing

706
00:45:08,370 --> 00:45:11,410
them hayek at tells us that

707
00:45:11,410 --> 00:45:17,350
law is like God we are living all the
time

708
00:45:17,350 --> 00:45:20,360
thanks to the system of rules of conduct

709
00:45:20,360 --> 00:45:24,820
which we have not invented between not
to sign military large Donald Rumsfeld

710
00:45:24,820 --> 00:45:25,830
and

711
00:45:25,830 --> 00:45:31,670
people have tried out over the time
different strategies to solve problems

712
00:45:31,670 --> 00:45:36,40
and they were able to learn which kind
of generalized strategies work better

713
00:45:36,40 --> 00:45:37,110
than others

714
00:45:37,110 --> 00:45:41,110
and these experiences they have
condensed in ruth's

715
00:45:41,110 --> 00:45:44,180
these rules of course are interpreted by
our parents are

716
00:45:44,180 --> 00:45:48,299
are so are are Anna

717
00:45:48,300 --> 00:45:52,710
authorities they're interpreted by those
with whom we interact so they do change

718
00:45:52,710 --> 00:45:54,670
gradually but nevertheless

719
00:45:54,670 --> 00:45:59,300
these rules are are not have our own
making its law that creates freedom

720
00:45:59,300 --> 00:46:02,730
by creating a rational framework

721
00:46:02,730 --> 00:46:06,460
within which individuals can leave their
life so I think that

722
00:46:06,460 --> 00:46:10,190
hikes underlying idea and political
philosophy is

723
00:46:10,190 --> 00:46:14,930
that liberty is the supremacy of law IX
understanding of the rule of law

724
00:46:14,930 --> 00:46:17,560
involved to critical points

725
00:46:17,560 --> 00:46:21,400
the first was that society's rules must
be general

726
00:46:21,400 --> 00:46:25,320
they must not become specific
centralized commands

727
00:46:25,320 --> 00:46:28,730
there's also keeps them from becoming
instruments for granting special

728
00:46:28,730 --> 00:46:30,590
privileges

729
00:46:30,590 --> 00:46:34,20
true freedom implies equality under the
law

730
00:46:34,20 --> 00:46:39,380
a society in which I can deed was an
impersonal and counter

731
00:46:39,380 --> 00:46:42,910
presuppose certain basic goals I and
foremost

732
00:46:42,910 --> 00:46:46,609
on everybody was in that territory

733
00:46:46,610 --> 00:46:50,680
iraq was concerned about how democratic
governments fail to safeguard this

734
00:46:50,680 --> 00:46:51,460
principle

735
00:46:51,460 --> 00:46:54,650
by confusing law with legislation

736
00:46:54,650 --> 00:46:58,570
they choose nations the sends ought to
be confined to

737
00:46:58,570 --> 00:47:02,730
general rules or Latino College Station

738
00:47:02,730 --> 00:47:06,50
largely rentals Commons

739
00:47:06,50 --> 00:47:09,240
addition to particular groups ending
privileged to some

740
00:47:09,240 --> 00:47:12,799
to imposing special duties will not lose

741
00:47:12,800 --> 00:47:17,260
hayek second point about the rule of law
was that laws should tell individuals

742
00:47:17,260 --> 00:47:18,720
only what they could not

743
00:47:18,720 --> 00:47:22,209
do in order to prevent harm to others

744
00:47:22,210 --> 00:47:26,220
laws should not tell individuals what
they must do

745
00:47:26,220 --> 00:47:30,339
these rules and this is the
characteristic general rules

746
00:47:30,340 --> 00:47:34,990
they tell people what strategies they
are not allowed to employ

747
00:47:34,990 --> 00:47:38,589
India efforts to improve their own
situation

748
00:47:38,590 --> 00:47:44,150
but within the remained a all the open
space of conceivably actions

749
00:47:44,150 --> 00:47:47,580
they are free to choose whatever they
consider most appropriate and more

750
00:47:47,580 --> 00:47:49,80
conducive to their

751
00:47:49,80 --> 00:47:53,220
interests hired did grant that
government might need to guarantee a

752
00:47:53,220 --> 00:47:55,870
minimum set up specific protections

753
00:47:55,870 --> 00:48:00,480
in areas such as health care the
environment and disaster relief

754
00:48:00,480 --> 00:48:05,610
but he argued the should be privatized
whenever possible

