the

FreemanVOL. 20, NO. 11 • NOVEMBER 1970

Harmony or Antagonism? .... .. . Frederic S. Bacon, Jr. 643In view of the natural harmony among men's interests, it is simply necessary not totry to redirect them.

Ends and· Means William W. Bayes 647'Where there is a better choice available, no means which cannot itself qualify asan end should be used."

Rising Taxes Weaken the Dollar Hans F. Sennholz 662Federal deficits, however financed, are a drag upon the economy and a burden uponall citizens.

A Conservationist Looks at Freedom Leonard E. Read 667Because man is a part of his environment, he must rely on the market as his con·servation guide.

"For the Best Interests of Man" A. Neil McLeod 674Conservation "movements" have many of the characteristics of war.

Dissent Merryle Stanley Rukeyser 676Liberty tolerates dissent, but does not reward or excuse error.

Throttling the Railroads:7. The Grip of Privileged Competitors Clarence B. Carson 684

Subsidizing the competition, while strangling a business, spells trouble for all.

Fifty Years of Engineering Ben Moreell 695Emphasizing the special responsibility of the engineer for maintaining a climate offreedom.

Book Review:liThe Art of Community" by SpencerT. MacCallum

Anyone wishing to communicate with authors may sendfirst-class mail in care of THE FREEMAN for forwarding.

the

FreemanA MONTHLY JOURNAL OF IDEAS ON LIBERTY

IRVINGTON-ON·HUDSON, N. Y. 10533 TE;L.: (914) 591-1230

LEONARD E. READ

PAUL L. POIROT

President, Foundation forEconomic Education

Managing Editor

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Barmon~ or" Anta

FREDERIC s. BACON, JR..

IN THIS AGE of the "welfare state"there has been an acceleratingdrift toward more and greater con­centration of social power in thehands of the state, resulting inincreasing interference in ourdaily lives, our personal liberties,and our economic freedoms -.allmaintained and enforced by thecoercive police' power of the state.Before we reach that point of noreturn - beyond which it will beimpossible to recapture our God­given rights to life, to liberty, andto ,the pursuit. of happiness, .weshould pause to consider the. ques­tion: Are men's interests, whenleft to themselves, harmonious orantagonistic?

About 120 years ago,FredericBasti~t, a French. political econo­mi~t, answer.ed .. this question ,in anessay .. entitled "To the Youthof

Mr. Bacon owns and operates the BusinessService Company of New Bedford, Massachu­setts, specializing in bookkeeping, tax service,records, and business consultation.

France."l Bastiat's analysis is par­ticularly applicable to the turmoilin America today. He argued thatall men'·s impulses, when moti­vatedby legitimate self-interest,fall into a harmonious social pat­tern, and it· is the intervention bythe' state in attempting to redirectthese interests that causes turmoiland dissension.

Bastiat pointed out that if weassume that· men's interests areharmonious the obvious solutionto our social problems is simplynot to try to redirect these in­terests. If we accept the opposite,that men's interests are inevitablybound to. clash - the concept of the"welfare state" - and that the con­flict can be averted only throughthe creation of an artificial socialorder to be enforced by the police

1 Frederic Bastiat, Economic Harmo­nies, Irvington-on-Hudson, New York:The Foun'dation for Economic Education,Inc. $3.50 paperback.:

643

644 THE FREEMAN November

power of the state, then mankindis surely in serious trouble, andwe must get some solid answersto these questions:

1. Shall we be able to find aworkable plan for society and aman to implement it?

2. Will this man be able to winover to the selected plan otherswho have conceived different pro­grams for society?

3. How will the final form forsociety .be selected, adopted, andimplemented?

4. Will men submit to the se­lected planned society, which, ac­cording to our hypothesis, must runcounter to every man's interests?

5. Assuming that mankind willconsent to being regulated underthe selected plan, what will happenif another, obviously better plan,is developed? Should we preservea bad social order, knowing it tobe .bad; or are we to change thesocial order according to the per­suasiveness of the inventors of newplans?

6. Will not all others whoseplans have been rejected uniteagainst the accepted. plan with thebetter chance of destroying it be­cause, by its very nature, it runscounter to every man's self­interest?

7. Is there any human forcecapable of overcoming the funda­mental antagonism which is as-

sumed to be characteristic of theself-interests of all men?

8. If individual self-interest isantagonistic to the general inter­est, where would the principle offorce be established? It wouldnecessarily be outside of humanityin order to escape the consequencesof our premise.

9. If a man or men are en­trusted with the arbitrary powernecessary to enforce a contrivedsocial order, they must be differentfrom the rest of us; they, unlikeus, must not be moved by self­interest; and, when placed in aposition where there can be nopossible restraint on them or anyresistance to them, they must beexempt from error, from greed;.and from covetousness.

The Case for Nonintervention

It stands without proof that itis not necessary to force into har­mony things that are inherentlyharmonious. It is also without,question that there is a naturalharmony among men's interests,and so to solve the social problemsconfronting· us it is simply nec­essary not to try to redirect them.

The idea of liberty is based onthe premise that men's interests,when left to themselves, tend toform harmonious combinations andto work together toward "the goodlife." If one has faith in thewis­dom of the Laws of Providence,

1970 HARMONY OR ANTAGONISM? 645

Nature, and God, one must havefaith in freedom. Those who woulddirect and control the actions ofmen have accepted the Theory ofDiscord - that men's actions, whenleft to themselves, are· antagon­istic. They propose to substitutecoercion for freedom, a plannedsocial order for the natural, and awork of their own contrivance forthe handiwork of God. The idea ofliberty is to let men labor, ex­change, learn, band together, actand react on one another; accord­ing to the Law of Nature therecan result from their free and in­telligent activity only order, har-

~ mony, progress, and all things that., make for "the good life" because

there never was, never is, andnever will be any disorder in na­ture.

For the Laws ofNature to beharmonious, it is not necessarythat they exclude evil. Evil has itspurpose. It is self-limiting. Everypain is a means of preventinggreater pain by the elimination ofits cause. Every individual is afree agent, and, when man is free,he can choose; since he can choose,he can err; since he can err, hecan suffer. He must suffer; for hestarts in ignorance, and in his ig­norance he sees before him an in­finite number of choices. All butone leads to error. All error breedssuffering. This suffering eitherfalls upon the one who has erred,

setting in operation the Law ofResponsibility; or else it strikesinnocent parties, in which case itsets in motion the Law of Solidar­ity.

The Essential Freedom to Choose

The action of these laws, com­bined with the ability of men'sminds to see the connection be­tween cause and effect,brings manback, due to his suffering pain, tothe path of righteousness andtruth. However, if evil is to fulfillits purpose, the Law of Solidaritymust not be made to artificiallyencroach upon the Law of Respon­sibility; the freedom of the in­dividual to choose must not be re­stricted. Governments, under thepretext of· fostering among menan artificial kind of solidarity,have dulled and made ineffectivethe individual's sense of responsi­bility. This lessens the correctingeffect of error by spreading theconsequent suffering among theinnocent.

Through improper use of thecoercive police power of govern­ment, the relation between laborand wages· has been impaired, theoperation of the laws of produc­tion and exchange has been dis­turbed, the natural development ofeducation is distorted, capital andmanpower are misdirected, mindsand actions warped, absurd de­mands inflamed, wild hopes dan-

646 THE FREEMAN November

gled before men's' eyes, unheard ofquantities of ,human energy wast­ed, centers of population relocated,and even experience itself madeineffective.

In this age of intervention­under the "welfare state" ~ men'sinterests have been given artificialfoundations. They cannot help butclash. And the thought leaders. inthe news media,. in government,and in the intellectual establish­ment say: "You see, all men's in­terests are antagonistic..Personalliberty and economic freedomcause all the trouble. Both mustbe stifled."

Nature cares nothing whateverabout motive or intention; shecares only for order, and sees onlythat disorder shall. be corrected,and that the regular orderly se­quences of actions be upheld. Godmade men's interests harmonious.Let us follow the Laws of Nature.Let us do away with coercive re­direction of men's actions.. Let, us

Economic Harmonies

return to the concept, as expressedby Thomas Jefferson in apart ofone sentence in the Declaration ofIndependence, "'. . . men are en­dowedby their Creator with cer­tain unalienable rights~ ..." Menmust be allowed. to .be responsiblefor their own actions' and shouldnot look to government for· any­thing beyond the protection of lifeand property and· the .establish­ment of justice.

For men to havetrue'liberty andeconomic freedom the governmentmust be limited~ Governmentshould do only those things, indefense of life and property, whichprivate citizens cannot properly doeach man for himself.

Let all men have personal lib­erty and economic freedom. Thatis the Law of Nature. Then andonly then .will there be peaceamong. men and will mankindachieve "the good life"; for therenever was, never is, and never willbe any disorder in nature. I)'

IDEAS ON

LIBERTY

THE SOCIAL WORLD is rich in harmonies that we do' not fullyperceive until our .minds have gone back to their causes, in orderto find their explanation, and have then gone forward to theireffectEi, in order to know the, ultimate. purpose of. the phenomenathey exhibit.....

Ii' R E DE RIC B A; S T I A T ( 1850 )

DS AnD mEAns

WILLIAM W. BAYES

THE HONEST SEEKER,of truth facesan exceedingly difficult task inpenetrating 'the murky fog ofclaims and counterclaims made bythe zealous 'advocates of variouscauses. All. men proclai~ loftyends. No man 'proposes to' demon­strate the evils which will followthe adoption of his plan. No as­sociation or religious sect thathopes to acquire a large influenceand many members sets out toshow how affiliation with it willbe detrimental to one's interests.Still less are political parties dis­posed to persuade voters that theyintend to bring the nation to ruinif 'their candidates' are 'elected topublic office. Even dictators mustconvince their people that they areworking for the "common good."

The only general agreementamong men is that all ends should

Mr.' Bayes recently retired from the U.S. AirForce.

be good. Problems arise becauselmen do' not .universally agree on'what is •good. The conceptions ofgood multiply as, the view narrowsfrom the general to the particular.Thus men agree that life is good,but they do not agree that life8hould be preserved, in all cases:the lives of an honest, man, a con­victed .murderer, a steer, and amosquito", are not regarded withequal reverence.

Men disagree, also, concerningthe means which may be legiti­mately used to achieve even thoseends upon which' they completelyagree. They generally agree, forinstanc'e, that all should have anopportunity to obtain an 'educa­tion; but some believe that theeducation should be provided bythe state (taxpayers) ,while othersbelieve it shou,ld be earned andpaid for by the recipient.

The noncommunist world gen-

648 THE FREEMAN November

erally subscribes to the belief thatthe end does not justify the means.(This truism .should be stated:The end does not al,ways justifythe means. I will explain this re­vision later.) The commuIlist~ be­lieve that "... the end justifies themeans, and that the means canfind no other justification thanthat it serves the end."!

Marxist Morality

Karl Marx, who is now oftenpictured in the West as a great­hearted social refdrmer, originatedthis immoral code in his com­munist movement (thoughnotab­solutely, of course) :

He expelled people from his Com­munist party for mentioning pro­grammatically such things as "love,""injustice," "humanity," even "mo­rality" itself. "Soulful ravings,""sloppy sentimentality," he calledsuch expressions, and purged aston­ished authors as though they hadcommitted the most dastardly crimes.2

Marx would. be proud of hispolitical heirs, who have not de­parted. from his peculiar path tomorality. (It must be rememberedthat even Marx envisioned whathe believed to be a noble end, the

1 Alfred G. Meyer, Leninism (NewYork: Frederick A. Praeger, Publishers,1962), p. 87.

2 Max Eastman, Reflections on theFailure of Socialism (San Diego, Calif.:Viewpoint Books, 1955), p. 85.

paradisiac classless society.) Oth­er persons, who are not commu­nists. but who, as experts on com­munism, have drunk too often atthe Marxist fount, seem to haveingested some unsound ideas:

Nor does the assertion stand upthat moral systems, however utopi­an, do serve as checks against bar­harian excesses. Neither Christian­ity nor humanist ideals succeeded inpreventing the bestialities of Ausch­witz and Buchenwald. Indeed, . . .it often seems that the existence ofmoral sentiments or .. moral· convic­tions· permit [sic] inhumanities ofthis sort; they serve as some. sort ofother-worldliness, which lulls us intothe pleasant belief that, somehow,somewhere, the perpetrators will bepunished. Thus moral convictions al­low us to bear the evil against which,without these, we might rebel.3

Should we, then, aim no. higherthan at a balance of terror? Mr.Meyer seems to forget that, with­out "moral sentiments or moralconvictions," there can. be no con­ception and identification of evil.Are we no more capable. than theanimals of discerning good fromevil and aiming at the good? Mr.Meyer, like so many others today,seems to have trouble. identifyingcauses: the proximate (though notthe ultimate) cause of inhumani-

3 Alfred G. Meyer, Marxism: The Unityof Theory and Practice (Cambridge: Har­vard University Press, 1964), p. 148.

1970 ENDS· AND MEANS 649

ties is men's failure. to live up tothe standard,not the standard it­self. But he cannot really believethat the standard should be dis­carded, since he soon lapses intowriting about the "good life·. onthis earth."4 To call something"good" is to refer to a standard.All want to retain the standard:good men so that they may im­prove themselves by aiming at it;bad men so that they may justifytheir acts by citing the "good"end they have in view. Since noone wants to discard the standard,it is vain to blame it for men'sfailings .. In any case, we are notwithout tools with which to meas­ure and weigh men's announcedintentions and acts.

We may analyze the end itselfto determine whether it is indeedgood. But we may also compare theend to the means· to reveal whethereach is compatible with the other.The means, after all, contains· the

-end. Emerson wrote that "causeand effect, means and ends, seedand fruit, cannot be severed; forthe effect. already blooms in thecause, the end pre-exists in themeans, the fruit in the seed."5 Butthe means, it should be empha­sized, contains only its natural end

4 Ibid., p. 149.5 Ralph Waldo Emerson,"Compensa­

tion," Essays and English Traits, vol. 5of The Harvard Classics, ed. Charles W.Eliot, LL.D., 51 vols. (New York: P. F.Collier & Son Corporation, 1937), p. 90.

and not necessarily the end pre­dieted by ardent advocates.

Evil Means Cannot Achieve Good Ends

In defense of the use ·of evil:means, some social·engineers havesaid (with the assurance of hav­ing produced an unassailable argu­:ment), "You've got to break eggsto .make an omelet!" And if per­chance that argument should failbecause no human is injured whenthe egg is broken, resort is thenhad to an analogy between surgeryon a human and surgery on a so­cial body.

It should not· be necessary topoint out the fallacies in the eggargument (one has already beenmentioned) .

Let us. consider for a momentthe surgery analogy. We must firstobserve that surgery is performedonly with the patient's· consent.Does the social engineer hope toobtain the· consent of every mem­ber of society who will be affectedby his "operation"? Secondly, thepatient submits to surgery onlywhen no other, less extreme, meansis available to him. From the pa­tient's viewpoint, as well as thesurgeon's, the operation is a de­fensive measure. Finally, the re­sults of surgery are far. morepredictable on the whole than arethose of social planning. The sur­geon confines himself to an inte­gral unit whose processes are pret-

650 THE FREEMAN November

ty well known and whose reactionsto the stress of the surgery maybe predicted with a large measureof success.

Good cannot come from evil.Since the end pre-exists in themeans, evil consequences must flowfrom evil acts. Just as life cancome only from life (the doctrineof biogenesis), so good can comeonly from good. Most personswould not dispute the fact thatlike comes only from like (whichis the reason the alchemists werenever successful in their endeavorsto transmute baser metals intogold), but many do not believethat this principle can be appliedto human relationships. (But noneare so skeptical as to believe thatthe way to win someone's love isto behave uncivilly toward him orher.)

