Commanding Heights Essay

Episode 1 The Battle of Ideas begs a comparison between socialism and capitalism. It traces the worlds stinting history from the early 1900s to the events pursuit 9/11. Asks the question which is a better and more foolproof stinting system g overnment control or free trades? It delves into how the First manhood War impacted two brilliant economists, Keynes and Hayek. And then follows both Keynes and Hayek with their respective career paths (Keynes role as an advisor to the British authorities on wartime economy and Hayek as an Austrian soldier). Keynes predicted that the result of the treaty of Versailles and demanding reparations from an already bankrupt Germany and Austria would cause another war, The Second World War. Meanwhile Hayek and his partisan Zlabinger fought against hyper inflation and encouraged free markets. Simultaneously the American Economy was booming, till October 24th, 1930 when the great depression hit and unemployment soared and industry stopped and hal f of the US banks were closed down. During this time Keyness opening of government intervention helped scat the way out of the problem (Keynes wrote about Macroeconomics). Meanwhile Lenin had introduced the New frugal Policy which consisted of grass root level capitalism but the dominating heights would still be under the government. The reform was met with scrutiny from the left, in short after Stalin took power and employed centralised planning of every economic aspect. Owing to the recovery from the Great Depression and Keynes key role in the Breton Woods Conference, in America Keynesianism took control and Hayek faded into the background. In Britain a welfare state and socialism built the country back from the backside up. Newly independent countries like India also employed Keynesian methods, allowing for sound out led industry. One third of the world followed aspects of socialism until Churchill and Margaret Thatcher and Keith Joseph were influenced by Hayeks book, Road t o Serfdom. In Germany, Ludwig Erhard stopped price control and re-started the free market economy to combat hyperinflation. The success of his risky decision led to the German Economic Miracle. While Keynes still had a strong hold over Washington, a Chicago School of Economics was created and it emphasised Hayeks theory as a measure to battle stagflation. Finally Thatchers option and confidence in Hayeks theory allowed for free markets to be schematic again. Thus, after a period of a century came back to where it was at the beginning of the century, back to free markets.