755
00:48:05,610 --> 00:48:10,270
the constitutional liberty has taken its
place among the great works of classical

756
00:48:10,270 --> 00:48:12,780
liberal theory

757
00:48:12,780 --> 00:48:15,940
certainly means scholarship I have never

758
00:48:15,940 --> 00:48:18,940
before discovered that is absolutely

759
00:48:18,940 --> 00:48:22,610
surpassing the and the

760
00:48:22,610 --> 00:48:25,850
I deres the year especially the ideas

761
00:48:25,850 --> 00:48:28,920
about the the Justice problem

762
00:48:28,920 --> 00:48:33,270
about the problem of spontaneous
interaction of ten thousands of people

763
00:48:33,270 --> 00:48:37,509
hold them having completely different
value convictions

764
00:48:37,510 --> 00:48:41,530
in Howell we can find people

765
00:48:41,530 --> 00:48:45,360
who are to be confined Ways and Means

766
00:48:45,360 --> 00:48:49,100
to make people with completed different
value conviction to live together in

767
00:48:49,100 --> 00:48:51,110
more or less

768
00:48:51,110 --> 00:48:54,420
term peace and freedom

769
00:48:54,420 --> 00:48:58,270
is that was something worth still
fascinates me

770
00:48:58,270 --> 00:49:01,730
there's actually for me the quintessence
of economics

771
00:49:01,730 --> 00:49:06,830
in the early nineteen sixties hayek
unexpectedly received an invitation to

772
00:49:06,830 --> 00:49:09,660
teach in Fryeburg West Germany

773
00:49:09,660 --> 00:49:12,830
Freiberg was the professional home of
his old friend

774
00:49:12,830 --> 00:49:16,160
and Mont Pellerin Society member water
Oregon

775
00:49:16,160 --> 00:49:19,270
the word died in 1950

776
00:49:19,270 --> 00:49:22,710
Ludwig Erhard another month Pellerin
Society member

777
00:49:22,710 --> 00:49:26,150
was soon to become chancellor of west
germany

778
00:49:26,150 --> 00:49:30,980
after moving to pry bar higher pressed
on with the development of his ideas on

779
00:49:30,980 --> 00:49:33,460
spontaneous order

780
00:49:33,460 --> 00:49:38,270
my 1969 he had almost completed the
first volume of law

781
00:49:38,270 --> 00:49:41,560
legislation and liberty this work

782
00:49:41,560 --> 00:49:46,299
which you plan to publish in three
volumes was to expand on the concerns he

783
00:49:46,300 --> 00:49:47,50
had addressed

784
00:49:47,50 --> 00:49:50,790
in the constitution of liberty into
constitution

785
00:49:50,790 --> 00:49:54,900
Liberty High Boston maine bhi

786
00:49:54,900 --> 00:49:58,310
a tempting do he stayed for hola time

787
00:49:58,310 --> 00:50:02,230
what has the gardens traditional
principles the ones to explain but

788
00:50:02,230 --> 00:50:06,390
nineteen central limitless middle
intended to do

789
00:50:06,390 --> 00:50:11,420
Rooney it's a time when I packed he
finished simple

790
00:50:11,420 --> 00:50:15,610
I discovered sitter named dissension
liberalism had no answers to certain

791
00:50:15,610 --> 00:50:17,540
questions

792
00:50:17,540 --> 00:50:21,300
law legislation and liberty was
eventually to be a work of sweeping

793
00:50:21,300 --> 00:50:24,470
scope and substantial importance

794
00:50:24,470 --> 00:50:28,759
but before the first volume was
furnished hike began to suffer from a

795
00:50:28,760 --> 00:50:30,640
severe depression

796
00:50:30,640 --> 00:50:34,950
years have standing against the academic
and political mainstream

797
00:50:34,950 --> 00:50:39,509
were apparently taking their toll even
after he finally finished the first

798
00:50:39,510 --> 00:50:41,800
volume in 1973

799
00:50:41,800 --> 00:50:45,420
IX outlook had not improved

800
00:50:45,420 --> 00:50:50,90
the hike was feeling so low that he was
literally unable to get up from his bed

801
00:50:50,90 --> 00:50:54,450
and when he talked to Arthur Selden he'd
he told me at that time he felt that his

