Freedom Is Exchange
MARCH 01, 1977 by JOAN MARIE LEONARD
Miss Leonard is a free-lance writer.
There are many sayings to the effect that "bars do not a prison make." Even a prisoner is free to will his own actions, his degree of cooperativeness. His mind is free to be anywhere and do anything. A prisoner can certainly be freer than his jailers. And imprisonment has been known to so energize the spirit of independence that some of the most powerful pieces of freedom’s literature have come from a battery of prison cells.
At times throughout history we find the freest people were inside prison walls while those on the outside were such slaves to political restrictions, authoritarian hand-me-downs, confined notions and ignorance they didn’t even know they were enslaved.
How is a prisoner not free? What is confined? His choices. And all choices are an exchange. Every minute of time you spend is a choice in which you give up some things to have others. A prisoner is denied choices—but society is also denied—losing his participation through his choices. The advancement of society depends on all exchanges of energy. So its laws should be limited to confining only those whose choices and energies are injurious or destructive of exchange—freedom—the free making of choices that concern peaceful people and their property.
In pre-American history, most imprisonment was the result directly or indirectly of political manipulation and ideological or intellectual variance with overriding powers. All authoritarians realize the only real threat to their power is enlightenment and discovery. The method of such enlightenment and discovery is exchange. In many political cases, prison didn’t take away a person’s freedom so much as it took freedom away from those who might catch it from him through his discoveries of truth. Power centers can’t be held intact once it is known they are not centers of real power.
All exchanges throughout society are energy exchanges. It is energy and creativity that are imprisoned and confined when anyone is removed from society. The Dark Ages were dark because feudalism was a mass imprisonment in the State of Non-Happenings (non-exchange) through a very complete authoritarian control.
Ideas not put to use and exchanged have died in the political prisons and reprisals of history. When a Galileo is locked up for upholding that the earth revolves around the sun, in the minds of rulers demeaning their earth, their powers—who is victimized? Not Galileo alone as much as society itself. As a result, the world has stumbled around for ages, repeating mistakes, blundering along and having to rediscover what others had known long before.
Legend tells us Columbus ran all over with his egg, trying to tell people the world was round, but Archimedes knew the shape the world was in over 1700 years before Columbus’ time. And Thales knew about the earth’s roundness 400 years before Archimedes. And Aristarchus was teaching that the earth revolved around the sun about 1800 years before Copernicus.
Lack of communication? Sure. But that is lack of freedom. It is not incidental that communication and the spread of knowledge has increased so dramatically in tandem with freedom in America. Freedom is communication. Freedom is exchange. Freedom is an open, shared movement. To be open, it must be shared. Freedom is the natural synchronization of interests into the movement we call simply—progress.
We think of indoor plumbing as a development of the last 100 years or so—an advance still unknown in many parts of the world. Actually, indoor plumbing was in use 3000 years ago. Without freedom, ideas and discoveries wither on the vine. With freedom, they are not only used but widespread, contagiously, economically, usefully and happily extended in the quickest possible way to everyone.
Before America, the penalty for discovery was, not infrequently, death. The energies
of great minds were confined to producing pleasures for the politically powerful few. The magnificent mind of Leonardo was limited to novelties of amusement for royal gatherings, commissioned paintings and war gadgetry, such as his ideas on submarines, tanks, parachutes and other ingenious creations. But far more important than Leonardo’s weaponry undoubtedly were the discoveries of his private pursuits, conducted by necessity in secrecy and lost to history. He had a world-opening mind but he lived in a closed society and we may never know the treasures lost to us because of it. Notice, it’s his political (war) devices that we know about and which we refer to as putting him far "ahead of his time," but those are the inventions that rightfully belong to his age, not ours. It’s we who are behind the times. Had we not abandoned our original ideas of political freedom, freedom from politics, war would have been outmoded by now. It is an uneconomic exchange.
Knowledge . . . discoveries . . . ideas without freedom are like light imprisoned under a barrel. Confined to a few, they can’t spread a further increase of discovery. With freedom, everyone shares in all discoveries and builds on them in geometric advancement. Since freedom is exchange, its benefits are always transferred and amplified.
