All Commentary
Friday, October 1, 1965

Knowing That We Know Not

A question that plagues numer­ous libertarians is: “Why does the free market, private property, limited government way of life find so little acceptance? Isn’t it because it’s so hard to under­stand?”

The right answer, it seems, is a qualified “yes.” For it is ex­tremely difficult to understand that there is a method of social and economic cooperation that doesn’t require a lot of knowledge on the part of any one person. It isn’t easy to grasp the fact that there is a wonderful way of life, suited to humanity as it is—that is, made to order for all of us, no one of whom knows very much. The fact is, the free market can no more be understood than can a living tree or Creation itself. But like the sun’s energy, or even life, it is possible to gain an awareness of its miraculous per­formances and, becoming thus aware, treat this system of dis­coveries and willing exchanges with the intelligent solicitude of any other wondrous blessing. We can know of the free market; we cannot understand it!

We know of the Giant Sequoia, for instance. But we do not pretend that we understand this won­der of Nature. We readily concede the tree to be a product of Crea­tion, and let it go at that. True, scientists have noted that it is energy in particular atomic and mol­ecular configurations, but understanding fades into nothingness when it comes to comprehending what atoms and molecules really are and how they coalesce to mani­fest themselves in a tree. But we do not have to understand trees in order that our lives may be en­riched by their existence.

The free market is just as in­comprehensible to our finite minds as any other manifestation of Creation. The artifacts by which we survive and live and enjoy our­selves—each and all of them, from the bread we eat to Grand Opera—represent the culminations of trillions upon trillions of creativi­ties and discoveries which have been flowing through the minds of men and interacting in complex exchange ever since the dawn of human consciousness. These pro­ceed from the same Source as do the mysteries of Nature; they are spiritual forces—in depth? We will never really understand the free market, but it is our good fortune that the market will confer its blessings on us regardless—that is, if we do not destroy it. Be it remembered that man, while un­able to create life, has the power to destroy not only life but also the life-giving forces with which Creation has endowed him.

The Market Process to Be Taken on Faith

One of these important life-giv­ing forces is the market process of voluntary exchange that affords abundance to millions of individ­uals where thousands previously struggled for subsistence. The process functions without any over-all masterminding; indeed, centralized, dictatorial planning is its nemesis! But if there be no awareness of or faith in this fact, man will go beyond his com­petency; he will interfere and disrupt the market and, by so do­ing, deny himself and countless others its benefits and blessings. If he doesn’t know that he knows not, he will, as the saying goes, “throw a monkey wrench in the machinery.” Man’s misguided and coercive intervention can and will destroy this vital life force.

Man, with an exception now and then, has been willing to concede the creation of life and the cosmos to Creation. Some things in Na­ture he has had no part in origi­nating; he doesn’t know how they came about; a hand other than his own accounts for their mak­ing; he accepts them as the en­vironmental structure in which he finds himself; and, important to this explanation, he does not de­mand that he understand how to make a tree, for example, before enjoying its shade or using its trunk to build his home. In a word, man seems to think it is all right not to understand miracles he has had no part in bringing about.

Rejecting the Mysterious

But let mankind begin to par­ticipate in creation, that is, to have an infinitesimal part in an occasional miracle or discovery, and contemporaneous individuals will tend not to accept the free market way of life—merely be­cause they cannot understand how such “chaos” could account for the artifacts by which they exist.

The artifacts by which you and I survive and live give the appear­ance of flowing from our own hands, even though no one of us can make a single one of them.2 Power and light, TV sets, autos, computers, dishwashers, milking machines, ball point pens, reapers, or whatever, seem to be of our own doing. The illusion that we ourselves are the authors of these artifacts, coupled with the belief that we should understand what we originate, causes many per­sons to reject the free market. It is this illusion that lies at the root of the trouble. Why, they seem to ask, should we embrace something we cannot comprehend?

The reality? The source of these artifacts by which we live is not contemporaneous man. At best, you and I do no more than to add a discovery or a creativity, now and then, to an enormous body of antecedent discoveries and crea­tivities extending back through the millennia to the harnessing of fire. These trillions of discoveries and creativities, interacting in complex exchange, over many thousands of years, and finding their way through the porosity of restrictive and coercive inter­ventions, taboos, edicts, and laws constitute the free market. It is a mistake to think of the free mar­ket as anything less than this in­comprehensible performance in depth.

The Nub

Now we come to the nub of the matter: When people are unaware of the free market as it really is, they are prone to tamper with what they thoughtlessly miscon­ceive it to be. They will tend to reject a performance they cannot understand in favor of a system whose specifications can be framed within their own dim awareness. Put another way, they are disin­clined to place any faith in any­thing that is “over their heads.” The free market being beyond their ken, they embrace what comes within their ken: price and production controls, taking from some and giving to others, diluting the medium of exchange, and sim­ilar perversions. In short, they contrive a planned economy, dic­tatorially managed—a way of life shallow enough for them to grasp.

Assume that man had the same attitude toward Creation as mani­fested in Nature as most men now have toward Creation as manifested in the artifacts by which man lives and survives. What would he do in this case? Not understanding or being able to make a tree, he would first ob­tain all of a tree’s chemical com­ponents. He would next paste these together in the shape of a tree. He would then paint the parts to look like a tree. So skilled is the artistry of man that the visual resemblance would be remarkable. But there would be no functioning root structure, no osmotic pres­sure attending to sap flow; indeed, there would be no sap. Further, there would be no photosynthesis, or any chemical transformations, or any life! And as to its useful­ness—well, nothing beyond an art gallery. What a grotesquerie!

The trillions of varied creativi­ties, flowing through space and time, can never be synthesized to the point where the whole com­plex can be understood by any single person. Understanding is more than difficult; it is impos­sible. And, without question, it is this inability to understand which keeps faith in the free market from forming, growing, accumu­lating. It is also this inability to understand which accounts for all the little, annoying, destructive man-made substitutions. But the free market doesn’t need to be un­derstood.

The free market is but another of countless performances that re­quire no more of man than an awareness of and a faith in its miraculous promises. The aware­ness and the faith are easy enough to acquire for anyone who can per­ceive the abundant evidence which lies about us on every hand.

For a further development of the theme of the above article, see Leonard Read’s The Free Market and Its Enemy (Foundation for Economic Education, Inc., Irvington-on-Hudson, New York, 1965. $1.00 paper, $1.75 cloth).

Editor’s Note: This article appeared in the July 1959 Freeman and is a slight condensation of a pamphlet published in 1953 under the title “Stand-By Controls.” Unfortunately, it seems necessary to keep on explaining why government control of prices is economically, morally, and politically unsound.

Foot Notes

1 For an explanation of this concept, see Chapter II, “The Miraculous Market” in my The Free Market and Its Enemy (Irvington-on-Hudson, N.Y.: Founda­tion for Economic Education, 1965), $1.00 paper; $1.75 cloth.

2 See Chapter XI, “Only God Can Make a Tree—Or a Pencil,” in my Anything That’s Peaceful (Irvington-on­Hudson, N.Y.: Foundation for Economic Education, 1964), $2.50 paper; $3.50 cloth.

  • Leonard E. Read (1898-1983) was the founder of FEE, and the author of 29 works, including the classic parable “I, Pencil.”