If we can transpose the physicallaw that like can come only fromlike to the moral realm, we mayinfer that a good end can not beachieved by the use of evil meansand its corollary that good means,rightly construed, must attain agood end. We are able to observeand understand this principlewhen only two persons are· in­volved, such as in· a marriage orin a business partnership; but wecannot clearly see that every act,whether for good or for evil, mustinevitably cause a like reaction inthe larger and more complex re-

lationships within a social body.Unfortunately, it is· not alwayseasy to trace the consequences ofa public act, since delayed reactionand multiple causes and effects oc­curring concurrently·often obscurethe ultimate result of a single act.Such difficulties do not usually at­tend the observation of the im­mediate results of our acts; thesecan be seen and felt immediatelyand absolutely.

Means Become Ends

Having selected a means, we donot automatically carry it out.Each means becomes, and must be­come, an intermediate end: whenwe· decide that we will use a cer­tain means and plan the steps toimplement that means, we therebymake of it an end. We cannot somuch as take a pen in hand with­out first purposing to do so. Everyact and, therefore, every means· ispreceded by a purpose, or plan,· toact. That purpose is an end.·· If myend is togo to work in the morn­ing, every act I must perform toreach that end - including risingfrom bed, washing, shaving, dress­ing, breakfasting, and the like ~must first be purposed. When itis purposed, it is not yet an act,but is an end. Each of these. actsmay be further·· broken. down intomultiple ends arid means. Everypurpose, then, however fleetingand insignificant, is an end; and

1970 ENDS AND :MEANS 651

the consequent act, however sim­ple and brief, is a means. We es­tablish thousands of such endsand means in getting through anormal day, most of them in anunconscious manner.

Let us consider a. simple ex­ample. Let us imagine that we arestanding in a crowd of people as­sembled to view an imp~rtant per­sonar event. In order to get abetter >view (first end), we de­termine that we must rise on ourtoes (first means). But note­selecting the' means is not thesame as executing the 'means. Wemust now establish the end (sec-

. and end) of rising on our toes;the means (second means) usedis to press against the earth withthe balls of our feet. We shouldobserve that the means had tobecome an end before it could' becarried out. We should also ob­serve· that the "end-in-the-means"was the only certain end, i.e., weknew we would rise on our toes bypressing the balls of our feetagainst the earth. But we were notcertain we would obtain a betterview by doing so.

Each Means Is first an End

We have seen that every act ormeans 'is first au end. It is there­fore nonsense fora person to citea .remote lofty end .which he' hopesto achieve in order to excuse him­self for committing a. present evil

deed, as if that deed were not even:more directly and absolutely hisaim. He had to. intend, or purposethe evil deed, else it never wouldhave become an act. The starkfact is that, .given an opportunityto choose from a number of possi­ble acts, none, of which wouldcertainly produce any effect or endexcept the one immediately flow­ing from the act, he chose to com­mit an evil act.

It follows,. therefore, that thosewho would use evil means toachieve a. distant and as yet un­real noble end, while ignoring thevery real noble behavior now pos­sible to them, do not intend to dogood. It is deeds, after all, whichhave consequences that can be ex­perienced (felt). If such personshabitually resort to. acts involvingthe use of force or fraud, theyreveal. thereby their disguisedends. To refer always to someultimate good in order to sanctionevil· acts is to deceive first oneselfand then others. Men's character,it seems clear, is revealed more intheir choice of means (which, wernust not forget, are ends) than inthe ends they profess.

Nor may the reality of the pres­ent deed be taken as a call to goabout doing "good deeds" whichrely upon the involuntary contri­butions of others to carry out. Ifwe are capable of thinking, feel­ing, and acting,we must assume

652 THE FREEMAN November

that other humans are similarlycapable. Making that assumptionis the most noblehehavior a humancan practice. Some persons in oursociety, who are considerably en­raged at the prospect of self­appointed censors' determiningwhat they shall be permitted toread or view in a theater, are notat all reluctant to do another'sthinking for him in order toachieve what they call "socialjustice." They are apparently un­aware of the monstrous inconsist­ency of their positions.

The Means Must Qualify as an· End

Thus I arrive at what I believemen should take as a maxim:Where there is a better choiceavailable, no means which cannotitself qualify as an end should beused. No man could justify terroras an end, yet the communistshave attempted to justify the useof terror as a means of forwardingthe revolution and industrializa­tion toward the ultimate end ofthe classless society. Only themeans was certain. The ·commu­nists therefore traded a certain,immediate evil for an uncertain,remote "good." While waiting forthis paradise on earth, the peoplesof communist nations have beensubjected to a species of slaverycloaked as a necessary means. Inspite of their horrendous example,we have our own social engineers

whose means always involve in­voluntary servitude.

That an ideal society cannot bebuilt by the use of such means hasbeen eloquently stated by MilovanDjilas, the former Vice-Presidentof Yugoslavia:

Throughout history there have beenno ideal ends which were attainedwith non-ideal, inhumane means,just as there. has been no free so­ciety which was built by slaves.Nothing so well reveals the realityand greatness of the ends as themethods used to attain them.

If the end must be used to con­done the means, then there is some­thing in the end itself, in its reality,which is not worthy. That whichreally blesses the end, which j usti­fies the efforts and sacrifices for it,is the means: their constant perfec­tion, .humaneness, increasing free­dom....

No regime in history which wasdemocratic - or relatively demo­cratic while it lasted - was predom­inantly established on the aspirationfor ideal ends, but rather on thesmall everyday means in sight.Along with this, each such regimeachieved, more or less spontaneously,great ends. On the other hand, everydespotism tried to justify itself byits ideal aims. Not a single oneachieved great ends....

Thus, by justifying the means be­cause of the end, the end itself be­comes increasingly more distant andunrealistic, while the frightful· real-

1970 ENDS AND MEANS 653

ity of the means becomes increasinglyobvious and intolerable.6

Where it is certain that there isno better choice, an apparentlyevil means may be used; but itshould be discarded as soon as abetter choice appears. Cutting thebody of a human can never qualifyas an end in itself; but, as sur­gery, it may be· the· indispensablemeans to save a life. Its necessity,which almost completely eliminateschoice (except, perhaps, the alter­native to be crippled or blind, orto die), seems to remove it fromthe· category of good and evil.Thus, to justify the use of whatwould ordinarily· be evil meansthe end must be the preservatio~of life itself or of a value withoutwhich life would not be worth theliving, and there must be no betterchoice of means available toachieve that end.

How can we recognize meanswhich really bless the end, meanswhich could themselves qualify asends? Immanuel Kant has givenus two imperatives that may be ofenormous help in this primarytask of determining just means.

The Categorical Imperative

The first is what Kant calledthe categorical imperative: "Actas if the maxim of your action

6 Milovan Djilas, The New Class· (NewYork: Frederick A. Praeger, Publisher,1957), PP. 162-63, passim.

were to become by your will ageneral law of. nature."7 This im­perative, when used to assess vari­ous modes of human behaviorhelps us to see what the ultimat~effects of those actions would beif practiced by everybody.

We know, for instance, thatthere are fundamentally only threeways to obtain something of valuethat we need or want: (1) steal itfrom someone else; (2) receive itas a gift oras charity from some­one else; or (3) produce it oneselfor work to acquire the money tobuy it. Kant's categorical impera­tive, applied to each of these meth­ods in the economy, results in thefollowing possible standards:

1. Everyone steals from every­one else.

2. Everyone depends upon theproduction and generosity ofeveryone else (charity or pub­lic welfare).

3. Everyone who is able to do· soproduces, Le., works.

Number one was the standarduntil the advent of the IndustrialRevolution. Because the requisitetechnology was not available to ex­tract large quantities of raw ma­terials from the earth and to con­vert them easily and cheaply intoan abundance of tools and consum-

7 earl J. Friedrich (ed.), The Phi­losophy of Kant: Immanuel Kant's Moraland Political. Writings (New York: Ran­dom House, Inc., 1949), p. 170.

654 THE FREEMAN November

er products, wealth was thoughtto be static. One could not produceor· create great wealth ; one couldonly ,plunder, it from those whopossessed it. Only the mighty· suc­ceeded, ·of course, in acquiringreasonably great wealth. Such astandard. obviously limits the pos­session of· a good living standardto a very few; the majority iscondemned to a life of grindingpoverty. Universal 'plunder isclearly not a worth-while standard,not only because of its moral im­plications, but also because of itslow productivity.

Number two is obviously a stateof· universal dependency., This con­dition will never be truly approxi­mated because, fortunately,therewill always be large numbers ofproducers - persons who work andcreate simply because they must,because they reject dependency,because they want to build.Dan­ger arises when their·numbers be­come too few to sustain a viableeconomy. It is clear" that· numbertwo is really no better' a standardthan number one - for the samereasons.

We may observe that the onlypossible and the only moral econ­omic standard is that of universalproduction. Whatever motivatesindividuals to devote their willsand efforts toward personal pro­ductivity, including, the positivefactor of the possibility of re-'

ward and the negative' factor of(not punishment but) stern 'ne"­cessity. Itwas as much the spur ofneces~ity as anything, else whichhas, resulted in the e~traordinary

technological progress man hasmade - necessity operating, in anatmosphere of freedom to think,to plan, and to implement thatplan, and to bear risks and to winany rewards ensuing from suc­cessful plans and efforts. On theother hand, whatever ene,ouragesorpermits persons to defraud orto,steal or to depend upon public wel­fare when they are able to. workobviously diminishes the numberof producers and the total prod­uct, besides causing the growth ofa class of perennial dependents.These facts may seem very ele­mentary, but· public. officials oftenbehave as though they do not un­derstand the principle involved­that production is the only pathto prosperity. It is the so-calledobvious that often escapes critical,analysis, particularly when the in­terests of some collide with facts.

Modes of Social Conduct

When applied to government,the categorical imperative revealsvarious modes of organization ofsociety:

1. Everyone does everything hepleases., eNo organization;anarchy.)

2. Everyone does, what' everyone

1970 ENDS AND MEANS 655

else pleases that he shall do.(Impossible !)

3. A variation of number two:everyone attempts, by law, torestrain or·· compel everyoneelse.

4. Everyone does· as he pleases,except that .he must notvio..late the constitutional rightsof anyone. else.

TJ:1e absurdity of numbers oneand two will, I believe, be readilyapparent to all.

Every form of oppression­whether autocracy, oligarchy, ormajoritarian democracy - results,in the political realm, from num­ber three: the tendency of each ofus to fear our fellow men and at­tempt to prevent them from actingfreely, whether by restraint or bycompulsion. (Most of us, of course,are not fully aware that our guid­ing principle is force.) We believethat we should· be free to act, butwe doubt the .good intentions ofour neighbor. This principle isself-defeating. Just as "the onlyway to have a friend is to be one/'8so the only· way to have freedomfor ourselves is to permit it forothers. Every act of force mustcause a forceful reaction, and sothe cycle keeps repeating. If weseek and obtain restrictive or com­pulsory legislation, we gain noth­ing; for we ourselves shall· be re-

8 Emerson, "Friendship," Essays andEnglish Traits, p. 116.

stricted or compelled as much asour fellow men. Though we maysee only the particular law inwhich· our will seemingly works,we shall have advanced only theprinciple of force and shall haveinhibited the creative activity offree men.. Thus, if all (or nearlyall) of us work Jor the principleof force, and none of us for thatof ·libertY,we shall be responsiblefor the monster who chains us.

Fear and Freedom Inversely Related

There appears, then, to be an in­verse ratio between fear and free­dom: as a· people's fear - of for­eign or .domestic enemies or ofeconomic depression - increases,freedom decreases pari passu.Hence the enemies of freedom inevery nation seek to keep the peo­ple in a state of fear. Fearfulpeople, after all, need the. protec­tion of· an all-powerful state. It isnot accidental that every nationtoday has far larger armed forcesthan during the era of laissez­faire capitalism, which was a timeof relative peace, nor. that com­munist nations· have so immenseand. pervasive a· police apparatus.

As fear and freedom functioninversely, so courage and libertyrise or fall. together. There is noway in which we can retain ourliberties if. our courage .. fails~(Witness the inroads made bystate intervention during the

656 THE FREEMAN November

Great Depression.) And the cur­rent practice of conditioning citi­zens to be dependent upon the wel~

fare state is not likely to increasetheir courag,e. Courage, at oncethe cause and effect of self-reli­ance, grows when one encountersand overcomes obstacles. This· be­ing so, what will be the effect ifall of us rely upon the state forour security? Disaster. For thestate is a mythical entity, whichhas no existence apart from theindividuals: who compose it;' itcannot receive, as if by bloodtransfusion, the courage and vigorwhich flow out ·of the people. Thatcourage and that vigor' are lost-:­to the' individual and to the state.

The fourth maxim listed maybe recognized as the essence' ofconstitutional government. It isoften said· that ours is a govern­mentof laws and not of men. Thisstatement means (or should mean)that no man, or group of men, isfree to' make arbitrary judgmentsor decisions in the conduct of pub­lic affairs. It should also mean thatrights of individuals are protectedfrom the assaults of combinationsof men. In implementing the Con­stitution and the laws, .therefore,public' officials have a duty to con­sider only the rights of individu­als, since groups, as such, have norights. Nor may the individualrights of members of a group beadded up to defeat the rights of

a single individual. The so-calledrights of groups inhere in andflow from the rights of the indi­vidual who ·is a member of thegroup. No. matter how large thegroup, it can assert the rights ofonly one individual. To believeotherwise is to accept the "mightmakes right(s) "philosophy.

The Practical Imperative

Kant's second imperative, whichhe calls the practical imperative,is this: "Act so as to treat man,in your own person as well as inthat of anyone else, always as anend, never merely as a means."BAn individual maybe used as ameans only when he, the individ­ual himself and not some collectiveman, is simultaneously the end.When taxes are taken from oneperson and applied to the supportof another (whether through aidto education, Medicare, aguar­anteed annual income,or anythingelse) , the first person is being usedas the means and the second asthe end. It is deceptive to say thatthese aids will be available to all,because many persons will neveruse them. The government, whichis supposed to be the guardian ofjustice, thereby violates the firstprinciple of justice: it dispenses,not a uniform brand of justice toall citizens alike, but a brandwhich varies with the social or

9 Friedrich, Philosophy of Kant, p. 178.

1970 ENDS AND MEANS 657

economic status of citizens. If ithad the blind eyes of justice, itwould insure that every public actreached every citizen as an end.The so-called common good canthus mean only the total of indi­vidual "goods."

It is safe to say that no dictatoror totalitarian government in his­tory has ever emphasized therights of individuals, a fact whichshould stand as a beacon to allwhose highest aspiration is thefreedom to become. On the otherhand, those who hope to furtherthe collective society know theirenemy and have always inveighedagainst individualism:

Karl Marx wrote, "The Demo­cratic concept of man is false be­cause it is Christian. It holds thateach man has a value as a sovereignbeing. This is the illusion, dream andpostulate of Christianity." 10

Adolf Hitler wrote, "To theChristian doctrine of the infinitesignificance of the individual's hu­man soul, I oppose with icy claritythe saving doctrine of the nothing­ness and insignificance of the indi­vidual human being." 11

But, if the individual - whothinks, feels, and acts - does not

10 Quoted by Fred G. Clark in How toBe Popular Though CQnser'vative (NewYork: D. Van Nostrand Company, Inc.,1948), p. 10l.

