Advancing a Free Society

Hayek's Gloomy Prognosis for Egypt

Monday, February 21, 2011

F.A. Hayek’s most important insight is that we cannot have political freedom without economic freedom.  Hayek’s inexorable Road to Serfdom, from which it is difficult if not impossible to return, describes a number of today’s troubled countries, and it  likely portends the future of post-Mubarak Egypt.  Those caught up in the euphoria of democratic street demonstrations must confront the reality that the long-run outcome is likely to be bad.

Take Russia and  Iran as possible role models for Egypt. Despite their huge differences (a KGB state versus an Islamic theocracy), they share a common and sinister pattern:  A revolution occurs (the collapse of the Soviet Union, the Iranian revolution); a nominal democracy is established; the democracy is hijacked by the ruling elite;  the ruling elite (Kremlin-favored oligarchs, the Revolutionary Guard) gains control of the commanding heights of the economy; the ruling elite viciously blocks  democracy and liberalization as mortal threats to their vested interests. Anyone who stands in their way is dealt with harshly as corrupt or traitorous.

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