All Commentary
Friday, June 1, 1973

A Reviewer’s Notebook – 1973/6


The message of Henry Hazlitt’s The Conquest of Poverty (Arlington House, $8.95) is that his subject could have been dealt with in the past tense if it weren’t for the pernicious doctrine that “the State knows best.” Alas! the tendency to hand problems of income “distribution” over to politicians whose only real skill is the accumulation of votes has prevented the West from utilizing the great productive strength that is to be found in the principle of voluntary association. So the “cure” for poverty is still in the future.

Just how far are we from getting “government” off our backs? Mr. Hazlitt is not a total pessimist; he believes in the power of “education.” Mere verbal demonstration, however, is not an infallible schoolteacher; the collaboration of events is needed to make “education” effective. Fortunately, events are coming to Mr. Hazlitt’s aid; what he was saying twenty years ago about the fallacies of Statism is becoming hindsight as it is repeated by other and less prescient men who now stand appalled at what inflation, a government created phenomenon, is doing to compound our troubles.

Since poverty is a relative thing (some people are always going to be poorer than others), Mr. Hazlitt has had his difficulties with the conventional definitions. Value judgments are involved. It is wrong to define poverty, as one “authority” does, as the condition affecting “any family with an income less than one-half that of the median family.” If such a definition were to be accepted it would mean that the percentage of “the poor” would never decrease until all incomes were equalized. The bottom “fourth” of a nation might be sufficiently fed to remain healthy and still be candidates for soaring relief if any such definition were to be perpetuated. What Mr. Hazlitt proposes is that the “subsistence level” must provide our working definition of the poverty line. Any attempt to provide relief for able-bodied adults beyond subsistence must take money away from production and so render society poorer on the whole.

Capitalism, in league with technological ingenuity, is what delivered the “West” from the spectre of Malthusian doom. Before the industrial revolution, soaring populations pressed inexorably on the means of subsistence. But when the Manchester factories in England began to soak up the idled poor from the countryside and make the importation of cheap wheat a possibility, Malthus was discredited as a prophet for his own Britain. As things turned out, the ingenuity that capitalism unleashed was reflected in the birth statistics: “middle class” people who did not need big families in order to provide themselves with field hands found ways of limiting their children. The combination of smaller families and a more skillful application of science to agriculture itself ended the problem of famine in the “West.” We were on our way toward limiting poverty to the chronically incapacitated without saddling the productive system with high taxes and the inefficiency that always follows from government interference or takeover.

Combing through the records of antiquity, Mr. Hazlitt notes what “the New Deal in Old Rome” did to enervate our first great universal empire. Between State supported slavery, high taxes, the multiplying relief of “bread and circuses,” and the final imposition of price controls, Roman productive efficiency simply vanished. In Britain, there was a saving realism about the original application of the “poor laws.” But in 1795 the Berkshire magistrates, meeting at Speenhamland, decided to supplement wages in accordance with the price of bread. This placed everybody in the countryside on a “guaranteed minimum.” The rise in the cost of relief was geometric. In order to put people back to work and unleash the industrial revolution Britain had to amend the poor law in 1834. Pity for the pauper had to be reconciled with pity for the laborer, the investor and the taxpayer, as Nassau Senior pointed out. So England came to accept the workhouse, a place that would guarantee a pauper enough to live on without making idleness sufficiently attractive to undermine such desirable characteristics as frugality, industry and ambition.

The rise of affluence, however, dulled the common sense of the British people, and the Speenhamland mentality returned as the sentimentalists, following the recommendations of the radicals (Beatrice Webb, Prime Minister David Lloyd George), were seduced into accepting the idea of the Welfare State. With the Beveridge Plan (cradle to grave protection), the “difficult problem” raised by Nassau Senior in 1834 posed its dilemma all over again. How, under State Welfarism, can one “afford to the poorer classes adequate relief without material injury to their diligence or their providence.”

Mr. Hazlitt rather doubts that the problem can ever be resolved to everybody’s satisfaction. He recognizes that it would be “politically impossible” to get the State totally out of the welfare business. But he sees some hope in the educative value of events. Back in the late Forties and early Fifties Mr. Hazlitt warned that if Washington were to extend extravagant relief to other nations in the form of Marshall Plan and “Point Four” giveaways, it would not “save the world.” Government to government loans, he said at the time, would be squandered by political bureaucracies, and capital for free productive enterprise would thereby be diminished. Mr. Hazlitt was considered hardhearted by the “liberals” of the Fifties and Sixties, but common sense is now coming to his support. The dollars that we have given away for international relief now haunt us as the balance of payments statistics turn against us.