11 Ibid.

have supreme worth, who or whatdoes? Obviously, the collective.Jules Monnerot calls this the Mythof the Species:

To abstract the individuals whocompose it is to endow the Specieswith transcendence; but, in fact, theSpecies is only accessible through theindividuals. Hypostatized as an ab­straction, it becomes a transcendentand all-devouring entity; and to im­molate existing individuals for thesake of future individuals ~ or ofthe Species (the ambiguity is theessence of mythical thinking) - isto feed this transcendent entity withhuman sacrifices. But if the wholechain is present in each of its links,if the individual and the Species areeach immanent in the other, thenthis immolation of individuals maybe the destruction of the Species aswell.12

We should not forget that Kantsaid we are not to use ourselvesas means only. Thus a man maynot elect, rationally, to be usedmerely as the means for the endsof others, even though he may be­lieve he is being very unselfish andnoble in doing so. He cannot logi­cally assert that he is concernedwith the humanity of others whiledisregarding his own humanity,any more than he can logicallyrefer to the mote in other men'seyes while disregarding that in

12 Jules Monnerot, Sociology and Psy­chology of Communism (Boston: TheBeacon Press, 1953), pp. 280-81.

658 THE FREEMAN November

his .own. This accords with theCommandment: "Thou shalt lovethy neighbor as thyself"13 (em­phasis is mine). If Karl Marx, forinstance, had been more concernedabout his own welfare and that ofhis . wife and children, we couldperhaps better believe the portraitof him as a lover of all humanity.Instead, he lived as a frequentdependent of his collaborator,Friedrich Engels, often in grind­ing poverty. If a man sacrificeshimself and his family, whose ex­istence is more real and normallymore dear to him than that ofothers, we may be pardoned for be­lieving that he will not hesitateto sacrifice others.

The Golden Rule

Another guide to the selectionof just means is the Golden Rule:"Therefore all things whatsoeverye would that men should do toyou, do yeeven so to them: forthis is the law and the prophets."14This principle is expressed in thenegative by Confucius: "Do notdo unto others what thou wouldstnot they should do unto thee."15.This rule is not valid, however, foreverybody. It requires that the in-

13 Mark 12 :31.14 Matt. 7: 12.15 "The Sayings of Confucius," Sacred

Writings, Part 1, vol. 44 of The HarvardClassics, ed. Charles W. Eliot, LL.D., 51vols. (New York: p. F. Collier & SonCorporation, 1937), p. 53.

dividual have a proper (I.e., just)self-image: he must evaluate hisown intrinsic worth as a humanas no greater and no less thanthat of any other individual. Re­spect for others' individual rightsto life, liberty, and property isthe political expression of thismoral precept. If a man believeshis own person is more importantthan that of others, he will sacri­fice the rights of others to his owncause. If he believes that the per­son of another is more importantthan that of his own, he will sacri­fice his own rights (i.e., be usedas a means) to the cause of thatother person. If he believes he isas important as others, he willneither demand nor accept sacri­fice. This rule does not prohibiteither the recognition and rewardof individual merit or the identi­fication and punishment of crime.It merely requires that we do notvalue our own person, as opposedto our own achievements, morehighly or less highly than that ofanother.

With the above limitation inmind, what are some ways inwhich we may comply with thisGolden Rule?

First, we must respect otherpersons as the thinking, feeling,acting beings that they are;· andwe should realize that no one, our­selves included,is infallible. If wepay this respect, we will be un-

1970 ENDS AND MEANS 659

likely to decide that we know whatis best for our fellow men and at­tempt to implement our own planin the law. Frederic Bastiat ex­pressed ·this idea eloquently:

Dh, sublime writers! Please re­member sometimes that this clay,this sand, and this manure whichyou so arbitrarily dispose of, aremen! They are your equals! Theyare intelligent and free human be­ings like yourselves. As you have,they too have received from God thefaculty to observe, to plan ahead, tothink, and tojudge for themselves.I6

We must resist force and fraud.But, in doing so, we must not be­come that which we have con­demned. If we do, in what essen­tial respect will we differ fromthose whose actions we deprecate?In the fact that we were not thefirst to commit a certain act?Every man since Adam has beenable to seek that refuge. We can­not in good conscience criticizeanother for doing that which wewould do in the same circum­stances. In resisting force andfraud, therefore, we may useforce only in self-defense. Thisprinciple is of supreme importancein times like the present, whenprovocations abound.

Nor may we wait for everyother person in the world to do

16 The Law (Irvington-on-Hudson, NewYork: The Foundation for EconomicEducation, Inc., 1964), P. 48.

the right thing before we will doit, else no one would act morally.The Golden Rule requires ex­ample: it says we should do toothers, not what they do to us,but what we 'would have them doto us. If we regard a certain prin­ciple as good and just, therefore,We ought to practice it whetherothers do or not. This conceptdoes not rule out legitimate self­defense. If it is right to protectothers, either by not initiatingforce or fraud against them br bydefending them against force orfraud initiated by others, it· isright to protect ourselves, for weare human, too. The admonitionJesus gave his disciples is appro­priate: "Behold, I send you forthas sheep in the midst of wolves:be ye therefore as wise as ser­pents, and harmless as doves." 17

If we set out to reform our­selves, we will then not set stand­ards for· others which we do notourselves practice. One of the bestways in which we can guardagainst destructive criticism is towatch our speech. Our speech, apowerful means, reveals our ends.Our speech attracts or repels,praises or· condemns, inspires ordisheartens, honors or dishonors,conciliates or antagonizes, enlight­ens or deludes, identifies or ob­scures, unifies or divides - andthus with each expressed thought

17 Matt. 10 :16.

660 THE FREEMAN November

advances good or evil. As LeonardRead so frequently points. out, .wecan advance the cause of limitedgovernment, liberty, and the freemarket best by the power of at­traction. If we wish our ideas toattract, we must be positive in ourrhetoric.

We may - indeed, must - surelyidentify error and, to the extentwe are able to do so, reveal themeans of correcting it. But wemust avoid the temptation tolabel everybody with whom wedisagree a public enemy. We must,instead; find ever better, morelucid demonstrations of the cor­rectness of .our own position. (Itis, of course, equally important toinsure that our own position isthe correct one.)

We must, then, examine theends and means of those whowould persuade us. To that end,I have devised a tentative seriesof questions, which the readermay improve upon, to assist inanalyzing ends and means. Thesequestions summarize the ideas ex­pressed here. Some of them over­lap, but I believe all are neces­sary - and perhaps more as well.

To Recognize a Legitimate End

1. Is the end possible? Does itrecognize man's limited ability topredict any but the most immedi­ate consequences of acts?

2. Does the end recognize each

individual as a being able tothink, feel, and act for himself?Does it recognize the individual'sfallibility when it comes to plan­ning for others than himself?

3. Does the end recognize thatone individual should not be themeans while another is the end?

4. Does ·the end recognize everyindividual, in justice, only as ahuman being and not as a memberof a particular race, class, party,or other group?

5. Does the end require the useof force as a means? If so, is theend defensive in nature, i.e., ab­solutely necessary to preserve thehighest values (life, freedom) ?

6. Does the end contribute tothe enlargement or the diminu­tion of individual rights to life,liberty, and property?

To Recognize a Legitimate Means

1. Does the means recognizeeach individual as a being able tothink, feel, and act for himself?Does it recognize the individual'sfallibility when it comes to plan­ning for others than himself?

2. Does the means recognize thatone individual should not be themeans while another is the end?

3. Can the means itself qualifyas an end (though not necessarilythe most des,ired end, just as laboris a worthy, though perhaps notthe most desired end)? If not, isthere any better means which may

1970 ENDS AND MEANS 661

be used? If not, must that partie­ular end be attained?

4. Does the means involve theuse of force or fraud 1 If it in­volves the use of force, is thatforce used only by government,only in the degree necessary, andonly to protect individual rights tolife, liberty, and property?

5. Would those using the meanswelcome such means being usedon themselves in similar circum.­stances 1

6. Would the result be good,bad, or indifferent if everyoneused the same means or if themeans .. were applied to everyone?

7. Does the means, includingspeech and the printed word, em­phasize the positive 1 CIt is impor­tant to remember the power ofthe word. The question occurs: Ifall speech and written matter werepositive in approach, would ac­tions not follow suit1)

If the end is revealed in themeans, then surely our characteris revealed in our selection of bothends and means. If we believe inliberty and justice for all men,we will use only means reflectingliherty and justice. And theseconcepts - of liberty and of jus··tice - cannot be achieved separate··ly, because they are one. Their es··

sential unity has been expressedby Abraham Lincoln: "My faithin the proposition that each manshould do precisely as he pleaseswith all which is exclusively hisown lies at the foundation of thesense of justice there is in me"18(emphasis is mine). So-called so­cial justice is achieved by doingas one (the planner or the re­cipient) pleases with what belongsto another. The doctrine of socialjustice, therefore, agrees withthat of communism in kind if notin degree: both, one knowinglyand openly and the' other unwit­tingly and tacitly, accept the prin­ciple that the end justifies themeans. Though this is an unpleas­ant conclusion, it cannot be logi­cally avoided.

The libertarian argument· is notthat we should prefer the welfarestate to socialism and socialism tocommunism, but that we shouldprefer limited government to un­limited government, a free mar­ket to government intervention,private to collective property, andindividual rights to collectiveprivilege. II

18 Philip Van Doren Stern (ed.), TheLife and Writings of Abraham Lincoln(New York: Random House, Inc., 1940),p.162.

RISING TAXESWEAKENTBEDOLLARHANS, F. SENNHOLZ

POLITICAL SCIENTISTS tell us thatthe Federal government may in­cur a deficit of 10 to 12 billiondollars in fiscal year 1971. If theproposed welfare reform' measureknown as the Family AssistancePlan is enacted, and if the cur­rent business recession persistsor deepens, even greater Federaldeficits may be expected in theyears ahead.

When government spendingoutpaces revenues by such mag­nitudes we must brace ourselvesfor higher taxes, new debt, andmore inflation. For the Federalgovernment has only three sourcesof revenue that provide the fundsfor its spending.

It may borrow the necessaryfunds in 'the loan market. In com­petition with business it may com­pete for the savings that accrue

Dr. Sennholz heads the Department of Eco­nomics at Grove City College and is a notedwriter and lecturer for freedom.

in the economy. Indeed, govern­ment can outbid business for newfunds,' and thus deprive businessof capital needed for operation,expansion, and modernization. In­terest rates 'will then Boar andbusiness decline. An economic de­pression would be the, inevitableconsequence of such deficit finan­cing.

Inflation, i.e. the creation ofnew money, is a much more con­venient method of government fi­nancing. The new debt is simplymonetized, that is, either pur­chased directly by the centralbank - the Federal Reserve Sys­tem - or purchased by commercial

. banks which in turn are suppliedwith the necessaryreservesby theFederal Reserve System. The Fed­eral government thus uses newlycreated purchasing power.

But such spending tends to raisegoods prices and thereby deprivesall money holders of some pur-

1970 RISING TAXES WEAKEN THE DOLLAR 663

chasing power. In fact, inflationis a Federal tax on aU dollar hold­ers. It also alters all existing debtrelations as it enriches all debtorsat the expense of creditors. Infla­tion thus shifts huge amounts ofreal wealth from the pockets ofsavel'S and investors to those ofdebtors among which the U.S.Government is the - biggest. It isa cruel tax as it gradually de­stroys the financial substance ofmany people, especially the oldand weak. And it is a highly in­efficient tax as its unearned rev­enues accrue not only to the Fed­eral government that is levyingit, but also to all other debtorswho now discharge their obliga­tions with cheaper money and lesspurchasing power.

But inflation as a source of rev­enue -is rather popular with manypoliticians and bureaucrats assome of its painful effects becomevisible only much later. And fi-­nally, inflation is not so easily un­derstood by its victims. The gov­ernment· that inflates may blamebusinessmen and other minoritiesfor the inflation evils. In fact, itmay even broaden its powers overthe people through price, wage,and rent controls in order "tofight the inflation."

Thus, in view of the staggeringFederal deficits that are' all thefiscal horizon we must brace our­selves for -rampant inflation.

A less popular source of newrevenue is higher taxation. Newtaxes may be invented or the ratesof old taxes may be raised. Wemust expect both in times of hugeFederal deficits. It is' true, Fed­eral tax revenues are expected todrop $2.3 billion in fiscal 1970.And further tax cuts have beenwritten into Federal law for theyears ahead, mainly benefitingpeople in lower income tax brack­ets. This is why one may expectthe new taxes to be directed atAmerican business and business­men in higher tax brackets.

But few taxpayers are likely toenjoy lower tax burdens. Stateand local taxes are shooting uprapidly despite a taxpayers' re­volt that has blocked many taxboosts across the country. In1970, states and localities are ex­pected to collect $89.5 billion, some10 per cent more than in 1969.Altogether, taxpayers are esti­mated to turn in about $282 bil­lion in 1970, which is $5.9 billionmore than in 1969. In the yearsahead when the Federal demandfor funds will soar, sharp annualboosts in combined tax burdensmay be expected.

Rising Taxes Raise Prices

Most -students' of fiscal mattersare aware that Federal govern­ment deficits are inflationarywhenever they entail currency and

664 THE FREEMAN November

credit expansion. But they fre­quently overlook the fact that ris­ing taxes, too, may cause pricesto rise.

Taxes are an integral factor ofcost in economic production, likelabor, capital, land, electric power,materials, and other resources.Whenever production costs rise,goods prices tend to follow. Butrising costs are not simply addedto prices, as is commonly assumed.The economic "law of cost" teachesthat production costs exert theirinfluence on prices only throughthe interaction of supply. That is,rising costs tend to reduce busi­ness income and thus deprive mar­ginal enterprises of the neededrevenue to carryon production.Output is curtailed and supply de­clines, which then causes goodsprices to rise.

Taxing Peter to pay Paul hasbecome a respectable way of life\vith countless pressure groupsand their spokesmen in Congress.Taxation is one of the most po­tent instruments of political andeconomic radicalism. It is thepolitical tool that can change thepolitical and economic system, re­distribute the fruits of all ourlabors, and inflict oppression onsome or all people. In the oftenquoted words of Justice Marshall,"The power to tax is the power todestroy." And, in the words ofEdmund Burke: "Taxing is an

easy business. Any projector cancontrive new impositions; anybungler can add to the old; but isit altogether wise to have noother bounds to your imaginationsthan the patience of those whoare to bear them?"

Government's concern for thepoor is laudable indeed. But thetax programs that are so populartoday would only aggravate theplight of the poor. After all, taxeslike the corporate income tax andmany other business taxes imposedon the rich are taxes on economicproduction. Such taxes consumethe very capital that createsjobs through investments, im­proves production and workingconditions, and thereby raiseswage rates. To advocate highertaxes on the rich, most of whomare highly productive business­men and investors, is to expropri­ate the very means of capital in­vestment that afford jobs and bet­ter living conditions for the poor.It is in the vital interest of thepoor that there be wealthy pro­moters and investors who do notconsume all their income, butbuild factories and stores, shopsand other business establishments- all of which provide jobs andincome.

How Taxes Affect Our Lives

The impact of taxation on everyaspect of economic life is fre-

1970 RISING TAXES WEAKEN THE DOLLAR 665

quently underrated. Taxes on pro­duction, like wages and interest,are boosting. goods prices in ac­cordance with the "law of cost."But also those taxes that areleveled primarily at consumption,such as the income taxes paid byworkers, make their way intoprices. The $2,000 income tax with­held from the· steelworker's an­nual pay is a real cost to the steelmill like the wages paid directlyto the worker. As such the veryamount of tax withheld is re­flected in steel prices. A boost inhis income tax reduces the work­er's take-home pay, but does notreduce the steel production costs,and therefore does not lower steelprices. A boost of those labortaxes that directly raise produc­tion costs such as payroll taxes,employment taxes, and social se­curity taxes, does affect profitmargins and consequently output,supply, and ultimately also prices.

