===== PAGE 1 =====

THE

[eld

FEBRUARY 1961

IDEAS ON LIBERTY

How Did Lincoln Get His Education? . . Samuel B. Peitengill 3
Christianity and Education . . . . . Edmund A. Opitz 7
The Measure of Virtue . . . . . . leonard E. Read 13
Your Turn at Bat . . . . . . . . J. C. Sparks : 14
Profit and Public Relations . . . . . Koil Rowland 15
Freedom Does Pay . . . . . . . . William Henry Chamberlin 18
Let's Not Do-It-Ourselves . . . . . . Paul L. Poirot 25
Death in the Afternoon . . . . . . George Winder 30
Free Collective Bargaining . . . . . H.P. B. Jenkins 35
The Methods of Capitalism . . . . . Harold M. Fleming 36
Nothing To Lose but Qur Gains . . . . Claire Scoltock 43
Private Property and Freedom . . . . William Tolischus 46
Four Foundations of Freedom . . . . Kenneth W. Sollitt 50
Book Reviews:
If We Were in Russia’s Shoes? . . . . John Chamberlain 58
Other Books . . . . . . . . . . 62

fa THE FOUNDATION
FE FOR ECONOMIC EDUCATION, INC.

Irvington-on-Hudson, New York



===== PAGE 2 =====

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The Law

By FREDERIC BASTIAT (1801-1850)

“BUT HOW is legal plunder to be identified?
Quite simply. See if the law takes from
some persons what belongs to them, and gives
it to other persons to whom it does not
belong. See if the law benefits one citizen
at the expense of another by doing what the
citizen himself cannot do

without committing a crime.”

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===== PAGE 4 =====

THE

Teemdil A MONTHLY JOURNAL OF IDEAS ON LIBERTY

FEBRUARY 1961 Vol. 11 No. 2

LEONARD E. READ President, Foundation for
Economic Education

PAUL L. POIROT Managing Editor

THE FREEMAN is published monthly by the
Foundation for Economic Education, Inc., a non-
political, nonprofit educational champion of private
property, the free market, the profit and loss system,
and limited government, founded in 1946, with offices
at Irvington-on-Hudson, New York. Any interested
person may receive its publications for the asking.
The costs of Foundation projects and services, in-
cluding THE FREEMAN, are met through volun-
tary donations. Total expenses average $12.00 a year
per person on the mailing list. Donations are invited
in any amount — $5.00 to $10,000 — as the means of
maintaining and extending the Foundation’s work.

Accepted as controlled circulation publication at Irvington, N. Y., with
additional entry at New York, N. Y. Copyright, 1961, The Foundation for
Economic Education, Inc. Printed in U.S.A.

Additional copies, postpaid, to one address: Single copy, 50 cents;
3 for $1.00; 25 or more, 20 cents each.

- Permission is hereby granted to anyone to reprint any article In whole
or in part, providing customary credit is given, except ''How Did Lincoln
Get His Education?’ ‘‘Christianity and Education,” and ‘‘The Methods
of Capitalism.”

Fe E Any current article will be supplied in reprint form if there are enough
inquiries to justify the cost of the printing.


===== PAGE 5 =====

oe
How v dot
COT, INI (rn \

el Ly [/

7 mio NC ANIRIKO Ny.

SAMUEL B, PETTENGILL

IN JUNE oF 1860, friends asked from schools and books, and hav-
Abraham Lincoln to prepare a ing had little of either, he felt he
short biographical sketch, which had little education.

could be used as a campaign docu- Whence, then, came the power
ment. Lincoln did so, writing of to put in pure and limpid English
himself in the third person, and — as clear as a Vermont trout
insisted that it be used without stream — his letter to Mrs. Bixby,
material change: who had lost five sons in the War;
“The aggregate of all his school- the closing paragraphs of his Sec-

ing did not amount to one year. ond Inaugural; and the Gettys-

“He regrets hiswant of education burg Address? Whence, also, came
and does what he can to supply the power to make speeches and
that want. state papers that march to their

“After he was 23, he studied .,nc)ysion with the precision of a

ow books are important teach-

as well as he now does. .
“He was never in a college or ©€rS- 1 do mot downgrade them in

academy as a student, never even the least. They open many doors
inside a college or academy build- and tell you many things — some of
ing until after he had a license to which you remember for years.
practice law.” A subject taught in school is
As you can see, Lincoln felt, as like a whetstone on a scythe. It
so many do, that education comes may leave little of its substance on
— the scythe, but it leaves it sharper.

Mr. Pettengill, noted attorney and author, was

formerly a congressman, from Indiana. This ar- But books and schools are not as
ticle first appeared in American Mercury Mag- . .
azine. important as that from which they

3


===== PAGE 6 =====

4 THE FREEMAN February

come — life itself — and then they out those you meet in life, those
are important only as long as they with honor, and those without
are true to life, or some facet of honor — with what these teach you,
life, you can go far with no more than
An anecdote of Charles Ketter- one shelf of books, unless, of
ing, the noted inventor and re- course, you go into some specialty
search scientist of General Motors, like law, medicine, engineering,
illustrates this point. Kettering and so forth.
had thought up some new idea as So the question remains, where
to how a piston could work better did Lincoln get his education?
in an engine. When he ‘described Who and what were his teachers?
his idea to a famous engineer, the
man said, “It won’t work.” Ketter- Who Can Say?
ing asked, “How do you know it In Abraham Lincoln: The Prai-
won't work?” rte Years, Carl Sandburg says, “In
The man said, “Why, every en- wilderness loneliness he compan-
gineer and all the books on engi- ioned with trees....Silence claimed

neering know it won’t work.” him as her own. In the making of
Kettering said, “But does the him the element of silence was
piston know it won’t work?” immense.”
So they asked the piston by put- In describing the life of Lin-

ting it in an engine. The piston coln’s family and the pioneer peo-
did not know it could not work! It ple with whom he grew up, the

did work. The books were wrong. Encyclopedia Britannica says:
“Many, if not all, frontier women
Lite the Great Teacher of the old days were dreamers.

Life is the great teacher. Ralph Their lives were hard, their emo-
Waldo Emerson expressed this in tions mainly sealed up, but all
a sentence worth remembering: around them was the mystery of
“The scholar loses no hour that the primeval forest; they treas-
the man lives.” And he added: ured it in silence....

“The scholar recognizes his teach- “How had he gathered into him-
er in every man.” self a subterranean sense of beau-

What you learn from contact ty in words, whether it had grown
with life, with your schoolmates, out of long reading of the Bible,
teamwork on the athletic field, Shakespeare, and Robert Burns —
competition in the classroom, loy- the favorite books of his maturity
alty to the old school, loyalty — whether it linked back to his
to your country, how you sort mother’s world, with its forests


===== PAGE 7 =====

5

A
1%

stable of ghost writers like the
statesmen of our time, who read a
speech to a nationwide radio audi-
ence and stumble over the words
as if they had never seen them in
type before.

In his speeches and state papers,
Lincoln seldom quoted anyone as
authority for what he was saying.
Occasionally he quoted Jefferson
— his kindred spirit — and once or
twice, Henry Clay. Few others. He
was his own authority. He thought
things through to conclusions that

: seemed right to him.
and empty spaces, its loneliness Self-reliance was his teacher, as

and its lampless nights of stars, it was to all pioneer people. “Trust
who can say?” thyself, every heart responds to

Yes, who can say? A great book that iron string.” Nobody ever
remains to be written on how the taught Lincoln to use his vote so
wilderness and the prairie influ- as to eat his bread in the sweat of
enced the American character. other people’s brows. Lincoln made

Lincoln and all pioneer people his own way — and he traveled far!
learned to think for themselves.

They had to. There were no news- Tools Reveal Their Secrets

paper editorials, telephones, radios, The crude tools of the pioneers
or television sets by which pundits taught him their secrets. The axe
from afar could form their opin- was put in his hands when he was
ions and judgments for them. eight years old, and it was not far

And so, without all these mod- from his grasp until he was man
ern advantages (!) which we pos- grown. What you learn through
sess, they were free from the your hands you seldom, if ever,
mass-mind, the “Group Think,” forget, which is something not
which is one of the curses of our true of what you learn through
time. They thought as individuals, your eyes and ears.
groping for the truth and the These tools taught him many
right as God gave them to see it. things. They taught him how other

Lincoln wrote his own speeches! people had to struggle to make a
He did not have the benefit of a living. He learned the trades of


===== PAGE 8 =====

6 THE FREEMAN February

the farmer, the woodsman, car- no speech nor language where
penter, stone mason, surveyor, their voice is not heard. Their line
storekeeper — many others. And is gone out through all the earth
thus it was that he learned to un- and their words to the end of the
derstand people and talk to them world.”
in words they understood. These words were heard in the
We speak somewhat scornfully wilderness of Southern Indiana,
of a “Jack of all trades, and mas- seven score years ago. You don’t
ter of none,” and, of course, a man hear them so well in a city apart-
must be master of something to ment filled with “rock and roll.”
earn a living. Nevertheless, the Poverty and privation were his
tools of all these trades taught teachers. They were close to him
Lincoln many things not found in and to all around him. From them

books today. he learned kindness, compassion,
} sympathy, understanding. He
The Voice of Nature learned many things from living

Nature was his teacher. Think with poor people which rich men’s
of Lincoln as a boy in the primeval sons often never learn at all. Be-
forest of Little Pigeon Creek in cause this was so, people liked him
Southern Indiana where the sound and trusted him and later voted
of an axe had never before been for him.
heard, where trees grew nearly as It was thus that he could later
tall as the Redwoods of California, write to a mother of five dead sol-
where there was silence and mys- dier sons in words no other man
tery and peace. Think of him look- had ever put on paper. And so
ing up through the foliage far only he could make the Gettysburg
overhead to the blue sky of noon, Address.
or the bright stars of night— do Lincoln never lost the common
you think he did not hear voices touch and so it came about, in the
in the air? Do you believe he ever terrible years of war, that the
thought that a divine hand was plain people of the North came to
not behind it all? Do you think he speak of him as “Father” Abra- -
did not hear the same voices that ham. He trusted them, and most

the Psalmist heard? of them trusted him. Pride, vanity,
“The heavens declare the glory and high office never spoiled him.
of God, and the firmament show- The mystery and the mastery of

eth his handiwork. Day unto day Lincoln came from books, a little;
uttereth speech and night unto but from Life, the Great Teacher,
night showeth knowledge. There is he learned many lessons. -~


===== PAGE 9 =====

CHRISTIANITY
AND

EDUCATION

EDMUND A. OPITZ

THE CRISIS of our culture comes positive things in our culture have
into one of its focal points in edu- been Christian things, or the
cation. Most inquiries into educa- things of Christian cultivation.
tion, however, are little more than T. S. Eliot has said somewhat
amiable discussions about condi- the same thing in The Idea of a
tions in our schools. There is a Christian Society. There are some,
dearth of trenchant criticism of he observes, who say “that a soci-
contemporary educational theory ety has ceased to be Christian
and practice which measures its when religious practices have been
shortcomings against the demands abandoned, when behavior ceases
of the Christian revelation. to be regulated by reference to

Culture is religion externalized, Christian principle.” But there is
and our culture bears the imprints another way of looking at the
of its molding by Christianity; we matter. “The other point of view,
were Christendom before we be- which is less readily apprehended,
gan thinking of ourselves as Eu- is that a society has not ceased to
rope or the West. The hallmarks be Christian until it has become
of this faith stamp themselves positively something else. It is my
even on our rebellion against it, contention that we have today a
for every rejection or denial im- culture which is mainly negative,
plies something positive against but which, so far as it is positive,
which the reaction occurs. The is still Christian. I do not think
From the Introduction to R. J. Rushdoony’s that it can remain negative, be-
Intellectual Schizophrenia: A Study in Phi- cause a negative culture has ceased
losophy and Education (Presbyterian and Re-

formed Publishing Company, New Jersey, to be efficient in a world where

1). Mr. Opitz i ber of the Founda. : .
O61). gr Opitz is a member of the Founda” economic as well as spiritual

7


===== PAGE 10 =====

8 THE FREEMAN February

forces are proving the efficiency narrow the concept of the environ-
of cultures which, even when pa- ment down to the social group and
gan, are positive; and I believe recommend that schooling be a
that the choice before us is be- process of merging the man into
tween the formation of a new the mass. These theories have not
Christian culture, and the accept- gone unchallenged. Man, say the
ance of a pagan one.” (London, opponents of environmentalism,
1939, p. 13) has the capacity to respond cre-
The word ‘“pagan’ usually con- atively to his environment and
notes an innocent, carefree child surpass it. And the group, they
of nature. This kind of thing is point out, may exhibit norms that
hardly a live option for modern are warped or vicious. Aeccommo-
man and, presumably, is not what dation to these is debasing.
Eliot has in mind. Christianity’s
chief antagonist for the past two
centuries has been the secular The environmentalists return to
faith of the Enlightenment, and the fray by asking their critics if
a perverse form of it is the main the aim of education, then, is to
contender today. In its early produce maladjusted products? It
phases there was something at- is not, obviously, but at this point
tractive about this faith, but in the argument runs aground be-
its reactionary phase during this cause both parties accept too lim-
century it has spawned an idola- iting a notion of what constitutes
trous, statist cult manifesting it- man’s environment. As the term
self now as communism, and again is commonly used, environment
as various dilutions of Marxism. refers to the world of time and
Communism is one version of space, the world of things, the:
environmentalism — the notion physical frame within which man
that a man’s character is made struggles to survive. No Christian
for him and not by him. Improve can accept so narrow a defini-
his material circumstances and tion of environment; his natural
you change man for the better. habitat is the universe of time and
Education, under this dispensa- space, but he is also environed by
tion, is the sum total of efforts to another dimension, eternity.
adapt man to his surroundings. This dimension has dropped out
Should the educated man be of contemporary life. The modern
adjusted to his environment? Ad- outlook does not include it, with
justment is the aim, as many edu- the result that multitudes of peo-
cationists see it. Some of them ple no longer feel a sense of life as

What Is Environment?