Similarly, the inflation that has been caused by “welfare gone wild” is provoking the middle classes, including the blacks who have risen in the world, to cast a cold eye on unbalanced budgets and extravagant programs for such things as urban renewal and various make work projects. It may take the final “inflation crisis” to bring us to our senses. But Mr. Hazlitt, after waiting some twenty years, may find that it is at last possible to teach people “economics in one lesson,” to quote from his bestselling book of that title.

The real solution to the problem of poverty does not lie in any government relief system, or in any endeavor to “redistribute” wealth or income. It lies, says Mr. Hazlitt, in increased production. One increases production by making investments in more efficient tools. The free-swinging enterpriser, using capitalist savings, is the true hero of the “war on poverty.”

How long will it be before our “intellectuals” begin to see through fallacies that are as old as the economics of the Emperor Diocletian? I would feel better about the prospects if such books as The Conquest of Poverty were to be reviewed on the front page of the New York Times Sunday book section. This is not likely to happen tomorrow. But “events” will continue to call the turn. What Mr. Hazlitt has to say about the need to free the producing interests of a nation is bound to take hold as our inflationary crisis deepens.

The politicos are already trying to limit upward revisions of the minimum wage by making special exceptions for job seeking adolescents. Common sense does break through. And even some of the big unions, the steel union, for example, are now doubting the effectiveness of wage increases that run beyond productivity. If the unions ever get the idea, can the “intellectuals” remain far behind? Mr. Hazlitt may yet become a prophet with honor in his own country.

 

THE FOUNDATIONS OF MORALITY, 2nd ed. (Los Angeles: Nash Publishing, 1972), 398 pp., $12.00.

Reviewed by Bettina Bien Greaves

The many contradictions among different philosophical theories have caused much confusion over the years. Unfortunately, too few teachers and textbooks explain the basic principles that could help students discriminate intelligently among them and understand the ethical code which fosters freedom, morality and social cooperation. Thus, Henry Hazlitt deserves special credit for bringing logic and clarity to the subject. His book, The Foundations of Morality, was first published in 1964. After having been out of print for several years, it is again available thanks to Nash and the Institute for Humane Studies.

The author is primarily an economist, a student of human action. As a result, he is a strong advocate of individual freedom and responsibility. He has long been a close personal friend and associate of Professor Ludwig von Mises, the “dean” of free market economics, to whom he acknowledges a great intellectual indebtedness. With this background, he is well qualified to discuss the ethics of social cooperation. His many years of “apprenticeship” as essayist, book reviewer and columnist (New York Times, Wall Street Journal, Newsweek, The Freeman, National Review and many others) prepared him well for explaining complex matters simply. The reader may wish to pause, ponder and reflect from time to time on the ideas and concepts presented, but the author’s reasoning is clear, his prose unambiguous and most chapters delightfully short.

Mr. Hazlitt’s position is that “the interests of the individual and the interests of society,” when “rightly understood” are in harmony, not conflict. His goal in writing this book was “to present a’unified theory’ of law, morals and manners” which could be logically explained and defended in the light of modern economics and the principles of jurisprudence. This reviewer believes most readers will agree that Mr. Hazlitt succeeded. He has marshaled the ideas of many philosophers and analyzed them with careful logic. He has explained many of the contradictions among them, thus disposing of much confusion. He has formulated a consistent moral philosophy based on an understanding of the ethical principles, so frequently ignored in today’s “permissive” climate, which promote peaceful social cooperation and free enterprise production.

Mr. Hazlitt points out that our complex market economy requires peaceful and voluntary social cooperation. The preservation of the market is essential for large scale production and thus for the very survival of most of us. Therefore, social cooperation is the very most important means available to individuals for attaining their various personal ends. This means that social cooperation is also at the same time a well worthwhile goal. Let Mr. Hazlitt speak for himself.

For each of us social cooperation is of course not the ultimate end but a means…. But it is a means so central, so universal, so indispensable to the realization of practically all our other ends, that there is little harm in regarding it as an end in itself, and even in treating it as if it were the goal of ethics. In fact, precisely because none of us knows exactly what would give most satisfaction or happiness to others, the best test of our actions or rules of action is the extent to which they promote a social cooperation that best enables each of us to pursue his own ends.

Without social cooperation modern man could not achieve the barest fraction of the ends and satisfactions that he has achieved with it. The very subsistence of the immense majority of us depends upon it.

The system of philosophy outlined in the book is a form of utilitarianism, “insofar as it holds that actions or rules of action are to be judged by their consequences and their tendency to promote human happiness.” However, Mr. Hazlitt prefers a shorter term, “utilism,” or perhaps “rule utilism” to stress the importance of adhering consistently to general rules. He suggests also two other possible names — “mutualism” or “cooperatism” — which he thinks more adequately reflect the central role of social cooperation in the ethical system described.