The price of an automobile thusembodies all its costs of material,of capital and labor including allincome taxes withheld from thepaychecks of everyone partici­pating in its production, from thechairman of the board to the nightjanitor, in addition to all businesstaxes levied directly upon its pro­duction. A steelworker who finallypurchases the automobile mustcover all these costs in the pur­chase price, including ironically

his own income taxes that werewithheld from his paycheck whenhe produced the steel for the car.In short, his income taxes reducehis take-home pay, and with thistake-home pay thus reduced hecan buy the product at a price thatcontains his total labor costs in­cluding his own income taxes. Hepays income taxes and then paysfor them in the price of the prod­uct.

Even the taxes levied on theowners of the steel mill or auto­mobile plant may affect the pricesof their final products. New taxeson capital income not only pre­vent formation of new capitalthrough saving and investing, butalso may induce the owners towithdraw their liquid capital fromproduction. An investment madesubmarginal by corporate andcapital income taxes tends to beliquidated whenever possible. Thewithdrawal of capital from pro­duction, or merely the lack of newcapital for expansion and mod­ernization, causes economic stag­nation or even decline. In fact, aheavy tax newly levied on capitalincome must generate a seriousdepression with heavy unemploy­ment. Withdrawal and consump­tion of capital then raise the mar­ginal productivity of- capital, i.e.,the productivity of capital rela­tive to labor, which in turn tendsto raise interest rates. Thus again,

666 THE FREEMAN November

the taxes newly imposed work theirway into prices either throughhigher prices. or lower wages.

Taxes and Prices Rise -the Remedy is Higher Taxes

The total impact of taxation onour daily lives is probably beyondanyone's comprehension. Govern­ment statistics readily confess toa .share of 35 per cent of totalproduction as the money costs ofgovernment in the U.S. The ef­fects of such a burden on pricesare obviously incalculable. Butnext to labor costs they are un­doubtedly the most significant fac­tor. of cost and price in economicproduction today.

And yet, politicians and theiracademic propagandists like to

prescribe yet higher taxes as aremedy for rising prices. Theyare warning us again and againthat taxes will have to be raisedif the inflationary pressures donot soon subside. When the issueof new paper money by our mone­taryauthorities lifts prices orwhen new taxes stifle productionand then raise prices, the Federalgovernment proposes to levy newtaxes on the people.

Thus, rising prices caused bygovernment are the occasion foryet higher taxes by government.And in particular, rising taxesthat cause prices to rise are to bealleviated. by even higher taxes. Itis difficult to imagine where thisspiral of taxation must ultimatelyend. ®

IDEAS ON

LIBERTY

Reprints available, 5 cents each.

Tax Complications

THE FACT that it has become so difficult to accumulate even a

comparatively small fortune must have the most profound effect

on the organization of business; and it is by no means clear to

me that these results are in the social interest. Must not the in­

evitable consequence of all this be that it will become more arid

more difficult for innovation to develop save within the ambit of

~stablishedcorporate enterprise, and that more and more of what

accumulation "takes place will take place within the large con­

cerns which -largely as a result of individual enterprise in the

past - managed to get started before the ice age descended?

LIONEL ROBBINS, "Notes on Public Finance,"Lloyds.Banlc Review, October, 1955 :

THE TERM "conservationist" isgenerally applied to those who con­cern themselves about our ecologi­cal situation and look to govern­ment to do the conserving. We whodo not look upon gO\Ternmentasthe Great Conservator are gener­ally regarded as not interested inconservation.

Despite this confusion of termsI, too, am a, conservationist!

Advanced' students' of the free­dom philosophy readily recognizethat mail delivery should be takenout of governmental operation andturned over to the free market,that is, to men in', voluntary, pri­vate, competitive, cooperative ac­tion. And they will make the samecase for nonintervention in hous­ing, welfare, and' a host of othercreative activities - even educa­tion and religion.

But there is one troubled situa­tion which few approach with faithin freedom: conservation of natu­ral resources and wild life. Leavethe blessings of nature to freemen? Perish the thought! Why,men left to their own devices areso profit hungry, - avaricious ­that in no time at all the forestswould be denuded, natural recrea­tional areas and wild life but amemory of bygone days! Mostpeople abandon freedom as ameans of conservation, which is tosay, they turn the problem over

668 THE FREEMAN November

to society's coercive arm: govern­ment.

Searching the Unknown

The case for freedom as relatedto conservation is difficult becauseit requires exploratory thinkingabout experiences that have gonepretty much unnoticed. We mustassess the unheard, the unseen, theunknown. No wonder we standconfounded as would have AdamSmith or Frederic Bastiat hadthey been asked if freedom couldbe trusted to deliver the humanvoice at the speed of light! Un­thinkable! Extracting meaningfrom the unthinkable is no easymatter.

But I am convinced that conser­vation can be far more safely en­trusted to men in freedom than tothe verboten techniques - figura­tively, "keep off the grass" - whichseem to feature and set the limitsto .governmental achievement.1

The reasons for my deep-seatedconviction derive in part fromglimpses of free market achieve­ments and of governmental fail­ures, but even more from my faith

1 This is not to preclude a reliance onthe courts and other governmental pro­cedures to stop the upstream polluter ornearby smoking chimney or slaughterhouse that clearly damages or threatensthe property or lives of others. See "ThePollution Problem" in my Let FreedomReign (Irvington-on-Hudson, N. Y.:Foundation for Economic Education,Inc., 1969), pp. 1-8.

in the miraculous results that canbe obtained by men when free totry and an utter lack of faith inthe possibility of any creative ac­complishment by coercive devices.Conservation is clearly in the crea­tive realm!

Conservation vs. Preservation

But first, what really is conser­vation and how is it distinguishedfrom preservation? "Melville BellGrosvenor has artfully defined thedifference between preservationand conservation. Preservation isretention undisturbed and in anatural condition, much as a mu­seum. Conservation is the wise useof our environmental resources forthe best interests of man. Of nec­essity, it involves a sense of stew­ardship and responsibility in theuse of those resources. We un­doubtedly need some preservation.But it cannot be the answer to thecontrol of man's environment, forwe are an ecological part of thatenvironment, and to preserve itmakes us a· museum-piece as well."2(Italics added.)

Had mankind been aroundthroughout the ages and succeededin preservation - "retention un­disturbed" - dinosaurs would still

2 Extracted from "Young Forests AidGlobal Oxygen Supply" by Dr. JohnRediske. See Weyerhaeuser World, April,1970. Melville Bell Grosvenor is Editor­in-Chief and Board Chairman of Na­tional Geographic Magazine.

1970 A CONSERVATIONIST IJOOKS AT FREEDOM 669

be with us. As it is, we have onlyreconstructed skeletons of thesereptiles in museums. These admit­tedly have their value: they permitus to gain some knowledge of theMesozoic Era. Assuredly, however,the existence today of prehistoricanimals would not be considered as"the wise use of our environmentalresources for the best interests ofman," which is to say that theirpreservation would not qualify asconse'fvation.

Back to the Cave

Can we not make a similar ob­servation about all natural re­sources? Trees, for instance ? Noquestion about it, the Giant Se­quoias are a feast to the eye. Andwho among us does not yearn fortheir preservation? But had thepreservation of trees - "retentionundisturbed" - been the rule,would that have been "the wise useof our environmental resources forthe best interests of man"?Hardly! We'd still live in nothingbetter than adobe huts!

Apparently the preservationistswould have all of us in our presentstate of affluence being able to tourthe forests in their pristine glory.What they fail to realize is that astrict preservationist policy ap­plied to all natural resources wouldreduce "all of us" to the popula­tion of a foraging. economy. Howmany would that be? The number

of Indians who lived in this land- less than one-half of one percent of today's population! A con­servation policy, on the otherhand, counsels the use of trees forhomes; indeed, timber now has notless than 5,000 uses. "Retentionundisturbed" would hold our num­bers at a few hundred thousandand condemn us to huts and tepees.

Freedom Is the Effective

Method of Conservation

Let me sketch here a fewglimpses and thoughts which haveturned my mind toward freedomas the effective means to conser­vation.

Bearing in mind that man, too,is part of the ecology, observehow governmental preservationschemes work on human beings,American Indians on the reserva­tion being a case in point. Pre­served they are indeed - and asmuseum pieces.3 Now note that theIndians who have escaped thispreservation and have entered intosociety and competition are amongour finest citizens - conservationin its best sense. 4 Arbitrary andartificial preservations scarcely

3 See "Wards of the Government" byDean Russell, and "The GuaranteedLife" by Maxwell Anderson. (Singleeopies on request)

4 For a clear analysis of human re­sources as related to conservation, see"The Greatest Waste" by Paul L. Poirot.THE FREEMAN, March, 1964.

670 THE FREEMAN November

suffice for the survival of a species- human or other.

Doubtless the world's outstand­ing example of animal preserva­tion is to be found in India - per­haps more than 200,000,000 sacredcows. Are they put to a wise usein the interests of man ?These ani­mals largely destroy rather thanconserve scarce natural resources.

In contrast, note the program ofanimal conservation in the. UnitedStates. Aberdeen· . Angus, Here­ford, and other breeds of cattle­109,000,000 head - have largelydisplaced the bison that roamedthe western plains. Under thesecircumstances, one might expectthe bison to go the way of thedinosaurs, but conservationistshave come to the rescue. Whetherfor novelty or profit or fun orwhatever, there are now thousandsof bison under private ownership- far from extinct.

Russian Forestry

Those who look to governmentas the Great Conservator shouldreflect on its. "achievements," forexample, in forestry. Russia is theultimate in this respect, for thereis no private ownership of land.The whole Soviet area - 8.6 millionsquare miles - is owned "lock,stock and barrel" by' government.And what do we find? The Com­missal" charged' by the .Kremlinplanners with achieving lumber

and pulp quotas, and with a mini­mum labor fO,rce assigned to himto do the job, finds it necessary toharvest lumber along the riverbanks and highways. Talk aboutdenuding the landscape! This isprecisely the opposite of what mostpreservationists have in mind.

Or reflect on the U.S.A. - 3.6million squaremiles,- 39 per centof which is governmentally ownedand controlled, and the percentageincreases. As the shadow of gov­ernment has lengthened, the pleafor more government· ownershipand control - "keep off the grass"- has also increased. Back in 1920the voices of preservationists werebarely audible. Today, their loudspeakers reach us everywhere. Themore control we relinquish to. gov­ernment, the more control is de­manded of it. Why? Simply be­cause the right way - freedom ­is thereby displaced and thus ob­scured. The merits of freedomgrow ever less imaginable to thosewho are abandoning it in theoryand in pra.ctice·.

Private Timberland Practices·

Most people, because they won'teven take a look, are blind to whatprivate ownership and control isaccomplishing in this field.

Private timberland owners­at least 5,000 of them - are on asustained yield basis, that is, theyare planting. and growing more

1970 A CONSERVATIONIST LOOKS AT FREEDOM 671

than is being harvested. The firsttree farm was established in 1941.At that time 20 per cent moretrees were being harvested thangrown. Today, 61 per cent morewood is being grown than is har­vested and .lost to fire, insects, anddisease.

But more: most major forestcorporations and many small op­erators are engaged in inte~ive

high yield forestry. This includesintensive soils· site classification,researching for genetically supe­rior seed, optimum spacing, fer­tilization, thinning, and timberutilization - not a wasted chip!And investments are being madetoday with an eye on yields a cen­tury hence. Could anything likethis be expected in Russia, or ofany governmental operation, hereor elsewhere? Not remotely! Gov­ernments can and often do enforcepreservation, but only men in free­dom can achieve conservation.

Recreational Areas?

But what about parks and play­grounds and other recreationalareas? Leave these to free men?Are you crazy! 5

Again, my mind is turnedtoward freedom, not by searchingthrough infinite details but, rather,by what is glimpsed in passing. I

5 See "Exploring the National Parks"by John C. Sparks. THE FREEMAN, De­cember, 1964.

note, for instance, that 63,000,000acres of privately owned forestsare open to the public for recrea­tion, including hunting and fish­ing.

Among the lands most valuableper acre on earth are two govern­ment properties: London's HydeParkandNew York City's CentralPark. I have driven through thelatter and past the former manytimes and on each occasion I havetried to relate public use to publicexpense. I have viewed the beau­tiful trees, the lawns, and clearponds of each place - emptyspaces, often with no human be­ings in evidence. True, the passingmotorist has an aesthetic appre­ciation of Hyde Park as does thetourist who looks down on CentralPark from the Empire StateBuilding. But is it properly a func­tion of government to thus limitthese valuable properties?

Yellowstone National Park ­larger than Rhode Island and Dela­ware combined - last year hadslightly over 2,000,000 visitors.

In contrast,· consider three pri­vate operations in California­conservation in manifestation. Ifwe would but look, every state af­fords somewhat similar examples.

There's Disneyland - about 160acres - now accommodating some10,000,000 individuals annually, arecreational delight.

Knott's Berry Farm, of no more

672 THE FREEMAN November

than 150 acres, with its perfectreplica of Independence Hall, has4,500,000 visitors each year.

The 22 acres bordering SanFrancisco Bay - Fisherman'sWharf, The Cannery, and Ghirar­delli's Square - give pleasure to3,700,000 people annually.

These private operations, occu­pying but· a tiny fraction of oneper cent as much space as Yellow­stone National Park, give enjoy­ment to 9 times as many people!Acreage-wise and recreation-wise,these would seem to be overwhelm­ing odds in favor of freedom, thatis, on the side of conservation asdistinguished from preservation.Such facts persuade me that weshould not· rely on government asthe conservator of our resources.

Yes, goes the rebuttal, but Ihave other preferences; Disney'splayground, Knott's Americanatheme, and the gastronomy andviews at Fisherman's Wharf holdno lure for me; I relish the greatopen spaces or the mountains orthe seashore or the forests in theirnatural state. And all I say to thisis, "Fine and dandy. But why notencourage the proper means tothese ends: freedom!"

Myths that Blind

There are countless myths .andfallacies which blind people· to themiracles that can be wrought onlyin the practice of freedom.

I suppose the ranking myth hasto do with profit. It is generally as­sumed that profit seekers, in aim­ing for their own gain, \vill notserve others aesthetically or cul­turally or spiritually. The fact isthat he who peacefully seeks hisown gain can succeed only as heserves others. This is lesson num­ber one in economics, and appliesas rigidly to the clergyman orteacher as it does to the baker ofbread or the builder of Disney­land.

We must keep in mind that thereare two kinds of profit: monetaryand psychic, the latter, in many in­stances, more strongly motivatinghuman action than the former.6

There are several reasons whywe fail to see how these two formsof profit work their wonders.Foremost is governmental pre­emption. When government takesover parks and recreational areas,profit-seeking men simply turnelsewhere. Incentive is at zero. It'sprecisely the same as when gov­ernment assumes the responsibilityfor the welfare of your neighbor- you feel no responsibility forhelping him in time of need.

Also, we are inclined to lookupon present-day profit seekers asrepresentative of free and self-

6 See "What Shall It Profit a Man?"in my Deeper Than You Think (Irving­ton-on-Hudson, N. Y.: Foundation forEconomic Education, Inc., 1967), pp.108-117.

1970 A CONSERVATIONIST LOOKS AT FREEDOM 673

responsible men. For, so it is im··agined, we are a free people! Farfrom it! We are living in a highlyrigged and interventionist society.Instead of the rectitude expectedof those whose· profit depends onefficient service to willing custom··ers, we find men grasping for spe-·cial political privilege. Interven··tionism lowers the moral standard.7

Rely on the Profit Motive

Abandon the myth of govern­ment as the Great Conservator;confine this power structure to in­suring against fraud, violence,predation, misrepresentation, andother destructive actions, andwatch the profit seekers go to workin the interest of everyone! 8 If wemay judge by performance whereprofit seekers have been allowedopen opportunities, their accom­plishments will far exceed any­thing we can imagine.

