Hayek writes in The Road to Serfdom:

With every grant of such security to one group the insecurity of the rest necessarily increases.

If you guarantee to some a fixed part of a variable cake, the share left to the rest is bound to fluctuate proportionally more than the size of the whole.

And the essential element of security which the competitive system offers, the great variety of opportunities, is more and more reduced.

He means, I speculate, that if 90 ounces of a 100-ounce cake is guaranteed to be given to the privileged, then if the size of the cake declines by 5 ounces, the share to the non-secured declines by 50% which is greater than 5%.

Hayek’s observation that the “the great variety of opportunities” is the essence of security under laissez-faire capitalism is nothing short of eye-opening. So you lost your job? Your business has gone under? Find another way to make money! There are plenty of opportunities to outshine your competitors in some area of production.

However, the more people are protected from your competition, the smaller your range of action, and the less secure you are against your own competitors wherever you happen to be if you are not protected. If, however, everyone is protected, then we obtain Cuban-style socialism, certainly something highly undesirable.

Your security under free market is found in the insecurity of others.


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