Socialism relies heavily on central planners; that is "Philosopher-Kings" that allegedly know what's "Good" for the whole community. The longstanding assumption that underlies all communitarian philosophy is that empowered "experts" are better suited to decide what's good for us as individuals. In short, socialism is inexorably paternalistic. One of Hayek's main arguments against socialism is that, in the real world, Philosopher-Kings are not impartial, but tend to distribute social goods based are group favoritism and cronyism. Let's sort this out.
Socialism is based on the notion that political organization must be based on groups: Plato (leaders, military, populace), Marx (Bourgeosie, Proletariats) etc. Philosopher-Kings are empowered to eliminate competition by serving as the master-distributer. Why does this lead us down "the Road to Serfdom?" Well, the basic problem is that human beings have an infinite capacity for group membership. I am a member of many different groups: white males, college professors, faculty member at MSJ, band member, AARP member, etc. Now what happens when there is a central planner? Well, suppose that central planner decides to build a new football stadium for UC. How would other colleges in the region respond? Hayek says "envy!" We'd probably want a new dorm. So how does this allegedly "unbiased" central planner proceed? Well, he'd (it would be a guy, right?) probably aim at equality. Thus if UC get's $12 million, so does every other college. Suppose the zoo asks for more money, what does the Freedom Center ask for? Union Terminal? Get the idea...?
Now let's get down to it. What kind of person would want to be a Philosopher-King? Well, Plato got it right! Anyone with a high-degree of intelligence would NOT want to be a Philosopher-King. If you're not willing to force intelligent persons to serve as Philosopher-Kings, what kinds of persons will volunteer for the job? Will they be intelligent? Would they be unbiased? Let's look at what's going on today. Congress has already "bailed out" several large Wall Street banks, an enormous insurance company, and two "American" automobile companies. How about "cash for clunkers?" Tax breaks for "Green Corporations." Tax breaks for first-time home owners? Note the cascading effect that Hayek predicted. And of course, when Philosopher-Kings pay for these favors, where does the money come from? You would think that it comes from taxpayers, but taxpayers also are a group that lobby the Philosopher-Kings. One recent group that lobby against increased taxation are called "Tea-Partiers." So right now, the money for these schemes comes from loans from China, which someone must pay back someday? Who will that be? The rich? The poor? The middle-class? The elderly? Corporations? Small businesses? White people? Black people? Native Americans? How about future generations? That's my guess! Why because future generations do not yet exist and therefore do not have well-funded lobbyists.
What does all of this say about the prospects for group-based equality? My fourth and final blog on Hayek will explore Hayek's defense of individualism as an alternative to collectivism and speculate on the prospects for world peace.