Not everyone is a Leonardo, but everyone energizes society to a certain degree through his ability—and never to his complete capacity. More is the keystone of freedom. It is freedom that multiplies our energies with the energies of others through exchange and activates dormant capabilities by expanding our knowledge, awareness and experience in proliferating ways.
Freedom is an exchange of limitation for opportunity, confinement for expansion, poverty for prosperity and ignorance for knowledge. It is an exchange of political aggrandizement for personal enlargement. Freedom alone enables us to provide for the general welfare through the pursuit of personal happiness. And everything freedom is and does is the result of the expansion aspect of exchange.
Freedom begins with an exchange—you can’t have it until you grant it. Your own liberty is measured by the extent you agree to grant it to others. Freedom exists to the degree exchange exists uninterrupted. It starts, proceeds and expands through exchange. All its blessings are derived from exchange.
One person who is free in a society that is not free is not experiencing freedom. He has the same freedom as any prisoner: lack of exchange. A millionaire is limited by what he can buy in exchange for his dollars. A million dollars is no good in prison—nor in the prison of a regulated, artificial economy as was demonstrated in Germany in the 1920s when a million marks wouldn’t buy a loaf of bread—and in France when the cancerous nature of inflation was exposed with the issuance of thousands of millions of new francs in the period of a month. (See Fiat Money Inflation in France by Andrew Dickson White.)
"Free" people living in separate isolation, supporting themselves, as in the hippies’ idea of freedom, are imprisoned by their own abilities and limitations, their lack of exchange. If they lived thousands of years, they would continue to live under virtually continuous conditions of poverty as all communal, tribal people have—a condition still displayed today by primitives on every continent.
The enlargement aspects of freedom are societal, shared. The benefit is expanded to the degree liberty is recognized and widespread. Freedom is extended by numbers. The more widespread, the greater the freedom and choice of every participant in exchange. That’s why our borders should be free and open to all trade. Tariffs and duties are very real barriers barring us from efficient production on the basis that it was produced by "others." But there are no "others." Not under freedom. That’s why freedom is the only democratic system. Everyone has a stake in it. It eliminates classes. Its blessings reach everyone.
Like a refreshing and nourishing rain, freedom’s benediction falls on "the just and unjust" alike. It is a mistake to say freedom rewards the energetic and penalizes the lazy, unemployed or incapacitated. It accommodates everyone to their best advantage. It is a totally beneficent system of such increase it even elevates the improvident and makes them more capable of providing for themselves. It rewards the industrious but it’s easy on the lazy. It penalizes folly but rewards with new opportunities even those who make mistakes. Its productive power allows shorter working hours for those who value other pleasurable pursuits. Shorter hours can only come about naturally from an extravagantly productive system—not the disruption, strikes, slowdowns, artificial wages and other obstructions to production demanded by those predators who would rob everyone of progress.
Freedom is rewarding to both the skilled and unskilled, the artistic and mechanical, borrowers and lenders, geniuses and poorly educated, employers and employees—all because of the variety of opportunities and services allowed and demanded by exchange.
The free, competitive system is the only one in which quality improves with quantity. New products become increasingly better at lower cost through competition. Why do we have such increasing shoddiness in production today at higher and higher prices? It is a worsening condition resulting from more and more intervention in free exchange through union demands, phony money, welfare funds extracted from productivity, subsidies of the non-competitive—all government interventions.
Numbers … population … volume is a drag on every economy except the free economy where it is a stimulation and energizer. It sets things in motion. Freedom is nothing but movement—through energy exchanges. It is life itself.
Ours is the only society in history that ever went around actually looking for people’s needs in order to satisfy them. That’s the only way companies can exist and succeed in a free system. Many people earn their livings just trying to find large numbers of people who need something . . . marketing research people looking for needs that can be satisfied through the capabilities of their companies.
Never before have such extraordinary values been created and distributed so democratically, so extensively, increasing the well-being of all society. Volume is both the source and objective of benefits we enjoy under freedom. Volume of exchange is the only way to derive myriad benefits—the only way to have many sources of benefits. And because it operates on need and through volume, our system is the only one not depleted by consumption but stimulated by it.
