Abstract
The ambition in this chapter is to summarize debates and events in the 1920s and 1930s related to economic planning in Great Britain and the United States. The British case was complex; planning was “a word that was on everyone’s lips and yet fractured by a multitude of interpretations and meanings”. Planning ambitions in the US made an imprint around the world when Franklin Roosevelt in the spring of 1933 launched his New Deal. In both countries, the ideas of detailed planning was more or less eclipsed by John Maynard Keynes’ “middle way” at the end of the 1930s. Furthermore, the so-called socialist calculation debate, which had been unfolding in German language on the European Continent in the 1920s, triggered by Ludwig von Mises, expanded into English language contributions in the 1930s. Friedrich von Hayek was probably the most outspoken economist against economic planning. He was challenged by E. F. M. Durbin, one of his colleagues at the London School of Economics.
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Notes
- 1.
D. Ritschel, The Politics of Planning: The Debate on Economic Planning in Britain in the 1930s (Oxford: Clarendon Press, 1997), 330.
- 2.
Ibid., 4.
- 3.
Ibid., 48.
- 4.
Ibid., 90–91.
- 5.
Ibid., 116.
- 6.
Ibid., 183.
- 7.
Ibid., 282–283.
- 8.
J. M. Keynes, The General Theory of Employment, Interest and Money (London: Macmillan, 1936).
- 9.
Ritschel, The Politics of Planning, 303.
- 10.
A. Budd, The Politics of Economic Planning (Manchester: Manchester University Press, 1978), 32.
- 11.
See W. J. Barber, From New Era to New Deal: Herbert Hoover, the Economists, and American Economic Policy, 1921–1933 (Cambridge: Cambridge University Press, 1988); E. W. Hawley, “Herbert Hoover, the Commerce Secretariat, and the Vision of an ‘Associative State’, 1921–1928”, Journal of American History 61(1) (1974); and E. W. Hawley (ed.), Herbert Hoover as Secretary of Commerce: Studies in New Era Thought and Practice (Iowa City: University of Iowa Press, 1981).
- 12.
W. J. Barber, Designs Within Disorder: Franklin D. Roosevelt, the Economists, and the Shaping of American Economic Policy, 1933–1945 (Cambridge: Cambridge University Press, 1996), 6.
- 13.
Ibid., 7. Wolfgang Schivelbusch highlights similarities between the regimes of Roosevelt, Mussolini and Hitler and quotes Tugwell stating in his diary that fascism is the “most efficiently operating piece of social machinery I’ve ever seen. It makes me envious”. See W. Schivelbusch, Three New Deals: Reflections on Roosevelt’s America, Mussolini’s Italy, and Hitler’s Germany, 1933–1939 (New York: Picador, 2006), 32.
- 14.
Quoted from Barber, Designs Within Disorder, 29.
- 15.
Ibid., 53.
- 16.
Ibid., 59.
- 17.
Adolf Berle and Gardiner Means had co-authored the famous book The Modern Corporation and Private Property in 1932; the basic message was that ownership and management had been divorced in the modern corporation.
- 18.
Means, quoted in Barber, Designs Within Disorder, 62.
- 19.
Ibid., 67.
- 20.
Ibid., 68.
- 21.
A. Shales, Forgotten Man: A New History of the Great Depression (New York: HarperCollins, 1997), 151. Raymond Moley was professor of law at Columbia University. He recruited colleagues at Columbia to Roosevelt’s original “Brain Trust”, wrote speeches for Roosevelt and coined the term “the forgotten man”. Stuart Chase was a member of the Veblenite technocracy movement and a Soviet Union admirer. In 1932, he wrote a book titled A New Deal. Samuel Insull was an entrepreneur within the electrical utilities industry.
- 22.
Barber, Designs Within Disorder, 116.
- 23.
L. von Mises, Gemeinwirtschaft: Untersuchungen über den Sozialismus (Jena: Verlag von Gustav Fischer, 1922).
- 24.
L. von Mises, “Economic Calculation in the Socialist Commonwealth”, in Collectivist Economic Planning: Critical Studies on the Possibilities of Socialism, ed. F. A. Hayek (Clifton: Augustus M. Kelley Publishers, [1935] 1975), 110–111. Originally in German in 1920.
- 25.
L. von Mises, Kapitalism och socialism i de liberala idéernas belysning (Stockholm: P. A. Norstedt & Söners Förlag, 1930). In the Royal Library digital newspaper database, Mises book is mentioned a few times in the 1930s, mainly in advertisements for book sales. Mises himself is only mentioned once in passing.
- 26.
Mises, Kapitalism, 66.
- 27.
Ibid., 81. When Mises in 1945 delivered an address before the American Academy of Political and Social Sciences, he repeated this conclusion: “There is no middle way”. See L. von Mises, “Planning for Freedom”, in Economic Planning, ed. L. von Mises and R. F. Tucker (New York: Dynamic America, 1945), 12.
- 28.
In the Royal Library digital newspaper database, Hayek is only mentioned once in passing in the 1930s.
- 29.
B. Caldwell, Hayek’s Challenge: An Intellectual Biography of F. A. Hayek (Chicago and London: The University of Chicago Press, 2005), 199.
- 30.
F. A. Hayek, “The Nature and History of the Problem”, in Collectivist Economic Planning: Critical Studies on the Possibilities of Socialism, ed. F. A. Hayek (Clifton: Augustus M. Kelley Publishers, [1935] 1975), 4.
- 31.
Hayek thus had a completely opposite view compared to Veblen, whom he, however, did not mention.
- 32.
Hayek, “The Nature”, 7–8.
- 33.
Ibid., 16–17.
- 34.
Ibid., 21.
- 35.
Ibid., 22.
- 36.
Ibid., 23–24.
- 37.
F. A. Hayek, “The Present State of the Debate”, in Collectivist Economic Planning: Critical Studies on the Possibilities of Socialism, ed. F. A. Hayek (Clifton: Augustus M. Kelley Publishers, [1935] 1975), 211.
- 38.
Ibid., 212.
- 39.
Ibid., 214.
- 40.
Ibid., 139. In Sweden, a famous dictum by Wigforss, that poverty is more easily accepted if shared equally by all, was often the subject of sarcastic comments.
- 41.
Caldwell, Hayek’s Challenge, 226.
- 42.
Mannheim quoted in Caldwell, ibid., 240.
- 43.
E. F. M. Durbin, Problems of Economic Planning (London: Routledge & Kegan Paul, 1949), 140, 155. This book contains eleven previously published papers/articles. Particularly interesting in the present context are “The Importance of Planning” from 1935 and “Economic Calculus in a Planned Economy” from 1936.
- 44.
Ibid., 41.
- 45.
Ibid., 43–44.
- 46.
Ibid., 46–48.
- 47.
Ibid., 51.
- 48.
Ibid., 56–57.
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Carlson, B. (2018). The International Context. In: Swedish Economists in the 1930s Debate on Economic Planning. Palgrave Studies in Economic History. Palgrave Pivot, Cham. https://doi.org/10.1007/978-3-030-03700-0_2
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