New Right Ideas – Hayek and Ayn Rand

The Unthinking USA & Its Outsourced Praise-Singers

by Gwydion M. Williams

Anyone who prizes individual liberty ought to see military conscription as a deep offence. A few of the New Right have actually done this. SF writer Robert E. Heinlein took a very odd view of the world in Starship Troopers, much odder than was shown in the mediocre film of his book. But he did at least uphold the principle that no one should risk their life in the military except as a volunteer.

Heinlein could follow the logic because he was writing fiction and far removed from the real world. Actual ‘libertarians’ need to hook up with the rich and powerful if they are to matter – intellectually they are light-weights and would never be taken seriously on just the strength of their ideas.

I explained in a previous article (Milton Friedman, Banker’s Pet) how a Swedish bank invented a ‘Nobel Prize for Economics’, nothing to do with Nobel’s intentions, and mostly awarded to economists who wanted to make the world even nicer for rich bankers. Friedman was a recipient, and he also accepted conscription as a right of the state over the individual, though qualifying it to say that there had to be an official war. This allowed him to confuse left-wing opponents by saying that conscription for the Vietnam War was wrong, given that officially there was no war. In real terms it was obviously a war. Friedman’s arguments are based on no particular set of principles.

Finding no consistency in Friedman’s various beliefs, I concluded that they were rooted in the need of recent immigrants of a non-WASP background to gain acceptance in a highly bigoted society. Jews had been a marginal and accepted element in the original West European immigration to the USA. Attitudes changed when there was a huge wave of new immigrants from South Europe and Eastern Europe, including large numbers of Jews who had been separate communities in the countries they had come from.

Jews mostly and very sensibly fitted in on the liberal wing of US society. In the 20th century, original thinking in the USA has been almost entirely done by people of Jewish origin. It is common throughout the world for a lot of the creativity to come from people who are neither wholly part of the society nor strongly attached to anything else. But in the 20th century USA, the role of ‘outliers’ has been unusually large:

“Jewish kids, the sons of immigrants, many of them misfits in their own communities. They were all two or three steps removed from the American mainstream but were more poignantly in touch with the desires and agonies of that main stream than those in the middle it… They invented a cultural form that came like a revelation to kids of every class and ethnicity.” [E]

This is about the inventors of comic-books and cartoon super-heroes, but it’s surprising how much else in modern US culture fits exactly the same pattern. It is normal for a lot of the creativity to come from ‘outliers’, partial outsiders. In 20th century British literature, George Orwell was the son of colonial officials in British Bengal. Mervyn Peake was the son of a British medical missionary in China. Doris Lessing was born in Persia and grew up in what was then the British colony of Southern Rhodesia, now Zimbabwe. J R R Tolkien was born in South Africa and grew up as an English Catholic, rejected by Protestant relatives who disapproved of his mother’s conversion. A disproportionate amount of good literature has come from Protestants in Ireland and Catholics in England. And also from Jews, but Britain’s Jews are fairly well integrated. Very few people know or care how many Jews there are in Parliament: rather more than would happen under a ‘quota’, last time I saw any figures, but they are also distributed right across the political spectrum. The British gentry in the 19th century decided to admit a few selected Jews and set the tone for the rest of the society.

The USA is a different matter. The US mainstream produces excellent engineers and business people, better than any other country except maybe Germany, definitely much superior to Britain. But this seems to be at the expense of original thinking: conformity is demanded and ingenuity is only admired if it is a clever rearrangement of known elements. Original thinking tends to happen only among those who are for various reasons outside of the mainstream and unable to find a place there. This creates a particularly deep division between the can-do types and the intellectuals.

Older Anglo groups were and are very good at practical matters, tinkerers who could make someone else’s idea into a business success. The ‘American system of manufacture’ with standard interchangeable parts was invented by Frenchman Honore Blanc. The first flight of the Wright Brothers was far from the breakthrough it is nowadays presented as: earlier inventors had flown heavier-than-air machines without disaster and the Wright Brothers work received little attention at the time.[D] Alberto Santos-Dumont made the first public flight of an airplane in Paris in October 1906: some consider him to be the real inventor of the airplane.

The USA has mostly functioned as a giant extension of Old Europe, turning ideas into marketable products. Or rather the Yankee North had been that. The Southern states that tried to secede as the Confederacy were something less, preferring to base their prosperity on slave-grown cash crops that Old Europe needed.


The USA democratised early, and it was a mixed blessing. Both Britain and the USA became suspicious of cleverness and were boosters of anti-intellectual values. The USA in particular has attached an absurd importance to success in complete trivia, sports and athletic achievements with zero inherent worth. Sports are only worth doing if you happen to enjoy them, because animals can run, jump and fight a lot better than any human. But this rubbish is hyped. Mental skills, prowess in uniquely human accomplishments, is sneered at as ‘nerdy’.

