Position Paper: Issue 3

In a democracy like here in Canada there tends to be either a conservative or liberal (not including the results of the previous elections of 2011) government in power. Friedrich von Hayek was a conservative himself so he had thought that society should embrace self interest and economic freedom. Hayek used directed economy to represent a socialist economy which has no economic freedom for the individuals without the use of force, since there is no economic freedom then there is not self interest which backs up economic freedom. No equality can be achieved with a directed economy. When self interest and economic freedom have been abused then that is the point where it should be embraced more in order to bring back a part of a conservative democracy.

Hayek believed when a directed (socialist) economy uses force, fraud or theft when it comes to production, trade and consuming then economic freedom should be embraced by that society/country. Russia is a prime example of a socialist economy, especially during Stalin’s five year plan. The state owns all of the farms and so when the government wanted more exports of grain then the state would force the farmers to grow more grain. The farmers were hardly paid as the Russian government wanted to save a few more bucks by paying people less like the farmers and during this time there was no subsides for the farmers. It was almost like theft since the government took the goods from the farmers and left them with nothing. Life was hard for the farmers to earn wages and to keep food on the table for their family. Through Hayek’s quote it is safe to say that if the Russian government were to embrace economic freedom then the farmers would be able to make an income and be more equal with society. Canada, on the other hand, currently day has economic freedom. The citizens can go and put their financials into the market on free will. Canadian farmers has the freedom to produce, trade and consume any good and services acquired which shows that Canada has economic freedom since it is done without the use of force, fraud or theft. Canada has embraced economic freedom because it is good for the people which is what Hayek believed in. If a society were to embrace economic freedom to the point of which people were to become too selfish then it must be more controlled until the position where that country has economic freedom without people fighting over producing, trading and consuming goods to the extreme.

Self interest goes almost hand in hand with economic freedom in that without economic freedom requires the pursuit of self interest. When Hayek talks about how a socialist economy it is saying that the government has self interest for itself rather than giving the people of that country self interest. This is the past what Hayek said is good for the people in that they do not have self interest. During the great depression in the dirty thirties, there was little self interest for the people in the United States. The government had to think of the whole rather than then individuals and so self interest was put on the back burner until the depression was over. The U.S. did implicate self interest before and after the great depression and so it had embraced self interest after the depression was over even though it was self interest that had caused the depression from people buying stuff that they want and did have the money the pay it off. Every country has its times when they are having issues and so it is sometimes better to think for the whole rather than for the different individual types. Self interest should be embraced until the country focuses primarily on the individuals and hardly on the whole group. When there is no self interest in place then there tends to be a self interest type of government. An example of this would be with Stalin and his government; they had put their needs and wants above the people of Russia which is inequality and which Hayek had stated. While there is an inequality then there is no self interest amongst the people and so self interest should be used by and for the people.

Hayek supported self interest and economic freedom for governments and when the principles are rejected then they should be embraced. If a country does not accept economic freedom then that limits what the people can produce, trade and consume and goods and services acquired which leads to economic issues for the people. Now if economic freedom is accepted then self interest is typically accepted since they mostly go hand in hand with each other. Self interest should be embraced until the government only uses it and does not give the citizens self interest and denies the people personal advantage. With self interest it can create official enforced inequality amongst the government and the people. Hayek proposed that a directed economy is no good for the people and that self interest and economic freedom should be used in its place along with other classical liberal principles.