===== PAGE 11 =====

1961 CHRISTIANITY AND EDUCATION 9

participation in a cosmic adven- ism as the principle of social cohe-
ture. They have come to believe sion. There are very few new
that the world of things which can truths, but there are always lots
be seen, felt, measured, and tested of new errors — and these are
is man’s sole habitat. Belief in the some which have gained accept-
reality of things not seen has ance during recent centuries. The
dimmed or disappeared and we are axioms now widely taken for
living, so the French writer, André granted are largely eighteenth
Malraux, tells us, in “the first and nineteenth century products,
agnostic civilization.” This charge, and they are alien to the Christian
or description, is all too true. It is and humanist tradition. But even
a fundamental assumption, uncon- though they seem more deeply
sciously presupposed in our time entrenched than ever in the pop-
— and thus more a mood than a ular mentality, they have already
premise — that man is a creature come under fire from some of the
of the natural order only. It was more discerning minds.
the evil genius of Karl Marx to
seize upon this mood and make it Socialism Lacks Appeal
explicit. Communism today offers The acids of modernity may
a godless religion and a this- have eaten away at historic Chris-
worldly salvation, a caricature or tianity, but more recently they
parody, point by point, of Chris- have also attacked the Enlighten-
tianity. And one has the uneasy ment faith. Christianity has been
feeling that many people, now on purged of some undesirable accre-
the fence, would go communist ex- tions during this ordeal, but its
cept for an inertia which prevents rival has probably been damaged
them from following their prem- beyond repair. Reflect further on
ises to the bitter end. some of the tenets of the latter and
We are living, some have sug- ask: Where are now its votaries?
gested, in the post-Christian era. Futurism, the gospel of unimagin-
Our outlook is, in general, man- able progress; scientism, belief in
centered, secularist, and utopian. the messianic potential of science;
It is materialistic and rational- democracy, faith in the omnis-
istic. It uses majority decision as cience of majorities; socialism,
its criterion of right. It asserts a utopia by means of political owner-
false individualism as against nat- ship — who now defends these
ural associations such as the fam- dogmas? They still have their
ily and intimate community group- partisans, true, but they gain few
ings, and then it turns to national- recruits. Christianity, on the other


===== PAGE 12 =====

10 THE FREEMAN February

hand, is resurgent; not always respect each of us needs all the
wisely so, perhaps, but it is, at any help he can get, and he can get
rate, alive enough to challenge the help from the right books.

ablest contemporary minds. It This analysis will hardly find
fared badly under the shallow op- favor with professional education-
timism which reigned last century ists, nor with those who reject
because Christianity is a religion religion. But even many church-
of hard answers. It is not called men, regrettably, are more at
into play when men are content home with sentimentality than
with glib answers to soft ques- hard, rigorous thinking. They will
tions; it partakes of the tragic be uncomfortable with anything

view of life. that challenges them to re-examine
things they have taken for grant-

Opportunity from Crisis ed.
Henry Adams ironically re- Many churchmen are disturbed

marked that his contemporaries because the Bible may no longer
had “solved the universe.” Chris- be read in the so-called public
tianity is not for the likes of these. schools, but how many acknowl-
But today’s crisis is religion’s edge the inevitability of the secu-
opportunity. Life again confronts larist trend in tax supported and
men with paradox, uncertainty, politically controlled schools? The
dilemma, and catastrophe; the state is secular in a free society,
smooth facade is dented and the alternative being some form
breached. Man tries to play God of caesaropapism. It follows that
and fails to secure even a niche wherever government gets into the
for himself in any pantheon. The education business — whether at
homemade heaven he tries to fash- local or national levels — its influ-
ion on earth — in totalitarian lands ence will tend to secularize the
— resembles an old-fashioned hell. schools. The churches respond to

He aspires to the role of deity'and this challenge by offering released- |,

reverts to subhumanity. Perhaps time religious instruction, and by
if men attempt a more modest establishing —at a progressive
role — to become truly human — we rate — their own weekday schools.
may, with God’s help, make it. Laudable as are these efforts, it
But such a choice as this demands is feared that, in all too many
an individual commitment. Before cases, parochial and private schools
we seek for better answers, let operate with the same theories of
alone hard answers, we must start education as tax supported insti-
to ask the right questions. In this tutions.


===== PAGE 13 =====

1961 CHRISTIANITY AND EDUCATION 11

Before we can discuss the na- tion for that which has to do with
ture of education intelligently we ends, or formative knowledge.
must have come to some under- Instruction in instrumental
standing of the nature of man. knowledge is not education, al-
Soviet schooling with its emphasis though it is part of education and
on scientific and technological in- useful in its own right. It is need-
struction, reflects the Marxian ful that men possess such skills as
understanding of human nature. the ability to lay bricks, cut hair,
Whatever else we say about the add figures, perform experiments
Marxian view of man, we must in physics and chemistry, write
certainly admit that it falls short books, and preach sermons. But
in every dimension of the Chris- while the possession of such skills
tian view of man -—a creature is desirable and important, their
created by God for fellowship with exercise is not the distinctive mark
Himself. If the Christian view of of an educated man. It is true,
man’s nature and destiny is our however, that an educated man
premise, we cannot possibly agree ought to have a quiverful of such
that even a superbly trained engi- and similar talents and be able,
neer is a finished educational pro- like Jefferson, “to calculate an
duct. We need lots of engineers in eclipse, survey an estate, tie an
modern society, and good ones are artery, plan an edifice, try a cause,
to be preferred to those less high- break a horse, dance a minuet, and
ly skilled. But engineering is in play the violin.” But this is merely
the realm of means, and the crucial to say that a man ought to be
question concerns the ends to be trained as well as educated.
served by these means. It’s fine
that we constantly. improve our
means, but unless we simultane- The so-called public school sys-
ously improve our ends we gen- tem in the United States stems
erate a conflict by hitching too mainly from the nineteenth cen-
much power to too little purpose. tury and partakes of the dubious
“Power is never a good,” Alfred philosophy of that time and sub-
the Great observed, “except he be sequent periods. As a system of
good that has it.” It would further instruction supported by taxation
the interests of clarity if we could and compelling attendance it was
use the word training to describe bound to veer toward secularism
the instruction that has to do with and statism, but other inherent
means, or instrumental knowl- defects were apparent as. well.
edge; reserving the word educa- Late last century the astute

Inherent Defects of the System


===== PAGE 14 =====

12 THE FREEMAN February

French critic, Ernest Renan ob- argument and debate, but insisted
served that “countries which, like upon dogmatically as the only per-
the United States, have set up missible point of view. I. L. Kan-
considerable popular instruction del, Professor of Education Emer-
without any serious higher educa- itus, Teachers College, Columbia
tion, will long have to expiate University, writes, in School and
their error by their intellectual Society for August 22, 1953, “The
mediocrity, the vulgarity of their critic, however sincere, who ven-
manners, their superficial spirit, tures to comment adversely on the
their failure in general intelli- consequences of the cult of prag-
gence.” (Quoted by Albert Jay matism, experimentalism, or in-
Nock in The Theory of Education strumentalism is regarded as -al-
in the United States, Chicago, most committing sacrilege.”
1932, 1949, p. 20) But now it is admitted on all
In the twentieth century, com- sides that the sacred cow is out
pulsory government schooling got of sorts. There is something wrong
its philosopher, John Dewey. “The with our system of education be-
educational process,” as viewed by cause there is something wrong
this influential teacher, “has no with our theory of education, and
end beyond itself.” Education is we won’t correct our system until
“vital energy seeking opportunity we straighten out our theory. But
for effective exercise.” (John Dew- this we cannot even begin to do
ey, Democracy and Education, unless we know what is normative.
N. Y., 1921, pp. 59 and 84) The We really do know, as a matter of
Dewey philosophy is pragmatic, fact, but we need to be reminded
experimental, and instrumentalist that the norms are Christian
—not advanced tentatively for imperatives. . PN

Calvin Coolidge

A REVOLUTION IS TAKING PLACE which will leave the people de-
pendent on the government. . . . Finding markets will develop
into fixing prices and finding employment will develop into fixing
wages. The next step will be to furnish markets and employment,
or in default, pay a bounty and dole.

Those who look with apprehension on these tendencies do not
lack humanity, but are influenced by the belief that the result of
such measures will be to deprive the people of character and
liberty.


===== PAGE 15 =====

THE MEASURE OF VIRTUE

LEONARD E. READ

THE CROWN of virtue should rest think of ourselves as virtuous be-
uneasily on any man until he has cause we disapprove TVA, sub-
given evil a setback. This is to say sidies to farmers, wage, price, and
that virtue is a quality of char- production controls, and other so-
acter born in victory over evil. cialistic indulgences. Political vir-
Ever so many persons think of tue, however, is a false claim until
themselves as virtuous simply be- our affinity to right principles has
cause they have done nothing they been tested and found unbreak-
conceive to be wrong. This is like able.
thinking of oneself as victorious Will we stand against social-
when there has been no contest. ism when we realize that our own
Viewed in such a light, victory or pet project rests on federal aid?
virtue is pretty thin stuff. When such things are at stake as
The wealthy individual who has a downtown parking lot or a chil-
no temptation to steal may think dren’s hospital or our alma
of himself as honest. But, how mater’s expansion program or a
does he know that honesty is one foreigner’s purchase of our gad-
of his virtues? If put to the test gets or our town’s slum clearance?
of Victor Hugo's Jean Valjean, There is no manly virtue in
he might find himself as much a mere lip service to right princi-
weakling as those whose frailty he ples. Our virtue or manliness is
scorns. Only if he does not falter unknown until each of us faces his
“when the chips are down” can he own ‘temptation. The measure of
properly lay claim to virtue. character is recorded in how each
How easily integrity is pre- of us responds to the question,
sumed when the motive to lie is “Do I'yield or triumph over what
absent! But whether or not in- I believe to be wrong?”

tegrity is a personal virtue re- Virtue is the crown of victory
mains in question until we meet over the temptation to moral
and yield, or yield not, to the weakness! ~

temptation of the lie.

Applying the above to our day- Reprints of this article are available
to-day political life, many of us at 1¢ each.

13


===== PAGE 16 =====

J. C. SPARKS LB + ,

federal aid to one or another proj-
ect. How is it then, that the de-
mand for federal aid continues to
increase if so many people under-
stand why it is wrong? Let us take
a look at this temptation to forget
one’s principles.

Principles are easily claimed,
but they may be extremely diffi-
cult to retain under adverse cir-
cumstances. Of course, this is the
true test of whether one really
embraces a set of principles or
carries them only in his imagina-
tion.

An athlete may train for the
day of a sporting event, but his
fulfillment is reached only when
he engages his opponent in the
contest to determine the winner.
Then, and only then, has he truly
become an athlete.

A man may read and become
familiar with all of the rules of
baseball, studying books, pictures,
and films to learn how to play the
game. He may even become a critic
of those who are playing. The day
then arrives when he has an op-
portunity to get into the game
himself, but at that moment he
Mr. Sparks is a businessman in Canton, Ohio. fearfully puts away his bat and

OF ALL the plans and laws to bring
about the adoption of socialism,
perhaps none has been more effec-
tive than to offer to various local
governments and public institu-
tions the bribe of matching funds
-or grants-in-aid out of the federal
treasury. There is no greater
temptation than the offer of
money, particularly where accept-
ance of such money can be justi-
fied with the reasoning (though
faulty) that unless one takes his
share, others will consume it for
him. Another way of stating the
same fallacy is that since every-
one else is doing it, it is right for
me to do it. It is by such thinking
and action that federal aid and its
twin, federal control, have grown
over the past 30 years to bring
about the insidious threat to
American liberty that socialism
has become, :

That this idea is wrong is easily
understood by large numbers of
people throughout the country. In
fact, many go on record opposing

14


===== PAGE 17 =====

1961 YOUR TURN AT BAT 15

ball. And so it is with fighting an expressway, or a school in his
federal aid. The man in Ohio criti- own city. It doesn’t take much
cizes the acceptance of federal aid courage to wave the baseball bat
by cities and states throughout and tell what you would do if you
the nation but not in his own home were in the game when the game
town. When he comes face to face is being played somewhere else.
with the temptation to get on the It is quite another thing to stand
federal aid band wagon, he finds at the plate and battle for your
it too difficult to stand on his pur- principles when the game is in
ported principles. Federal aid may your own home town and it is
be wrong in Tennessee, Oregon, your turn at bat. ~
and Maine, but it is right when ——m . . .

it is sought to build a hospital, eprint of this article are available

A

KoIL ROWLAND

LATE in the last century, an Amer- likely. For never in its history has
ican businessman brought noto- the American business community
riety to himself and trouble to his been so intent on the practice of
company with a public statement public relations as it is right now.
as memorable as it was unfortu- The cant of the public relations
nate. “The public,” he said, “be man is much in evidence nowadays
damned!” in books about business, in the
That a representative Ameri- pages of the business journals,
can businessman would even think and in the speech of corporate ex-
such a thing today is highly un- ecutives. A very great deal is be-
—_— ing written and said about “corpo-
Mr. Rowland is Information Director of the . 1 . .
Missouri State Chamber of Commerce. rate images” and their “projec-


===== PAGE 18 =====

16 THE FREEMAN February

tion.” And the agreement about Different Ways To Serve

what sort of “corporate images” It is, of course, quite true that
should be ‘projected’ is wide- in order to be successful in its
spread. prime function — the making of

It seems reasonable to state money — a business concern must
that the “corporate image” which provide to its customers good
the average American business- products or services, reasonably.
man is currently attempting to priced. By doing this, the busi-
“project” for his firm is the “im- ness concern well serves the area
age’ of a service institution. Great in which it is located. It is also
stress is being laid on the desire true that in order to be success-
of the average company to be “of ful in its prime function — the
service to the community,” and on making of money — a business con-
its efforts to be “a good corporate cern must do a wide variety of
citizen.” things which contribute to the

This approach is considerably welfare of the area in which it is
less than candid. The primary ob- located. By doing these things,
jective of any properly run Ameri- the business concern doubtless
can business firm is neither “serv- manifests “good corporate citizen-
ice to the community’ nor the ship.”
practice of ‘“‘good corporate citi- But the services a business con-
zenship.” It is the making of cern renders, and the good cor-
money. Businesses are not started porate citizenship it exhibits, are
and-run ‘to “serve” the communi- never anything more than means
ties in which they are located. And to its end, which is the accumu-
they are not started and run to lation of profits for its owners. To
press toward the goal of “good imply, as the current public rela-
corporate citizenship,” either. tions effort of a large part of the
Businesses are started and run to American business community
make as much in profits as they does imply, that these things are
can for the people who own them. themselves the ends of business

Most American consumers know endeavor is disingenuous in the
about the profit and loss system, extreme. :
and approve of it. So, not many of The reluctance of most Ameri-
them are much impressed by all can men of enterprise to acknowl-
the lofty talk about ‘service to "edge a desire for profits as the
the community” and “good cor- thing which chiefly =motivates
porate citizenship” now being di- their business actions and chiefly
rected at them. structures their business attitudes


===== PAGE 19 =====

1961 PROFIT AND PUBLIC RELATIONS 17

is alarming. For it strongly sug- people more of the good spiritual,
gests a lack of faith on their part mental, and material things of life
in the rectitude of the profit mo- than any other motive has given

tive. any other people in the whole of
The collectivists, who are dedi- human history.
cated to the destruction of busi- The idea of profit is in very

nessmen as a class, have been grave danger these days. It is un-
claiming for decades that there is der the constant and heavy attack
something inherently evil in the of men who want to destroy it
idea of profit. Are businessmen completely, and to substitute for

beginning to believe them? it — as a motive for getting the

world’s work done — universal

Why Not Say So? compulsion grounded in naked and
American businessmen have al- ruthless force.

ways been motivated chiefly by a American businessmen owe

desire for profit. They still are. their very existence to this idea of
They used to say so — frankly, and profit. Not too long ago, they were
with a deep sense of pride. They its ablest spokesmen and its
ought to start saying so again. stanchest defenders. But they are
The simple truth is that Ameri- not speaking for it ably or de-
can business is interested mainly fending it stanchly today. They
in profit. It ought to tell people so, are playing it down and selling it
and then turn its attention to the short while they talk spurious ir-
vastly more important job of tell- relevancies about “service” and
ing them why. “citizenship.”