But the ‘nerdy’ still have a place, if they have money. If you’re not likely to achieve distinction through the socially-hyped trivia of sport, you can get a secondary distinction by studying hard and using your brain. Lots of Jews followed that path and mostly used their brains as part of the liberal wing of US society. Friedman is one of the exceptions, part of a clutch of mostly-Jewish thinkers who created the New Right, became valued by the sections of US society that inherently didn’t like Jews. Especially Jews newly arrived from Vienna and points east, which was true of most of them.

Friedman was born in Brooklyn, but his Jewish immigrant family came from the city of Berehove – then in Austria-Hungary but nowadays in the Ukraine. Fellow libertarian economist Friedrich Hayek came from higher up the social ladder, Viennese intellectuals who were briefly included in the nobility. Hayek was also related to Ludwig Wittgenstein: he claimed to have no Jewish ancestors but fled Austria after it united with Nazi Germany. His mentor was Ludwig von Mises, definitely of Jewish ancestry. The bulk of the modern crop of Neo-Conservatives are also of Jewish origins, though a clear majority of US Jews are bitterly opposed to the NeoCons.

The first major challenge to the post-war Mixed Economy came from Barry Goldwater, whose family were Jewish converts to Protestantism. He too was unpopular with US Jews: they mostly support the Democrats, but no other major Presidential candidate was so unpopular with Jews as he was in 1964.

On a more lightweight and populist level, ‘Ayn Rand’ was born Alisa Zinov’yevna Rosenbaum, from a Russian-Jewish family that had lost its religion and perhaps found no alternative roots. I’ll say more about Ayn Rand in a future article, including her novel Atlas Shrugged. For now, it is worth mentioning that Ayn Rand has done what none of the other New Right Jews have done, as far as I know, she has internalised WASP prejudice against the new arrivals. In Chapter 1 of Part Three of Atlas Shrugged, there is a community of ‘superior people’ driven out of a corporatist USA. “One is a professor of history who couldn’t get a job because he taught that the inhabitants of slums were not the men who made this country“.

Ayn Rand herself managed to hop straight from Soviet Russia in the 1920s to a job as a Hollywood script-writer. She gave herself a name made from Finnish and Estonian elements and then married a US citizen. Maybe she was sensitive about her Jewish origins: the modern NeoCons certainly are. Her novel Atlas Shrugged was written in the 1950s and is supposedly set in the future, but her ‘future’ is a permanent 1920s, with aircraft marginal and railways as the backbone of long-distant travel. Whatever ideas she picked up in the 1920s she stuck to for the rest of her life, taking no notice of how the world changed all around her.

Growing up in the slums in the 1920s were Isaac Asimov, Richard Feynman and many others of future intellectual brilliance and popularity. Someone should do a list of all the contributors to US culture and science who would have been missing if the ‘Know-Nothings’ had had their way in the 1860s and successfully closed the USA to new arrivals.

But the Jewish role is just one aspect of a much wider US pattern, the uniformity and unoriginality of mainstream US culture. The old-Anglo elements are much more rigorously conformist and anti-intellectual than their British equivalents. They have successfully sterilised the mainstream culture: no one wants to be different or original outside of the limited area of engineering and business ingenuity. Interesting new ideas come mostly from recently-arrived Jews. The bulk of successful US films have a strong Jewish element. Likewise Science Fiction and also Nuclear Physics: the best brains of the ‘Manhattan Project’ were Jewish: not just refugees from Europe but also US-born Jews. And the old-Anglo elements in the USA are sufficiently dull and dumb that they even have to outsource their bigotry, their resentment at the bright new arrivals. Or rather, they outsource it to the small number who will play that game, which most US Jews will not.

Hayek was never as crude as Ayn Rand, but he did say: “Nobody who has lived through the rise of the violent anti-Semitism which led to Hitler can refuse Mrs. Thatcher admiration for her courageous and outspoken warning. When I grew up in Vienna the established Jewish families were a generally respected group and all decent people would frown upon the occasional anti-Jewish outbursts of a few popular politicians. It was the sudden influx of large numbers of Galician and Polish Jews [during World War I]…which in a short period changed the attitude. They were too visibly different to be readily absorbed.” (Letter to The Times,1 February, 1978, taken from ‘Wikiquote’.)