802
00:50:54,450 --> 00:50:55,339
entire

803
00:50:55,340 --> 00:51:00,670
life's work had been a waste then in
1974 very unexpectedly

804
00:51:00,670 --> 00:51:04,380
Hayek was awarded the Nobel Prize in
Economics

805
00:51:04,380 --> 00:51:07,990
ironically his call recipient was gonna
Myrtle

806
00:51:07,990 --> 00:51:11,200
a socialist thinker from Sweden

807
00:51:11,200 --> 00:51:15,960
the Nobel Prize led to a swift reversal
in high x reputation

808
00:51:15,960 --> 00:51:19,100
as one writer noted he quickly went from

809
00:51:19,100 --> 00:51:23,920
goofball to Guru it also seemed to spark
a burst the

810
00:51:23,920 --> 00:51:27,470
energy with an hayek resulting in
renewed health

811
00:51:27,470 --> 00:51:31,689
and a dramatically increase the
intellectual outboard

812
00:51:31,690 --> 00:51:33,910
who say no it wasn't Nobel Prize night

813
00:51:33,910 --> 00:51:37,69
under but the Nobel Prize for tremendous
shot in the arm

814
00:51:37,70 --> 00:51:40,950
in 1976 higher completed volume 2

815
00:51:40,950 --> 00:51:45,899
law legislation and liberty when knows
if its completion was delivered to a

816
00:51:45,900 --> 00:51:48,120
meeting of them on power in society

817
00:51:48,120 --> 00:51:52,509
during erupted three years later in
nineteen seventy-nine

818
00:51:52,510 --> 00:51:55,580
the last of the three volumes was
published

819
00:51:55,580 --> 00:52:00,20
I thought very highly of Road to Serfdom

820
00:52:00,20 --> 00:52:03,110
I knew how important it'd been
historically

821
00:52:03,110 --> 00:52:07,10
but to lawless station Liberty

822
00:52:07,10 --> 00:52:10,360
mas revelation

823
00:52:10,360 --> 00:52:13,730
I accused one volume each for what he
termed

824
00:52:13,730 --> 00:52:16,880
three fundamental insights on the
preservation

825
00:52:16,880 --> 00:52:22,180
over society a free individuals the
first the Vikes 3 insights was

826
00:52:22,180 --> 00:52:27,569
order without commands this was a
further clarification of his concept

827
00:52:27,570 --> 00:52:29,480
dubbed spontaneous order

828
00:52:29,480 --> 00:52:33,210
hayek persisted in combating the
misperception that

829
00:52:33,210 --> 00:52:37,440
order is equivalent to a single
overarching vision or plan

830
00:52:37,440 --> 00:52:42,200
he argued that order occurs
spontaneously in society

831
00:52:42,200 --> 00:52:45,210
because all the plans have individuals
are

832
00:52:45,210 --> 00:52:50,330
coordinated through various mechanisms
the transmit information such as market

833
00:52:50,330 --> 00:52:50,990
prices

834
00:52:50,990 --> 00:52:55,419
customary practices venues language and
tradition

835
00:52:55,420 --> 00:52:59,150
it is very exciting to Transpo whose

836
00:52:59,150 --> 00:53:03,340
what one thinks of as a vast networkers
operations

837
00:53:03,340 --> 00:53:08,390
people exchanging money in goods
suddenly to discover that this really

838
00:53:08,390 --> 00:53:10,779
has a totally different aspect
altogether

839
00:53:10,780 --> 00:53:15,80
and I think that's a brilliant
illumination hayek second inside the

840
00:53:15,80 --> 00:53:16,560
address the concept though

841
00:53:16,560 --> 00:53:20,70
social justice for hired the term

842
00:53:20,70 --> 00:53:23,330
social justice was without any clear
meaning

843
00:53:23,330 --> 00:53:27,600
and could be used simply to dress up the
political buyer so the user

844
00:53:27,600 --> 00:53:30,990
as the standard by which to judge the
economy

845
00:53:30,990 --> 00:53:34,319
it was at best useless and at worst

846
00:53:34,320 --> 00:53:37,960
harmful centered obscure the real nature
or both

847
00:53:37,960 --> 00:53:41,640
justice and social order any delivered

848
00:53:41,640 --> 00:53:45,120
10 to convict's a distribution the
contusion

849
00:53:45,120 --> 00:53:48,880
whose principal sue them just as are
ultimately