Surely the reasons why — the American businessmen ought
good and moral reasons why — are to start talking about the idea
neither very difficult to find nor of profit again. They ought to
very hard to make plain. begin again to show some pride

In a free society, the idea of in it, and to make plain the rea-
profit supplies people with the sons for the pride they show. And
most widely acceptable motive for in the concepts and techniques of
work there is. And in the free public relations, they have at their
American society, the profit mo- disposal the ideal means for doing
tive has given all classes of our that job. Pe


===== PAGE 20 =====

WILLIAM HENRY CHAMBERLIN

“THE CITIZEN of the United States might have been in his position;
is taught from his earliest infancy but in the end the sum of these
to rely upon his own exertions in private undertakings far exceeds
order to resist the evils and the all that the government could
difficulties of life; he looks upon have done.” Thus wrote Alexis de
social authority with an eye of Tocqueville in Democracy in
mistrust and anxiety, and he only America, published in 1835.

claims its assistance when he is At that time the young Repub-
~ quite unable to shift without lic of the United States repre-
it. . .. sented the most complete flower-

“When a private individual ing of the ideal of unlimited pri-
meditates an undertaking, how- vate initiative and opportunity.
ever directly connected it may be Monarchy had been swept away;
with the welfare of society, he there were no relics of feudal
never thinks of soliciting the co- privileges; there was so much open
operation of the government, but land and so many industries to be
he publishes his plan, offers to developed that no one was com-
execute it himself, courts the as- pelled to labor under oppressive
sistance of other individuals, and conditions or to accept unsatisfac-
struggles manfully against all tory wages. There was no para-
obstacles. Undoubtedly he is often sitic “big government”; there
less successful than the state were no theories of the desir-
Mr. Chamberlin is a skilled observer and re- ability of “deficit spending”; at
porter of economic £24, political conditions et one time the modestly run federal
of books, has lectured widely, and is a con- government hardly knew what to
pia The Wall oarcer Journal snd many (with the surplus that had ac-

18


===== PAGE 21 =====

1961 FREEDOM DOES PAY 19

cumulated in the national Treas- stressing the connection between
ury. individual freedom and general

The natural result was the tre- well-being. So there is this com-
mendous outburst of free indivi- ment on an incident that occurred
dual enterprise which impressed during the visit of Peter the
the observant and philosophical Great to England near the end of.
French visitor. And America was the seventeenth century:
in line with the general trend of “He [Peter] heard with great
Western civilization. In Europe interest the royal assent given to
also, Adam Smith and thinkers of a bill for raising fifteen hundred
his school had discredited statist thousand pounds by land tax, and
theories of economics. The advan- learned with amazement that this
tages of leaving people alone to sum, though larger by one half
go as far as they could by their than the whole revenue which he
own industry and ability had sup- could wring from the population
planted the older idea that it was of the immense empire of which
up to the government to regulate he was absolute master, was but
everything, including even what a small part of what the Com-
people of various social classes mons of England voluntarily
might wear. granted every year to their con-
stitutional King.”

The association between despo-

Viewed in historical retrospect, tism and poverty, between liberty
the nineteenth century stands out — political and economic — and
as an era of true liberalism, when prosperity was almost universally
the close, intimate connection be- accepted in North America and in
tween political liberty, economic Western Europe in the nineteenth
liberty, and general well-being century. This era appears in retro-
was most generally recognized. spect as the golden age of genuine
Despotic and oligarchic forms of economic liberalism, of the belief
government were giving way to that men fared best when they
increasingly generous constitu- were subjected to the fewest state
tions. If one glances through the restrictions and were allowed to
pages of Macaulay’s highly read- go as far as their individual
able History of England, com- ability and industry would carry
posed when political reform and them.
economic progress were in full The paternalistic supervision
tide, one finds passage after pas- which was always a characteristic
sage, explicitly and implicitly of absolute monarchy had largely

Nineteenth Century Liberalism


===== PAGE 22 =====

20 THE FREEMAN February

disappeared with the rise of self- few Americans are old enough to
governing institutions. Not yet remember the period before World
arrived was the new paternalism War I when no passport was re-
of the twentieth century, with its quired for travel in most Euro-
extreme tyrannical forms of com- pean countries. Even Russia asked
munism and fascism and its milder only for a passport and did not re-
and more insidious expressions in quire a visa. Any European who
socialism and the ever-expanding desired could pull up stakes and
rsa Weelfare. State, based on, a more | travel or migrate where he liked
and more intensive pillaging of without let or hindrance, or the =?
the thrifty for the benefit of the necessity of obtaining permits to

thriftless. work in the land of his choice.
This comparative freedom of
Four Freedoms movement brought millions of

This era, when economic liberty European settlers to the United
was tried out in practice as never States and built up American in-
before, or since, was characterized dustry and agriculture much
by four freedoms, which have now faster than would otherwise have
completely disappeared in totali- been possible. The same was true,
tarian states, and have been con- on a smaller scale, for the newly
siderably curtailed, even in na- developing overseas lands, for
tions where political freedom has Canada, Australia, New Zealand,
been preserved. These were: South Africa.

(1) Freedom of the individual This freedom of movement made
to regard what he earned as his nonsense of nationalist mercantil-
own. Such taxes as were levied on ist economics. There were colonies
personal income in the nineteenth of foreign businessmen, engineers,
century. were negligibly small by technicians, people engaged in all
current standards and were im- sorts of occupations, in Russia —
posed, as a rule, only in response something fantastically impossible
to some big emergency, such as today. There were more Germans
the Civil War in the United earning their living in Paris than
States. There could scarcely have in all the German African colonies.
been a better incentive to hard (3) Freedom of trade. There
work and the taking of risks than were still customs barriers in
the knowledge that the fruit of Europe, and the United States
the individual’s labor was his own, tariff went up and down, depend-
to dispose of as he liked. ing on whether Republicans or

(2) Freedom of movement. A Democrats were in power. But the


===== PAGE 23 =====

1961 FREEDOM DOES PAY 21

vast British Empire was open to tegral part of the national income
all comers on a basis of free com- of the great industrial Powers,
petition, and the smaller countries protected not only by their politi-
of northern Europe, the Nether- cal and military might but — more
lands, Belgium, the Scandinavian strongly — by the general, unques-
countries, were generally on a vir- tioned acceptance of the funda-
tual free trade basis. The tariffs mental capitalist principles: sanc-
of that time raised prices here and tity of treaties, abidance by in-
there, but did not seriously affect ternal law, and restraint of gov-
the flow of trade. Such really crip- ernments from interference in
pling devices as import quotas business.”
were unknown.

(4) Freedom of investment. As War Destroys
a brilliant German economic edi- These four basic freedoms of
tor, the late Gustav Stolper, puts the nineteenth century, along with
it in his somewhat neglected book, the society, at once stable, progres-
The Age of Fable (Reynal and sive, and prosperous, which they
Hitchcock, 1942) : helped so much to promote, took a

“Year in, year out, billions were terrific beating at the hands of the
invested by the great industrial two great wars and the many so-
European Powers in foreign coun- cial revolutions of recent times.
tries, European and non-European. Under communism and under
England and France held the lead, fascism they were wiped out com-
Germany joined them at a rapidly pletely. And even in countries
growing pace after the 1880's. which retained political and civil
These billions were regarded as liberties the trend toward state
safe investments with attractive intervention and state direction of
yields, desirable for creditors as economic life was strong and un-
well as debtors, with no doubts mistakable.
about the eventual return of both Yet the validity of these prin-
interest and principal. Most of the ciples, which boil down to leaving
money flowed into the United the individual free to manage his
States and Canada, a great deal own life and which have very im-
into South America, billions into portant moral implications, has
Russia, hundreds of millions into been strikingly vindicated by the
the Balkan countries, minor results of doing away with them.
amounts into India and the Far It was rightly hailed as a big step
East. The interest paid on these forward when the principal Euro-
foreign investments became an in- pean currencies were made sub-


===== PAGE 24 =====

22 THE FREEMAN February

stantially convertible in the be- a state planned economy. A point
ginning of 1959. Yet this was that was generally overlooked is
merely returning, with some limi- that, while the Soviet Union had
tations, to the situation which had pretty full compulsory employ-
prevailed in Europe for genera- ment, the standard of living of
tions before World War I. The the unemployed in the United
economic goals which the two com- States and Great Britain was
peting organizations, the Euro- higher than that of the Soviet
pean Common Market and the employed.
European Free Trade Association,
hope to achieve during this decade The Argument Shifts
coincide very largely with the re- Now that unemployment has
establishment of freedoms which ceased to be a serious problem,
were taken for granted in the the argument for a planned econ-
nineteenth century. And at that omy has shifted. We are asked to
time there was no supposed need view with alarm a Soviet “rate of
to guarantee and implement these economic growth” faster than
freedoms by means of a cumber- America’s. The implication is that,
some international bureaucracy. unless America goes in for some
Communism and fascism, at type of government planned econ-
variance as to means, were at one omy, the Soviet Union will realize
as regards the end: the destruc- the boasts of Stalin and Khrush-
tion of individual liberty and the chev, “catch up with and surpass”
creation of a robot state by re- America economically and, in
serving for the government all im- Khrushchev’s phrase, “bury us”
portant economic decisions. And without resorting to war.

the apostles of these totalitarian But this numbers game of com-
creeds found allies — unconscious parative growth is extremely
and unwilling allies, no doubt — tricky. There has been official ad-

in groups which, while rejecting mission in Moscow that Soviet
political dictatorship, went all out methods of computing economic
for state planning of the national growth, different from ours, are
economy, an objective which could calculated to exaggerate the real
not be effectively realized without progress of Soviet industry. There
state compulsion on a large scale. is obviously much more room for

An argument that was often percentage growth in Russia than
heard during the thirties was that in the United States in the output
mass unemployment could only be of automobiles, telephones, and
averted by the Soviet method of many other products of which the


===== PAGE 25 =====

1961 FREEDOM DOES PAY 23

United States already has an a- the least damaged by war and the
bundant supply, while the Soviet least impoverished of the Soviet
Union is only beginning produc- satellite states. But what a con-
tion and distribution on any large trast between what freedom has

scale. accomplished on one side, tyranny
Is there any convincing reason and state control on the other!
for the United States to “grow” in Despite its unfavorable geo-

wheat and cotton output when graphical position, an island in a
heavy surpluses of these and many Red sea of surrounding Soviet-
other commodities pile up unsold controlled territory, West Berlin
— and not unsold because anyone has forged ahead tremendously
in the United States is going hun- since the first bleak postwar
gry for lack of bread or naked years. The Kurfuerstendamm
because of any shortage of cotton looks like the principal avenue of
goods? America has already any European country. There are
proved, in World War II, its abil- all the normal accompaniments of
ity to “grow” in military output a big city: lively traffic, open and
as fast as any emergency may well patronized movies, theaters,

require. concert halls, more and more hotels
and restaurants. Housing projects
Two Vivid Examples are rising on what were once piles

If anyone wants a vivid illus- of rubble. New and revived indus-
tration of how freedom raises and tries have helped to make up for
how lack of freedom depresses the the loss of employment which is
standard of living, he should visit the result of the fact that Berlin
in quick succession, as I have done, is no longer a capital.

West Berlin and East Berlin, the Cross the long winding border
Ziirich airport and the Prague between the two sectors and one
airport. These are fair compari- has the feeling of being in an-
sons. The bombing of Berlin was other country. Reconstruction is
distributed impartially between largely limited to one show avenue,
the sundered sections of the city. the Stalin-Allee. What were once
The people in the two parts of the liveliest streets of old Berlin,
Berlin are of the same nationality Unter den Linden, Friedrich-
and language, with the same edu- strasse, Wilhelmstrasse, are bare
cational background. As for the and desolate. The few automobiles
- two airports, Switzerland is pros- are state-owned. One has the feel-
perous as a relatively free enter- ing that a stranded traveler in
prise country; Czechoslovakia is East Berlin would find it very


===== PAGE 26 =====

24 THE FREEMAN : February

difficult to find a place where he a kind of luxury which only a rich
could get a meal or find a roof country can afford. This is em-
over his head. So bleak and deso- phatically putting the cart before
late is the atmosphere that it is the horse. It is not true that na-
easy to understand, quite apart tions become rich and then adopt
from politics, the steady flow of freedom as a kind of status sym-
refugees from communist-ruled bol. The idea that peoples must
East Germany to free enterprise choose between freedom and eco-
West Germany. nomic growth, between freedom
On a smaller scale the two air- and maximum economic develop-
ports tell the same story. In Ziir- ment, is sheer nonsense.
ich one can buy at the airport a There are so many spiritual im-
wide variety of articles. Most plications in liberty that it de-
significantly, newspapers, mag- serves to be considered an end in
azines, and books in many lan- itself. Even if state planning of-
guages are on sale. In Prague fered more material goods, people
about all the airport offers is a who have known and cherished
few flyspecked communist propa- liberty would rather live as free
ganda posters and old copies of a human beings on a more modest
pamphlet extolling the achieve- standard of living than sell their
ments of ‘socialist construction” birthright for a mess of totali-
in Czechoslovakia. The contrast tarian pottage. But no such alter-
between the richness and variety native exists. The fruits of totali-
of life under freedom and the tarianism are for the State, at
bleak drab poverty of life under most for a limited ruling class.
communism could not be pointed It is the peoples who have re-
up more effectively than by this mained freest, who have been
quite unrehearsed contrast be- most successful in the art of
tween the appearance of the two orderly self-government, who

airports. have kept their governments on
leash by a system of constitu-
Luxury or Necessity? tional checks and balances, who

A familiar argument of those will always fare best in the ma-
who consciously or unconsciously terial goods of life.
favor state planned direction in Freedom does pay, in more ways
economic life is that freedom is than one. - ~


===== PAGE 27 =====

PAuL L. PoIROT I I

Aa
To SHIRK personal responsibility for instance, involving costly
and “let George do it” — or in the building programs and adminis-
expectation that the government trative procedures and curricu-
will fulfill the obligation —is a lum changes. Rising school taxes
certain step away from freedom raise cries for more and more
toward compulsory collectivism. state “aid,” often under the mis-
But it is also possible to approach apprehension that this will fore-
socialism from the opposite direc- stall further federal “aid” and
tion, as when men who are steeped federal control over education. But
in the tradition and practice of the record seems to show that the
competitive private enterprise try higher the local school tax bill, and
to thwart anticipated governmen- the greater the reliance on state
tal expansion by introducing a lo- aid, the greater is the urge to
cal or private brand of collectiv- throw the entire responsibility in-
ism. How often we pressure one to the lap of Uncle Sam.
another into actions harmful to There are numerous other ex-
everyone concerned with no more amples of local government actions
logical excuse than “if we don’t do that eventually invite, rather than
something, the government will” preclude, federal subsidy or inter-
— or worse yet, “if our govern- vention — housing projects, high-
ment doesn’t do something, the ways, hospitals, and so on — but it
Soviets will.” must also be recognized that many
Consider modern developments moves toward socialism begin as
at the local school district level, strictly voluntary or private ven-

25


===== PAGE 28 =====

26 THE FREEMAN February

tures, This is not to question the tors’ fees and control of prices
general principles and practices of medical supplies and serv-
of competitive private enterprise ices.

and voluntary cooperation which 6. Government rationing of sup-
largely account for the high and plies and services rendered
rising standards of living in the scarce through price control.
United States and other compara- 7. Government taxation to cover
tively free nations of the world. costs, rather than free mar-
Great good comes through special- ket pricing in response to
ization and division of labor and supply and demand.
voluntary exchange in a free mar- Though incomplete, this list at

ket, as buyers and sellers cooper- least suggests why doctors might
ate and compete to their mutual oppose socialized ‘medicine. But
advantage. But freedom also al- consider for a moment what some
lows men to associate or cooperate doctors themselves have done, in-
in ventures that fail or that prove dividually or in groups, to pro-
harmful to themselves and to mote the very controls now de-
others, as when they lead toward plored.

socialism and eventual coercion.