Seekers of monetary profit willsupply whatever the demand war­rants and do so with the least pos­sible waste of either natural or hu-

7 For a further explanation of thispoint, see "Why Freedom Is NotTrusted," Notes from FEE, March, 1970.

8 The price system is among thegreatest and most powerful conserva­tors. As a resource - renewable or irre­placeable-becomes scarce, its price rises,cutting down less important uses andencouraging more discoveries and equallygood or even better substitutes.

man resources. Who can justifiablyask for more than this? If an in­dividual insists upon a vast parkfor his own enjoyment, let himprovide it at his own expense.

But here is where the psychicprofit seekers will come to the res­cue, and extravagantly! They'llbuild parks, playgrounds, bird andother sanctuaries, and recreationalareas of every conceivable kindand all over the place, just as to­day they give billions to educa­tional and religious institutions,art galleries, museums, monu­ments, civic centers, libraries, andwhat have you. There are thous­ands of individuals who wouldgladly turn their fortunes tosomething of this nature. That'spsychic profit!· And no more is re­quired to put this remarkableprofit process into action than tostop governmental pre-emption.It's that simple, and far morepromising than anyone can pos­sibly portray.

Conservation is the wise use ofour environmental resources forthe best interests of man. Who isto determine "wise use" and "bestinterests"? Free men, that is, menin voluntary action with no re­straints against the release oftheir creative energies. These arethe only true conservationists! ~

UPor the Best Interests of ManU

A. NEIL McLEOD

IN THIS LAND of abundance, peo­ple generally have lost sight of thefact of scarcity. They have beenbemused so long by tales of con­spicuous consumption, overproduc­tion caused by the misallocationof resources (never due to inter­vention, always due to malfunc­tioning markets), they have beenassured that the problem is one ofdistribution - that they are infactunable to accept the fact of physi­cal scarcity let .alone economicscarcity (it's really the only kind) .Oil existed in abundance beforeour forefathers discovered it. Assoon as it was discovered it be­came scarce. Who can comprehendthat kind of perversity? Scarcity,they have been taught, is causedhymalevolence because "science"knows enough to permit everyman to live like a king!

The "scarcity" that concerns

Dr. McLeod is Economist and Director ofBusiness Affairs, Institute of Paper Chemistry,Appleton, Wisconsin.

the typical conservationist is usu­ally that scarcity having to dowith a resource that men did nothave the wisdom and foresight tobring under the rules and stric­tures of private property. Oftenthese resources are psychic andaesthetic in nature and pose ex­tremely difficult problems to bringthem into an exchange mechanism.

You and I have, in our lifetime,seen air and water· pass from acategory of free goods to economicgoods - in other words we haveseen the metamorphosis of scarc­ity. It has happened rather sud­denly and our institutions are notin shape to cope with air andwater as we did with land. Al­though the institutional frame­work is not the barrier in the caseof the oceans, the system that hasworked so admirably'forland isn'tbeing given a thought for its ap­plicability to oceans.

The much used phrase, "in thebest interests of man," is the crux.

1970 "FOR THE BEST INTERESTS OF MAN" 675

Nothing can filter the infiniteneeds of man better than the mar··ket; the market demands ex-·change, and free exchange de··mands private property~'For thisreason there can never', bea wide··spread conservationist ,movement.,To conserve - what? - somebodyhas to decide whether to mine coaland use pit props, or to preservethe forest and let the coal lie un-,used. The myopia of the conserva-,tionist never permits him to graspthe principle of substitution.

Conservation has too many in­gredients that are incompatible toeach other, and that are complexlyinterrelated for it ever to be at­tractive as a broad regulatoryfield. Regulatory attempts areprimitive' in that the objects oftheir violence must be discrete anddiscernible, Le. airlines" railroads,farmers, post offices. The littlezealous preservationist interven­tions are annoying, cause somemisallocation of resources, but areno great threat because the job issimply overwhelming. For ex­ample, during World War II theW.P.B. chronicled the fact thatthere were at least 700,000 sepa­rate uses for paper. Since then percapita consumption of paper hasrisen from' 306 pounds in 1941 to

565 pounds in 1969. Who wouldlike to guess how many more than700,000 ways we are using paper"today?

There is a great similarity be­twe~n 'some ,'aspects' of pollutionand violence. We have polluted ourenvironment because our account­ing has been in error. We haveoverlooked certain costs. We haveassumed a costless situation thatnow suddenly tenders its bills,bills we acknowledge. We havemade these mistakes, indulged inthese abuses, because we thoughtthey were eostless.• Recovery frompollution will be slow until we getthe bills in shape and enter theminto the proper accounts.

So it is with violence. Peopleare under the mistaken idea thattheir particular conservation (vio­lence) is costless. In large partthey have seen that the conserva­tion in Viet Nam (a very particu­lar kind of conservation - aren'tthey all?) is indeed not costless;and they are recoiling from, thisspecial violence. So violence willbe used (and abused) until itscosts come to light., Then, as withpollution, recovery from the abusewill be slow and painful. Freedomis unthinkable for those who onlythink coercion. ~

IISSEIfMERRYLE STANLEY RUKEYSER

IN A FREE SOCIETY we should neverforget that dissent, no matter howirritating, is a symbol of liberty.In·a police state a negation of of­ficial policy, if it is expressed,necessarily goes underground.

While freedom includes theright to be wrongheaded, a pru­dent person does not intentionallyutilize this privilege. Where thereis a free and uninhibited market­place for the interplay of ideas,intellectually mature persons un­dertake as part of self-educationto audit affirmative concepts aswell as criticisms.

There is a default when oldercitizens indiscriminately lump awhole generation into a stereotypeand conclude that "the young peo­ple are very bright." Such super­ficial characterizations not onlyblur the vast differences of.opin-

Mr. Rukeyser is well known as a business con­sultant, lecturer, and columnist.

676

ions on campuses, but also deni­grate the need of Marquis ofQueensberry rules in the squaredring of dissent. To criticize onlythe criminal fringe who burnbuildings and records and who kid­nap deans, while tolerating allother activities of youth, is not asufficient exercise of parental re­sponsibility. Unless there is under­standing in depth, such permis­siveness may have the effect, how­ever unintended, of freezing anach­ronisms and errors.

Fred M. Hechinger, educationeditor of The New York Times,recently illuminated the point:

Students are capable judges ofmany flaws in their education and thecollegiate environment. But theirknowledge about the relationship be­tween the universities and nationalpolicies or between intellectual prep­aration and the eventual reform ofsociety and the world is shallow and

1970 DISSENT 677

immature. Their interpretation ofthe power and the politics that moti­vate ... rival forces is as unrealisticas their judgment of the actual ...aspirations of many of the peoplewhom they would like to help....

It is highly doubtful that the uni­versities could force political policydecisions on the American people, nomatter how hard they might try. Itwould be tragic if, in their inabilityto know what they cannot and shouldnot do, the universities were to under­mine their capacity to accomplishwhat they can and ought to do in theservice of scholarship and society.

Even before reaching manhood,a child knows when he doesn't likefarina. Likewise, a student isaware of whether a curriculumfulfills his expectations and needs.Youth is a time for idealism andit is healthy to indulge a dream ofhuman betterment. It is no con­demnation of a whole age group torecognize that a freshman has notpursued his studies as far asmight be expected of a Ph.D. can­didate. In more primitive times,this condition of youthful jump­ing to conclusions during the un­completed learning process wascalled being "half-baked."

Charges 0' Injustice

In the circumstances, it is notenough to turn thumbs down onnihilistic burners. It is also im­portant to pinpoint the illusionsand fallacies which confuse quieter

and well-meaning dissident groups.To be specific, a major fallaciousdogma turns around the emotionalfeeling that the American systemis cursed with inj ustices. A recentLouis Harris poll, for instance,found that a high percentage ofstudents believe "the real troublewith U.S. society is that it lacks asense of values - it is conformistand materialistic," and that "ourtroubles stem from making compe­tition the basis of our way of life."These findings represent the at­tempt of dissident students to pin­point the injustices in a systemthat keeps· tabs on individual dif­ferences.

The kindest and least patroniz­ing attitude .is fairly to analyzethe basis of discontent on the partof sincere dissenters. Those whoare devoted to liberty, however,should not be tongue-tied. Aris­totle remarked that, if you knowit, you can say it. Don't fall into abooby trap of ominous silencebased on fear of a lack of com­munications and a generation gap.The chasm of age differences canbe narrowed when older personstreat youth respectfully, despitedifferences of opinion. It is toofrequently overlooked these daysthat those in adversary stanceslook for some guidance from op­ponents as to how far they can go.Capable union·· leaders prefer tobargain with knowledgeable man-

678 THE FREEMAN November

agement personalities and. look. tobusiness executives to signal theouter limits of demands which canbe lived with.

Thus, it is less than patriotic toshrink from. entering the lists ofintellectual conflict and from point­ing out that progress lies instressing the harmony of interestsof the groups - the very antith­esis of internal class warfare. Theidealism behind dissent, even ifmisdirected, should be reclaimedas a potential national asset. LouisUntermeyer, the poet, articulatedthe American theme for progresswhen he wrote: "From sleek con­tentment, keep me free." Evenwhere there is a. demonstrableerror made in the heads of prot­estants, there is frequently goodin their hearts. Since dissent turnson injustices, real and imagined,it would enrich our natural re­sources in human understandingto think through the attitudeswhich lead to social dissatisfac­tions. There should be unanimityin wanting to eliminate or reduceman-made injustices. According­ly, the ideas and emotions behindsuch dissent should be objectivelyappraised. The beginning of a res­olution of the unrest is to separatethe wheat of good ideas from thechaff of illusions.

In the first place, it's importantto recognize that no economic andsocial system either in operation

or in contemplation is perfect.Man's foibles and inner conflictscondition the real world.

Equality May Not Be Just

Secondly - and far more impor­tant - is the error of equating '~in­

justice" with "inequality." It is afact of .life that individuals varygreatly in talents,aptitudes, dili­gence, intelligence, and manualskills. The American system, basedon the operation of a free market,rests on recognition of differences.Put in more affirmative terms, acompetitive or free enterprise na­tionaleconomy is predicated ondiscerning and rewarding merit.

The antithesis of inequality isegalitarianism as expressed in theMarxian goal that each should con­tribute according to his abilityand each should take according tohis need. Marxism has infectedmany who· haven't marched underthe socialist banner. For example,in Fascist Italy under BenitoMussolini, the productivity of theworker was ignored, and marriedmen with children were paid morethan bachelors for a week's work.And non-Marxist "liberals" talkpoignantly about the "rich and thepoor."

It seems an easy intellectual andemotional step for young idealiststo move from distress of "injus­tice" (inequality) to the Marxianformula of leveling down so that

1970 DISSENT 679

everyone becomes equal, at least inworldly goods. But when the edu­cational process is properly pur­sued, the dreamers of bettermentwill eventually confront such chal­lenging realities as the meagersubsistence living standards inIndia where socialist ideas arewidely held by those in highplaces, by the dull mediocrity oflife in the Soviet Union, ·and by acomparative languor and back­sliding in Red China while Taiwan(Formosa) has moved dramati-cally forward in farm output andin technological gains in industry.Close and careful study of the realworld clearly reveals that, as ameans to utopia, Marxism is ahoax.

It is fallacious to confuse in­justice with inequality of talentsand aptitudes; more fallaciousstill is to equate justice with equal­ity of worldly possessions. An in­dividual's favorable adjustment tocompetitive life affords him widediscretion as to how he shall usethe fruits of his labor. Some, inthe spirit of Thorstein Veblen's"conspicuous consumption," electto acquire great mansions, yachts,racing horses, sports cars, andother vehicles of self-indulgence;others choose to· be patrons of thearts, to endow learning, and tofinance philanthropies. But· thosewho prosper from specializationand trade are under a social ob-

ligation to become savers and thusreserve part of their receipts ascapital to provide labor-aidingtools of production which increasethe·· output of the worker and en­able him to earn more. In thesesophisticated times, this functionhas been in part delegated tocorporations which accumulate un­distributed profits to acquire morecapital facilities.

If all individuals were unhap­pily at the subsistence level andcorporations were perpetually atthe break-even point, the sociallyimportant reservoirs of savingswould dry up and the people wouldbecome poorer to a spectacular de­gree.

Rising Expectations

While these principles wereequally true in an earlier period,the issue has come forth with newand added urgency. This is be­cause mass media, especially mov­ies, television, radio, and the rap­idly distributed printed word, haveheightened popular awareness ofhow "the other half" lives. Tothus encourage envy and let itrun riot is far from a method ofbuilding a. great society.

Frankly, I am not unhappy thatJ. Paul Getty has more worldlygoods than I, or that NelsonA.Rockefeller's estates at Tarrytownand in Venezuela outclass my mod­est backyard in New Rochelle.

680 THE FREEMAN November

Neither do I suffer when I con­template that William Shakespearewrote sonnets and plays of a qual­ity that I can never achieve. Idon't feel badly because J aschaHeifetz on the violin made me ap­pear to be tone deaf. Likewise, Idevelop no inferiority when I readof the accomplishments in golf ofplayers such as Jack Nicklaus andLee Trevino, while I remain aduffer.

In a free society, each emotion­ally healthy person should under­take to achieve optimum develop­ment of his own abilities. It isirrelevant to self-advancementwhether a neighbor possesses somesuperior qualities and some re­strictive infirmities.

Vital Differences

I never quarreled with the Cre­ator for developing man in infin­ite variety. In an economic sense,I know that differences are essen­tial for a highly sophisticated cap­italistic society in which special­ized workers give employment toone another by exchanging theproducts of their day's labor. Ifwe all had precisely the same bent,the opportunity for give and takeat the marketplace would be nil.

Differences are closely linkedwith the system of incentives.While exploiters of persons of lowproductivity tend to block prog­ress by telling them they are

doomed and are caught hopelesslyin a vicious cycle from which thereis no escape, the American dreamhas embraced the concept of aclassless society. This used to in­spire young persons raised in non­affluent neighborhoods to believethat it was their mission to begraduated from the slums to raisethe living standards of their fam­ilies. This breaking of class linesoccurred widely in the annals ofthe nation, and The Grand StreetBoys Association in New York isa monument to the achievementsof young ghetto dwellers who be­came illustrious in the arts, inpolitics, in the professions, and inindustry.

And the movement was not en­tirely a one-way street. The factthat competitive processes wouldalso- in due course reorient wastreldescendants of wealthy familyheads was embodied in the ex­pression, "from riches to shirtsleeves in three generations."

Undoubtedly, a small elite ofdedicated individuals would con­tinue to pursue creative urgeseven without material rewards;but experience demonstrates thatincentives in general add to pro­ductivity. In my numerous debateson university campuses, on TVand radio with the late NormanThomas, six times socialist candi­date for President, I used to turnagainst the Marxians their hack-

1970 DISSENT 681

neyed plea that human nature canbe changed. I would point out that,if a· management consultant werecalled in, he would laugh at heter­odox management personalitieswho argued that, if the quality ofmaterials and the nature of manwere different, they could achievegreat things. In the practicalworld, the executive's function isto put into harmonious contactmachines, raw materials, and man­power, and not to alibi his failureby complaining about the physicaland chemical attributes of com­modities and the nature of man.Just as experience shows that bi­tuminous coal burns and generatesheat, visible facts show that mostmen improve their performancewhen motivated by incentivesrather than by the whiplash of aSimon Legree.

No real gains can be·· built onthe foundation of illusions. By wayof illustration, it's fashionable tocast aspersions on the Establish­ment, which is a fantasy. The so­called power structure is foreverchanging with new ones cominginto the fold and others leaving.Competition is forever testing theright of a business enterprise tosurvive and the only Rx for along life expectancy is pleasingcustomers. Even the mighty FordCompany suffered from overstay­ing with its Model T and laterwith the ill-fated Edsel! Even the

promises men live by are subjectto change in these dynamic timeswhen the creative mind in science,invention, and engineering is per­petually introducing changes.