What’s amazing is how people like Hayek and Friedman can totally misunderstand the nature of the society they grew up in and later had to run away from. The multi-national Hapsburg Empire had its origins in the personal conquests of a dynasty. You could be loyal to it while keeping your own identity. Jews could dominate various middle-class professions because other nationalities were not expected to form their own nation-states, in fact not allowed to do so.   But since dozens of nationalities overlapped with each other, a break-up could only lead to chaos, which is just what the break-up of Austria-Hungary caused. Understandable rancour at the stripped-down Austrian centre, and a sudden intensification of national identity in the newly created states. Lots of long-settled communities found that they were suddenly minorities in states which saw them as an alien and disloyal element. Some of them crossed the newly-created borders to somewhere where they fitted better. Jews were in the unhappy position of not really fitting anywhere.

Poland after World War One was re-created on the basis of Roman Catholicism and ancient Polish traditions. If you were a Jew who lived there and had no wish to be part of it, cosmopolitan Vienna was an obvious place to go. Even more if you were a Jew in Galicia, contested between Catholic Poles and Orthodox-Christian Ukrainians, both sides hostile to Jews.

Not, indeed, that Vienna was wholly safe. To speak of “the occasional anti-Jewish outbursts of a few popular politicians” is hardly a good summary of the remarkable career of Karl Lueger, mayor of Vienna from 1897 till his death in 1910. Lueger said some nasty things about Jews, but also worked with a lot of Jewish converts and did a great deal of progressive reform. If he’d lived another twenty or thirty years, history might have gone rather differently. Lueger tapped into anti-Jewish feelings, but he channelled such feelings into a benevolent municipal socialism.[F]

The closest Lueger had to an heir was Engelbert Dollfuss. A right-wing authoritarian but also a barrier to Nazism, which is why they assassinated him.

To Hayek, Friedman etc., benevolent municipal socialism is something malign, whether or not it has any connection with anti-Jewish feelings. Fascism was an unexplained outbreak of evil, and anything similar to that old evil should be viewed with suspicion. Salvation lies only in the purity of market forces. If pushing those market forces leads to a re-growth of fascism, as has happened in the former Leninist nations, that is another unexplained outbreak of evil.


Nazism emerged because Britain from 1914-17 had waged war on Germany for no good reason. Had Britain said that a violation of Belgian neutrality meant war, Germany would almost certainly have chosen some other battle-plan and might still have won. The invasion of Belgium was no more than a pretext.

British ruling circles had been making secret arrangements with France for many years, evidently hoping for an excuse to break Britain’s major global rival – Germany’s economy had caught up with Britain and was forging ahead. The British government rejected a German proposal to call the war a draw in 1915 and go back to pre-war borders. If the war had been against ‘German aggression’, a non-punitive peace in 1915 would have been a victory. Instead the war was waged till 1917, when the collapse of Tsarism threatened to end the war with Germany undefeated. But then the USA came in to bolster the Allied cause, and in practice lay the foundations for its present global hegemony.

Had the US openly said it was after world hegemony, that would have been much less damaging than the glittering empty rhetoric that President Wilson spouted. His ‘Fourteen Points’ did not sound like the basis for the sort of peace that was actually imposed on Germany and Austria-Hungary at Versailles. Among other things, it said “The peoples of Austria-Hungary, whose place among the nations we wish to see safeguarded and assured, should be accorded the freest opportunity to autonomous development.”[A] He said nothing about splitting Austria-Hungary into new nation-states, except that an independent Polish state had been specified that would include all ethnic-Polish territory.[B] The actual treaty went beyond ethnic balance to create an unjustified ‘Polish Corridor’ and isolate the German city of Danzig. They also chose to draw the borders to give territory to Czechoslovakia where Czechs and Slovaks are a minority. Hungary also was minimised, excluding areas where Hungarians were an ethnic majority.

Germany wasn’t militarily defeated at the time the Armistice was signed. It was defeated afterwards, by use of blockade and starvation. Though point 2 of the Fourteen Points specified “Absolute freedom of navigation upon the seas, outside territorial waters, alike in peace and in war, except as the seas may be closed in whole or in part by international action for the enforcement of international covenants“, Germany continued to be cut off from foreign food until it signed the Versailles Peace.

The new republic based on a mix of liberal and socialist values was discredited by having accepted such a peace. Naturally it was seen as treason and betrayal. Exactly the same would have happened in Britain or the USA, if they had accepted such a bad peace without having suffered a clear military defeat, something more like Germany after 1945. A 1914-1920 war in which Germany had been obviously defeated would have meant a very different post-war attitude. A rather better choice would have been a fairer treaty, one that didn’t blatantly cheat in drawing ethnic boundaries. One which left it to the Germans to decide whether or not they blamed the Kaiser for the war.

Nazism could still have happened with the Kaiser ruling Germany: Mussolini was put into office by the Italian king. But Mussolini was also officially dismissed in 1943, though with limited effect since the German army dominated Italy and did not let Italy’s official surrender take effect. But if we suppose a Kaiser had been ruling Germany and had been the official Head of State, he could have dismissed Hitler in 1943 or 1944 and saved a very large number of lives. (Anne Frank died in March 1945.)

