Honorable mention goes to Ludwig von Mises for “The History of Capitalism” :It may sound shocking to some, but modern-day America compares "favorably" to fascist Germany of the 1930s with regard to the degree to which the state interferes with and controls economic activity. First of all, government expenditures at all levels of government account for about 40 percent of national income. ... This doesn't count all of the off-budget government agencies that exist at the federal, state, and local levels of government as James Bennett and I documented in our book, Underground Government: The Off-Budget Public Sector. If this is included, government expenditures as a percentage of national income would be at least 45 percent, which is not so far from the 53 percent in Nazi Germany that Hayek alluded to.
In addition, as George Reisman pointed out in "The Myth that Laissez Faire Is Responsible for Our Present Crisis," there are nine executive-branch cabinet departments in the federal government that exist for the purpose of regulating, controlling, and regimenting housing, transportation, healthcare, education, energy, mining, agriculture, labor, and commerce. That pretty much covers the entire economy.
According to the White House website, there are also hundreds of federal regulatory agencies and commissions, among the better known of which are the Army Corps of Engineers, [BATF], Commodity Credit Corporation, Commodity Futures Trading Commission, Consumer Product Safety Commission, Department of Veterans Affairs, [DEA], Employment and Training Administration, Employment Standards Administration, [EPA], [EEOC], Farm Credit Administration, [FAA], [FCC], [FDIC], Federal Election Commission, Federal Energy Regulatory Commission, Energy Efficiency and Renewable Energy Commission, Federal Highway Administration, Federal Trade Commission, Nuclear Regulatory Commission, and others. New "commissions" are being formed all the time, and their budgets and responsibilities expanded. This is a short list. In addition, there are now more than 73,000 pages of regulations in tiny print in The Federal Register instructing all Americans how their lives are to be regulated by these bureaucratic monstrosities.
On top of all of this, state and local governments have literally thousands of regulatory agencies and commissions that regulate everything from allergies to zoos. ...
Then there's the Fed. In addition to attempting to fix prices (interest rates) and causing perpetual boom-and-bust cycles with its monetary manipulation, the Fed performs dozens of regulatory functions. ...
Because of the inevitable failures of all government planning in a democracy, Hayek wrote that "the conviction [will grow] that if efficient planning is to be done, the direction must be 'taken out of politics' and placed in the hands of experts — permanent officials or independent autonomous bodies." Moreover, "the cry for an economic dictator is a characteristic stage in the movement toward [central] planning." This indeed describes many of the above-mentioned agencies and commissions, but is especially descriptive of all the central planning "czars" who now hold office in the federal government. ...
In sum, it would be very difficult to argue against the proposition that the US economy today is even more heavily controlled, regulated, and regimented by the state than Germany was at the time Hayek wrote The Road to Serfdom. Americans have travelled many miles down the road to serfdom by deluding themselves that the god of democracy will somehow save them from statist slavery. But as Hayek warned 56 years ago, "There is no justification for the belief that, so long as power is conferred by democratic procedure, it cannot be arbitrary…"
The exercise of arbitrary or dictatorial power is, of course, the whole purpose and function of all those agencies, commissions, and czars.
The history of capitalism as it has operated in the last two hundred years in the realm of Western civilization is the record of a steady rise in the wage earners' standard of living. The inherent mark of capitalism is that it is mass production for mass consumption directed by the most energetic and far-sighted individuals, unflaggingly aiming at improvement. Its driving force is the profit motive, the instrumentality of which forces the businessman constantly to provide the consumers with more, better, and cheaper amenities. An excess of profits over losses can appear only in a progressing economy and only to the extent to which the masses' standard of living improves. ...
... As money is no yardstick of value and want satisfaction, it cannot be applied for comparing the standard of living of people in various periods of time. However, all historians whose judgment is not muddled by romantic prepossessions agree that the evolution of capitalism has multiplied capital equipment on a scale which far exceeded the synchronous increase in population figures. Capital equipment both per capita of the total population and per capita of those able to work is immensely larger today than fifty, a hundred, or two hundred years ago. Concomitantly there has been a tremendous increase in the quota the wage earners receive out of the total amount of commodities produced, an amount that in itself is much bigger than in the past.
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The improvement in his material well-being has changed the worker's valuation of leisure. Better supplied with the amenities of life as he is, he sooner reaches the point at which he looks upon any further increment in the disutility of labor as an evil that is no longer outweighed by the expected further increment in labor's mediate gratification. He is eager to shorten the hours of daily work and to spare his wife and children the toil and trouble of gainful employment. It is not labor legislation and labor-union pressure that have shortened hours of work and withdrawn married women and children from the factories; it is capitalism, which has made the wage earner so prosperous that he is able to buy more leisure time for himself and his dependents. The 19th century's labor legislation by and large achieved nothing more than to provide a legal ratification for changes that the interplay of market factors had brought about previously. ... As far as the allegedly prolabor laws decreed measures that were not merely the ratification of changes already effected or the anticipation of changes to be expected in the immediate future, they hurt the material interests of the workers.
The term "social gains" is utterly misleading. If the law forces workers who would prefer to work 48 hours a week not to give more than 40 hours of work, or if it forces employers to incur certain expenses for the benefit of employees, it does not favor workers at the expense of employers. Whatever the provisions of a social-security law may be, their incidence ultimately burdens the employee, not the employer. They affect the amount of take-home wages; if they raise the price the employer has to pay for a unit of performance above the potential market rate, they create institutional unemployment. Social security does not enjoin upon the employers the obligation to expend more in buying labor. It imposes upon the wage earners a restriction concerning the spending of their total income. It curtails the worker's freedom to arrange his household according to his own decisions.
... One may try to justify it by declaring that the wage earners lack the insight and the moral strength to provide spontaneously for their own future. But then it is not easy to silence the voices of those who ask whether it is not paradoxical to entrust the nation's welfare to the decisions of voters whom the law itself considers incapable of managing their own affairs; whether it is not absurd to make those people supreme in the conduct of government who are manifestly in need of a guardian to prevent them from spending their own income foolishly. Is it reasonable to assign to wards the right to elect their guardians? It is no accident that Germany, the country that inaugurated the social-security system, was the cradle of both varieties of modern disparagement of democracy, the Marxian as well as the non-Marxian.
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