Scarcity and Availability have been the foes throughout history’s wars. From the first migrant peoples who attacked agrarian settlers to get food, to the latest union demand, lobbyist pressure, business subsidy and welfare payment, economic history has consisted almost entirely of satisfying some by taking the property of others. With supply and demand always at odds—values existing in insufficient quantity (limited exchange)—war has been the way of life. Wars expropriate things of value to solve problems of scarcity. Freedom creates them.
Seeds of Harmony
The American system of free exchange substituted increasing abundance for the steady depletion of authoritarian economic systems. Every day of free exchange is a day of increasing peace, harmony, happiness and prosperity. Every day of depletion under authoritarianism is a day closer to the necessity and inevitability of war.
While an economy is often represented as a pie—divided and segmented into shares of who gets what—a free economy is more of a way to have your cake and eat it too. It is not a system of authoritarian apportionment and depletion such as every other country has known. It is a flow of increasing abundance as boundless as Creation . . . a cornucopia spreading its blessings over the entire world. Wealth, or production, is not sliced up and divided as in the controlled countries of history, but self-sustaining, self-expanding — an economy that replenishes itself and expands in more and more diverse ways. The more you take out of it or consume, the more it grows and produces because it grows like intelligence and as fast as need. In no other system can you produce so little and have such an extensive, multiplying whole to partake of. Any interference with it is a deprivation, a diminishing of its power to provide for the general welfare.
Naturally, it is impossible for people to become impoverished under such a system of continuous expansion and applied energy. It is equally impossible to avoid the spreading impoverishment that occurs when government intrudes on production with regulations—each control inhibiting the flow of our naturally productive market processes.
Freedom is a dynamic system because what is exchanged so freely is energy. Honest (unregulated) money simply represents the energy expended to earn it. When you spend money you spend energy—the payment for your energy provided in work. And what it buys is the result of energy expended by others. In these energy exchanges, both the needs of buyer and seller are fulfilled or there would be no exchange. Through the exchange, energy is renewed in multiple ways. The producer is stimulated to produce more, drawing on the energies of others in the market. The consumer, having satisfied his desire for something, is on his way to gratifying more desires, gladly expending energy to exchange for still more ways to serve his needs.
But where freedom is limited, energy is not exchanged. Money that is tampered with is energy drained to the degree it is manipulated. Dollars unbacked by gold or other value do not represent either real money or real energy. Tax money used to pay welfare needs is energy siphoned from productive activity to pay for inactivity and an increased cost of living. The energy loss is multiplied by government interferences in the same way that benefits multiplied without it. As these energies diminish, choices disappear and opportunities for exchange become more limited. Energy loss through market interference inevitably leads to scarcity and high prices. The consumer becomes a prisoner of limitation. The worker is unemployed. It’s all natural and inevitable. The energy has gone out of the system.
When unregulated by government, free market exchanges work like electricity for us, moving solutions toward problems and services toward needs in the same way electrons move toward protons. In the economy, as with electricity, balance or equality is a static state—neutralized and useless. We use heat in cathode tubes to set electrons free to flash pictures on our television screens and bring far-off voices into our homes. The unequalized condition caused by heat or magnets leads to the movement of electricity. In the market, movement is provided by the heat of competition—again, a condition that can exist only through inequality. Equalizing conditions of competition through statutory wage scales, prices, subsidies, supports, tariffs, welfare and the like, reduces the movement and leads to a static state. Freedom is the state of inequality that stimulates exchange and supplies all our needs as members of one societal body. Profit acts like a magnet drawing the market toward efficiency and inventiveness.
Every government intrusion assumes that the interests of some are unfavorable to the interests of others, thereby supposedly justifying one interference after another in attempts at some nebulous equalization. This is robbery justified on the grounds that it is universal . . . one act making up for another act. But what is robbed is energy and it is taken from us all.
We are thus paying a high price to break up a conflict that never existed. There is no more discord among the segments of a free market than between the tarsal and metatarsal bones of your foot. They serve each other naturally in their unique functions. And injury (interference) here isn’t just to your foot. It’s the movement of the whole body that’s thrown out of kilter. Even the "opposition" of competition is no different or more harmful than the opposition of thumb and fingers that provide the leverage that enables the hand to work.
