The plan to end planning

National Review, June 16, 1997 by Ralph Harris

From the first meeting in 1947 the Society eschewed publicity. If more "second-hand dealers in ideas" were to spread the vision of the free society, their recruitment and re-education would be undertaken spontaneously (a favorite Hayekian word) by individual members through their lectures and writings or through the burgeoning of "think tanks" following the pioneering example of the Institute of Economic Affairs, established in 1957 by Antony Fisher, one of the minority of early business members of the Society.

SUCH was the broad plan to end planning. Fifty years later, how far could it be said to have been fulfilled?

It requires no invasion of the privacy of the anniversary meeting to mark a number of major landmarks in the worldwide retreat from socialism. The collapse of the Soviet Union and the emergence of Reagan and Thatcher as trailblazers for radical market reforms around the world hardly require elaboration. But can the Mont Pelerin Society claim part of the credit? Americans can best judge the influence of the many MPS members surrounding President Reagan. From Britain I have no quiver of doubt that Margaret Thatcher's central reform of trade unions, state industries, monetary policy, and much else owed a great deal to the advisors and members of Parliament directly instructed in market analysis by IEA publications shaped by Mont Pelerin principles. But the decisive role was played by our academics and journalists who helped transform public opinion on the market alternative to the failing collective consensus. Final proof of the Iron Lady's success was displayed in the recent British election, when "New Labour" won a landslide victory only by explicitly renouncing socialism and boasting it could make the "dynamic market economy" work better than the tired Conservatives could.

One of a new British breed of "contemporary historians" has gone on record with a more wide-ranging tribute to the MPS. Dr. Richard Cockett, author of Thinking the Unthinkable, was prompted by the anniversary to write of its meetings as marked by "rigorous debate about economics away from the gaze of a world which probably now owes more to the MPS than any other single organization of intellectuals. . . . [My italics.] Hayek and the Mont Pelerin Society are to the twentieth century what Karl Marx and the First International were to the nineteenth century."

This remarkable claim is lent strong credibility by a less noticed sign of success in the decisive intellectual battle of ideas. In 1974 an early signal was hoisted from neutral Sweden in the form of the totally unexpected nomination of Hayek as Nobel Laureate. True, the accolade was shared by a socialist Swedish economist whose name I have now forgotten. But the next award, in 1976, went exclusively to another founding member, Milton Friedman. By 1997, four further active MPS members had been similarly recognized: James Buchanan, George Stigler, Ronald Coase, and Gary Becker.

I must resist the temptation to quote from the ever lively discussions that marked the anniversary meeting. What I can reveal is that sober rejoicing over the undoubted spread of market ideas did not banish anxieties about the persistence of overblown government -- even in the United States public spending has roughly doubled, from 20 to 40 per cent of national income, since the 1950s. True, the tide of central planning has been reversed, but only to be replaced throughout the West by the remorseless growth of collectivist welfare. Not only has this providential state failed to solve poverty, it has dangerously weakened the traditional moral foundations of self-support and voluntary action. For Europeans there is also the emerging shadow of a centralized bloc fused by protective regulation and preferring a constructivist single money to Hayek's competition in currencies.