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Friday, May 29, 2020

19 Nuggets of Wisdom from the Best Economics Writer You’ve Never Heard Of

Americans would do well to make up the deficit in their knowledge of the works of Arthur Seldon and his “life for liberty.”

Image credit: Independent Institute

May 29 marks the birth of Arthur Seldon. While too-little known to American readers, he was editorial director of the London-based Institute of Economic Affairs for more than thirty years, during which, The Economist wrote, it “brought to the lay reader the ideas of all the leading free-market economists and thinkers of the day.”

Seldon produced a seven-volume set of collected works, including books, monographs, essays and articles, as well as editing hundreds of papers, monographs, and pamphlets.

In such a vast body of work, one cannot easily winnow out the best of Arthur Seldon’s insights. Therefore, consider some of the wisdom in just one of his books—Capitalism—winner of the Fisher Arts Literary Prize and celebrating its 30th anniversary this year:

  1. “Capitalism…creating high and rising living standards for the masses without sacrificing personal liberty speaks for itself. Only the deaf will not hear and the blind will not see.”
  2. “Even bad men are led by the market process to do good, but good men are induced by the political process to do harm. [So] discipline the writ of politics to the bare minimum.”
  3. “Private property is a potent working institution. Public ownership is…political power cornered by handfuls of irresponsible non-ownerships.”
  4. “Capitalism…allows individuals to take the risks of living their lives as they see best.”
  5. “The capitalist market…puts power–effective purchasing power–directly into the hands of the common man and woman for them to use where they wish…That is why the market is more essentially democratic than government.”
  6. “Changing private identifiable property into public unidentifiable property is to destroy the incentives to protect, conserve, improve and render it productive by using it profitably in making goods and services for which consumers will pay.”
  7. “Pricing is the peaceful way of resolving argument and conflict.”
  8. “It was the development and refinement of the law of private property rights that explains… modern progress.”
  9. “That in practice markets are imperfect has obscured the more fundamental truth that they are the best-known way of enabling individuals to meet for mutual benefit . . . World practice and experience…show no better, less imperfect, mechanism.”
  10. “As government has been inflated…It has undermined the instrument that could have done more for the common man.”
  11. “Capitalism embraces the self-correcting mechanisms of open discussion in free society to identify error and open competition in free markets to apply the corrections.”
  12. “The market does not require people to be good: it takes people as they are and induces them to do good by using their capabilities to provide what others want.”
  13. “Wherever it is used, government is so disappointing or worse—inefficient, unaccountable and corrupt—that it is best not to use it at all except for functions where all its faults have to be tolerated to obtain the services required…In short, the price of government is so high that it should be avoided wherever possible.”
  14. “The state has shown itself the false god of all who have looked to it.”
  15. “Capitalism…requires the eventual withdrawal by government from most of its accumulated activities.”
  16. “The inducements of capitalism compel the money-makers to do good; the inducements of socialism enable the power-holders to do harm.”
  17. “The political process…has become the master rather than the servant of the people.”
  18. “Individuals are smothered by collective decisions in the political process.”
  19. “The market of capitalism treats people as individuals; the political process of socialism herds them into categories. Capitalism makes for harmony, socialism for friction.”

Americans would do well to make up the deficit in their knowledge of the works of Arthur Seldon and his “life for liberty,” as his biographer, Colin Robinson, described it. As the IEA website put it, “Seldon highlights the improvements of mankind which came about not through some central plan or social organization but through individuals recognizing an opportunity to produce goods and services which met a need expressed by the demand in the market.”

In so doing, he advanced every individual’s potential, which is expanded by private property and voluntary market arrangements, but constricted when political power hinders the freedom and cooperation they engender.

  • Gary M. Galles is a Professor of Economics at Pepperdine University and a member of the Foundation for Economic Education faculty network.

    In addition to his new book, Pathways to Policy Failures (2020), his books include Lines of Liberty (2016), Faulty Premises, Faulty Policies (2014), and Apostle of Peace (2013).