And the free market has a brain not unlike our own. As every nerve fiber sends messages to the brain, every transaction in the market sends messages of supply and demand through the social body telling producers what to produce and what they can charge, telling workers where the jobs are, telling investors where to invest—all making it possible for us to move ahead by fulfilling needs in the most efficient ways, putting all energy to use with as little waste as possible.
The social body is most alive, healthy and responsive with all its members functioning—every cell and fiber of its being in action and part of its dynamics. Regulatory interferences only immobilize, desensitize and cripple this gracefully coordinated movement. A manipulated, artificial currency, price and wage controls, subsidized imbalances are all lies fed into this marvelous computer destroying its equilibrium and capacity to function. Like any computer, it can only work well with honest information—untampered and direct from the market. If our bodies were made to function with the kind of informational system government planners contrive through their dictates, we would be putting shoes on our ears, eating candles and heating our homes with the warmth of snow.
It is through individuals that life capsulates bits of unique experience and ability—like computer bits—which are incorporated in the larger life of the social body. By being a part of this peaceful and harmoniously operating body, we share it all. And by doing "our bit" we find ourselves in ways only made possible by zillions of opportunities—each position in society being unique. In open, free exchange, there are as many choices of things to do as things to have—as many levels of doings as levels of ability. No one is left out. All enjoy the benefits of the whole. When exchange is limited, there is no expanding whole. There is an undeveloped minimum which dwindles through waste.
The Choice of X-Changes
Authoritarian plans are solidifed obstructions to change. Freedom is the fluid accommodation of all change—through exchange. And maybe we should spell that X-change, because X is for the unknown and freedom brings change in unexpected ways and in forms unimaginable by any one or group. When government confines change and choices to the whims of a few planners or for the benefit of certain groups as is the case in all political activity these days, progress diminishes, energy recedes and discovery is denied. A free society, on the other hand, allows, coaxes and harmonizes the expansion and development of our personal energies and liberties through exchange. When the number of freely acting individuals is reduced through group actions, united demands and legal enforcement, the movement of the social body becomes spastic, out of control and increasingly paralyzed. (See To Free or Freeze by Leonard E. Read.)
Public education is an example. Instead of thousands of outlets of educational services for parents to choose from, government regulates the market for learning and reduces it to one source. The result: instead of a variety of alternatives, lowering education costs, refinement in teaching techniques, individually tailored programs, improved services and the general expansion of knowledge, we have a disintegrating system, higher and higher costs, less and less service, more and more political intrusion (busing and the like), uniformly low standards, teacher strikes and collusion, classroom disruption, the general confinement of knowledge and deterioration of behavior.
The Bars Against Trade Imprison All of Us
We are, in fact, imprisoned by each control of the market . . . every one of which reduces our options and exchanges. When we are isolated from ideas and their extensions, we are effectively imprisoned. Freedom exists where political effort is directed only at stopping interference with exchange. Freedom is lost with the first interruption of exchange, not the last. A "mixed" economy is an imprisoned economy since an act can’t be destructive and creative at the same time any more than we can be free and at the same time slaves to the desires of others.
The question is not whether we are going to be Communist dominated, but when we are going to stop. The only difference between Russia and the United States today is that Russia is a tight-security prison while ours is still a medium-security prison. The difference is negligible.
Freedom for Criminals
As the government intrudes on the economy in the creative sector, while neglecting crime in the destructive sector, peaceful and responsible people are rapidly being imprisoned by the predators of society. It is the law-abiding who are increasingly walled-in and watched by security guards—by necessity. We have to chain down our possessions. We are afraid to walk on our streets. We are putting bars on our windows and more locks on the doors to protect us from marauders. Is this freedom?
The government no longer preserves the peace. It has abandoned the general welfare to provide for the special interests, making criminal activity our way of life both through legalized privileges and unrestrained criminality. Through its economic interference, it guards us against the benefits of freedom! Through its jurisdictional neglect, it leaves us prey to both controlled and uncontrolled predation.
We need to separate all freedom of exchange from governmental control, leaving all but socially destructive energy free for exchange in the market of progressive improvement. As it is, we have creative energy confined and destructive energy on the loose. Government barriers to exchange are rapidly confining us in a prison "from sea to shining sea."