All Commentary
Sunday, November 1, 1964

A Reviewer’s Notebook – 1964/11

The Case for the Free Market

Every fourth year we get in­volved in the frenzied madness of a presidential election. A candidate says a sensible thing—such as that it would be in keeping with a gen­eral profession of a belief in free enterprise if the TVA were to sell whatever facilities it possesses that have nothing to do with flood con­trol—and all hell breaks loose. The head of a great Detroit union, with a gesture of horror, says the can­didate will soon be advocating the sale of the U.S. government to Gen­eral Motors. At another point the candidate remarks that social se­curity would be better if it were voluntary. Practically everybody jumps on him, and he tries to make a sidewise retreat by saying that he only wants social security to be “strengthened.”

Watching the quadrennial show, Leonard E. Read correctly esti­mates that politicians are power­less of themselves to change things.

The politico, when he is running for office, is a mere resultant of forces. The way to move society on its axis is not to play politics. It is to persuade teachable people to think as you do. And the best way to do this is to be a good personal living example of the philosophy you hope to spread.

Leonard Read is not running for office, so he can freely say what some people would describe as the damnedest things. His book, Anything That’s Peaceful: the Case for the Free Market (FEE, $3.50 cloth, $2.50 paper) wouldn’t get him through the New Hampshire primary. He believes that govern­ment should be limited to such things as keeping the peace, pre­venting fraud, dispensing justice, and fending off attacks by foreign powers. He says it is violent coer­cion to force social security on any­body. He thinks that Robin Hood, who advocated taking money from one set of people to give it to an­other, should properly be called Robin Hoodlum. He argues that any type of government economic intervention forces human energy into shapes that are marketable only at the end of the police club. He doesn’t consider that people think well in committee. He refuses to vote when the choice is between two trimmers. He challenges the idea that the government is pecu­liarly fitted to run the post office, or to maintain schools, or to plan the coming of either a good or great society. In short, his opinions are such that he couldn’t be elected to the office of dog catcher, let alone win a state primary.

Nevertheless, Mr. Read, by in­sisting that the state should not intervene to keep people from do­ing anything at all that’s peaceful, is beginning to shake up American society as no political figure has ever managed to do. I know this because I have witnessed the come-back of the freedom philos­ophy over the past twenty years. Mr. Read began in the nineteen forties as a still, small voice. He had a few accomplices then. There were a couple of emigrant econo­mists of the Vienna neo-liberal school taking issue with the domi­nant Keynesian hosts. Three wom­en—Ayn Rand, Isabel Paterson, and Rose Wilder Lane—were won­dering what had gotten into men to make them think that the way to release energy was to deliver ev­erybody to the dictates of a public planning authority. The colum­nists, radio commentators, and magazine writers who believed in economic freedom could be counted on a couple of hands. When the writer of this review teamed up with Henry Hazlitt and Suzanne La Follette to start THE FREEMAN, he was told by an old friend, his first night city editor, that he had better consult a psychiatrist, for surely he was sick, sick, sick.

Doubtful Uses of Coercion

All of this was scarcely a genera­tion ago. Mr. Read still sounds ex­treme to the conventional way of thinking when he says that edu­cation would be improved if there were no tax-supported public schools. But private schools throughout America have started to come back in recent years with a rush. Not so long ago an ex-Presi­dent of Harvard University, James Conant, was advocating the aboli­tion of private secondary schools as “undemocratic” institutions. Dr. Conant isn’t talking this way today. The “freedom philosophy” has been creeping up around him, changing the climate in which he speaks as an authority on second­ary education.

Mr. Read doesn’t think you nec­essarily have to forbid socialistic enterprise by law to restore free­dom. Take this matter of the Fed­eral monopoly of mail delivery, for instance. Mr. Read is satisfied that if the law were changed to permit private corporations to undertake the delivery of mail, and if an un­subsidized Post Office were to be put on an accounting basis com­parable to that forced on private industry, some ingenious free en­terprisers would soon compete the government out of the mail busi­ness. For what, so Mr. Read asks, is difficult about delivering mail? The telephone company, in trans­porting the human voice three thousand miles from New York to San Francisco, does something that takes much more ingenuity. And. so Mr. Read adds, the American Telephone and Telegraph Company showed a profit of $22 billion when the Post Office was losing $10 bil­lion.