850
00:53:48,880 --> 00:53:53,940
is a concern rumors and free society
hired believed in what he considered

851
00:53:53,940 --> 00:53:58,960
true justice which sprang from the
genuine equality of individuals under

852
00:53:58,960 --> 00:54:00,80
the rule of law

853
00:54:00,80 --> 00:54:03,310
distributive equality was another matter

854
00:54:03,310 --> 00:54:06,880
crew justices impartial and impersonal

855
00:54:06,880 --> 00:54:11,450
different conditions among individuals
and groups which are not the result of

856
00:54:11,450 --> 00:54:12,410
interference

857
00:54:12,410 --> 00:54:15,529
do not imply a lack of social justice

858
00:54:15,530 --> 00:54:19,420
it's not acts which a free it's human
action which

859
00:54:19,420 --> 00:54:25,330
Yahoo trust and to appliance a concept
of justice which is an attribute of

860
00:54:25,330 --> 00:54:26,390
human action

861
00:54:26,390 --> 00:54:30,580
to a state of affairs richest open to
live with a report about the enabled

862
00:54:30,580 --> 00:54:31,779
this just boxers

863
00:54:31,780 --> 00:54:35,170
the third of high x trilogy have
insights

864
00:54:35,170 --> 00:54:39,280
was the democracy did not necessarily
equate to Liberty

865
00:54:39,280 --> 00:54:43,400
confusing democracy will liberalism was
for him

866
00:54:43,400 --> 00:54:48,690
tragic allusion far more important was a
constitutional order that would limit

867
00:54:48,690 --> 00:54:53,450
the power of government to interfere
with the spontaneous order of society

868
00:54:53,450 --> 00:54:57,750
to the degree that democracy holes
government officials accountable for

869
00:54:57,750 --> 00:54:58,580
their actions

870
00:54:58,580 --> 00:55:02,400
it is an essential part have a
functioning political order

871
00:55:02,400 --> 00:55:07,880
by itself however democracy is not the
sufficient protection for freedom

872
00:55:07,880 --> 00:55:12,340
that of course is Lou those who will
select religions all Kenyans

873
00:55:12,340 --> 00:55:15,360
much religion purchase which

874
00:55:15,360 --> 00:55:20,80
other to terms with the government
islands that's a government

875
00:55:20,80 --> 00:55:23,810
is hosts to satisfying

876
00:55:23,810 --> 00:55:27,740
all kinds of special into small to
conduct a month old

877
00:55:27,740 --> 00:55:31,790
it's as close as as most majority which

878
00:55:31,790 --> 00:55:35,810
a group as a poem wheels president up
the majority

879
00:55:35,810 --> 00:55:41,270
as satisfying article coops in the late
nineteen seventies

880
00:55:41,270 --> 00:55:46,310
the world was entering a new era and
high x ideas were beginning to have an

881
00:55:46,310 --> 00:55:47,160
influence

882
00:55:47,160 --> 00:55:51,359
the simultaneous high inflation and high
unemployment

883
00:55:51,360 --> 00:55:54,560
would seem to be the legacy of Keynesian
economics

884
00:55:54,560 --> 00:55:57,720
caused many to begin looking for other
answers

885
00:55:57,720 --> 00:56:02,80
in England margaret thatcher was turning
the British economy around

886
00:56:02,80 --> 00:56:05,810
largely through reliance on high x
theories to

887
00:56:05,810 --> 00:56:08,950
higher code great admiration for missus
thatcher

888
00:56:08,950 --> 00:56:12,509
her adoption up his concepts cause some
to call hi ok

889
00:56:12,510 --> 00:56:15,790
her mad professor on Sat I am i once

890
00:56:15,790 --> 00:56:19,850
she pulled the constitution of liberty
out of her bag placed it on the table

891
00:56:19,850 --> 00:56:24,610
and said this is our program and then
extraordinary changes happened in

892
00:56:24,610 --> 00:56:25,450
England

893
00:56:25,450 --> 00:56:30,600
in the nineteen eighties an economic see
change occurred in the United States

894
00:56:30,600 --> 00:56:35,220
ronald reagan had come to office with a
new approach based in part on high x

895
00:56:35,220 --> 00:56:36,799
ideas

896
00:56:36,800 --> 00:56:42,820
Reagan's administration would bring both
inflation and unemployment under control