Examples of this voluntary The Licensing Prerogative

march toward- socialism may be If any person or any group is
found in the activities of various to have the power to grant or deny
professional groups. Just now, for a license to practice medicine,
instance, there is grave concern why shouldn’t this government-
among members of the medical like power be exercised by the
profession about the threat of so- government? Why, above all,
cialized medicine in the United should the members of a given
States, which would involve such professional or occupational group

controls and regulations as: be allowed to decide whether or
1. Government licensing of doc- not new members are to be ad-
tors. mitted to practice or work in that
2. Government operation and field? And if there is to be a li-
control of medical schools. censing agency with governmental

3. Government determination of powers, should it not also control
medical standards and prac- the schools or training programs

tices. for prospective licensees and as-
4. Government provision of sume responsibility for profes-
equipment and facilities. sional standards and practices?

5. Government regulation of doc- It is one thing to associate vol-


===== PAGE 29 =====

1961 LET'S NOT DO-IT-OURSELVES 27

untarily with others of a profes- or not he is unwittingly con-
sion to improve one’s own under- tributing to it under the banner:
standing and skill, but the tempta- “If we don’t do something, the
tion — once the association is for- government will.”
malized — is to use it to set stand- :
ards and controls not only for Other Paths to Controls
willing members but for nonmem- It would be wrong to imply
bers as well. And this “voluntary” that medical associations are the
assumption of governmental pow- only groups moving toward so-
ers is a long step toward the kind cialism through misdirected ef-
of government control that spells forts to avoid it. The licensing of
socialism. barbers probably was their own
If a local, state, or national idea; lawyers voluntarily organize
medical association attempts to and support the bar associations
pass judgment on or to regulate that lead to licensing and increas-
the fees a doctor may ask for a ing government regulation and
given service, the stage is set for control of the profession; mer-
government price control. The chants organize chambers of com-
growing practice by individuals merce to put their community on
and groups of doctors to adjust its own feet and then degenerate
their fees to the size of each pa- into pressure groups to render the
tient’s income is certainly not a community dependent on federal
coercive practice — but neither is subsidy; economists organize so-
it sound economic procedure for cieties which become the breeding
equating the demand for medical ground for farm support pro-
service with the available supply. grams, deficit financing, federal
Blue Cross and Blue Shield insur- regulation and control of industry,
ance programs, voluntarily initi- commerce, and people; and so it
ated, are taking on more and more goes in one professional organiza-
of the characteristics of socialized tion after another.

medicine, and may well provide Businessmen in the early thir-
the framework for its administra- ties voluntarily and patriotically
tion if and when it comes. agreed not to overproduce, or un-

There is no denying that the dersell competitors, or reduce
trend is toward government con- wage rates. During the early days
trol of medicine in the United of World War II they agreed not
States; and the question con- to raise prices, though they could
fronting every doctor and patient not begin to satisfy demand at
who deplores that trend is whether such “fair” prices. Oil producers


===== PAGE 30 =====

28 THE FREEMAN February

and importers agree to abide by dividuals organize to get a job
“voluntary” production or import done “voluntarily” before the gov-
quotas. And these voluntary de- ernment does it. This is not to
partures from competitive prac- deny that many worthy aims and
tice in a free market, no matter objectives have been achieved
how well-meant, inevitably lead to through voluntary cooperation.
price and wage ‘and rent control, But the difference is in the nature
rationing and regulation by the of the objective — of the job to be
federal government. done. If it is truly worthy of vol-
Consider also the paternalistic untary support, then it can and
practices of businessmen in offer- should be done voluntarily. But if
ing pensions, medical care, recre- it is not — if it was a misguided
ational facilities, and all sorts of effort from the beginning — it
“free” fringe benefits, whether or cannot succeed voluntarily and
not an employee wants to get his will have to be done by the gov-
pay in such form. All such meas- ernment, through powers of coer-
ures were undoubtedly rational- cion and taxation, if it is to be
ized in part to keep the govern- done at all.
ment out of these particular areas.
But the result has been govern- Limited Government
ment expansion of social security, According to the ideals of com-
medical care, recreational facili- petitive private enterprise upon
ties, and other welfare measures, which this nation was founded and
built in and around and upon the has prospered, a common and gen-
industrial programs. eral respect for life and property
Even the charitable inclina- should leave comparatively little
tions of mankind have been or- need for government action. Let
ganized into ever bigger and bet- the government confine itself to
ter community chests, united the suppression of private out-
funds, Red Cross, polio and can- breaks of violence and fraud and
cer and tuberculosis societies, to defense against external ag-
joint college fund-raising drives, gression. In other words, if there
church mergers, social action Is to be any. coercion at all, let
hierarchies — until it is a very this coercive force be concentrated
short step from there to socialism, in the hands of government for
when the government takes over, the sole purpose of maintaining
organization and all. the peace and protecting the lives
Other examples abound of the and private property of peaceful
disastrous consequences when in- citizens.


===== PAGE 31 =====

1961 LET'S NOT DO-IT-OURSELVES 29

Needless to say, this ideal of grounds that otherwise the gov-
limited government has not been ernment would do it. Coercion is
upheld; and in our time we have the government’s business, and
seen the reckless expansion of the business of individuals is to
government into practically every respect life and property and
field of human action, thus dis- avoid any private association for
turbing rather than maintaining coercive purposes. The moment
the peace for which it was consti- any one of us or any group of us
tuted. Even so, this is no proper initiates force against others, we
excuse for private resort to coer- move away from freedom toward
cive practices on the flimsy compulsory collectivism. >

“Every Man A King”

LIBERTY, or the right to act as one wills according to his wisdom
and conscience, is sometimes charged with being “license” and
totally irresponsible conduct. But, on the contrary, responsibility
of the highest order is required in a liberal society. What social
design could be more challenging, in terms of responsibility, self-
discipline, and self-control, than that of liberalism in its require-
ments of self-restraint; in avoiding trespass on the rights and the
property of others; in its respect for the rights of others to dis-
agree without precipitating conflict? Liberty requires the highest
order of conduct in its practice.

The disciplines of liberty, however, have their rewards. “Every
man a king” has had great appeal as a political slogan. The near-
est possible approach to it is to be found in a liberal society, in
which everyone is king over his own affairs to the greatest possible
extent. At the other extreme, one man is king over all men instead

of every man being king to a degree.

F. A. HARPER
Liberty: A Path to It's Recovery


===== PAGE 32 =====

GEORGE WINDER

The story of two great London newspapers

ON MONDAY, October 17, 1960, an day. Then at 5:20 p.m. they went
event occurred which stirred Fleet dead, forever.
Street to its depth. This famous The news broke just as the ma-
street has seen many sensations jority of the staff were preparing
in its long history, but probably to leave for the day, and it was
none which affected it so deeply soon flashed round Fleet Street.
as this; for on that day the News Journalists and printers congre-
Chronicle, one of the country’s gated in pubs and did not leave
oldest newspapers, with a circula- until closing time. It was “Black
tion of over a million copies, came Monday,” and one of the most
to an untimely end. With it went memorable in Fleet Street.
its associated paper, The Star, A great debate has continued
with a circulation of over 700,000. ever since as to why these two
It was death in the afternoon. papers, with such comparatively
That day the news editor of the satisfactory circulations, and with
News Chronicle had sent out his their pages reasonably filled with
reporters for stories as he had advertisements, came to such an
done all his editorial life; the for- untimely end. The News Chronicle
eign editor had sent his usual had a strong liberal (nonsocialis-
“service messages” to many parts tic) following whose loyalty noth-
of the world; in the news room the ing would shake. With the rising
tape machines had clattered all fortunes of the Liberal Party, the
R prospects of this great mouthpiece

ing in Sussex, England. He has written books, vate property, limited govern-

ticles, d hlets on law, iculture, .
and economics To aw agricul ment) should have been brighter

30


===== PAGE 33 =====

1961 DEATH IN THE AFTERNOON 31

than in the past. How could such discussed, and they had the power
a paper as this fail so dismally? to enforce their wish. Everyone in
Mr. Laurence Cadbury, a member Fleet Street, however, knows the
of the famous chocolate manufac- real cause of the disaster. To those
turing firm, whose family owned unused to the ways of Fleet Street,
most of the shares in the two the story at first may seem ex-
papers, came in for most of the aggerated, but evidence has been
criticism; especially for the sud- piling up, and there is now little
denness of the demise. He ex- room for doubt. The News Chroni-
plained that for some years the cle and The Star were simply done
. two papers had been losing money to death by the printing trade
steadily, and that he had been unions, and the weapons used in
offered nearly £2,000,000 for their destruction were restrictive
their assets by the Daily Mail. The practices. They died because they
transaction, however, had to take were forced by the trade unions to
place without warning so that the employ more than twice the num-
Daily Mail might be delivered the ber of workers their production
next morning to the customers of required.
the News Chronicle before rivals This, the real story which the
attempted to fill the vacuum. great newspapers only hinted at,
Nearly all the purchase money has not frightened one smaller
went to secure the pensions of paper which has given its readers
former employees and to pay com- the truth from the beginning. The
pensation to the dismissed staff. editorial staff of this paper, the
The disastrous end of the News New Daily, and book publisher,
Chronicle and The Star was Christopher Johnson, have now
treated by the press and the B.B.C. combined to present the whole
as a major story, but, with a few story in a book, produced in
exceptions, only oblique hints were eighteen days, and named The
made concerning the real cause Murder of the News Chronicle and
of their demise. The reason for The Star.
this reticence is quite simple: the
British press is subject to censor- One Spokesman for Freedom
ship. Not, of course, government The New Daily is a phenomenon
censorship, but censorship, never- so remarkable that it deserves
theless — even more effective when special mention. Whereas the great
imposed. Those most responsible Fleet Street newspapers are sub-
for the death of these two great jected by the trade unions to the
papers did not want their guilt system of the closed shop, the


===== PAGE 34 =====

32 THE FREEMAN February

New Daily has exactly the opposite ployees. It suggests that a staff
idea. It will not employ trade of 1,500 workers would have been
unionists at all. The trade unions quite enough to run the two Lon-
are able to exercise censorship don papers. This would have en-
simply because the proprietors of abled them to save £2,000,000
the great newspapers dare not a year, whereas the largest deficit
offend them. The unions make no in any one year has not been more
overt threat; fear of their reac- than £300,000. It claims that the
tions is sufficient to cause editors unions forced this excessive staff
to anticipate their wishes. But in on the News Chronicle and The
the case of the New Daily there is Star, and that in consequence no-
simply no union to be afraid of, body did a fair day’s work. Ma-
and so it can produce the whole chines had to be manned by larger
story. Unfortunately, this unique crews than were required. Lino-
newspaper has not a large circula- type operators were not allowed
tion, although it is growing stead- to set nearly as fast as they were
ily and has its readers in every able, and printing machines were
part of the country. The story it - not allowed to be run at full speed.
has revealed is startling, but well Automatic tying machines were
substantiated. It claims that of vetoed. Every job was subject to
the 3,500 employees of the two de- strict demarcation. For example,
ceased newspapers, 2,000 of them no one but a member of the Elec-
were unnecessary and were only trical Trade Union dared change
employed because the printing an electric light bulb. A second
unions in control of Fleet Street man had to accompany every
insisted upon it. It gives figures vehicle, even when only a small
which show that in the case of parcel was being delivered. When
these two papers the wages bill advertisements came in already set
was approximately 45 per cent of as complete blocks or stereos, they
their total costs —an excessively had to be credited to the news-
high proportion for any news- paper's setters as though done on
paper. It points out that the the premises.

Guardian and the Manchester

Evening News — which have rather Restrictions Raise Costs

less circulation but in every other All these restrictive practices,
sense are larger than the two lost declared the New Daily, more than
London dailies — are produced, doubled the number of workers
where union power is not so op- required. Similar charges have
pressive, with only 1,700 em- been made quite independently by


===== PAGE 35 =====

1961 DEATH IN THE AFTERNOON 33

the Institute of Economic Affairs the extreme form of waste which
in its book, Advertising in a Free insists that two men shall do the
Society, published two years ago. job of one. It means that, as far
Describing the great waste which as his use to society is concerned,
goes on in newspaper printing a man completely wastes his life.
works in Fleet Street, this book Finding a job where he was really
states: ‘‘Restrictive practices wanted would, if he were an ordi-
abound in the stereo department. nary honest man, improve his
Some men are engaged solely in morale and self-confidence out of
putting plates on lifts. If these go all recognition. Furthermore, this
to the foundry late, the whole sec- doubling up of labor reduces pro-
tion charges overtime though some ductivity per man, and this must
of the men will have no work to necessarily reduce wages and the
do. general standard of living.

“Another union has members in The effect of restrictive prac-
the machine room pushing papers tices in the News Chronicle and
along for dispatch, one man per The Star was not only to overbur-
yard. Many of the workers are re- den the employer but also to deny
quired only in short stretches, him any opportunity of paying
when the papers are printed and high wages, so that in the end it
come off the machines, but they was the employees who suffered.
have to be paid for a full shift. It Now, restrictive practices have
has been known for men employed robbed 3,500 workers of their jobs.
at one Sunday newspaper office to The authors of Murder of the
sign on before going to a dog race News Chronicle and The Star pro-
meeting and return in time to vide a long list of other news-
carry out their work.” Advertising papers and magazines which have
in a Free Society also tells us that succumbed during the last five
one firm had to employ twelve men years as victims, they declare, of
to work one machine, whereas five these same disastrous practices.
men could handle it with ease.

It is such restrictive practices as Why the Silence?
these, enforced by the London One question is left to answer.
printing unions, which destroyed Why has the Newspaper Proprie-
the News Chronicle and The Star. tor’s Association, the wealthy or-

ganization of the London news-

A Wasted Life papers, never seriously tried to

Perhaps no other restrictive abolish those restrictions imposed
practice is quite as dangerous as by the unions which must add so


===== PAGE 36 =====

34 . THE FREEMAN February

much to their costs of production? able to survive such pressures.
And, more particularly, why do They would be driven out of busi-
they allow the unions to impose a ness, and then he could buy them
censorship upon them so that the cheaply. :
real reason for the failure of a This is a charge which cannot
newspaper is seldom revealed? be proved; but there can be no
Fear of the unions is, I suppose, doubt that the excessive costs of
the overriding reason. But the production on Fleet Street are at
authors of the New Daily’s book the present moment destroying
suggest a reason which, they the marginal units of the news-
claim, existed many years ago and paper world, and the number of
may possibly have effect in the national newspapers has been
present. They tell us that Lord drastically reduced. The dissemi-
Northcliffe, who built up a great nation of news and opinion is
newspaper empire, actually en- steadily being concentrated into
couraged the unions to press for fewer and fewer hands, which is a
higher wages and indulge in re- far from favorable omen for a free
strictive practices. His reason for society.
this was a rather terrible one. He Restrictive practices, and the
himself was so financially secure trade union censorship which con-
that he could meet any increased ceals them, not only destroy news-
costs union demands brought papers; they éndanger the very
about, but his rivals might be un- basis of our liberty. -~

| Organized Instability

LIKE ALL MONOPOLIES, labor monopolies do not adjust easily to
changing conditions. Policies, once decided, are hard to revise.
The very notion of “stability” to which monopoly is usually at-
tached and which appears to be the cornerstone of monopolistic
economic policy is a risky guide of conduct, especially in unstable
times. The price paid for protecting certain standards of prices,
wages, or work rules may well add instability to the whole
enterprise. When an employer cannot reduce costs, he may have
to close down altogether, or at least dismiss a large part of his
labor force. When this happens to many employers at the same
time, the result is mass unemployment and depression.

