"No ordinary misfortune, no ordinary misgovernment will do so much to make a nation wretched as the constant progress of physical knowledge and the constant effort of every man to better himself will do to make a nation prosperous. It has often been found that profuse expenditure, heavy taxation, absurd commercial restrictions, corrupt tribunals, disastrous wars, seditions, persecutions, conflagrations, inundations, have not been able to destroy capital as fast as the exertions of private citizens have been able to create it."
So, in the mid-nineteenth century, wrote Thomas Babington Macaulay in the chapter of his famous History of England describing the state of the country in 1685.
It could easily be proved, he went on, that the national wealth of
Claiming the Credit
Macaulay was calling attention to a fact of the first importance, but one that is constantly overlooked. It is systematically ignored today by nearly all governments, who are, at least by implication, constantly claiming for their own policies all the credit for all the economic improvement during their term of office.
This has been especially true since gross-national-product statistics have been compiled. Spokesmen for the Truman Administration boasted that the GNP increased from $211 billion in 1944 to $347 billion in 1952. Spokesmen for President Eisenhower pointed to the increase to $503 billion in 1960; spokesmen for President Kennedy to the increase to $584 billion in 1963; and spokesmen for President Johnson to the increase to $670 billion in 1965. But it remains to be determined to what extent these increases (even after allowance is made for a constant rise of dollar prices) were because or in spite of the government policies followed.
Most European governments boast an even faster "economic growth," since the end of World War II, in their countries than in our own. But by far the greatest part of the credit for this growth must be given to the efforts of private citizens of these countries to improve their own condition. If the governments also deserve some credit, it is chiefly because they did not put too many restrictions and deterrents in the way.
Usual and Expected
The great fact that Macaulay emphasized, "the constant effort of every man to better himself," is important not only as it affects the question of who or what should receive the main credit for economic progress. It is the tremendously reassuring fact that all of us would do well to keep in mind as we read our daily newspapers. Too many of us become disheartened anew every morning as we read the sorry record of accidents, divorces, quarrels, unemployment, diseases, deaths, burglaries, muggings, murders, riots, looting, racial violence, strikes, fires, revolts, revolutions, and war, as well as droughts, floods, and other natural disasters. We forget that the newspapers print the "news," and that the news means the unusual and unexpected.
We do not pick up our newspaper and read such items as "Strange case of virtue in the
The normal thing, in short, is not merely that most people are leading peaceable lives, but that most people are daily working and producing. Many are producing just enough to meet their current living expenses, but others are able to save something—in brief, to accumulate the capital, the money to create the new tools and equipment, that will make not only themselves but later generations constantly more productive.
Copyright Newsweek, Inc., September 27, 1965, and Henry Hazlitt.