That the climate has changed since Mr. Read, with a handful of confederates, started to preach the freedom philosophy is proved by the lip service that is now being paid to libertarian generalities. A candidate for vice president re­signs as co-chairman of the so­cialistic Americans for Democratic Action and makes a sudden appear­ance before a number of important businessmen to assure them that he isn’t anti-business. An occupant of the White House invites a prominent publisher to Washing­ton to assure him he is all for self-made men. The TVA may still be regarded as sacrosanct, even when it burns coal to add to the electric­ity that is made by use of water power, but it is getting tougher to sell huge river development schemes to the public. The objec­tion to saddling the existing social security system with new compul­sory payments for new services be­comes respectable among the poor, for they are at last beginning to see that the value of the social se­curity they already have depends on keeping inflation from getting out of bounds.

The Non-Politician

During the twenty years I’ve known him, Mr. Read has not, to the extent of my knowledge, ever argued for or against any specific Congressional bill as such. He has not attacked or supported specific men for specific public office. This is not because he values tax exemp­tion for his foundation, for it is part of his fundamental creed. He can’t have voted very often in his lifetime, for he believes that it is just as wrong to vote for a small-scale trimmer as it is to vote for a big one. As this country reckons things, he is the completely non­political man. He even argues that we might do better if we were to choose our Congressmen for non‑recurring terms by lot, for by such a method we would get represent­atives who would have no stake in buying voters with their own mon­ey. Such obliviousness to the emo­tions that are unleashed in most breasts in a campaign year is a marvel to behold.

Yet I do not doubt that Mr. Read will one day be a chief architect of a change in this country that will have a profound effect on our philosophy of government. He is a positive force, and, being such, he shapes the adaptation of other peo­ple without buttonholing them, or demanding that they vote for this or that bill or this or that man.

I say this with profound admira­tion, even though I have often, in my lifetime, voted for the man whom I have regarded as the “lesser evil.” I have always been hopeful that a “lesser evil” might, in office, be more likely than a “greater evil” to see the light on the Road to Damascus. Almost in­variably I have been disappointed, yet I persist in coming back for more. But contact with Mr. Read has done much to make me serene in the face of continual disappoint­ment in the electoral process. Even “greater evils” can be forced, by changes in the intellectual climate, to slow the pace toward socialist goals. And when the natural lis­teners and followers in the middle begin to listen to the intellectuals of the right instead of the intellec­tuals of the left, even the greatest of “evils” will begin a new career of trimming in the right direction.


THE AGE OF INFLATION by Jacques Rueff; translated by A. H. Meeus and F. G. Clarke (Chi­cago: Henry Regnery Company, 1964). 175 pp., paper, $.95.

Reviewed by Percy L. Greaves, Jr.

Monsieur Rueff is an eminent French statesman and economist. He played a major role in re-es­tablishing the French franc after the inflations of both World Wars. This book, a collection of six es­says and the author’s 1958 recom­mendations—which were largely accepted by General de Gaulle—appeared last year in the French. Rueff writes from a European or world viewpoint and makes an im­passioned plea for an immediate end to present-day monetary poli­cies while there is still a chance to do it without producing a world­wide catastrophe.

As he phrases it, “Mankind is seeking—and waiting for—a lead­er who will display the courage and intelligence required to rescue us. If such a leader does not exist, or if political circumstances pre­vent him from emerging, man’s destruction is as inevitable as that of a man falling from the roof of a skyscraper.”

Disclaimers by the dozen cannot alter the fact that we live dan­gerously in an age of inflation. For half a century, governments the world over have been meeting their extra expenses by inflating the number of their monetary units by the billions. The United States is no exception. In the last year, our officials have sanctioned an increase in the nation’s money supply of almost 20 billion dollars.

Each added dollar buys some­thing and thus reduces the pur­chasing power of previously owned dollars. The few who spend these new dollars first are the gainers, while the majority, whose dollars buy less, are the losers. What is worse, the whole economy is de­ranged as producers try to satisfy the first spenders of the newly created money. When the inflation ends, as it must some day, let us hope that the necessary readjust­ments will not be too painful.