LEO WOLMAN, Industry-Wide Bargaining


===== PAGE 37 =====

FREE oo
COLLECTIVE ©
BARGAINING

or — THE SOURCE OF UNION POWER

[SUN

It was a sunny afternoon RR
At story-telling time. <
Old Kaspar pulled the window shades ,

And poured a rum-and-lime, J
While Peterkin and Wilhelmine
Looked at the television screen.

They saw a crowd of workingmen
Who tried by force or weight
To break the double picket line
That blocked an open gate;
While squads of motorcycle cops
Stood idly munching lollipops.

“Now tell us what it’s all about?”
Cried little Peterkin.

“It’s Free Collective Bargaining,”
Said Kaspar with a grin.
“The union called a strike today

To force another raise in pay.”

“That crowd of men outside the gate
Believe they're paid enough;
And being kept away from work
Has put them in a huff.
The union goons who block the way
Will earn their bonuses today.”

“Why don’t the cops just clear the gate?”
Asked little Wilhelmine.

“When unions bargain,” Kaspar said,
“The cops don’t intervene.

If they should dare to interfere

They'd lose their jobs and pensions, dear.”

“Then who is free,” cried Peterkin, oT
“In bargaining like that?”

“The union is,” Old Kaspar sighed,
“Just like a jungle cat.

It always gets the right of way

When on the prowl for higher pay.”

H. P. B. JENKINS
Economist at Fayetteville, Arkansas

35


===== PAGE 38 =====

HAROLD M. FLEMING

The greatest need of
underdeveloped countries
is to develop —

OF CAPITALISM

THE WASTES that are natural to

big government enterprises are

not as serious as those that result up stunted or die young. A lively
from interferences by the same birth rate for infant industries is
governments in the smaller busi- the best offset to a high birth
ness ventures of private citizens. rate for infant humans. It has
The channeling of the main cur- been said that some countries are
rents of economic energy through so poor that their people cannot
the government, however wasteful, break out of the vicious cycle of
is not as wasteful as the repres- poverty. It is safer to say that
sion, by taxes and controls, of the they stay poor because onerous
currents of energy that would taxes and fastidious’ controls will
otherwise flow through the minds not let them pull themselves out.
and hands of private citizens. Free enterprise is the true ‘“take-
What meets the eye is not as im- off point” for economic progress.
portant as what fails to meet the Underdeveloped countries are
eye — the small business ventures more in need of a redistribution
that never get born, or that grow of opportunities than of goods.
The latter will follow.

Mr. Fleming is a prominent writer on business

and economics. Many readers will recall his There seems to be a roughly
lier book, h d dments: . : : '
k Story of ihe Anti-Trast Laws TEMS inverse correlation between the

The above article is an excerpt from a new : ’ :
book, States, Contracts and Progress: Dynam- degree of a nation’s economic de-

ics of International Wealth (Oceana Publica- velopm 1
tions, Inc. 128 pages.) Copies of the book may p ent, and the scope of its
be obtained from The Foundation for Eco- government controls. The more
nomic Education, Irvington-on-Hudson, New

York. $3.50 cloth; $1.50 paper. controls, the less development.

36


===== PAGE 39 =====

1961 THE METHODS OF CAPITALISM 37

Governmental resistances decrease thus put out of bounds for private

the flow of economic energy. business. It is called “the govern-
American businessmen com- ment’s responsibility.” In one

plain of excessive regulation and word, it is a monopoly.

red tape in their own country. The most notable government

But in many South American monopolies are in oil exploration
countries they find these hurdles and production; and it is here that
multiplied, and in some parts of the results of government monop-
Asia, multiplied again. In India oly are soonest seen. The Mexi-
a man must have a license to start can government has had such a
a business, to build a factory, to monopoly since the nationalization
expand it, to issue new shares, to in 1938. The great “A, B, C” coun-
change the board of directors, to tries of South America — Argen-
buy steel, or even to ship goods tina, Brazil, and Chile, have tried
from one Indian state to another. them.
All the roads lead to New Delhi, Though Argentina had one of
and the regulators may not issue Latin America’s best oil prospects,
the license if they think the busi- foreign capital was shut out dur-
nessman’s plan does not fit their ing the Perén regime from 1946
plan for the nation. Heavy restric- to 1958. By 1958, Argentina was
tions, including some outright pro- buying about $250,000,000 worth
hibitions, are laid down, for in- of goods more than it was selling;
stance, on the manufacture of and by chance this was about the
such staples as cotton cloth, cloth- amount it was spending for im-
ing, shoes, soap, and matches.! ported petroleum products, de-
Some of these bans are to protect spite its own large petroleum re-
cottage industry. The building of serves. The country owed about
any industrial plan must be justi- $1,100,000,000 abroad, and its gold
fied to government officials, who reserves at home were approach-
may find the proposed plan is ing zero.
“unnecessary.” In Chile, oil development has
been a government monopoly since
1928. The government found no oil
And, of course, the “public sec- until 1949. It still does not meet
tor” of the economy, which is flatly Chile's oil requirements. The Chil-
“reserved to the government,” is ean legislature in 1959 defeated
1 See P. T. Bauer’s U.S. did und In- a proposal that the northern part
dian Development, 1959, published by the of the country be opened to for-
American Enterprise Association. eign oil companies.

Monopolies



===== PAGE 40 =====

38 THE FREEMAN February

In 1953 Brazil locked the door States in 1956. About $1,400,000,-
on foreign capital and set up a 000 of silver was imported into
government oil monopoly, “Petro- India between 1850 and 1890, and
bras,” to be financed out of taxes another $3,000,000,000 since then,
with an initial capital of $80,000,- figuring silver at $1.00 an ounce.
000. In 1958 Brazil was importing About $6,000,000,000 of gold, or
four times as much oil as it was about 6,000 tons, is estimated to
producing, and was, like Argen- be held privately in India today;
tina, paying about $250,000,000 and gold is still being smuggled in
for these imports. at $70 an ounce, or twice the U. S.

In 1959 Petrobras tried to ar- price. Most countries in the Middle
range with the Bolivian govern- East area do not lack capital at
ment for Petrobras to go into all; governments in that area get
Bolivia and find oil. But the Boli- about a billion dollars a year in
vians wanted no foreign govern- roydlties and income taxes from
ment operating there. Then private foreign oil companies.

Brazilian capital began negotiat- In a nation without a thriving
ing to go into Bolivia in partner- business community, private
ship with private companies of wealth is generally stored in vaults,
other countries. But the Brazilian or used in conspicuous consump-
government would not permit this. tion, or invested in real estate, or

placed with business communities
Long-Term Results abroad. But where a country’s pri-

It is said that some poor nations vate business is not subject to
cannot “get their heads above Procrustean measures of control,
water” because they have nothing this'private wealth is less likely to
to spare for “capital formation,” be shipped abroad, buried, or
by which to raise their standards otherwise diverted into circuits of
of living. But there is no country low economic potential. It is likely
so poor that it does not have a to come out of hiding or to be
wealthy class, and the inequalities brought home from abroad, par-
of income are normally greater ticularly since the prospects of
the poorer the country. Thus South profit are normally higher in a
America has its pensadores, and poor country if the political en-
India its rajahs. The U. S. govern- vironment is good.
ment’s Survey of Current Business Private enterprise never expires,
recently published figures showing even under the most rigid controls.
that Latin Americans had $560,- But much of it goes to surrepti-
000,000 invested in the United tiously conducting the current of


===== PAGE 41 =====

1961 THE METHODS OF CAPITALISM 39

economic energy under, round, and stowed from above, by the “ins.”
through the backdoor of the con- They favor the conformist “organ-
trol system, in such forms as smug- izational man.”
gling, black marketing, personal Socialist governments lack an
influence, and straight corruption. incentive system to match that of
either capitalist or communist sys-
Planned Repression tems. Each of these systems has
The fact that a high degree of its “stick and carrot” — a stick to
control, and a low rate of energy beat the donkey and a carrot to
flow, occur together, is explained lure him on. In the capitalist sys-
by socialistic governments as nec- tem the stick is the fear of loss
essary but temporary. The low and the carrot is the hope of gain.
energy flow, they say, requires The communist carrot is promo-
controls so that what little there tion and special privilege; the
is shall not be wasted. But it does stick is arrest and transfer to
not seem likely to be temporary. Siberia. A new socialist govern-
The converse side of a Five-Year ment takes over with enthusiasm,
Program for planned growth is vigor, and new ideas. But it is
five prospective years of economic likely to just keep on with the same
repression. The more the state idea. Government officials are sel-
plans, the less practice the private dom risk-takers, cost-cutters, or
citizen gets in planning. innovators. In business, they lean
An economic “rule of succession” toward yesterday’s ideas.
prevails in states where competi-
tion is free. Imaginative and effi- Inflation
cient managers are constantly ris- Sooner or later, socialist and
ing to the top, and being elected welfare governments usually end
by customers to larger constituen- up with inflation. The degree of
cies, while less imaginative and the inflation seems in fairly direct
efficient managers are voted out. ratio to what they attempt and
But the management of a nation’s promise. Paper money and over-
economy by civil servants discour- expansion of bank credit even-
ages imagination, and has no tually seem the easiest way out of
“built-in’’ mechanism for selecting government attempts to:
the most efficient. The bestowal © Raise the maximum possible

of honors, it is sometimes argued, taxes;
takes the place of the money incen- Go as far as possible into indus-
tive of private gain. But there is trial ventures;

a vast difference. Honors are be- ¢ Raise wages as high as possible;


===== PAGE 42 =====

40 THE FREEMAN February

* Sell goods below cost; and prices multiplied about 8 times.
* Control private business. However, in the last half of the
The British pound was devalued 1950’s Mexico’s rate of inflation
a third in 1949 to $2.88, and with slowed down, and the Mexican
it went the Egyptian pound to economy became unprecedentedly
$2.88 and the Indian rupee to 20.5 prosperous.
cents. The Egyptian pound, still
officially quoted at $2.88, sold in Severe Cases
New York at the end of 1959 at Inflation in Chile went much
around $2.00. The Indian rupee, further. That country’s cost of liv-
still nominally -worth 20.5 cents, ing multiplied about ten times
sold in New York at 13.5 cents. between 1929 and 1950, and then
Both these countries started the about 15 times during the 1950’s,
1950’s with large balances in Lon- for a total rise of about 150 times
don, but these were drawn down in 30 years. In the 1950’s prices
sharply, like those of Argentina, averaged to rise nearly 40 per cent
in the last half of the 1950’s. a year.

After World War II, inflation The Republic of Indonesia was
swept through almost all the Lat- established in August 1950. Be-
in American countries (with such tween then and the end of 1959,
notable exceptions as Guatemala, the free-market price of the In-
Venezuela, Ecuador, and Cuba). donesian 7rupia dropped from 30

As a result, the cost of living in cents to less than half a cent,
Argentina at the end of 1959 was despite the fact that during this
about ten times what it was in period the Indonesian government
1929. In Brazil it was nearly 20 expropriated valuable Dutch prop-
times as much, having risen 50 per erties and through 1959 had not
cent in 1959. The Brazilian cru- paid for them.
ziero, which was worth about 12 The world’s record for postwar
cents in 1929 was down to about inflation, however, was made by
five cents in 1950 and to less than mountainous little Bolivia, which
a half-a-cent (220 to the dollar) after the 1952 take-over of its
by the end of 1959. foreign-owned tin mines, became

Mexico, after going through a more or less a financial out-patient
hyperinflation during the political of the U.S. government. Per-capita
troubles in 1916, started another aid to Bolivia in the 1950’s was
inflation in the 1930’s. From then the highest to any country receiv- .
to 1959 the Mexican money supply ing United States aid. But in four
was multiplied about 16 times and years the Bolivian boliviano


===== PAGE 43 =====

1961 THE METHODS OF CAPITALISM 41

dropped from 1/180th of a dollar In each case these resistances to
to 1/6,000th of a dollar, and by the international flow of wealth
1958 it had dropped to 1/11,600th enhance the powers of civil serv-

of a dollar. ants. But in the process, the coun-

try’s foreign trade, including the
Inflation a Symptom potential inflow of foreign capi-
of Cultural Conflict tal, gets ensnared like Laocoon

Inflation is a symptom of cul- and his sons in the coils of gov-
tural conflict in a nation. Any de- ernment rules, regulations, licen-
valuation of a long-stable currency ses, and priorities.
involves a crisis; and repeated de- The effects on the domestic flow
valuations spell a chronic, unre- of economic energy are also harm-
solved conflict of ideas. Inflation ful. The established mechanism
resembles alcoholism, which seems of saving and investment is en-
to some individuals the only escape feebled; nobody wants to buy
from a hidden inner turmoil; for bonds. Private capital again tries
some nations, inflation appears as to go abroad, or goes further into
the only escape from an obscure hiding, or turns again to specu-

but painful social turmoil. lation in land, or into a new field
Inflation looks like a stock of quick profits — commodities.
dividend, but with a significant The “self-generation” of capi-

difference. Like a corporate divi- tal for new plant by corporations
dend of additional shares, inflation is retarded, because depreciation
“re-divides the same pie.” But un- reserves kept in a currency of
like the stock dividend, inflation shrinking value will not pay for
cuts the pie in new proportions. replacements.

It cuts a larger share for those Among the severely squeezed
whom the government wishes to industries are the public utilities
favor. such as electric power and tele-

But inflation eventually aggra- phone services. In South America
vates the conflicts that led to it. most of these are now govern-
Governments generally try to dis- ment-owned but some are still in
guise its meaning by imposing private hands (as in the United
more and more complex controls States). In either case inflation
on foreign trade. They keep most steadily pushes up costs. It also
of the foreign exchange earned by steadily increases demand. This
their citizens, reserve for them- last calls for extensive and costly
selves first call on imports, and additions to plant. But for polit-
sometimes subsidize the exports. ical reasons, governments are re-


===== PAGE 44 =====

42 THE FREEMAN February

luctant to increase their own productive, tends to be overex-
rates or to permit private com- panded, creating vested interests
panies to increase theirs. As a re- in inflation.

sult, the biggest cities in Argen- “Such (sectional) resistance ac-
tina and Brazil are badly short tually may be so strong as to make
on power, water, and phone serv- it difficult for the monetary au-
ices. thorities to enforce restrictive

Inflation breeds its own vested credit policies on private banks, or
interests. They are particularly even on government agencies.”
strong in the form of uneconomi- [Italics added.]
cally high wages, uneconomically
low prices, in unnecessary jobs, What Is a “'Less-Developed’’ Country?
and in certain producing sectors No one seems satisfied with the
of an inflation economy. The Fron- term “less-developed country” or
dizi return to a stabilized cur- ‘‘under-developed country.” It
rency has made hardship for does not exactly mean ‘poor coun-
many Argentinians. Stabilization try,” for some comparatively poor
has been blocked in Bolivia by the countries are progressing rapidly
powerful mine-workers’ union. and resent the term. It does not fit
Mexico City had a strike in the the meaning of “countries where
late 1950's against an increase in development is going on apace,”
bus fares to paying levels. Those for it is scarcely applied, for in-
who gained by inflation in the stance, to Canada, and less and
first place need continued infla- less to Mexico, which in 1959 was
tion to keep those gains. booming.