897
00:56:42,820 --> 00:56:46,410
in 1982 hike was awarded the Order of
Merit

898
00:56:46,410 --> 00:56:50,210
by the Austrian government and in 1984

899
00:56:50,210 --> 00:56:56,110
he became a companionable honor a
personal award from the Queen of England

900
00:56:56,110 --> 00:57:01,120
high x final book the fatal conceit was
published in 1988

901
00:57:01,120 --> 00:57:05,730
in it hike warned his readers against
the temptation to assume that social

902
00:57:05,730 --> 00:57:08,760
institutions and inherited practices

903
00:57:08,760 --> 00:57:13,560
can simply be altered or abolished to
suit the momentary objectives of

904
00:57:13,560 --> 00:57:16,580
would-be reformers

905
00:57:16,580 --> 00:57:22,40
in 1989 at the age of 90 Friedrich Hayek
witness the dismantling of the berlin

906
00:57:22,40 --> 00:57:23,400
wall

907
00:57:23,400 --> 00:57:26,900
the victim old unworkable government
economic planning

908
00:57:26,900 --> 00:57:30,140
and increasing pressure for freedom

909
00:57:30,140 --> 00:57:33,759
this was the first step on the road away
from serfdom

910
00:57:33,760 --> 00:57:38,60
and the ultimate affirmation of Hayek's
ideas about the nature of order

911
00:57:38,60 --> 00:57:41,259
in human society if you are

912
00:57:41,260 --> 00:57:44,810
a good hi Aki en it should have been
inevitable

913
00:57:44,810 --> 00:57:49,830
that communism was going to fall because
it should have been inevitable that this

914
00:57:49,830 --> 00:57:54,549
terribly inefficient system was going to
take some point just grind to a crashing

915
00:57:54,550 --> 00:57:55,460
halt

916
00:57:55,460 --> 00:57:59,540
and nowhere i is high ikaes popular us
well respected

917
00:57:59,540 --> 00:58:04,40
as in the East European countries
because those people have seen

918
00:58:04,40 --> 00:58:08,890
his sis theories his the they have it at
the o2 shows the which gives an accurate

919
00:58:08,890 --> 00:58:09,650
the

920
00:58:09,650 --> 00:58:14,70
account on all that all the all the
police states and the

921
00:58:14,70 --> 00:58:19,000
all the conditions the on Underwood
centrist economic planning

922
00:58:19,000 --> 00:58:23,670
can be performed and they also see the
great promise that the whole salt

923
00:58:23,670 --> 00:58:29,000
for them President George Bush presented
the US medal of freedom to hire

924
00:58:29,000 --> 00:58:32,810
in 1991 I X un doctor lawrence higher

925
00:58:32,810 --> 00:58:36,840
accepted Friedrich August von hayek

926
00:58:36,840 --> 00:58:42,620
died in 1992 his life had essentially
come full circle

927
00:58:42,620 --> 00:58:47,390
group two distinct half-centuries in
which is reputation had risen

928
00:58:47,390 --> 00:58:50,410
then fallen and finally risen again

929
00:58:50,410 --> 00:58:52,980
even more strongly

930
00:58:52,980 --> 00:58:56,670
he had seen the ideas are free markets
and human liberty

931
00:58:56,670 --> 00:59:00,390
go from ridicule to being the
centerpiece of social thought

932
00:59:00,390 --> 00:59:06,279
this is high x legacy I think that we
can

933
00:59:06,280 --> 00:59:09,400
divide the tent this entry into four
quarters

934
00:59:09,400 --> 00:59:13,720
the first quarter was dominated by
lyndon and Russian Revolution

935
00:59:13,720 --> 00:59:17,799
the second quarter by Hitler National
Socialism

936
00:59:17,800 --> 00:59:20,940
under World War the third quarter I'm

937
00:59:20,940 --> 00:59:26,180
was dominated by it came Shin thinking
it was really look what locations

938
00:59:26,180 --> 00:59:30,169
but the fourth quarter on the tent this
entry was characterised

939
00:59:30,170 --> 00:59:34,390
and dominated in some ways by higher I
think the higher

940
00:59:34,390 --> 00:59:39,710
will be perceived in retrospect as the
greatest political philosopher

941
00:59:39,710 --> 00:59:46,710
the 20th century hayek have a dollar
from I'll manhole times

942
00:59:47,240 --> 00:59:47,490
good