The criterion for judging the consistency or inconsistency of a specific rule or action with this ethical system is always whether or not it promotes social cooperation. Mr. Hazlitt reasons from the thesis that social cooperation is of benefit to everyone. Even those who might at times like to lie, cheat, rob or kill for personal short run gain can usually be persuaded of the longer run advantages of social cooperation, i.e., of refraining from lying, cheating, robbing or stealing.

Even the most self-centered individual, in fact, needing not only to be protected against the aggression of others, but wanting the active cooperation of others, finds it to his interest to defend and uphold a set of moral (as well as legal) rules that forbid breaking promises, cheating, stealing, assault, and murder, and in addition a set of moral rules that enjoin cooperation, helpfulness, and kindness….

The predominant moral code in a society is compared with language or “common law.” Society does not impose a moral code on the individual. It is a set of rules, hammered out bit by bit over many centuries:

[O]ur moral rules are continuously framed and modified. They are not framed by some abstract and disembodied collectivity called “society” and then imposed on an “individual” who is in some way separate from society. We impose them (by praise and censure, approbation and disapprobation, promise and warning, reward and punishment) on each other, and most of us consciously or unconsciously accept them for ourselves….

This moral code grew up spontaneously, like language, religion, manners, law. It is the product of the experience of immemorial generations, of the interrelations of millions of people and the interplay of millions of minds. The morality of common sense is a sort of common law, with an indefinitely wider jurisdiction than ordinary common law, and based on a practically infinite number of particular cases…. [T]he traditional moral rules… crystallize the experience and moral wisdom of the race.

But what about religion, you say? Doesn’t a moral code have to rest on a religious basis? The fundamental thesis of this book, as noted, is that reason and logic are sufficient to explain and defend the code of ethics which fosters and preserves social cooperation. Yet, the author does not ignore religion. He calls attention to similarities among the world’s great religions and the contradictions in some of them. Religion and morality reinforce one another very often, he says, although not always and not necessarily. Here is his description of their relationship:

In human history religion and morality are like two streams that sometimes run parallel, sometimes merge, sometimes separate, sometimes seem independent and sometimes interdependent. But morality is older than any living religion and probably older than all religion…. [W]hile religious faith is not indispensable [to the moral code]…, it must be recognized in the present state of civilization as a powerful force in securing the observance that exists….

The most powerful religious belief supporting morality, however, seems to me… the belief in a God who sees and knows our every action, our every impulse and our every thought, who judges us with exact justice, and who, whether or not He rewards us for our good deeds and punishes us for our evil ones, approves of our good deeds and disapproves of our evil ones….

Yet it is not the function of the moral philosopher, as such, to proclaim the truth of this religious faith or to try to maintain it. His function is, rather, to insist on the rational basis of all morality, to point out that it does not need any supernatural assumptions, and to show that the rules of morality are or ought to be those rules of conduct that tend most to increase human cooperation, happiness and wellbeing in this our present life.

Mr. Hazlitt discusses many perplexing ideas and concepts such as natural rights, natural law, justice, selfishness, altruism, right, wrong, truth, honesty, duty, moral obligation, free will vs. determinism, politeness, “white lies.” Anyone who has speculated on these problems without reaching satisfactory conclusions, as has this reviewer, will no doubt find his analyses and comments both stimulating and enlightening.

The book contains numerous quotations from the works of early and recent philosophers, which the author always analyzes for their consistency with social cooperation. Except for a few technical philosophical terms — such as tautology (repetition of the same idea in different words), eudaemonism (the doctrine that happiness is the final goal of all human action) and teleotic (an adjective derived from the Greek meaning end, design, purpose or final cause) — readers should not find anything in the book really difficult to understand. As they follow the author’s line of thought, they will discover that reason and logic come to the defense of morality; order and a common sense ethical code evolve from philosophical chaos.

Mr. Hazlitt has long been a noted free market economist — one of the very best. His introductory Economics In One Lesson is a longtime best seller. The Failure of the “New Economics,” a careful critique of Keynes, is a real contribution to economic theory. With the publication of The Foundations of Morality in 1964, he added another very important feather to his cap as a moral philosopher. It is good to have it in print again.

To summarize, the author explains again and again, in the course of the book under review, that the rules of ethics are neither arbitrary nor illogical. They are not mere matters of opinion. They are workable, acceptable, moral rules developed over long periods of time. They must be adhered to consistently and may not be willfully violated without detriment to social cooperation. In this age of permissiveness, when everyone is encouraged “to do his own thing” and few see any urgency in respecting the rights of others, it is a rare philosopher who recognizes that the consistent adherence to a set of ethical rules promotes social cooperation and benefits everyone in society. Perhaps a free market economist, whose very field of study encompasses the role of social cooperation, is the most appropriate person to explain the logic of this position. This book should live through the centuries. 


  • 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.