Thus the International Mone- But among the “less-developed”
tary Fund, in its annual report countries, as the term is most
for 1958-1959, said about infla- often used, almost all have at least
tion in “less-developed” countries: one thing in common. They are

“During periods of prolonged countries that desire capital but
inflation, investment in certain have not yet put into practice the
sectors, which usually are less methods of capitalism. ~

Oliver Wendell Holmes, Jr.

I HAVE no respect for the passion for equality,
which seems to me merely idealizing envy.


===== PAGE 45 =====

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I D0 NOT HAVE a Ph.D. and I usu-
ally skip over the statistics in an
article, but I am in favor of lib-
erty for the individual as opposed
to the government-managed State
and I think my reasons are as
good as anyone else's.

In the first place, the govern-
ment-managed State here in Amer-
ica takes on a particularly irritat-
ing form. In Russia they come
right out and kill people in whole-
sale lots, force pitiful, shawl-wear-
ing grandmothers to sweep the
streets in summer dresses at
twenty below zero, and deport po-
litical prisoners to Siberia to die
the slow death of slave labor. Any-
one can see that the government-
managed State as it exists in Rus-
sia is wrong. The Chinese commu-
nist State has the same “virtue”
as the Russian. Even intellectuals

Mrs. Scoltock is a housewife in Des Moines,
Iowa.

CLAIRE SCOLTOCK

who at first considered Mao an
agrarian reformer now have to ad-
mit that some rather regrettable
things are going on in China. How-
ever, here in America the govern-
ment-managed State's public
image is that of a huge settlement
house managed by junior Robert
Owens for the benefit of laboring
men, farmers, the elderly, and
whoever else is part of a voting
bloc.

It is somehow more infuriating
to be considered part of a faceless
mass of voters to be kept happy by
a social security health program,
or whichever of their bag of
“benefits” applies to us, than it
would be to have the visible whip
of government power cracked over
our heads. I do not want these
junior Robert Owens now in pow-
er to read about the strange crea-
tures in my social class and imme-
diately start building a new and

43


===== PAGE 46 =====

44 THE FREEMAN February

costly pen for us and supplying us less privileged classes — no matter
with government hay, so that we how oddly the mask looms above
won't have to forage for ourselves their well-tailored shoulders.
in the woods. If they were actually to achieve
What makes the proliferation of the end product of their design,
our government-managed State so they would be sorry. Ever-increas-
insidious is that those at the top ing government managementwould
actually see themselves as virtuous “eventually lead to anemia and final
saviors who are fighting to bring death of our free enterprise sys-
all the elements of our economy tem; and then these well-inten-
under strict control so as to bene- tioned social workers would have
fit us all. The worldly-wise and to get out the whip and brass
rather cynical idea of our Found- knuckles the way they do in Rus-
ing Fathers that governments sia and try to make our vast econ-
must have built-in restraints be- omy work by government coercion.
cause they tend to behave like the So far, however, free enterprise
camel with his nose under the tent has been so indestructible that it
has been completely repudiated by has survived mismanagement by
these “liberal” intellectuals. its politically inclined beneficia-
ries, and continues to supply them
New Leaders Needed with private planes, Florida vaca-
Encouraged by the present all- tions, and the other “necessities”
encompassing scope of our federal of life.
government, leaders who believe So the question remains — how
in the government-managed State can we effectively fight against be-
are popping their fuzzy heads up coming gray-faced members of a
all over the country like dandelions government settlement house run
in our front yard in the spring. by young and attractive social
What we need are leaders who be- workers who view us with patro-
lieve in liberty for the individual nizing distaste? To me, the only
and who are able to disassemble solution is to take our forefathers’
this sprawling governmental mon- ideas on liberty for the individual
ster and prevent its tentacles from and set them forth unequivocally
choking the life blood out of the to sink or swim in the modern en-
ordinary taxpayer. However, the vironment. We need many more
government-management boys people who will catch the flaming
seem to be more articulate and torch of liberty and reject the
quite able to assume the benign sticky spiderweb of the Welfare
mask of noble compassion for the State. People need to know what it


===== PAGE 47 =====

1961 NOTHING TO LOSE BUT OUR GAINS 45

is in terms of liberty or fetters they are so that our economic posi-
(programs calling for higher taxes tions will not be damaged -- be-
and more government control) cause some of us are!

that they are voting for at the These believers in individual
polls. It is possible to show them; liberty for purely selfish reasons
and it will be to our everlasting vote against excessive government

discredit if they are not shown. control, but their presence on our
side alienates many more people
The Albatross : than their votes are worth. We

We who believe in liberty for need to find some way to penetrate
the individual are weighed down the well-massaged hides of these
by quite an overstuffed albatross — materialists and help them under-
the people who are conservative stand that something besides
simply because they have carved three-inch steaks and membership
out a luxurious niche for them- in an exclusive club is at stake.
selves in our society and want to Freedom for the individual is
maintain the status quo. Our op- still the most revolutionary
ponents who want to whip us all thought at large in the world to-
into line in their government-man- day and should irresistibly attract
aged State have us over a very un- the keenest minds among our
comfortable barrel when they say emerging young intellectuals. If
that we are fat, self-satisfied peo- it does not, we of the middle gen-
ple who want things to stay as eration have failed to articulate it.

A Leaky Bucket

FEDERAL AID to education is comparable to carrying water in a
leaky bucket from your own reservoir to a big central well. What
is left of the water is poured into the well, and then those in
charge apportion you some water in that same leaky bucket and
you bring it home.

Besides losing what water is spilled on the two-way trip, you
eventually find yourself being told what to do with the water that
remains—although it was your own water in the beginning.

Education means learning. And the principal lesson one learns
about federal aid to education is that you end up with considerably
less than you started out with. Wouldn't it be wiser to keep the

water at home in the first place?
Life Line.


===== PAGE 48 =====

Private Property and Freedom

WILLIAM TOLISCHUS

PRIVATE PROPERTY and a free econ- life or death. Alexander Hamilton
omy are the material foundations said, “Power over a man’s sub-
of freedom. Property makes the sistence is power over his will.”
individual economically independ- Leon Trotsky, the Communist, put
ent; it frees body and mind from it more brutally: “In a country
servile dependence on others. Eco- where the sole employer is the
nomic independence gives birth to State, opposition means death by
aspirations for political liberty. slow starvation. The old principle,
Only the self-sufficient and self-re- who does not work shall not eat,
liant individual has the courage to has been replaced by a new one,
voice his opinions and to oppose who does not obey shall not eat.”
tyranny in any form. The depend- That is precisely what confiscation
ent serf must dance to the tune of of private property means to peo-
his master. He is interested in ple in communist states: obedi-
more bread and better treatment ence or slow starvation.
rather than liberty as an ideal. The American Revolution was
Neither liberty nor the pursuit precipitated by material interests,
of happiness are secure without namely taxation without represen-
the right to acquire and hold prop- tation. John Dickinson elucidated
erty. Property rights and human the basic causes of that conflict
rights are inseparable. Whoever most succinctly when he wrote:
controls the means of existence of ‘Let these truths be indelibly on
a people, whether by monopolistic our minds — That we cannot be
coercion at private hands or happy without being free — that
through the confiscation of prop- we cannot be free without being
erty by the State, has power over secure in our property — that we
ee (LL Co cannot be secure in our property,
i an hearnce thinker” spe if without our consent, others

46


===== PAGE 49 =====

1961 PRIVATE PROPERTY AND FREEDOM 47

may, as by right, take it away.” If rules to govern conduct within the
the Americans had acquiesced to group. These rules slowly evolved
taxation without representation, into ethical concepts which have
they would have surrendered the lifted mankind, however fitfully,
key that could have locked the above the rule of brute force. They
shackles of economic servitude and made freedom and the growth of
political tyranny; the two go to- civilization possible.
gether. Although precipitated by Property has played an impor-
what some people would call base tant role in the development of
material interests, the American ethics. Since human history began,
Revolution gave birth to some of most crimes have been committed
man’s noblest political ideals. for gain. Primitive justice was
Violation of legitimate property harsh. A thief was mutilated not
rights destroys freedom; it is the only in ancient Babylon but, until
beginning of moral disintegration a few centuries ago, in many West-
that leads to social chaos and tyr- ern countries. On Western fron-
anny. John Adams wrote: “The tiers many a horse-thief was
moment the idea is admitted into hanged. By precept and punish-
society that property is not as ment man learned to differentiate
sacred as the laws of God, and that between mine and thine.

there is not a force of law and Primitive races who depend up-
public justice to protect it, an- on the ready-made bounties of na-
archy and tyranny commence.” ture for sustenance have only a

vague idea of property. Hunting
Ethics and Justice Are the Spiritual or fishing are collective enter-
Foundations of Freedom prises, and food so obtained is

Nature is amoral. She is not shared by all the members of the
concerned with ethics; her goal is group. They live under a primitive
progress. In the animal world, form of communism. If nature
predatory competition is the way smiles, they all feast; if she
of life. The physical struggle for frowns, they all starve.
existence is the mainspring of evo- The concept of property began
lution. to form when man became a pro-

Ethics and justice are human ducer, when he began to cultivate
attributes. When primitive man the soil, to sow and reap, to manu-
became a social animal, the prob- facture tools. A question began to
lem of human relations arose. At stir in the producer’s mind: “Why
first, rule of the strongest pre- should I share the fruits of my
vailed. But in time man developed labor with my lazy neighbor loll-


===== PAGE 50 =====

48 THE FREEMAN February

ing in the sun?” That question has that theorists who never did an
echoed through the ages. The honest day's work elect themselves
equitable distribution of the fruits to lead the workers into utopia.
of labor is the central problem of
social organization and of a just Unearned Prosperity
social order. Of course, not all property is
There is a close correlation be- the product of honest effort. Karl
tween virtue and honest labor, be- Marx believed that all property is
tween legitimate interest and ethi- acquired by force or fraud; that
cal valuation. Jefferson said, “Vir- revolution and the confiscation of
tue and interest are inseparable.” property are the only roads to so-
Making a living by honest means cial improvement. As events have
is the primary moral discipline of proved, with the abolition of pri-
life; it builds character; it breeds vate property go human freedom,
virtues of self-reliance and self- ethics, and justice. Communism’s
respect. From self-respect springs total disregard of property rights
respect for the rights of others. is reflected in its total amorality
The man who accumulates a sub- and upside-down ethical concepts.
stance by honest effort will usu- Unearned prosperity demoral-
ally respect the property rights izes as surely as does the confisca-
of others because he knows from tion of property. Attempts to pros-
experience what it takes to acquire per by such predatory practices as
and hold on to property. The lazy, coercion, featherbedding, payola
the thriftless, who want to share and fraud, government subsidies
without contributing, will not re- and protectionism are refined
spect the rights or property of forms of thievery at the expense
others. Their ideas of ethics and of the community. The taxpayer -
morality are hazy. and consumer who cannot get on
Crimes committed in the name the gravy traip must pay the
of liberty generally are perpe- freight for the freeloaders.
trated by the thriftless and disin- Unearned prosperity destroys
herited — or the inheritors of un- incentive and personal responsi-
earned wealth. It is not without bility. There is a curious parallel.
historical significance that commu- between the don’t care attitude of
nism was fathered by Karl Marx, the communist slave laborer and
disinherited by choice because he that of the free worker who at-
would not work, and Friedrich tributes his job security and high
Engels, inheritor of unearned wages to union coercion. In both
wealth. It is one of life's enigmas cases there is no incentive to ac-


===== PAGE 51 =====

1961 PRIVATE PROPERTY AND FREEDOM 49

complishment and therefore no munity. The decent businessman
sense of personal responsibility. will be forced to subscribe to such
Why exert oneself! It will make practices or go out of business.
no difference whether a job is done Unearned prosperity by hook or
. well or badly. The idea is to get crook multiplies the number of
the most with the least effort, malefactors, big and small.
preferably something for nothing. Jeffersonian democracy was de-
Communist newspapers are com- signed for a self-sufficient agrarian
plaining of slipshod goods that the society. Jefferson said: “I think
public will not buy despite the we shall [remain virtuous] as long
shortages of consumer goods. Sim- as agriculture is our principal ob-
ilar complaints of poorly made ject, which will be the case, while
goods with built-in obsolescence, there remains vacant lands in any
of faulty or fraudulent repair part of America. When we get
work, are increasing in America. piled upon one another in large
cities, as in Europe, we shall be-
Unethical Procedures come corrupt as in Europe. ...”
The harmful effects of welfar- This need not necessarily be so.
ism in America also are evident Jefferson’s pessimistic view of ur-
in various professional and busi- ban society grew from his observa-
ness management practices, when tions of the Parisian proletarian
gains or profits seem to be of- mob, a by-product of feudalistic
fered through the avenues of spe- tyranny. America’s democratic
cial political privilege, legal loop- system has developed no heredi-
holes, and unethical procedures, tary proletariat in the European
either sanctioned or encouraged sense. However, the rapid transi-
by a government committed to tion from an agrarian to an indus-
practically everything except its trial society is creating many so-
proper role of defending life and cial problems and giving rise to
property. some muddled thinking. To pre-
The decent citizen must not only serve freedom within industrial
bear the expense of unearned pros- society, it is necessary to return
perity but his freedom to make an to a free market economy by elimi-
honest living is thereby curtailed. nating subsidies, coercion, and un-
The political favorite will have the ethical practices as means to un-
inside track to success. If permit- earned prosperity; by reaffirma-
ted to flourish, he will impose his tion of personal responsibility and
way of life on the business com- individual initiative. ->


===== PAGE 52 =====

FOUR FOUNDATIONS
OF FREEDOM

KENNETH W. SOLLITT

Two youngsters from London curity you pay too big a price. But
were enjoying a holiday in the apparently there are millions of
country. They romped and played people who do not think so, and
. until they were completely worn thousands who naively believe you
out. They threw themselves down can have both, if you just elect the
on the cool green grass and lay people who promise them to you.
watching the clouds and the birds . The people to whom Isaiah ad-
above the treetops. After a short dressed his words in Isaiah 28
silence one of the boys looked at were the politicians of his day
the other in alarm. who in open defiance of Isaiah’s

“What on earth is the matter warnings had plotted a secret al-
with you?” he asked. “Why do you liance with Egypt. They had de-
look so sad?’ To which the sad fected to the enemy. Isaiah ap-
one replied, “I was just thinking peared in the midst of their
of those poor little birds up there. rejoicing over the imagined se-
They haven't any cages!” He was curity Egypt might give them to
sad because the birds were not warn them again that only in God
safe — in bondage — like boys and is there a sure defense. Their
men under socialism. “covenant with death,” as he called

