Dr. Cage, economist and administrative analyst at Tamko Asphalt Products, Inc., in Joplin, Missouri, speaks and writes extensively in behalf of the free market. This article Is from a recent speech at Southwest Baptist College, Bolivar, Missouri.
There are basically two different ways to organize a society. We can take the viewpoint that we know how people should live their lives—and organize society and the economy accordingly. Or, we can say that we don’t know—that we are uncertain enough about life’s ultimate purpose that we will not impose our values on anyone else.
We have experienced a "knowledge explosion" over the past few decades and today we know more about the earth, its universe and its creatures than ever before. We can split atoms without seeing them. We can see the other side of the moon without being there. We have a better understanding of both bizarre and normal types of behavior. But some knowledge is forever beyond our grasp. We can never be sure that any one of us knows, beyond doubt, exactly what the purpose of each person’s life is and how that person can best fulfill that purpose. That is true at the "grand" level—to what I should dedicate my entire life—and at the "ordinary" level—what I should do today.
This attitude of "I don’t know" is basic in the formation of a free economy and a free society. I don’t know how to: live your life, manage your finances, or make your decisions. And because I don’t know, I don’t even try! The result is a free society in which everyone makes his own decisions about how he will spend his time, use his talents, and allocate his material wealth. It encompasses more than just economics. You can choose not only your vocation but also your spouse; your own brand of coffee and your own "brand" of religion; where you will work and even if you will work. The entire list of civil liberties stems from the same source as our economic liberties—the willingness to admit "I don’t know."
I don’t know if my religious denomination has "the truth," so you choose your own church. I don’t know if my opinion on a subject is correct, so you speak your mind as well. I don’t know if you should be an engineer, a poet, or a banker, so you choose for yourself. When people choose for themselves, we have a free market and a free society.
But there has to be an essential humility, a recognition of our own limited knowledge. Each of us must admit that "I don’t know" before we can have a viable, free society. And there lies the difficulty.
The Urge to Control
Almost everyone would publicly acknowledge that he is incapable of directing other people’s lives. However, deep inside, a lot of us seem to believe that we do have the knowledge and wisdom to control others. In fact, recorded history is an ongoing account of people who thought they did know how to organize their society. From the kings who ruled by divine right to the feudal lords who totally directed the economic and social activities of their peasants; from the crusaders who were out to win the hearts and minds of men (and to kill them if that failed) to the Hitlers, Stalins, and Idi Amins of this century—all are classic cases of people who would not admit "I don’t know." And the classic cases aren’t all. The historic listing of truly free markets and societies is about as short as the list of government agencies that have voluntarily disbanded.
The institution that works against liberty is government. Government is the only agency that can rely on coercion instead of cooperation, and if coercion is used it is a pretty good sign that the people coerced did not act of their own choosing! When government goes beyond its peace-keeping functions, both internationally and domestically, it is in essence saying "I know!" It knows:
- how your home should be constructed (even if it doubles the cost by using outdated methods);
- what education you should receive (even if it means you will forever read and write at a third-grade level);
- how much you should pay for gasoline (even if none is available at that price);
- what wage you should earn (even if you can’t find a job at that wage);
- what you should and should not read, eat and watch on TV, what countries you shouldn’t visit, and what foreign products you should be allowed to purchase.
Government, once it exceeds its essential duties, will strive to organize our economic life and our total society because it thinks it has the answers, the knowledge, the truth.
But people are not inclined to accept government as the possessor of all knowledge. As a result, the people must be "persuaded." The traditional form of persuasion was the point of a sword or the muzzle of a rifle. Modern governments, though, are too advanced to use such outright force. They use the carrot instead of the stick. We no longer resist government restrictions, regulations, controls, prescriptions, and proscriptions for the simple reason that we have been bought off. We have discovered the secret that kings tried to hide for centuries: it is a lot easier to live off the public purse than it is to work.
Wards of the Government
People throughout the economy now depend on government for some or all of their livelihood. Government funds provide welfare payments, program and project grants, contracts for services and equipment, and even direct employment to a growing proportion of our population. In addition, many businesses rely on federal, state, or municipal agencies to effectively eliminate competition.
Consider what has happened.
Item: In 1955, government spending was about 30 per cent of our national income. Twenty years later, that proportion had risen to 44 per cent. The government now spends nearly as much of our income as we do!
Item: Although it is difficult to arrive at a precise estimate, today somewhere between 35 per cent and 40 per cent of the entire U.S. population (not just the work force) receive some or all of their income from government. That is actually less than it might be: someone calculated that our country passed the point of no return in 1972 because in that year more than half of the population became eligible for some type of government aid, program, or project.
Item: Professions of all kinds rely on government restrictions to reduce the number of competitors. The same is true of businesses. A leading business publication recently referred to an airline company which is suing the Civil Aeronautics Board for insufficient regulation. The airline is apparently unhappy because, as it stated in its annual report, the CAB’s policy is to grant any fit, willing and able carrier any route for which it applies!
In short, we have sold our freedom. We have been increasingly willing to acknowledge the government’s "superior" knowledge in exchange for a few dollars. This has occurred despite the government’s demonstrated ignorance and incompetence in delivering mail, operating schools, and even in handing out money. We have allowed government to claim "I know" as long as it also says "Here’s your share."
Our Freedom in Jeopardy
The government expansion has been largely concentrated in the economic sphere, and that is where the effects of false claims to knowledge have shown up the most strongly. But our political and civil liberties are not far from jeopardy. As the government increasingly claims to know how energy should be used, it will at some point have to decide whose printing presses will be allowed to run. Is it likely that newspapers which are critical of the national energy policy will get as much electricity to run their presses as will be granted to the papers which support the policy? Who will be allowed to travel—lecturers who criticize the government or the bureaucrats who carry out government policies? Will art books have the same energy claim as the annual report of the Department of Energy? What churches will be allocated enough fuel oil to heat their sanctuaries?
The brief appearance of Miss Liberty came as a result of recognizing that no one person, no group, no agency possessed the knowledge to run the economy and society. Her visit brought forth all of the benefits of freedom: high living standards as creative and productive energies were unleashed; a wide variety of lifestyles as people pursued high (and low) purposes; a concern for the welfare of others, voluntarily supported through private charities; and technical and intellectual advances in knowledge which would have been inconceivable even to Jules Verne. All of this from our simply saying, "I don’t know."
But now, at least for the present, the temptation of living off of the public purse seems too great to resist. We let the government claim to be all-knowing in exchange for the low-grade security of government providing and protection. However, knowledge—or lack of it—will ultimately surface. When government finally is overwhelmed by its own ignorance, when we finally say once again, "I don’t know," then our free market economy and free society will allow the human spirit to reach new heights.