Jacques Rueff’s collection of es­says lays stress on one little-under­stood international aspect of our government’s policy of dispensing “foreign aid” while increasing the money supply at home. For years, M. Rueff has been chiefly con­cerned about the effects of an in­creasing number of European-owned dollars left on deposit in the United States. Our government has encouraged this policy since it cuts down on the current outflow of gold.

The facts which rightly disturb him so much are:

1.        More and more American dol­lars are spent, lent, or presented to foreigners without ever leaving the United States or reducing the number of dollars which can be spent in the United States.

2.        American banks lend out these foreign-owned dollars do­mestically while paying interest to the foreign depositors.

3.        Foreign central banks, which can legally demand gold for these dollars, treat them as if they were gold reserves and thus use them as a base for expanding their own domestic money supply.

So, the continuing American in­flation becomes the basis for the further inflation of many Euro­pean currencies. As M. Rueff states it, this policy “has saddled a con­siderable portion of the United States gold stock with an exceed­ingly high double mortgage. If a substantial part of the foreign holdings of claims on dollars were cashed in gold, the credit struc­ture of the United States would be seriously threatened.”

He would like to see the situa­tion corrected, and promptly. If this is not done, he fears this house of cards may come tumbling down. Unfortunately, however, the author weakens his case by endors­ing expansion of the money sup­ply for the “needs of business” and against domestic government securities. But for anyone inter­ested in the top economic problem of our age, this little book is a frightening reminder of what could be just around the corner for our civilization.


IDEAS AND INTEGRITIES: A Spontaneous Autobiographical Dis­closure, by Buckminster Fuller (Englewood Cliffs, N. J.: Prentice Hall, Inc., 1963) 318 pp., $6.95.

Reviewed by Arthur P. Moor

As engineer-designer-builder, Buckminster Fuller has become famous for his “geodesic domes” and other structures which span large areas with light, strong space-enclosures, built on a prin­ciple about 2,000 times as efficient, per pound of material, as ordinary building methods. His domes, like all technological advances, are based on discovered ways of doing more with less—less weight, less bulk, less time, less cost. And tech­nology, according to Fuller, is simply the art and science of “do­ing more with less.” Increasing service with diminishing cost is good economics in any field. But since technology is now so diversified in so many different fields, are there any general principles or laws by which technology ad­vances, and with increasing ac­celeration? Fuller believes there are, that the principles are simple, but infinitely extensible in appli­cation. The chief shock and invig­oration of his autobiography is the tracing of his own reasoning and quest for the “inclusive equa­tion” of the industrial complex.

Among Fuller’s observations along the way are these:

1.    The major source of increas­ing wealth is the organization of energy. The physical universe does not wear out or run down by use; the intellectual factor of organi­zation and design improves with use, and is self-augmenting. Since increasing production and world-around service flows from the progressive integration of tech­nologies, the primary initiative can be taken by the individual de­signer. If one sees a gap-closing task in the world equation for which his experience and compe­tence prepares him to make a con­tribution, and finds no patron or sponsor for the task, he may as­sume he is being directly chal­lenged by the Universe and will be supported by it, often in indirect and unpredictable ways. “One of the rules of Nature is that she permits us each day the integrity of that day’s thinking.”

2.    The integrity of the Universe is extensible to man, but “only through the congruent integrity of the individual.”

3.    Increasing wealth and free­dom will be achieved through com­prehensive design and planning in a world service context. This, how­ever, is not to be confused with state planning, or political plan­ning, any kind of authoritarianism or compulsion. We cannot expect politicians to solve the problems of technology, industry, and eco­nomics any more than we can ex­pect them to solve problems of chemistry. The problem and the solution is in progressive design and production for a world soci­ety, and can only be hampered or obstructed by attempts to subor­dinate it to the limited interests of any political or economic pres­sure groups.

The book is amply illustrated with pictures of his structures, and is crowded with fresh obser­vations on economic history, the development of technologies in shipbuilding and aircraft design, the application of these in forward planning to “livingry” instead of to “weaponry,” and his experi­ences with labor unions. It is not a book for browsing or drowsing—but if you like rugged climbing with some breathtaking views, don’t miss it!       


THE CONSERVATIVE PA­PERS, introduction by Representa­tive Melvin R. Laird (Garden City: Doubleday & Company, Inc.).$1.45.

WHAT IS CONSERVATISM?, edited by Frank S. Meyer (New York: Holt, Rinehart and Wilson). $4.95 cloth, $2.75 paper.