The Importance of Incentives

What, if anything, constructivefor the future can come out of cur­rent widespread dissatisfaction?

It will be helpful to separate thegoodness which cries out for bet­ter living from error in layingdown premises. But the process ofpromoting harmony cannot beachieved in a melting pot in whichare mixed in equal proportions theingredients of truth and fallacy.

The social utility of incentivesshould be re-examined in depth,especially since Marxian illusionshave somehow penetrated thethinking of even avowed nonso­cialists. First, the labor unionswith few exceptions lean towardequalitarianism by demanding uni­form pay for hourly workers ir­respective of differences in indi­vidual productivity. On the otherhand, experience has shown thatpiecework and other forms of in­centive pay tend to enlarge thecontribution of the worker. Theleveling process even runs into theprofessions. In teacher organiza­tions, including not only the unionsbut also the professional associa­tions, the proposal of Hmerit pay"constitutes a red flag. Such violent

682 THE FREEMAN November

objection is rationalized on theground that it is difficult to meas­ure the productivity of a teacher.In business, however, supervisorssomehow manage to rate the pro­fessional staff, white collar em­ployees, executives, and' others ac­cording to productivity.

A second subtle assault on in­centives is made by social legisla­tion, which subsidizes idleness andforgets that old-age social secur­ity tends to weaken motivation forsaving and investment.

"Capitalism the Creator"

One cure for the spreading ofthese misconceptions on campuseswould be periodic re-examinationof the fitness of the faculties. Asan antidote to Marxian and Key­nesian fallacies, Carl Snyder'sbook, Capitalism the Creator,should be used. Written thirtyyears ago by the one-time econo­mist of the New York' Federal Re­serve Bank and former editorialwriter of The New York Tribune,the volume would also help to in­spirit today's distraught parents.Snyder gives first aid for curingthe malignant habit of elders whobecome frightened by talk of "afflu­ence" and become immobilized bytheir own unwarranted feelings ofguilt. Much harm is done by con­ceding to the uninformed thatthere is something in what theysay.

Snyder vigorously defends in­equality, and in positive languageascribes progress to the elite'ofin­ventive persons and to capitalism.College deans and dons take no­tice! Snyder's thesis is that "thereis one way, and only one way, thatany people, in all history, haveever risen from barbarism andpoverty to affluence and culture;and that is by that concentratedand highly organized system ofproduction and exchange which wecall' capitalistic: one way and oneway alone. Further, it is solely bythe accumulation (and concentra­tion) of this capital, and directlyproportional to the amount of thisaccumulation, that the modern in­dustrial nations have arisen; per­haps the sole way throughout thewhole of eight or ten thousandyears of economic history.

"N0 principally agricultural orpastoral nation we know of hasever grown rich, powerful, andcivilized. These are the fruits ofwealth and enterprise; and these,in turn" of, organized industry andtrade.... All this represents theaggressive drive of the deepestand strongest of human motiva­tions; the 'will to live, to gain, todiscover, to conquer; and thatwhenever these begin to wane andweaken, and a nation is given overto visionaries, doctrinaires, andnovices in 'social' experimentation,its decadence has begun."

1970 DISSENT 683

Thus, the late Carl Snyder pro­phetically warned against the con­temporary era of intellectual Hip­pies. Since World War II, Sny­der's appraisal of the role of cap­italismhas been further docu­mented by the miraculous forwardmovement in the free world ofWest Germany, and in SoutheastAsia in the new prosperity of freeenterprise Japan, Hong Kong,Singapore, and Taiwan, despitetheir meager natural resources.

In connection with the procliv­ity of superficial conclusion-jump­ers on the campuses and elsewhereto fly in the face of the demon­strated realities of past historyand contemporary affairs, it maynot be entirely coincidental that

the acceptance of economic falla­cies is facilitated by smoking pot.

ObviouslY,"man cannot live onbread alone," but my. personal ob­servation of poverty on the streetsof Bombay, Delhi,Lima, Bogota,Montevideo, Lusaka, and elsewherein underdeveloped countries un­derscores .the fatuity of decryingthe availability of bread as a dis­play of vulgar affluence.

In conclusion, although it maynot be chic to applaud the socialutility· of the creative mind work­ing. in science, invention, and en­gineering, its humane contribu­tion toward better living is demon­strably and infinitely greater thancan be accomplished through theexploitation of envy. ,

IDEAS ON

LIBERTY

The Social Character of Capitalism

THERE is but one means av:;tilable to improve the material condi­

tions of mankind: to accelerate the growth of capital accumulated

as against the growth in population. The greater the amount of

capital invested per head of the worker, the more and the better

goods can be produced and consumed. This is what capitalism,

the much abused profit system, has brought about and brings

about daily anew. Yet, most present-day governments and politi­

cal parties are eager to destroy this system.

L U 0 WIG VON MIS E S, The Anti-Capitalistic Mentality

CLARENCE B. CARSON

'I'llrottling tile lIailroads

As LATE as World War I, the rail­roads were king of Americantransport. Virtually all of the in­tercity freight within the UnitedStates moved by rails. For prac­tical purposes, there were no com­petitors for passenger transport,if steam and electric lines wereboth properly considered as railtransportation. So great was thepreponderance of the railroadsthat governments had come totreat them as the only effectivemeans for moving either peopleor goods to most places within thecountry. In the parlance of politi-

Dr. Carson is a frequent contributor to THEFREEMAN and other journals and the authorof several books, his latest being The WaT onthe Poor (Arlington House, 1969). He isChairman of the Social Science Department atOkaloosa-Walton College in Florida.

The Gripof PrivilegedCompetitors

cians and reformers, they had amonopoly of transport. Judgingby the Transportation Act of1920, Congress expected this pre­ponderance to last indefinitely in­to the future.

It was not to be, of course. Look­ing back from the perspective ofa half a century, it is now clearthat the railroads had reached andpassed the peak of· their domi­nance of transport by the timethat law was passed. The totalrailroad mileage in the UnitedStates had already begun to de­cline. It reached a peak of 254,037in 1916 and had dropped slightlyto 252,845 in 1920. This downwardtrend has continued over theyears. By 1930, it was down to249,052; by 1940, 233,670; by

1970 RAILROADS: THE GRIP OF PRIVILEGED COMPETITORS 685

1950, 223,779; by 1960, 217,552;and by 1968, it had fallen to209,000.1

Loss of Passenger Traffic

Of themselves, the figures fortotal railroad mileage mightsig­nify little. But when combinedwith the statistics for passengerand freight traffic they help toillustrate the declining conditionof the railroads. The most dras­tic decline has been in passen­ger traffic. It is estimated thatin 1926 the railroads provided39.5 billions of passenger miles oftransport for people. There wasan absolute decline in this overthe years; the figure was 28.6 bil­lions in 1956.2 In 1968 there wereonly slightly over 13 billion pas­senger miles by rail. Relative tothe total passenger miles by everymeans of intercity transport therail total declined much moredrastically. The rail share of suchtransport by all common carrierswas estimated to be over 83 percent in 1926. By 1956 it was onlya little over 35 per cent. Whenprivate transport was taken intothe estimate, the rail percentage

1 John F. Stover, The Life and Declineof the American Railroad (New York:Oxford University Press, 1970), p.155.

2 There was a tremendous increase ofpassenger traffic during World War II. Itdeclined precipitately after the end ofthe war, though for several years it wasstill above the prewar level.

for 1926 was 22.48. By 1956 itwas only 4.09.3 "In 1968 theslightly over 13 billion passenger­miles of rail travel were only ahalf of the volume of bus travel,and less than one-seventh of thetotal .air carrier traffic. The railtraffic constituted less than one­tenth of the total commercial in­tercity traffic, and was under 1.4per cent of the total private auto­mobile travel."4 As things havebeen going, the passenger trainwill soon join the oxcart in themuseum of abandoned transport.

The freight tonnage hauled bythe railroads for distance has notgenerally declined over the years.In 1926 the railroads· carried alittle over 452 billions of revenueton-miles of freight. In 1956 - agood year for rail freight - thetotal was over 655 billions of rev­enue· ton-miles. But the rail shareof this intercity traffic has de­clined greatly over the years. Itwas estimated to be 76.56 in 1926,and to have fallen to 48.22 in1956.5 However, the percentage ofrevenue coming to the railroadsvis a vis that to other modes hasdeclined much more than the per­centage of freight ton-miles mightlead one to suppose. For example,

3 James C. Nelson, Railroad Transpor­tation and Public Policy (Washington:Brookings Institution, 1959), p. 18.

4 Stover, op. cit., p. 193.5 Nelson, op. cit., p. 10.

686 THE FREEMAN November

"the rail share of combined truck­rail freight revenues fell from67.4 per cent in 1940 to 38.7 percent in 1955.6

More Freight - Le.ss Revenue

VVhathas happened most gen­erally is that the railroads havemade their gains for the mostpart in low-rated bulky commodi­ties and lost much of the high­rated traffic, which accounts forthe relatively greater decline inproportion of revenues .receivedthan of freight ton-miles trans­ported. Certain kinds· of traffichave been taken away from therailroads almost entirely. In 1922there were 80,000 railroad stockcars; the number had declined to20,000 in 1966. "Long-haul furni­ture vans soon made boxcar move­ment of household furnishings athing of the past, and the in­creased use of intercity truckingcaused a reduction of less-than­car-load lot freight from 51,000,­000 tons in 1919 to 1,000,000 tonsin 1966."7

It has been commonly supposedthat these absolute and relativedeclines in passenger and freightservices .by the railroads were aninevitable consequence of the de­velopment of other means oftransportation. Undoubtedly, au­tomobiles, trucks, buses, barges,

6 Ibid., p. 27.7 Stover, op. cit., p. 128.

pipelines, and airplanes have, eachin its own way, advantages overrail transport. Automotive· trans­port on highways has much great­er flexibility than that on rails.VVater transport is much less ex­pensive. Air is much faster. Thepublic might well welcome and usethese alternative means of gettinggoods and people to distant places.

However, we do not know withcertainty today which of these issuperior to others in transport inmany ways and which the con­sumer would prefer for what inthe open market. This is so be­cause governments have inter­vened so extensively in transportthat the market for transport hasbeen greatly distorted. Almost allof this intervention in the twen­tieth century has been detrimen­tal to rail transport and muchof it has been advantageous toother means of moving goods andpeople. The restrictive legislationon the railroads has already beensurveyed. Here, the task is to ex­amine government aid to othermeans of transport and the muchless extensive and later regulationthat generally has been the casethere.

VVhat happened to the rail­roads in relation to other meansof transport can be put succinctly.The railroads were regulated, re­stricted, restrained, and circum­scribed: their rates were set, ex-

1970 RAILROADS: THE GRIP OF PRIVILEGED COMPETITORS 687

pansion and contraction limited,investments monitored, competi­tion hindered, and services pre­scribed. They were bound handand foot, as it were, most man­agerial leeway taken from. them,vested with responsibilities with­out corresponding freedom, andtreated as though their ownersand managers were irresponsiblechildren. Th~ir would-be compet­itors, on the other hand, weregiven special privileges, werefostered, succored, developed, andwere for varying periods of timelittle hampered by restrictive leg­islation.

Subsidized Highways

Much of rail traffic has been di­verted to the highways. People inever larger numbers have turnedto travel by way of the privateautomobile, and buses and taxishave provided transport for thosenot having or wishing to use theirown conveyances. Trucks havecome to haul larger and largerportions of intercity freight aswell as that within cities. Govern­ments have long played some rolein road bUilding, maintenance,and, of course, such policing aswas done. From the 1830's - whenthe Federal government aban­doned extensive projects and stategovernments shifted their activi­ties elsewhere - to the 1890's mostroad building was done by local

governments, frequently counties.States began at abou~ that timeto play a larger role in road con­struction. They were doing muchmore by World War I~ by whichtime automobiles and trucks werein widespread use.

The Federal government beganto .evince an interest in highwaysonce again in the 1890's. Initially,this interest only resulted in suchactivities as surveys. To this end,$2,997 was spent in 1894. How­ever, Federal expenditures grewover the years until by 1916$662,785 was spent. In the latteryear, the Federal governmentwent more directly into highwayconstruction by authorizinggrants-in-aid. to states "to estab­lish post roads, regulate com­merce, provide for common de­fense and promote general wel­fare." It entered much more ex­tensively into road building. byway of the Federal Highway Actof 1921. According to that Act theSecretary of Agriculture was todesignate a system of interstatehighways. For the construction ofroads so denominated states wereto be granted half the cost on amatching basis. Road buildingthen got underwaY in earnest.Total expenditures for roads byall levels of government increasedfrom approximately 1lh billionsof dollars in 1921 to 2~ billionsin 1930. The Federal share of

688 THE FREEMAN November

spending increased from 4.68per cent in 1921 to 37.11 in 1938,after which it decreased some­what for a number of years.s

Total government expenditures forroad construction rose rapidlyonce again in the 1950's; by 1957it had reached $5,662,000,000.9

The Federal percentage began toincrease once again also. This waseven more the case·as the Federalgovernment gave priority to theInterstate system and began tofund it vigorously after 1956.

Rai/beds Are Taxed

That the development and useof the highways had a debilitatingimpact on the railroads is clear.It should be clear, also, that gov­ernments were promoting high­way use by road building andmaintenance. The power of emi­nent domain was brought into useto acquire routes. The power oftaxation was used to finance con­struction and maintenance. Gov­ernments undertook the erectionof safety devices, patrolling, andthe provision of auxiliary servicessuch as aid to motorists in dis­tress. They were aiding one formof transportation while they wererestricting and inhibiting an­other. Whether those who have

8 See Marvin L. Fair and Ernest W.Williams, Economics of Transportation(New York: Harper, 1950), PP. 68-69.

9 Nelson, op. cit., p. 76.

used these roads have borne thefull burden of the costs is an in­teresting question, though onedifficult to answer. Much of thecost has been paid by user taxes,such as those on gasoline, oil,tires, and so forth, but by nomeans all. It has been estimatedthat between 1921 and 1965 atotal of $216 billions were spentby all governments within theUnited States on roads and high­ways. Only about 60 per cent ofthis has come from user taxes,leaving some $80 billion to bemade up elsewhere. One writernotes that "a considerable fractionof the $80 billion of tax moneyclearly has provided a public routefor the more than 16,000,000buses and trucks which crowdour highways today."lO

There have been efforts in re­cent years to close the gap andto have the users of the roads andhighways pay for them fully byway of taxes related to their use.Even when and if this is donethere is the much debated ques­tion of whether trucks and busesare paying their share throughthe taxes. This last question canbe left for the experts to hassleover, but there is one differencebetween the users of the highways(and the users of airways andwaterways) and the railroads thatincontestably favors the former.

10 Stover, op. cit., p. 137.

1970 RAILROADS: THE GRIP. OF PRIVILEGED COMPETITORS 689

The railroads have generally beentreated as private property andhave thus been assessed heavy realproperty taxes by local govern­ments over. the years. By contrast,highways are generally govern­mentally owned· and are free fromall property taxes. The result is. asubtle. but real promotion of high­way use visa vis the railroads bygovernment. There· are. other dif­ferences to be taken up below.

Waterways

If there is doubt about the ex­tent of government subsidizationof highway travel, there. can belittle about the amount and extentof that of the use of the water­ways. One writer notes that total"federal appropriations for therivers and harbors programamounted to $4.6· billion· throughfiscal 1954. It has involved im­provement and maintenance ofsome 286 commercial seacoastharbors, 131 Great Lakes harbors,and 22,500 miles of waterways, in­eluding several multiple-purposedams."ll Extensive expenditureshave been authorized more re­cently for the St. Lawrence Sea­way and the Ohio river, amongothers. States and cities have alsoundertaken improvements of portsand waterways. For example, thestate of New York widened anddeepened the Erie Canal early in

11 Nelson, op. cit., p. 85.

the twentieth century at an· ex­pense of $176 million.l2 In conse­quenceof all these expendituresthere has been a dramatic rise infreight ton-miles.· shipped overwater.

