Professor Shannon teaches in the Economics Department, Clemson University.
While Mark Twain’s fame rests largely on his tales of youths growing up in mid-19th century America, he also wrote an incisive demonstration of the superiority of free market economics over the regulated and hierarchical society of English manorialism. This fact may be less surprising when one recalls that, although Twain (born Samuel Clemens) grew up in Missouri, he spent much of his adult life writing at Nook Farm near Hartford, Connecticut, where he was a neighbor of Harriet Beecher Stowe.
Unlike Tom Sawyer and Huckleberry Finn, Twain’s later work, A Connecticut Yankee in King Arthur’s Court, is set in medieval England, where the protagonist of the story, Hank Morgan, suddenly finds himself in Camelot. Morgan sets about establishing such elements of Yankee ingenuity and enterprise as a telegraph, a soap factory, and advertising. In the end, of course, all these anachronisms are destroyed, but in the meantime Twain has been able to make some telling points about the superiority of laissez faire and individual initiative over regulation and rigidly customary procedures.
In Twain’s Camelot, the rosy romantic hue in which modern presentations bathe Arthur’s regime is totally missing. We find that a person’s position, power, and prestige depend solely on his parentage. All economic activity is carefully controlled, including wages, which are set by the local magistrate. Such policies are widely accepted as being in the best interest of society as a whole.
It is in the chapter entitled “Sixth-Century Political Economy” that Hank Morgan tries to persuade people of the faults in their thinking. He argues that restrictions give the impression of success because they have resulted in higher nominal wages for the protected workers. By contrast, in the area of Camelot where Morgan has developed his enterprises without such restrictions, free market forces have resulted in lower pay measured in dollar terms. But Morgan points out that, since freedom induces greater efficiency and productivity, his workers pay even lower prices for the goods they buy than workers in regulated industries must pay.
Finding his point hard to make, Morgan finally compares the number of hours it takes people in each situation to work in order to acquire certain necessities. At last, he is able to convince his listen-crs of the advantages that accrue to the unregulated workers in terms of lower costs of living and higher living standards. The extreme difficulty required to get this message across attests to the persuasive power of the principle of regulation which still finds many adherents today.
Although Twain’s book is far more readable, his argument is not as logically rigorous as David Ricardo’s demonstration of the benefits of free trade based on comparative advantage which was published in 1817. Nor, despite his wit, does Twain surpass the devastating power of Frederic Bastiat’s famous petition of the candlemakers who sought to protect their industry by shutting out the light of the sun.
Nonetheless, Twain’s achievement is a notable addition to the literature on the benefits of free markets. Although many details would differ, the Connecticut Yankee could just as well be set down in Stalin’s Russia or Mao’s China, for the criticism of medieval society could equally apply to modern totalitarian systems. Indeed, one suspects that the tenacity with which the old ideas are grasped in Twain’s Camelot is matched in those countries and in Eastern Europe today. For shedding such insight on both the past and the present, Twain’s work deserves more recognition than it so far seems to have achieved.