I am one of those horrible non- it, would not save them. The bed
conformists who believes that they had made for themselves
when you trade freedom for se- would soon be seen to be too short
—_— for them. The imagined benefits
This article was his sermon at the annual cover themselves would -soon be

meeting of the Michigan Baptist Convention
at Battle Creek, October 21, 1960. seen to be too narrow. God would

50


===== PAGE 53 =====

1961 FOUR FOUNDATIONS OF FREEDOM 51

use their enemies to teach them in political ideologies that have
what Isaiah had not been able to over and over again proven to be
teach them. And they would soon beds too short and covers too
awaken to find that they had narrow!
neither security nor freedom. Such is the socialism into which
“Now therefore do not scoff,” we have walked with our eyes
Isaiah says to all who will not heed wide open, and the communism
his warnings. “Do not scoff lest toward which we are headed. Both
your bonds be made strong.” begin with our willingness to
Isaiah reiterates his message of spend our lives in government-
hope, however: “Therefore thus issue bird cages rather than ac-
says the Lord God, ‘Behold I am cepting the responsibilities of free
laying in Zion a foundation stone, men and women. So we make a god
a tested stone, a precious corner- of government and quite forget
stone, of a sure foundation . ... the government of God.
and I will make justice the line, The oyster is endowed with a
and righteousness the plummet; ready-made house to live in. All
and hail will sweep away the ref- he has to do is to open the doors
uge of lies, and waters will over- of his house to take in his food
whelm the shelter.” ”’ (Isaiah 28:- and close them again to keep

16, 17) out his enemies. He would seem

to have perfect security. Yet he

Belief in God is easy to catch, crush, and cook,
There are at least four founda- and always ends up in the soup.

tions of freedom. Whosoever scoffs The eagle, on the other hand, is

at these foundations and builds on peculiar among created things in
others cannot endure. The first of another respect. When the winds
these is belief in and reliance upon blow, he neither fights nor runs.
God. He simply sets his wings so the
Here is the tested stone, the fury of the storm itself lifts him
precious stone, the sure foundation above the storm where, because
of which Isaiah speaks. his wings are strong, he remains
I do not expect to get much of an “free as a bird.” And only the
argument in response to that fool would pity the eagle because
statement. But how easy it is to he isn't an oyster.
say we believe in God and then Yet in the last thirty years
worship other gods ahead of him Americans have become so brain-
— to stamp on our coins, “In God washed by the idea that freedom
we trust,” and then put our trust always means freedom from some-


===== PAGE 54 =====

52 THE FREEMAN February

thing instead of freedom for been guilty of building up this
something that, like the oyster, “refuge of lies,” as Isaiah would
we are in retreat from everything call it, we need to repent of our
— want, worry, war, and work, too, folly and begin preaching from
if possible — and in pursuit of our pulpits the virtues of honesty,
nothing but more comfortable self-reliance, and reliance on God
cages with beds which are never instead of government.
long enough and covers which are
never wide enough. Are we be- Government Limited
coming a nation of oysters? by a Constitution

To our forefathers freedom was This brings me to the second
a positive thing. It was freedom to foundation of freedom which is
worship, to work, to win in honest constitutional government.
competition, and to grow strong No one denies that we have to
thereby. And they wisely chose have government and that we have
the eagle as their national em- to pay for it. (And thank God we
blem. Beneath this emblem and still aren’t getting all the govern-
under God they built a great na- ment we pay for! When that hap-
tion on the sure foundation. We, . pens we will be in bad shape.) But
their children, have instead let us have a government that will
sought to lengthen our beds and be our servant and not our master.
stretch our comforters by trying That’s what the framers of our
to multiply wealth by dividing it, Constitution intended our govern-
by trying to get rid of our little ment to be. Those men were not
problems by creating a big one only students of history. They
called government, and expecting were also victims of it. To make
it to give us what it does not first sure that we should never have to
take away from us. Thus we make suffer the governmental tyranny
government our Golden Calf. from which they had fled, they

“Government is my shepherd. I created a government with these
shall not work. It maketh me to three unique characteristics: (1)
lie down in a fool's paradise. It The government's authority was
leadeth me into deep water but it limited to specific delegated pow-
refills my dinner pail.” ers. (2) All authority not so dele-

I will probably be as unpopular gated remained with the states or
as old Isaiah. Still I say to you, the people. (3) The federal gov-
for I believe thus saith the Lord, ernment’s power was carefully di-
Insofar as we as individuals and vided into three separate branches
churches and a denomination have with specific duties and realms of


===== PAGE 55 =====

1961 FOUR FOUNDATIONS OF FREEDOM : 53

influence, each to check and bal- the same, for in those days it
ance the others. wasn’t quite so obvious that no
These men were still mindful of President could give us what he
the Declaration of Independence. didn’t either first take from us,
In that document, after stating or charge to our children and
the conviction that men had cer- grandchildren.
tain “unalienable rights’ ‘such as We invented a fascinating new
“life, liberty, and the pursuit of parlor game in which we all stand
happiness,” they made crystal in a circle, each with his hand in
clear what they thought the pur- the next person’s pocket, all seek-
pose of government was: “to se- ing to get richer thereby.

cure these rights governments are So today, instead of the great
instituted among men,” they said god government protecting us
(emphasis added). from being robbed by others, we

Then came the thirties and Mr. have a government which, if you
Roosevelt with his emergency vote right, promises to rob every-
powers and his new philosophy body else for your benefit. We
of government which he expressed don’t seem to see even yet that
in these words: “Government has what one man gets without earn-
the definite duty to use all its ing, another man must earn with-
powers and resources to meet new out getting, and that this is not
social problems with new social right, and because it isn’t right
controls.” a society so organized cannot en-

This he justified by saying that dure. He who has made “justice
it was “to insure the average per- the line and righteousness the
son the right to his own economic plummet” is not apt to see justice
and political life, liberty, and pur- in legalized piracy, or righteous-

suit of happiness.” ness in those who love to play
This lip service to the Consti- God.
tution while tossing it into the How long has it been since you

discard kept people from seeing read these words from Luke 12:13
that you can’t protect man in the and 14: “One of the multitude
exercise of his legitimate liberties said to him, ‘Teacher, bid my
by imposing on him controls which brother divide the inheritance
destroy those liberties. So we with me.” But he [Jesus] said to
launched on an era of social control him, ‘Man, who made me a judge
utterly new to Americans. Those or divider over you?”

who received economic benefits Is it unfair to say that about
kept voting for more and more of nine-tenths of all our so-called


===== PAGE 56 =====

54 THE FREEMAN February

social progress has consisted in ers to be kept secure in jobs at
taking from the man who has and which they refuse to work? Is it
giving to the man who wants? I wrong for the few to rob the many
know we have had the best inten- and right for the many to rob the
tions, but can that excuse us for few? Or is robbery still robbery
doing in the name of Jesus what no matter who commits it? Or
Jesus himself would not do? We does HOW we commit the crime
may have had the sympathy of make the difference? If you think
Jesus in our hearts, but we have it does, that brings up our third
not had the wisdom of Jesus in problem:
our heads. 3. Why is it wrong to take what
In addition to repenting the sin belongs to another with a bullet
of making a god of government we in a gun but right to do it with
need to repent the sin of playing a ballot in an election? Does mak-

God ourselves. ing a thing legal make it right?
If four of us go out to dinner

Christian Ethics tonight and three of us decide
A third foundation of freedom that the fourth must pick up the
is Christian ethics. check (and three out of four is a

I see five ethical problems con- whopping majority), must the
fronting us — problems about Church uphold the verdict that the
which the Church has no right to majority is always right? Or is it
be silent. that we just don’t feel so guilty if

1. If it is wrong for a politician the majority shares our guilt?
to buy votes with his own money, And that brings up another
what makes him a great humani- question:
tarian to be backed by the churches 4. Can we delegate our respon-
when . he buys millions of votes sibility for wrongdoing by elect-
with other people's money? Is ing those to public office who will
bribery in the one case right and do wrong for us? Who is guilty
the other wrong? If so, what when we vote for the man who

-makes it so? promises to rob collective Peter
2. If it was wrong for a few to pay our selected Paul?
plunderers, or “robber barons,” to 5. Is it right or is it wrong for

enrich themselves at the expense us as churches, or as combinations
of others (as happened during the of churches, to pass resolutions
“Gilded Age” of our history), how and lobby for programs which
can it be right, and therefore obliterate the relationship between
worthy of our backing, for labor- reward and effort, which destroy


===== PAGE 57 =====

1961 FOUR FOUNDATIONS OF FREEDOM 55

human dignity by making half the possible, going into every conceiv-
people victims of piracy and the able business in competition with
other half victims of charity, and established enterprises, paying
which smother initiative and self- the state’s business losses out of
reliance by replacing them with the treasury. I would try to keep
indolence and reliance upon hidden how this could lead at the

others? right time to the nationalization
Either we have done a lot of of industry.
fuzzy thinking in this area of I would create a government

Christian ethics as it applies to strong enough to give its citizens
social action, or we have merely everything they want. Thus 1
swallowed packaged propaganda could create a government strong
programs appealing to our sym- enough to take from them every-
pathies for first this segment of thing they have.
society and then that, without By a combination of inflation
thinking at all. and taxes I would rob the very
If I were the devil and wanted people I pretended to help until, if
to turn America into a communist they ever should want to return
hell, I think I would go about it to freedom, they couldn’t but
something like this: would be completely dependent on
I would cultivate among the peo- the State.
ple the idea that the individual Next, I would gradually raise
is nothing, the indiscriminate taxes to 100 per cent of income
mass of people everything. I would (we are one-third of the way there
also seek to convince Americans now) so that the State could have
that God and Christian ethics and it all. Then I'd give back to the
an honest desire to make one’s people enough to keep them alive
own way in the world are old-fash- and little enough to keep them

ioned. enslaved.

I would get elected to office on In the meantime I would take
the promise of helping everybody from those who have and give to
at someone else’s expense. those who want until I killed the

Then I'd treat the Constitution incentive of the presently ambi-
as a sort of handbook on the phi- tious man and satisfied the mea-
losophy of government to be re- ger needs of the rest. The police
ferred to only if it served my pur- State would then be required to
pose. make anybody work, and the

I would increase the size and transformation of America from
scope of government in every way a republic to a second rate com-


===== PAGE 58 =====

56 THE FREEMAN February

munist nation would be complete. where, and I think I know the
Do you see in this any similar- reason why.
ities to what we have been doing It is because freedom and char-
for thirty years? acter rise or fall together. You
The communist slogan is “From cannot develop character without
each as he is able, to each as he freedom of choice. One must be
has need.” We are acting as if able to choose the wrong in order
ours were “From anyone who has to develop the ability to choose
something, to anyone who wants the right. On the other hand,
something.” The difference be- freedom cannot long endure where
tween those two is the same as the there is no character to maintain
difference between an alligator and it. We are witnessing a steady

a crocodile. decline of both freedom and
. strength of character in America,
Strength of Character partly because we have said, “This

The fourth foundation of free- is the age of the common man, and
dom then is individual stremgth the common man is too dumb or
of character among. our people. too wicked to make any decisions

We are not devils. We don’t for himself. They must all be made
want to wreck America. We want for him in Washington.” Unless
to make her, under God, a great we give the common man the op-
nation. The trouble is we of the portunity and the incentive to be-
churches approach all our prob- come uncommon if he can, there
lems heart-first instead of head- will soon be a shortage of angelic
first. This is entirely understand- politicians to make our decisions
able. Thank goodness we have for us.
hearts. Charlotte Elliott, author of Just

Because we have hearts, we are as I Am, once wrote to her con-
interested in people — all kinds of gressman about a matter involving
people everywhere. It is because an injustice to a certain individual.
I am interested in people that I She received the reply that the
don’t like what I see happening to Senator was too busy with plans
them. While we boast that “we are affecting the great American pub-
rich and have need of nothing,” lic to be concerned about one man.
we desperately need a strength of It is said that Miss Elliott pasted
character that will reverse the the reply in her album with this
trend of alcoholism, divorce, juven- comment penned below it: “When
ile delinquency, and adult crime. last heard from, our Maker had
These are on the increase every- not reached this altitude.”


===== PAGE 59 =====

1961 FOUR FOUNDATIONS OF FREEDOM 57

Here is one of our troubles. We our churches would do well, in my
are so involved in grandiose opinion, then, to turn their atten-
schemes to save everybody at once tion away from coercive social leg-
that we seem to have lost our in- islation to the preservation of our
terest in saving individuals. Yet a vanishing incentives.
redeemed society can be made of You cannot coerce into exist-
nothing except redeemed men and ence a Henry Ford, a Thomas Edi-
women. No possible rearrangement son, or an Alexander Graham
of bad eggs will ever make a good Bell by making it an un-American
omelet. activity for a common man to be-

A good society is one based up- come uncommon. But you can pro-
on the cooperation of its members. vide a social climate in which un-
Cooperation must be either volun- common men can develop. And
tary or forced. Voluntary coopera- that climate is one which provides
tion depends on incentives to co- economic and social incentives. It
operate. Forced cooperation leads was our Master’s way of dealing
to a police state type of govern- with men to lead them by incen-
ment. Therefore, we automatically tives rather than compelling them
choose between a society of free bylaw. It was incentives, not laws,
men and a society of slaves when that made our nation great. The
we choose between the creation of way of the Master must once more
incentives and coercion by law. become the way of his Church, or
Social Action Committees within God pity both us and our nation.

IDEAS ON LIBERY Injustice Defined

THE ESSENTIAL character of injustice consists in the forcible inter-
ference of one man with another; nor is any man justified in con-
straining another to receive even a benefit (or what nine hundred
and ninety men out of a thousand would pronounce a benefit)
against his will. The essential character of injustice is the over-
bearing of one man’s will by another man’s force or fraud.

PATRICK EDWARD DOVE


===== PAGE 60 =====

A REVIEWER: NOTEBOok

WE NEED MORE education, Yes. ing type, but In the sort of sturdy
But do We need more of the type common senge that js to be foung
we have been getting 7 in Jameson G. Campaigne’s Amer
€Te we have Very learneq ican Might ang 0viet Mysy,
People — £4) €xample, Professor €gnery, g3 95). Where Profes.
Alvin H, Hansen of Harvarg, au- sop Hangep Subscribeg to the neu
thor of CoOnomie Issues of the traligt economic theory that the
1960’ cGraw-Hjj), $7.50) Input-outpyt equation cgp be sye-
Scaring readers by telling them cessfully solved by any type of
that j ‘Present Comparative politica] and economic System, Mp
growth rates continye, the Soviets dMpaigne knows that when input
would cate Up with yg by 1980p.» is largely a matter for govern-
ile admitting that the Present ment decision, the efforts of People
oviet rate of growth 18 statist; eteriorate over the long pull, He
cally Impressive because 1t starts I$ first of all a Mmoralist, not an
rom a Jow base, the arvard po €Conomist, Ap €cause he jg pri
essor says jt would be 4 “mistake ]
to €come to

i itiong Making for
€ spread between their rate of Progress ip such purely economic
growth ang ours wijjj Completely categories as efficiency, statisticg]
disappear, automatica]yy, In a suf Erowth, ang the output that is the
Clently short time span to ensure other face of efficient input,
the Maintenance of American eco 18
nomie Superiority »

€ answer to th

in Statistic]
‘rently prevail.

