Freeman

PERSPECTIVE

Divide and Conquer

What Makes Friendly Relations Between Human Beings Possible?

DECEMBER 01, 2000 by SHELDON RICHMAN

Filed Under : Scarcity, Division of Labor, Ludwig von Mises

If I had to pick my favorite sentence in all of Ludwig von Mises’s Human Action (a daunting task in a 900-page book), it would be this one: “The fact that my fellow man wants shoes as I do does not make it harder for me to get shoes, but easier” (p. 673 of the Third Revised Edition). That sentence may seem rather pedestrian compared to all the sentences Mises used to establish the science of praxeology (human action) and to spin out its countless implications for economics. But it’s a perfect example of how Mises showed that untutored intuitions about social interaction are often wide of the mark.

There is an old school of thought, widely identified with the Reverend Thomas Malthus, but actually quite older, that held the opposite of Mises’s position. Beginning with the undeniable assumption of scarcity, that school believed the human race was doomed to misery. Population would grow until it strained the carrying capacity of the environment; then starvation, disease, and conflict would set in and scale back the numbers. This process was more or less the permanent fate of mankind.

How could it not be? Growing numbers of people would be vying for limited resources. Life had to be poor, nasty, brutish, and short, though not, as Hobbes had it, solitary.

Mises was surely not the first to see it otherwise, but he was second to none in spelling out why the pessimists are wrong. He first seemed to concede their point, then zeroed in on what they missed. “The characteristic mark of the ‘state of nature,’” Mises wrote, “is irreconcilable conflict. The means of subsistence are scarce and do not grant survival to all . . . . The source of conflict is always the fact that each man’s portion curtails the portions of other men.”

What saves man from the dismal existence of wild animals? The division of labor, the first topic taken up by Adam Smith in The Wealth of Nations. As Mises put it, “What makes friendly relations between human beings possible is the higher productivity of the division of labor. It removes the natural conflict of interests. For where there is division of labor, there is no longer question of the distribution of a supply not capable of enlargement.” (Here Mises differs with Smith. Smith thought the division of labor grew out of man’s “propensity to truck, barter, and exchange one thing for another.” For Mises, exchange comes from the realization that gains were available from trade and the division of labor. I take Mises’s side in this controversy.) Mises drives home the point: “Because many people or even all people want bread, clothes, shoes, and cars, large-scale production of these goods becomes feasible and reduces the costs of production to such an extent that they are accessible at low prices.”

The upshot is that because of the productivity specialization makes possible, the rest of the animal kingdom holds few lessons for mankind. Anyone who believes government’s role is to temper the market with cooperation needs to learn that lesson.

For more, see Wendy McElroy, “The Efficiency of Natural Rights,” The Freeman: Ideas on Liberty, December 1997.

* * *

When the World Health Organization ranked 191 of the world’s health-care systems, the United States placed an unspectacular 37th. As Twila Brase points out, serving patients was not the overriding criterion.

Does the Harry Potter phenomenon have any relevance to classical liberals? Andrew Morriss sees something in the best-selling books for lovers of liberty.

Women who are likely to be brutalized by estranged husbands too often seem to prefer that fate to a measure that could significantly reduce the chances of their becoming victims of violence. Karen Selick explains.

The movie theater is not typically a place where devotees of capitalism and individual liberty can find comfort. But as the year 2000 closes, Ray Keating revisits some of the bright exceptions that have come out of Hollywood.

Much went into the evolution of capitalism. The institutional and ideological history is rich. Yet John Hood finds that “nothing” has been ignored.

Societies are often lauded for their high savings rate and chided for their low savings rate. Things are not so simple. Christopher Lingle takes a new look at the Asian economic crises.

Should the law reward people for tattling? Environmental law and the courts do just that. Timothy Terrell says the development is ominous.

The attempt to reduce all motivation to economics seems to leave out some of the richness of human life. What about moral values? Tibor Machan and David Brown have an idea where economics went wrong.

Here’s what our columnists have come up with this month: Donald Boudreaux muses on universal values. Lawrence Reed pens an open letter to statists everywhere. Doug Bandow describes the horror of the Burmese civil war. Dwight Lee demonstrates that in the name of safety, the government makes us less safe. Mark Skousen wonders how many people are on food stamps. Russell Roberts says fear not budget deficits. And Robert Murphy, hearing Michael Kinsley’s doubts that markets are efficient, protests, “It Just Ain’t So!”

Subjects for our book reviewers: campus illiberalism, Pearl Harbor, the National Education Association, college fluff, anti-discrimination laws, and Western tradition.

And don’t miss our comprehensive annual index.

—Sheldon Richman

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December 2000

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SHELDON RICHMAN

Sheldon Richman is the former editor of The Freeman and TheFreemanOnline.org, and a contributor to The Concise Encyclopedia of Economics. He is the author of Separating School and State: How to Liberate America's Families.

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Unfortunately, educating people about phenomena that are counterintuitive, not-so-easy to remember, and suggest our individual lack of human control (for starters) can seem like an uphill battle in the war of ideas. So we sally forth into a kind of wilderness, an economic fairyland. We are myth busters in a world where people crave myths more than reality. Why do they so readily embrace untruth? Primarily because the immediate costs of doing so are so low and the psychic benefits are so high.
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