Users of thewaterways paylittle, if any, of the expense ofimproving and maintaining therivers and harbors. Such costs asthese users have, one economistnotes, are "only the expenses ofowning and operating equipmentand of rendering services.Noth­ing is included for operating,maintaining and amortizing thefederal investment in waterways. . . or for tax contributions onpublic waterway facilities."13

Air Travel

Air travel has also been exten­sively subsidized by governments.Most of the. major. airports in theUnited States have been built andare maintained by local govern­ments, or agencies set upby them.The Federal government has alsomade extensive grants for the es­tablishment of airports. Weatherinformation· for take-offs, land­ings, and flights is provided bythe Federal government. Air spaceover the United States is, in ef­fect, owned by the Federal gov­ernment, and authority over it isexercised by the Federal Aviation

12 Fair and Williams, op. cit., p .. 90.13 Nelson, op. cit., p. 90.

690 THE FREEMAN November

Agency. Acts passed in 1926 and1938, according to a summary,authorize and direct "the Ad­ministrator of Civil Aeronauticsto designate such civil airways asmay be required in the public in­terest, and authorizes him to de­velop,establish, improve, operate,and maintain air navigation facili­ties wherever necessary. . . ."14

Between 1925 and 1957· somethingover one billion dollars were spentin this operation within theUnited States. Airlines wererather extensively subsidized, atleast in the early years, by gov­ernment contracts for carryingthe mails. A study made of thesituation for 1940 concluded thatif all subsidies to commercial air­lines had been eliminated for thatyear, "gross revenues would havefallen from the actual $65,000,000to ·only $50,550,000 and operatingexpense would have increased by$8,000,000. The 1940 net incomeof $6,900,000 would have beenconverted to a deficit of $15,300,­000."15

Airplanes have not been quiteas fortunate as barges and shipsin the use of these governmentallyprovided facilities. They do haveto pay for some of the facilitiesand services, at least some por­tion of the cost of them. Airplanespay a fee to land at airports. They

14 Quoted in ibid., P. 94.15 Fair and Williams, Ope cit., p. 114.

also pay a tax on fuel which par­tially pays for services rendered.However, there can be no· doubtthat the airlines have been heavilysubsidized by governments. TheHouse Committee on Appropria­tions observed in 1954 : "This com­mittee has year after year calledattention to the fact that the Fed­eral Government is providinghuge sums for airway facilitiesand operations without .reimburse­ment from the aviation industry.The committee does not proposeto continue indefinitely making ...such large appropriations·· unlesssome system .of airway usercharges is placed in effect...."16

Nonetheless, Congress has in re­cent years turned to the develop­ment of commercial aircraft.

Early Aid Was Repaid

It may be objected that the -rail­roads were aided also in the earlyperiod of development. So far asit goes, the statement is correct,but there are some significant dif­ferences between that and the ·aidgiven to competitors in more re­cent times. In· the first place, nonew aid was given to the railroadsby the Federal government (untilvery recently) after 1871; nor, sofar as I know, was any extensivestate or local aid given after thatdate. In the second place, the Fed­eral aid was repaid over the years.

16 Quoted in Nelson, Ope cit., p. 99~

1970 RAILROADS: THE GRIP OF PRIVILEGED COMPETITORS 691

That which was extended as loanswas, in. general, repaid with inter­est. The lands granted were paidfor over many years by the. in­dividual railroads which hauledgovernment cargoes at reducedrates~ One writer describes theculmination of i the latter in thisway: "Land-grant rate reductionsanQ voluntary equilization of ratesby competing railroads up to June30, 1943, totaled an estimated $580million. Since this was severaltimes the value of the land grantsat the time land was granted. forrailwaysandit exceeded the. sumsderived by the railroads from thegrants, the Congress in 1945 re­lieved land-grant roads of the ob­ligation and land-:grant reductionsceased as of Oct. 1, 1946."17 As forstate and Jocalaid, it has prob­ably been repaid many times overby property taxes ..

Other Aids to Rail Competitors

Governments have not onlyhamstrung the railroad.s withregulation, restricted them in vari­ous ways, taxed them, and sub­sidized competitors, but they havegiven other aid and comfort tothem. They were· usuallyregu:.lated much later. Motor carriersdid not come under general Fed­eral regulation until 1935. Theyhave also protected competitorsrather assiduously.

17 Ibid., p. 69.

The Federal government hasbeen most solicitous in the pro­tection of water transport. It hasfrequently taken care to see thatrailroads did not underprice anddrive out water carriers. A fan­tastic example of this solicitous­ness occurred several years ago'Nhen the Southern Railway pro­posed to haul grain in hug,e box­ears at greatly reduced rates. This,it was supposed, would have con­siderable effect on the transportof grain by barges on the Ten­nessee River. .Therefore, the In­terstate Commerce Commissionheld lengthy and involved hear­ings, going from town to town inthe Tennessee Valley to explorethe ramifications of the matter.In like manner, the railroads werelong prohibited from the use ofthe "unit train" as a means oflowering rates. Bus and truckrates have usually been lower thanrail rates. It is likely that this fre­quently would· not have been thecase were all means of transportcompeting vigorously and freelywith one another.

Newer modes of transport havenot only been subsidized and pro­tected but also given special privi­leges. The most notable of thesespecial privileges is the franch~se~

An interstate trucking commoncarriers have franchises for theira~tivities. In like manner, statesfrequently license and franchise

692 THE FREEMAN November

intrastate and intracity carriers.Entry into the taxicab business isusually restricted in some similarfashion. In like manner, airlineshave their routes granted to them,and a limited number are permit­ted to service any area.

Franchise Privileges

It may be objected that the rail­roads were also franchised. Sothey were, but this had a some­what different rationale. Railroadswere expected to provide theirthoroughfares, safety equipment,and stations - all of which wereor became quite expensive. Fran­chises and other aids were grantedto lure entrepreneurs into thebusiness. By contrast, airlines,trucking, and water transportcompanies have not provided theirthoroughfares, rarely providesafety equipment except that ontheir conveyances, and frequentlydo not provide their stations. Cer­tainly, franchises were not neededto lure men into the trucking busi­ness, and it is doubtful whetherairlines were for long promotedby this privilege. In any case,trucking and airline franchiseswere different; they were and arespecial privileges to use facilitiesprovided by governments. Thehighways may have been builtinitially for all to use, but onlythose withspecial· charters mayuse them commercially as com-

mon carriers. In like manner, theairways are there; they are openspace above the earth altered onlyby surveillance and the provisionof take-off and landing facilities.Yet only a most limited numberof companies are permitted to usethem for scheduled commercialpurposes.

These chartered privileges haveusually been granted in such waysas to protect established businessesand assure, so far as possible, theprosperity of those engaged inthem. By limiting entry, govern­ments have endeavored to see thatonly those would offer service whocould continue to provide it, thatthey were protected from numer­ous small competitors, and thatthose earliest in the field wouldnot be unceremoniously shovedout. If the railroads ever had suchprotection, it has long since lostits earlier significance. In anycase, the railroads have long beenstuck with special responsibilitieswhile their competitors have beengranted special advantages alongwith such responsibilities as theyhave.

A Brief for the Consumer

This· work should not be mis­taken, however, as a brief for therailroads. If it is a brief for any­one, it is a brief for the consumer.And the consumer has frequentlybeen disadvantaged by govern-

1970 RAILROADS: THE GRIP OF PRIVILEGED COMPETITORS 693

ment policies on all means oftransport. The limiting of entryto various fields has reduced theprice and service competitionwhich the consumer would other­wise have· enjoyed. In interstatemoves of household furniture to­day, for example, the shipper paystribute, wittingly or not, to somecompany which has the good for­tune to be franchised. The mov­ing company involved may notown a single piece of movingequipment - though some of themdo - nor have any of its employ­ees touch one item of householdgoods. Whether it does or not, itgets a considerable cut out of themoving bill because it holds afranchise for the interstate move­ment of household goods to theappropriate places. Whether itperforms a commensurate servicecan be determined by doing awaywith all such franchises and see­ing how well such companies fare.

Less Restraint on PrivateNoncommercial Transport

Yet another major infelicityhas resulted from government in­tervention in commercial trans­port. However late it has come,regulation and restriction hascome to almost all commercialtransport in greater or lesser de­grees. By contrast, private non­commercial transport has muchfewer and more limited restric-

tions and restraints. For example,one may operate his personal au­tomobile without a special fran­chise, may travel by whateverroute .of highways he chooses,have as his destination whatevertown in whatever state he pleases,notify no authorities of his inten­tion, abandon any service he hasprovided to others, cease to travelregularly between points where hecustomarily did, sell his automo­bile if he grows weary of it, andso on through an extensive list offreedoms. So may he do with histruck generally, so long as he doesnot haul for others. With somereservations, much the same canbe said for private airplanes andboats, and for railroads that gonowhere of commercial interest.

The consequences of this dif­ference between the governmenttreatment of commercial and pri­vate transport are everywhere tobe seen. It is most apparent on thehighways and city streets but itcan also be seen in the airwaysand waterways. Much of publictransport has .been abandoned,shifted from the railroads tohighways, or is in varying degreesof trouble. City street transpor­tation systems have become moneylosers in numerous places. By con­trast, private conveyancesprolif­erate: they clog the highwaysand streets, are now said to men­ace the airways, and make many

694 THE FREEMAN November

waterways hazardous. Not all ofthis should be attributed to dif­ferential .government interventionbut· much of it should. Hamperedcommon carriers and largely un­hampered private carriers resultin inordinate growth of privateconveyances and stultification ofcommon carrier enterprises.

The railroads are, however, themain subject of this work, and itis appropriate. to focus upon them

once. again. They have.been throt­tled by regulation and restriction,had their traffic reduced by aidsgiven to competitors, and beenmade to look as if theirs· was adying industry by special protec­tions to competitors. They werealso the e,arliest major industryto have large numbers of theiremployees organized in laborunions. That part of the storymust now be told. ~

Next: The Grip of the Unions.

Government in Business

IDEAS ON

LIBERTY

HAVE YOU ever heard of a private firm·· proposing to "solve" ashortage of the product it sells. by telling people to buy less?Certainly not. Private firms welcome customers~ and expand whentheir product is in heavy demand - thus servicing and benefitingtheir customers as well as themselves. It is only government that"solves" the traffic problems on its streets by forcing trucks (orprivate cars or buses) off the road. According. to that. principle,the "ideal" solution to traffic congestion is to outlaw all vehicles!And yet, such are the suggestions one comes to expect under gov­ernment management.

Is there traffic congestion? Ban all cars! Water shortage?Drink less water ! Postal deficit? Cut mail deliveries to one a day!Crime in urban areas? Impose curfews! No private supplier couldlong stay in business if he thus reacted to the wishes of customers.But when government is the supplier, instead of being guided bywhat the customer wants, it directs him to do with lessor do with­out. While the motto of private enterprise is "the customer is al­ways right," the slogan of government is "the public be damned!"

MURRAY N. ROTHBARD

50 yearsOF ENGINEERING

BEN MOREELL

IN 1844 the United States Commis­sioner of Patents declared that oureconomy was "substantially· ma­ture" and predicted "the arrival ofthat period when.human improve­ment must end."

Forty-two years later, in 1886,Carroll D. Wright, the first UnitedStates Commissioner of .Laborstated:

Industry has been enormously de­veloped, cities have been transformed,distances covered, and a new set ofeconomic tools has been given in pro­fusion to rich countries and, in a morereasonable amount, to poorer ones.What is strictly necessary has beendone. There maybe room for furtherintensive but not extensive develop­ment of industry in the present areaof civilization.

This article by Admiral Moreell, Civil EngineerCorps, United States Navy, Retired, is reprint­ed by pennission from the July-August 1970issue of The Military En~ineer. Copyright 1970by The Society of American Military Engi­neers.

In 1933, forty-seven years later,President Roosevelt said:

We have enough factories to supplyall our domestic needs, and more, ifth~y are used. With these factorieswe can now make more shoes, moretextiles, more steel, more radios, moreautomobiles, more ·of almost every-thing than we can use Our indus-trial plant is built Our task now... is not producing more goods ...it is the soberer, less dramatic busi­ness of administering resources andplants already in hand.

Thus spoke the cultists of the"mature economy," with firm con­viction and,as proved by laterevents, with maximum error. Evenas recently as 37 years ago, it ap­pears that our government officialswere not aware that man's wantsare insatiable. Man has certainbasic needs, but once these are tak­en care of, men seek the things ofculture..;...;; goods of the mind and

695

696 THE FREEMAN November

spirit, and the leisure to enjoythem. And when men are free toexercise their ingenuity and skills,they find ways to produce fantasticluxuries which soon become com­monplace necessities. Those proph­ets of economic stagnation whom Ihave quoted were convinced thatour sole problem was to deviseequitable methods of "dividing upthe pie" already on hand. Theywere wrong. The mainspring ofour economic progress consists inmaking an ever larger pie by ex­panding the scope and variety ofour technological, social, and eco­nomic resources.

It is pertinent to note an im­portant difference between thestatement of Commissioner Wrightin 1886 and that of PresidentRoosevelt in 1933. The former wasoffered as an opinion for publicconsideration, to be acted upon asindividual judgments might dic­tate; the latter was derived fromthe President's conclusion that:

... in our generation a new idea hascome to dominate thought about gov­ernment - the idea that the resourcesof the Nation can be made to producea far higher standard of living forthe masses if only government is in­telligent and energetic in giving theright direction to economic life.

All the power and prestige ofthe Executive Branch and, so faras the President could influencethem, of the Legislative and Judi-

cial Branches, would be directedtoward maximizing consumptionas opposed to increasing produc­tion ; .encouraging Widespread dis­tribution as against capital forma­tion; promoting dependence on gov­ernment-guaranteed security asagainst freedom of competitiveenterprise.

Cumulative Achievements

My subject is "Fifty Years ofEngineering." This might implythat one can draw a sharp line ofdemarcation between . engineeringdevelopments prior to 1920 andthose which came later. This is animpossible task. For all humanprogress is founded on the cumula­tive achievements ofcountIesstoilers who, over the ages,·· havecontributed to the vast store ofknowledge from which we engi­neers draw our intellectual inspir­ation and our technological suste­nance. Were it not for the laborsof those predecessors, our progressto date in science and technology,as well as .in many other areas,would have been impossible. Start­ing with the invention of thewheel about 4,500 years ago andproceeding throughthe ages to ourpresent era of sophisticated tech­nology, the record of materialprogress constitutes an accountingof our debts to our scientific andtechnological forebears.

I freely concede that during the

1970 FIFTY YEARS OF ENGINEERING 697

period from 1920to1970the cum­ulative efforts of our professionalancestry have come to fruition infar greater profusion than duringall of prior recorded history. Norwould I detract from the greatcredit due our contemporaries andthose of the preceding generationfor their contribution to .thisachievement. Weare fully justi­fied in pointing with pride to suchdevelopments during the past.halfcentury as the harnessing· of theatom; jet propulsion; greatly im­proved communication by meansof telephones, radio, television,satellites, laser beams, and others;computer science and electronicdata processing; space and oceanexploration; transportation by air,land, and water; development ofnew materials and revolutionaryimprovements of old ones; mis­siles and rockets; advanced tech­niques in the design, construction,operation, and maintenance of en­gineering. structures; and vastlyimproved management procedureswhich make possible the effectiveapplications of these and manyother developments.

