Freeman

ARTICLE

A Free Market

JUNE 01, 1956 by BEN MOREELL

Admiral Moreell is Chairman of the Board of Jones and Laughlin Steel Corporation.

What is meant by “the free market”? To answer this question we have to go back a step or two. Economics deals with desired goods in short supply. Air is not generally an economic good because there is enough for everyone and some to spare; “conditioned” air, however, is an economic good. So is almost everything else we need for living—or living well. Most things on this planet cannot be consumed directly; human labor must be expended on them before the consumer’s wants may be satisfied. Consumer wants are virtually unlimited, but both raw materials and manufactured goods are limited. So our question is: How shall we go about applying limited human energy to scarce goods for the greatest satisfaction of the most urgent human wants?

Roughly speaking, there are two answers to this question of how to harness and set in motion productive forces: (a) by political planning of economic production, and (b) by consumer choices freely expressed in the market place. The Swiss economist, Wilhelm Roepke, has put the matter this way: “The character, manner and quantity of production is determined either by those affected by it, that is by those whose needs are met by this production, or it is determined by other agencies.” The former pattern is created by the free choices of uncoerced men and women; the latter is based on whatever compulsions are necessary to set aside such free choices.

One may put the matter even more simply by saying that under conditions of political liberty a certain pattern of economic activity will emerge. This pattern is the market. The economic aim of a totalitarian state is to annul the decisions of the market by replacing free personal choice with political directives, allocations, and over-all plans.

In short, human liberty, in one of its facets, is consumer choice and direction of productive activity. And individual liberty, in turn, is an important element of our Christian heritage.

The free market has never been 100 per cent operative, but this is not to say that it has never existed. Neither has Christianity ever been 100 per cent operative. But it is a wrong inference from this fact to declare that Christianity has never existed. To the extent that people are free, the market is operative.

Some persons fear that “an uncontrolled market would result in economic anarchy.” Again we are involved in a question of terminology. An uncontrolled market is simply another way of referring to men freely and peacefully engaged in economic production and exchange. I have never encountered a valid argument, on moral or any other grounds, to justify the control of any person’s creative and peaceful actions against his will by any other person or combination of persons. If a free society, as opposed to a totalitarian one, is anarchical, I suppose that by the same reasoning, the economic activities of a free society result in economic anarchy. But the actual facts are quite different. Economics is based on the regularity in the sequence and interdependence of market phenomena. Harmony is the keynote—not chaos.

Men should be wholly free in their creative activities. As a matter of fundamental principle, there is no more warrant for attempting to clamp political controls on a man’s energies in his shop than there is to put his energies under political control in his church, his classroom, his editorial office, or his study. If freedom is good in any one of these places, which I believe, it is good in every one of these places—which I also believe. []


For men can never be free, unless they are educated to freedom. And this is not the education which is to be found in schools, or gained from books; but it is that which consists in self-discipline, in self reliance, and in self-government.

 

Thomas Henry Buckle, History of Civilization in England (1861)

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June 1956

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