Is sort of thing Colqg

at

r. Campaigne’
haracter wil]
Wh

S conten.
decide the

Mericans must
worry about, he sa
f-respect. He

YS, is their own
wants them to


===== PAGE 61 =====

1961 IF WE WERE IN RUSSIA'S SHOES i 59

stop ‘“huddling,” to cease the end- city and magnify them to occupy
less search for propitiation. Amer- nine-tenths of the city. That is the
icans have nothing to worry about nature of Soviet housing.”
in Soviet might; what they do
have to worry about is their own Hard-Earned Subsistence
unwillingness to face whatever It may be argued that it is the
strength the Russians may have. percentage of effort that the Rus-
Mr. Campaigne doubts that the sians devote to the production of
Soviets are an economic menace such things as submarines, tanks,
for reasons which he expresses and missiles, not to houses, that is
both quantitatively and qualita- the worrisome thing. But it takes
tively. Instead of taking Soviet manpower both to build and serv-
statistics at face value, he relies ice the missiles and to fight a war,
on the evidence of travelers whom and Mr. Campaigne finds it impos-
he trusts. He draws heavily on the sible to be scared by a nation
conclusions of Professor G. which locks up fifty-two per cent
Warren Nutter of the University of its population in farm labor in
of Virginia, who made an exten- order that everybody, the army in-
sive visit to Russia in 1956. Be- cluded, may be fed. According to
hind the statistics Nutter looked the U. S. Department of Agricul-
for the qualitative reality. There ture’s World Food Survey, the
was one plant manufacturing cur- 1958 estimated food production
tains with European machinery per capita in the Soviet Union was
dating from 1886. Industry, in eight per cent lower than their
general, was “between fifteen and pre-World War II average. In 1959
seventy years behind the United Khrushchev himself complained
States.” In place of wheelbarrows, that Soviet collectivized agricul-
the Russians used sledges and two- ture was using “more than seven
man litters. Brooms were still times as much labor to produce
made of twigs. The Zis automobile grain as the United States, over
was a copy of the 1939 Packard; five times more labor to grow pota-
the Zim, of the 1939 Buick; the toes, over six times as much to
Zil, a Cadillac-based model of grow beets, over fourteen times as
1940. Work forces used shovels much to raise cattle, over sixteen
where Americans used bulldozers; times as much to raise pigs.” Then
bricklaying hadn’t changed in there is the job of moving the food
fifty years. As for Soviet housing, from here to there — say, to ad-
Professor Nutter said: “Picture vanced military bases in Poland,
the slums of any major American Czechoslovakia, or Korea in case of


===== PAGE 62 =====

60 : THE FREEMAN February

war. Russia is “sixty-nine years be- Soviet planes, all better than our
hind” the West in the production own and stationed at two hundred
of freight cars. As for storing the and fifty bases in Mexico and the
food, “in canned food they are Caribbean. There would be over-
forty-five years behind.” whelming Soviet naval power close
Regardless of current compara- to our coasts. Half of our own
tive indices of growth (and if you population of 180,000,000 — or
own a single shirt it is easy to in- 90,000,000 — would be hard at
crease your clothing affluence 100 work on our farms to keep us all
per cent by merely acquiring an- fed. We might be making boasts
other one), Mr. Campaigne thinks about our missiles, but the Rus-
it will be many a long moon before sians would have a missile system
the Russians, under communist deployed, say, in Guatemala and
organization of production, will Trinidad, and ready at a word to
come within striking distance of demolish Dallas, New Orleans, Los
matching the economic growth of Angeles, and Miami. Furthermore,
the West. A clumsily-built Rus- submarines off the New Jersey
sian radio set costs 1,500 rubles — coasts would be carrying the
or more thah a month’s salary for Polaris missile, which would have
most workers. A bad pair of Rus- the range to hit Pittsburgh, Chi-
sian men’s shoes costs 350 rubles. cago, and St. Louis.
In the satellite countries (which If we were faced with such a
the Soviets must carry along) situation we might have reason to
things are bad, too. In Poland it doubt our capacity to win any kind
takes twenty minutes to earn a of war, hot or cold. But it is
pound of bread as compared to ten Khrushchev who is in that posi-
minutes in 1938. In Hungary it tion, not the U.S. Say what you will
takes two hundred hours of work about Khrushchev, he has the
to buy a new suit (the compara- character — or should we say the
tive figure for the U. S. is thirty effrontery — to push the Cold War

hours). against us in spite of the obvious
weakness of his hand.
Through the Looking Glass Mr. Campaigne thinks we might

All of this affects the Russian dissolve some of Khrushchev's ef-
military situation. Imagine, Says frontery if we would stop trying
Mr. Campaigne, if the tables were to buy love through government-
turned around and we were in the to-government waste. We don’t
Soviet position. We would be faced win elections in Laos, for example,
with more than 2,000 modern by financing a capital flight from


===== PAGE 63 =====

1961 IF WE WERE IN RUSSIA’S SHOES 61

that country. (When cash grants comes in to “grow by its own
are combined with a laxity in im- vitality on native soil.” This does
port controls, the country getting not happen under the “arrogant
the cash does not necessarily use parody” of our official “foreign
it for local capital investment.) aid” programs.

We don’t help build sound econ- Mr. Campaigne does not like the
omies by giving socialist and semi- United Nations because such an
socialist governments money to organization makes for “faceless”
spend on grandiose five-year plans nations. In ordinary life, decisions
when local farmers need individual are not made by collectivities but
instruction in methods which will by individuals in the inner re-

expand food production. cesses of their own minds and

souls. In international political
A Voluntary Program life, so Mr. Campaigne argues by
of Foreign Aid extension, a nation must also fol-

Lest he be thought of as an low its own conscience. It was in
isolationist Scrooge from the a “lonely hour” that the U. S,,
American Midwest (where he edits through its executive, made the
the Indianapolis Star), Mr. Cam- decision to send troops to Lebanon.
paigne advocates a foreign pro- “The decision to withdraw the
gram of his own. He notes that an troops similarly was made by the
American physician, Dr. Tom United States alone.”

Dooley, is busy fighting disease in Mr. Campaigne’s book is offered
Laos and Thailand. Another to the American people at an ap-
American, Paul Rusch, who spent propriate hour. In Washington,
the war in a concentration camp there has been a change in the
in Japan, now turns the other guard. That the new guard itself,
cheek by showing the Japanese left to its preferences, would
how to raise dairy and beef cattle choose to act on Mr. Campaigne’s
on the “bitter hills” that used to principles is unlikely. But politi-
be wasted land. Dr. Dooley and cians no longer follow past election
Paul Rusch are volunteers; they returns; they follow the latest
do not depend on government-to- thing in public opinion polls. Mr.
government programs. And be- Campaigne may still make himself
cause they are volunteers, they felt, for he represents a growing
“develop” solutions instead of “im- feeling that there is no health in
posing” them. Mr. Campaigne being a patsy when the other fel-
notes that wherever there is a Dr. low’s cards are certainly no better
Dooley or a Rusch, a “new idea” than one’s own. PS


===== PAGE 64 =====

62 THE FREEMAN February

Pp EMPLOYMENT OPPORTUNI- taxes were low. Businesses found
TIES IN LATER YEARS by it easy enough to start funding
James R. Morris. Burlingame, Cali- their pension programs and pay-
fornia: Foundation for Voluntary ing other minor fringe benefits.
Welfare. 125 pp. $2.50. But, then, costs began to rise as
Reviewed by Paul L. Poirot more persons became eligible to

collect the promised benefits. And

THE POOR we have with us always; almost before anyone realized it,

and some of us are old enough to the time had come to inquire about

remember when it was perfectly a prospective employee’s age and
proper, if not indeed something of calculate the cost of caring for

a moral obligation, for the indi- him in his later years before de-

vidual of good will to lend comfort ciding to hire him or not.

and assistance to anyone less for- After a generation of Social Se-

tunate than himself. Likewise, the curity and the Welfare State, it

aging we have with us always; and begins to appear that the compul-
some of us can recall when it was sory welfare activities of govern-
possible to grow old without neces- ment are creating more problems
sarily or automatically becoming for us than they were supposed to

a statistic of a major national have solved. Many persons now

problem — the problem of the ag- know by experience what James R.

ing. Morris, Senior Economist with
About 1935, however, the notion the American Enterprise Associa-

became official in America that the tion, abundantly documents in his
welfare of the poor and the aging study of Employment Opportuni-
was a governmental rather than a {ies in Later Years: that it is be-
personal or voluntary responsibil- coming increasingly difficult for
ity. This marked the beginning older women and men to find em-
here of Social Security and other ployment and look after them-
Welfare State programs. At about selves, and increasingly burden-
the same time — earlier, in a few some upon taxpayers to sustain
cases — business firms began de- this foolish waste of productive
vising pension plans and other pa- resources, not to mention the de-
ternalistic practices to help relieve moralizing and stultifying effect
older employees of the personal re- upon the real victims — the aging
sponsibility of looking after them- persons themselves.

selves in later years. . The recent activation of a Foun-
Each of these developments was dation for Voluntary Welfare,

modest at first. Social Security which sponsored Dr. Morris’


===== PAGE 65 =====

1961 OTHER BOOKS 63

study, is a telling commentary on communism is ideological. Those
the idea that personal responsibil- who try to fight it with guns and
ities can be turned over to govern- dollars must inevitably lose, for
ment and then forgotten, It is the appeal of communism lies in
high time to re-examine in Amer- the field of ideas and ideals.

ica and reactivate the glorious po- Dr. Schwarz cites specific com-
tentialities of self-help and volun- munist tricks for getting ideas
tary welfare. « across, for securing respectable

backers for “front organizations,”

» YOU CAN TRUST THE COM- for gaining power in labor unions,
MUNISTS by Dr. Fred Schwarz. and for brainwashing to extract
Englewood Cliffs, New Jersey: confessions.” He shows that com-

Prentice-Hall, Inc. 187 pp. $2.95. munism appeals to intellectuals
because it presumes to be a con-
sistent application of an ideal, but
YOU CAN trust the Communists! this, too, is a “trick” for Commu-
You bet you can, says Dr. Fred nists “can be trusted” not to let
Schwarz, to lie, to cheat, to fight, consistency to an ideal deter them
to do whatever may serve their from seeking their goal of world
ends. The title of his book is a power.
shocker. But Dr. Schwarz planned Dr. Schwarz’ description of a
it that way. college football game as seen by an
The study of communism and Australian (page 124) has rolled
its techniques has been practi- many of his American audiences
cally a full-time activity for Aus- in the aisles. But this story makes
tralian born Fred Schwarz. As a an important point: that a careful
student in the 1930’s at the Uni- observer who lacks understanding
versity of Queensland, he argued may completely misinterpret what
with Communists on the philo- he has seen. Thus he dramatizes
sophical conflict between God and the fact that eye-witness reports
materialism. Since then, as a med- of Russian marvels may give com-
ical doctor, psychiatrist, lay pletely erroneous impressions. Yet
preacher, speaker, and lecturer, Dr. Schwarz failed to realize that
and now as Executive Director of this same danger might lurk in at-
the Christian Anticommunist Cru- tempts to describe market phe-
sade, his studies of Marxian doc- nomena without adequate under-
trine and religious philosophy standing of economic principles.
have led him ever more firmly to To be comprehensible, capitalism,
the conviction that the war with like football, must be correctly in-

Reviewed by Bettina Bien


===== PAGE 66 =====

64 THE FREEMAN February

terpreted. Fortunately, the few everyone in the world could be
- pages on economics are relatively reached in less than twelve
unimportant for the thesis of the months.

. . “The power of individuals is
book as written, but they might |i itless The time has come for

better have been omitted. people to cease looking for great
Probably the most important organizations afar off, and to be-
part of Dr. Schwarz book is his £in looking for things that can be

. . done close at home. Every man
plan for action. He sees little that who invites a friend into his home,

big governments or huge organi- gives him literature to read, and
zations can accomplish in the war informs him of the danger, is help-
against communism. This is a war ing to thwart the Communist pro-
of ideas which must be waged by gram. The powers of multiplica-

aes . . tion are limitless. ...The success
individuals singly and in small ¢ this book can be measured by

groups: the number of readers whose at-
. . tention has been redirected from
“When faced with this chal- the responsibility of others to
lenge, the average person raises their own responsibility; who are
the objection that the power of the asking the question, ‘What can I
individual is very limited. From §o7 ” ’
one point of view, that is true; but }
from another point of view, what Dr. Schwarz has written an im-
can be accomplished by individuals portant message which boils down
is unbelievable. Most of my time eventually to this: The war
is spent trying to inform people ; . .
and to arouse them to the Com- against communism 1S one of
munist threat. However, even if I ideas and of spiritual philosophy,
were to speak to a thousand peo- a war that governments are ill-
ple every night and could convince equipped to fight. We should avoid
the thousand, it would take me “the temptation to try to form a
five hundred years to speak to totalitari Le
everybody now living in the United totalitarian organization modelled
States, and I would go behind at on communism. ... Organizational
the rate of two and a half million unity is a mirage. The great need
a year due to the continuing popu- js multiplicity, not unity. The

ation I vera to I an, the other unity of a free society resides in

son a week and could convince, in- its diversity.”

form, and instruct that person, In this era of government prop-
and if we each convinced, in- aganda and “freedom” academy
formed and instructed another per- proposals, it is well to be re-
son the following week, and the . ’ . . .

four of us each enlisted another minded of this again, again, and
the following week, by this process again. ~


===== PAGE 67 =====

\YW HEN a devotee of private property, free market, limited govern-

ment principles states his position, he is inevitably confronted with a
barrage of socialistic clichés. Failure to answer these has effectively
silenced many a spokesman for freedom.

The Foundation for Economic Education is developing a series of
suggested answers to the most persistent of these

~ Clichés of Socialism

Available now are answers to the following:

1. “The more complex the society, the more government control we need.”
2. “If we had no social security, many people would go hungry.”

3. “The government should do for the people what the people are unable to do
for themselves.”

4 “The right to strike is conceded, but. . .”
5. “Too much government? Just what would you cut out?”

6. “The size of the national debt doesn’t matter because we owe it to our-
selves.”

7. “Why, you'd take us back to the horse and buggy.”
8. “The free market ignores the poor.”
9. “Man is born for cooperation, not for competition.”

10. “Americans squander their incomes on themselves while public needs are
neglected.” )

11. “Labor unions are too powerful today, but were useful in the past.”
12. “We have learned to counteract and thus avoid any serious depression.”
13. “Human rights are more important than property rights.”

14. “Employees often lack reserves and are subject to ‘exploitation’ by capitalist
employers.”

15. “Competition is fine, but not at the expense of human beings.”
16. “We're paying for it, so we might as well get our share.”

17. “I'm a middle-of-the-roader.”

18. “Customers ought to be protected by price controls.”

Each one is on a separate sheet, 8%” x 11”. Single copies for the ask-
ing. Quantities at 1¢ a sheet. For sample copies (no charge) write to:

THE FounbaTioN ror Economic EpucaTioN, Inc.
IrvincTON-ON-HUDSON, N. Y.


===== PAGE 68 =====

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