This has been an epoch of bril­liant advances in science and tech­nology. And just as we cannotdraw a sharp line to mark its be­ginning in 1920, so should we notassume that it will end in 1970.

But we must be aware of cer­tain hazards which accompany

this progress and which seem tobe multiplying.

The IIAmerican Wayll

Our American productive ma­chine is highly mechanized. Thisis true not· only of the businessand industrial sector but also ofour agricultural production. Thissystem provides livelihoods for205,000,000 of our own people. andhelps support and protect much ofthe rest of the world.

How does one account for thisnation's amazing. capacity to pro­duce? Our people are no more tal­ented than those of the countrieswhence they came. Our country isno more favored with natural ad­vantages than many others. Fur­thermore, our resources· lay forcenturies relatively unused, sup­porting fewer than a million in­habitants. Now, our 6 per cent ofthe world's people produce about50 per cent of the world's goods.

Wherein do we differ fromothers? The significant differenceis that there was established herea governmental system whosemechanisms were designed to min­imize coercive force and releasethe creative energies of individ­uals.

The fundamental of fundamen­tals of the plan for living in theseUnited States, which has becomeknown as the "American Way ofLife," was an economically inde-

698 THE FREEMAN November

pendent citizenry supporting andcontrolling a government so lim­ited and confined by a written Con­stitution that the age-old politicaltrick of controlling people's livesunder the' guise of a 'concern fortheir welfare could never be pulledin America~ There was to be a neworder of things ,in which menshould, be free. But this reckoningfailed to take into account some ofthe loopholes in that Constitutionand the ingenuity of demagoguesin taking' advantage of them. Theresult is erosion of productivity.

Men Who Would Be freeMust Limit Government

This nation was' founded on theprinciple of a limited govern;ment.And judging from the costs ofgovernment, it operated that ,waythrou'ghout all of its earlier his­tory. But progressively more andmore of the people's incomes havebeen taxed away by government,especially over the past severaldecades. This reduces the area overwhich the individual can ,exercisehis freedom of choice, to spend, hisincome as he pleases. An increas­ing percentage is spent as official­dom dictates.

The opposite of freedom is slav­ery ; and everyone declares in fa­vor of freedom. But, "What is es­sential to the idea of a" slave?"asked Herbert Spencer in his greatbook, Man versus the State. He

goes on to answer his own ques­tion:

We primarily think ,of him [theslave] as one who is owneq by an­other. To be more than nominal, how­ever, the ownership must be shown bycontrol of the slave's actions - a con­trolwhich is habitually for the bene­fit of the controller. That which fund­amentally distinguishes the slave is'that he labors under coercion to satis­fy another's desires ... the essentialquestion is-how much is he compelledto labor for other benefit than his ownand how much can he ,labor for hisown benefit?

When our country was young,its citizens worked for their ownbenefit. Now that the tax take onthe average is 42 cents out of ev­ery dollar earned~ the' average cit­izen works only '58 per cent of thetime for his own benefit. And thetrend is continuing.1

Threats to Progress

Today the greatest threat topersonal liberty everywhere arises,not from aggressions by other na­tion's, but from encroachments" bygovernments upon the rights oftheir own citizens. If, overnight,all governments were compelled bysome higher power to confine theiractivities solely to the protection

1 The tax, by all levels of governmentgrew from less than 5 cents, per dollar ofpersonal income prior to' the' Civil War to42 cents today.

1970 FIFTY YEARS OF ENGINEERING 699

of the lives, limbs, liberties, andhonestly acquired property of theirown citizens, the world would enterupon an era of peace, productivity,and spiritual and, material pros­perity.. It is when those who con­trolgovernments induce their citi.;.zens to support ambitious schemesfor extension of .their power onthe international scene that con­troversy and wars result. It isclear that to avoid such disastersthe constitutional limitations onthe powers ·of government must bestrictly enforced· by the weight ofan informed public opinion.

The great conflict of our day isbetween coercion of the individualand suppression of his creative en­ergies by his own government onthe one hand, as opposed to free­dom of the individual acting vol­untarily in obedience to the re­strictions of God's moral code onthe other.

In this conflict engineers have aunique responsibility because theireducation, training, and experi­ence teach them the importance offixed principles and immutablelaws and the' dangers which flowfrom ignoring or disobeying them;For example, the· engineer' knowsthat ·in electricity he .is dealingwith a powerful force which oper­ates according to certain laws. Itis his duty to know those laws. Heknows "that electricity, uncon­trolled, can destroy and· kill. But

when controlled and directed inconformity with the laws of natureit can be a powerful servant toma~kind.

The engineer is, therefore, espe­cially qualified to understand andto. help others understand thegreat fundamental truth which isbeing ignored in human affairstoday: that there are similar fixedand unchanging principles gov­erning human nature and humanrelations in life on this planet. Theforces of human nature, like thoseof the physical world, may be con­structive, creative, and so directedthat they will help build abetterlife for all; or they can bedestruc­tive and disintegrating, even tothe extent of destroyingthephys­ical as well as the Spiritual struc­ture of a great civilization.

Undue Reliance on Technology

Jose Ortega y Gasset, the greatcontemporary Spanish philosppher,has pointed up the peril of ignor­ing the great moral and spirituallaws of which I speak. He said:

I wish it would dawn upon engi­neers that, in order to be an engineer,it is not enough to be an engineer.While they are minding their ownbusiness, history may be pulling theground from under their feet. Peoplebelieve modern technology more firm­ly established in history than all pre­vious technologies because of its sci~entific foundations. But this allegedsecurity is illusory.

700 THE FREEMAN November

Indeed, it is just this feeling of se­curity which is endangering Westerncivilization. The belief in progress,the conviction that on this level ofhistory a major setback can no longerhappen, and the world will go the fulllength of prosperity, has loosened therivets of human caution and flungopen the gates for a new invasion ofbarbarism.2

Ortega. has thus described theissue dramatically. We aretoo sureof ourselves, too complacent in atime of great danger. We placetoo much reliance on our technicalskill, our command of natural phys­icalforces and energy, and ourmatchless ability to produce. In­toxicated with pride in ourachievements, immersed in the in­teresting problems still unsolved,we have left unguarded the gatesthrough which are pouring thosedestructive hordes and forces ofthat "new invasion of barbarism"to which Ortega refers.

The Answer

The laws, the fixed and basicprinciples governing the develop­ment of the individual and his so­ciety, areas old as civilization.Some of those principles had to bediscovered .and practiced beforeman could start on his long jour­ney from his status as a preda­tory animal· toward the still far

2 Toward a Philosophy of History, pp.103-105.

distant goal of human perfection.Those unchanging spiritual andmoral precepts designed by theCreator, discovered by inspiredprophets of mankind, stated andrestated for man's guidancethrough the ages, include the fixedmoral absolutes of. the Ten Com­mandments, the Sermon on theMount, and the Golden Rule.These, in turn, require that· if aman wishes to be free to use hisfaculties as he may choose he mustaccept personal moral responsibil­ity for the manner in which heuses them.

The creative urge, implanted byGod in all normal human beings,thrives under liberty. But libertyis possible only when individualsare self-reliant and conduct them­selves toward each other in a cli­mate of mutual respect and en­couragement of those human qual­ities and forces which stimulategrowth and maximum individualdevelopment. Dr. Felix Morley,political economist and author,states the case thus:

When the American people havebeen self-reliant, mutually helpfuland considerate, determined in theirmistrust of political authority, thisnation has been "inform"; its tradi­tion alive, its contribution to civiliza­tion outstanding.3

It is clear from the foregoingthat the material blessings we

3 The Power in the People.

1970 FIFTY YEARS OF ENGINEERING 701

Americans have been enjoying arenot self-perpetuating. They arepremised on certain spiritual andcultural values which· this genera­tion did not create, which it in­herited, and, as the record clearlyshows, which it is losing. We areliving off our capital. That is thequickest way to go bankrupt. AndI am sure the stability of our so­cial. structure cannot long outlastthe exhaustion of our spiritual andcultural capital.

I have spoken to you as an en­gineer. I have stated that the en­gineer's responsibility to the socialorder is magnified because of hiseducation, training, experience,and his indebtedness to his profes­sional forebears. I have voiced myconviction that only as we contrib­ute to the creation and mainten­ance of a climate conducive to

James Madison

social progress can we dischargethe responsibilities imposed uponus when we entered our profes­sion. In the larger sense, when weaccept the emoluments and perqui­sites of that profession, we enlistas servants of society. If we aretrue to our heritage we rriust dis­eharge our obligations as engi­neers and as citizens and, by ourexample, show the way for others'who cry out for moral leadershipin this time of national peril.

Without such dedication to theeternal verities of a free society,the tourist guides of some futuregeneration may well recount, withtraditional professional boredom,to their wide-eyed charges thestory of how "pyramids" of greateost and no utility, were built bythe engineers of the twentiethcentury! t)

IDEAS ON

LIBERTY

GOVERNMENT is .instituted to protect property of every sort; as

well that which lies in the various rights of individuals, as that

which the term particularly expresses. This being the end ofgovernment, that alone is a just government, which impartially

secures to every man, whatever is his own. ... That is not a just

government, nor is property secure under it, where the property

which a man has in his personal safety and personal liberty, is

violated by arbitrary seizure8 of one class of citizens for the serv­

ice of the rest.

ARE V lEW E R'S NOT E BOOK J 0 H N C HAM BE RLA I N

THE ART OF COMMUNITY

IT ISMANYYEARS since I met Spen­cer Heath, a bearded gentleman(he'd be right in, style now) whohad a delightfully free way of look­ing at things. Among his manytheories was one which made thelandlord the center of an idealeco­nomic and PQlitical-:--- or maybe oneshould say a-political- order. Mr.Heath's utopia was pre-NormanEngland, where, as his researchesdid much to prove, free men paidrent for productive land instead oftaxes to unproductive politicians.It was Mr. Heath's contention thata landlord could sell, for marketvalue, everything from police andfire protection to public utilityservices without plunging a com­munity into serfdom.

Naturally, Mr. Heath encount­ered many doubters. His book, Cit­adel, Market and Altar, didn't makemany converts. The world haswagged on since Mr. Heath died,and those who refused to listen tohis theories haven't noticeably ad­vanced the cause of freedom or im­proved the quality of our life.Since· children aren't known fortheir pertinacity about carrying onthe work of their fathers, a fullgeneration has passed since Mr.

702

Heath started outlining his theo­ries.

Now a grandson of Mr. Heath,SpencerT. MacCallum, has mount­ed his charger to advance the causeof. his .grandfather. Mr. MacCal­lum's book, The Art of9ommunity(Institute for Humane Studies,Inc., P. O. Box 727, Menlo Park,Calif. 94025. $4.00 cloth, $2.00 pa­per), is a legitimate extension ofCitadel, Market and Altar, and itmay be more convincing to thepragmatists among us simply be­cause it proceeds by exploring cur­rent trends to show how people un­consciously turn to good theorywhen the practices resulting frombad theory have let them down.

Mr. MacCallum is a trained an­thropologist, which means that hecan look at community organiza­tion without blinking. He sees an"art of community" developing em­pirically, spurred only by the ef­forts of people to make profits bysupplying services that states andmunicipalities have fumbled withso badly. To those who say that acommunity must be political in na­ture, he offers hotels, shopping cen­ters, industrial estates', real estatecomplexes such as Rockefeller Cen-

1970 THE ART OF COMMUNITY 703

ter, condominiums, marinas, sci­ence research centers, and "newtowns.'" Some of these combine in~

dividual private ownership withpaying fees for the use of commonlands or common services that areopen to all participants in a' com­munity venture. But the point' istha.t one can buy protection ortransportation or access to a swim­ming pool or a playground withoutgoing through the often disap­pointing rigmarole of politics·' toget it.

The basis of the "art of commu­nity" is contract. Ordinarily onethinks of contract as .somethingthat binds separate individuals.Mr. MacCallum is not against theindividual ownership of homes oracreage, but the defect of suchownership is that it can't ordi­narily provide for police and fireprotection and public utilities with­out bringing in the state. The atom­ized private plot is at the mercy of"neighborhood effects" which thepurchaser never bargained for. Ac­cordingly he .may find himselfabandoning some of his own rightsas a private owner by acceptingzoning regulations, or by ,giving aright-of-way to a gas transmissioncompany under threat of expropri­ation by state invocation of eminentdomain. Mr. MacCallum thinks in,.;dividuals could get better bargainsby combining their units to formproprietary communities with cen-

tralplanning powers. The unrecon­8tructed individual will bridle atthis suggestion,but Mr. MacCallumquite soothingly insists that mem­bership in a proprietary commu­nity must go by voluntary choiceunder contractual arrangements.One need not be forced to do any­thing; .if one doesn't like the deci­sions of the proprietary authority,one can sell his own particular con­dominiurn, or· refuse' to renew hislease.

Mr. MacCallum contrasts 'thedowntown shopping centers in ourcongested cities with the new-stylesuburban shopping areas to makehis points. The downtown mer­chants may all agree that they needmore parking space near them forautomobiles. But· no .one of themv~ill willingly allow his own prop~

erty· 'to be condemned to provideparking space for the other mer­chants in his association. Theyolit­ieal arm must be called in fo busta few recalcitrants so that othersmay benefit. Naturally, this createsbad blood or political corruption orboth. Since politicians live to be re­elected even more than they'live toserve the community, they will don.ot what is aesthetically right butwhat is necessary to get the mostvotes the next time around.

In the suburban shopping center,the proprietor can make whateverdecisions he wants, provided hedoesn't break one of his contrac-

704 THE FREEMAN November

tual promises. The proprietor sellsa variety of services to those wholike them well enough to make con­tracts to pay forthem. The servicescan include parking, roads, light­ing,· landscaped common areas,police and ·fire .protection, stormsewers, even sewage disposal.

Mr. MacCallum offers some fas­cinating. bits of history of a sortthat doesn't .. usually get into thestandard history texts. I'd like toknow more about such charactersas James B. Douglas, the pioneerof the Northgate "regional" shop­ping center in Seattle, who firstworked out the theory of the "cu­mulative pulL" Douglas began byinsisting on the "Noah's Ark Prin­ciple" of supplying two competitorsfor every type of good that a shop­ping center had to sell. (Today therule is. obsolete; two are no longeradequate.)

The'll there is EdwardH. Boutonof Baltimore, whose Roland Parkdevelopment provided for orderlyresidential planning adjacent to ashopping center.. The pioneer of theindustrial estate seems to havebeen Marshall Stevens, who built aship canal from Liverpool to Man­chester only to discover that thecotton millers, who had marriageties with the cotton shippers ofLiverpool, disdained to use' hiswaterway. To save his canal invest­ment, Mr. Stevens prepared a large

tract of land in Manchester for in..dustrial .. use, putting in the streetsand supplying the utilities. Heleased the land to various indus..trialists, .. thus creating TraffordPark, England's first proprietaryindustrial park~ '

In their own way such pioneersas Bouton, Douglas, .. and Stevenswere practitioners of LeonardRead's. "anything that's peaceful"philosophy. They were communi..tarians rather than individualists,but they did not bring in that en­gine of compulsion, the state, tosolve the problems of group livingthat they posed.

I t is hard to see the whole worldbeing saved by the development ofproprietary com.munities. Somepeople· want a more complete typeof privacy than is to be· found inplanned. estates of one type or an­other. But the world could onlybenefit by a vast extension of. thesort of thing that engages Mr. Mac..Callum's enthusiasm. As long as hesticks to contract as the binder inhis "art ofcommunity," no individ­ualist, whether· unreconstructed ornot, can find fault with his theory.His book on the proprietary com­munity is stimulating, and even themost· obdurate live-alone-and-like­it individualists among our de­pleted tribe of voluntarists woulddo well to read and ponder Mr.MacCallum's conclusions. ~