SUICIDE OF THE WEST by James Burnham. (New York: John Day Company). $5.95.

THE CONSERVATIVE AMERI­CAN by Clarence Manion (New York: The Devin-Adair Company) $4.75.

THE CHALLENGE OF CON­SERVATISM by Paul A. Sexson and Stephen B. Miles, Jr. (New York: Exposition Press) $4.00.

DIALOGUES IN AMERICAN­ISM (Henry Regnery Co. (Chi­cago, Illinois) $3.95.

Reviewed by Edmund A. Opitz

In the Battle of the Books, the conservatives have it by a mile. Compare the first volume listed above with its counterpart of two years ago, The Liberal Pa­pers. That was a tired, party-line plea to quit rocking the boat; the book under review, on the other hand, has vigor and variety. Its scholarly authors are not members of the club, but each in his own way, in the sector as­signed to him, registers his dis­sent from the prevailing “liberal” prescriptions. Topics run the gamut from inflation, union pow­er, NATO, and federalism to the free market, civil liberty, and for­eign aid.

This work is in the nature of a handbook for policy makers, whereas What Is Conservatism? smacks more of the study. But again, there is no party line; the terms of the discussion are broad enough to permit inclusion of an old-fashioned Whig’s not very convincing account of why he is not a conservative!

There are major differences of emphasis within the conservative camp, even as concerns the name itself. Some stress the liberty of the individual, his right to a do­main of his own exempt from the encroachments of the state; others stress the importance of continuity and tradition in human affairs. Editor Meyer has, as a matter of fact, made “consensus and divergence” a theme of his book. Libertarians and tradition­alists share much common ground and are linked naturally in a common cause; that, at least, is made clear by each of the dozen contributors. This and the pre­ceding volume supplement each other beautifully; the academic community, if it takes its pre­tensions seriously, cannot shrug them off.

Liberaldom already feels itself stung by Burnham’s book. His point of departure is the thesis that civilizations are not mur­dered; they commit suicide. Macaulay predicted more than a century ago that we would breed our own Huns and Vandals; Ortega, in 1930, foresaw a “ver­tical invasion of the barbarians.” More prosaically, the central val­ues of Western civilization no longer generate spontaneous loy­alty and affection in the hearts and minds of many of our con­temporaries. Diagnosing this sit­uation. Burnham necessarily zeroes in on that body of doctrine currently labeled “liberalism.” He seeks to understand the program promoted by present-day “liber­als” by laying bare the premises on which their thought and ac­tions are based, and by systema­tizing the implications of their creed. In effect, the “liberal” is stretched out on the analyst’s couch with his psyche exposed. This amounts to radical soul-surgery and the “liberal” won’t like it. He’s not supposed to like it! Nor will all conservatives be pleased. But all men of good will, whatever the device engraved on their banners, will benefit from the kind of jolts and jabs that a profound and unorthodox mind like Burnham’s can administer. And they will be stirred by Dean Manion’s diagnosis of our recent past and his prescriptions for a better future. We of the present are stuck with the untoward—and unforeseen—consequences of the liberal program of a generation ago. That program promised to make America over; and its very success has proved its undoing! Liberalism is less sure of itself today, and conservatism is resur­gent.

A new consensus is being ham­mered out in our time which, in the normal course of events, will replace the current orthodoxy. That orthodoxy is challenged by Messrs. Sexson and Miles in an excellent little book, as informal and enlightening as a conversa­tion over the back fence. It is challenged again, more formally, in the final book, comprising three debates between Steve Allen and Bill Buckley, Robert Hut­chins and Brent Bozell, and James MacGregor Burns and Willmoore Kendall. Speaking for liberaldom, Professor Burns believes that the party which can mobilize a ma­jority behind it should be given a free hand to run the country. He would not deprive conserva­tives of this opportunity when their time comes, that is, when a majority of the citizens are con­servatives. And it is for this reason, he concludes, “that I want the liberals of the nation to have a right to rule in what I think is their day today.” When a political philosophy has to re­sort to the numbers game, its days, as a philosophy, are num­bered.

  • John Chamberlain (1903-1995) was an American journalist, business and economic historian, and author of number of works including The Roots of Capitalism (1959). Chamberlain also served as a founding editor of The Freeman magazine.