Nazism was a marginal movement in the 1920s, when liberalism seemed to be working, despite the injustices inflicted on Germany. But then there was the Wall Street Crash in 1929, followed by a major slump. Part of a pattern of instability, unemployment and political turmoil that had been recognised in the 19th century as an 11-year cycle. Noted first by Samuel Coleridge, as it happens, Coleridge being a philosopher of genuine conservatism as well as a poet.[C].

It was a clear failure of market forces and also reflected badly on the democratic governments that had allowed it to happen. Germany Nazism did not exist in isolation: most democratic governments east of Germany were replaced by either an authoritarian leader or an outright dictator. They nowadays get lumped together with quislings, all except Poland which was hostile to Jews but just as hostile to Germans and Russians, meaning they ended up as allies of the West. Greece was attacked by Italy and was getting the better of it until Germany joined in. Yugoslavia was spit between pro-German Croats – eager participants in the later genocide – and anti-German Serbs who thought that Britain was their friend. Yugoslave Serb resistance in 1941 delayed Hilter’s invasion of Russian by a few critical weeks and may have cost him the war. But this was an exception. Elsewhere, the various states made various pro-German compromises.

None of the countries that made pro-German compromises behaved any worse that Britain had, for as long as Nazi Germany seemed useful against the Soviet Union. Nor was Britain then a shining beacon of democracy: Britain’s ‘National Government’ tried to abolish party politics, though the Labour Party held out and was the government by 1945. In the USA, Roosevelt managed to function as quasi-dictator, get control of the Suprene Court and set aside the long-standing convention that Presidents only served two terms.

The New Right ignore most of what happened and concentrate on a very minor evil, the Smoot-Hawley Tariff Act of 1930. This had the effect of reducing trade between nation-states, which did not matter when the state itself was committed to keeping the economy healthy. Germany, Japan and the Soviet Union grew rapidly in the 1930s because they simply ignored global economics. With an ‘open’ economy, reduced trade is likely to be an evil, reducing demand rather than stimulating home production.

The USA under Roosevelt forced a partial recovery by state spending and without doing anything about the tarifs. He faced bitter opposition from the upholders of economic orthodoxy. By 1938, the US was maybe sliding back into recession, but Hitler unintentionally rescued Roosevelt by generating fears of a new war. From maybe 1937, Roosevelt was keen to fight such a war. But he might not have got Congress to agree to fight Germany before Japan, had Hitler had not made things easy by declaring war on the US a few days after Pearl Harbour.

Nazism succeeded because if you were a German and not Jewish or a committed left-winger, Nazism met a great many human needs. It also did this after liberalism and democracy had visibly failed. Hitler restored prosperity and employment to Germany, precisely because he ignored economic ‘wisdom’.

It turned out that 1930s economic wisdom was utter foolishness and gave Hitler an undue confidence in his own abilities. Hitler later applied this confidence to military matters and damaged the efficiency of the German Army, whose wisdom in military matters was quite genuine and much superior to anything Hitler could manage. War can tolerate a lot of illusions about why you fight, but very few about how you fight.

Illusions about why you fight can, however, throw away the fruits of a military victory. The USA at Versailles acted according to the Classical Liberal notion that Parliamentary Democracy and Free Markets are inherently good. This helped produce an unstable mix of new states in Middle-Europe and a global economy that boomed in the 1920s but crashed in the 1930s. After World War Two they were rather wiser and established a regulated global economy that ran smoothly till the 1970s, when Friedman’s ideas made a come-back. Not enough (so far) to produce another Great Slump. But enough to waste the opportunity offered by the Soviet collapse of 1989/91. Enough to waste the military victories of the US Army in Afghanistan and Iraq.

The New Right saw the Soviet collapse as a vindication of Classical Capitalism. In fact the Soviet system was most successful under Stalin, when it was furthest from Classical Capitalism. This tends to be evaded with complaints about the human cost of what Stalin did – never mind that the cost in lives was less than Classical Capitalism needed to make smaller transformations over a much longer period of time. The Soviet decline actually began when Stalin’s efficient planned economy was replaced by a peculiar semi-market system. But that’s another story.


[A] Fourteen Points – point 10. []

[B] Ibid, point 13. It was also specified that Poland would have access to the sea regardless of ethnic rights.

[C] Coleridge And The End Of Christian Economics, []

[D] See First flying machine at the Wikipedia.

[E] Men of tomorrow, by Gerard Jones. Heinemann 2005, Page xiv – xv.

[F] See Angela Clifford’s Karl Lueger And The Twilight Of Imperial Vienna for a fuller account.


First published in Labour & Trade Union Review, some time in 2007.

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