All Commentary
Tuesday, April 4, 2017

To Central Planners, We’re All Ants Outside an Airplane Window

The people below only exist as a statistic. Everything looks so simple from here.

The world looks seductively simple from 35,000 feet.

As soon as the back wheels of a jet lift off the ground, the people beneath begin to vanish, replacing facial expressions and personalities with faint monochrome specks. As the jet climbs higher, people melt into their surroundings altogether, leaving only microscopic cars aimlessly drifting along tiny cement tributaries. Entire neighborhoods become folded into the landscape below as the world increasingly resembles a patchwork model.

Those wielding political power always have a plan to foist upon the world.

Looking down from the clouds, the world below is still there, but it cannot be seen. The people below only exist as a grand collective, a statistic. When you’re up so high, everything seems so simple.

This is the view of the world through the eyes of the central planner.

For generations, the central planner has dominated political life the world over. From price and immigration controls to mercantilism and dropping bombs, those wielding political power always have a plan to foist upon the world. Behind the pomp and rhetoric, all of these plans hold one thing in common: the belief that society can be better steered by the decrees of rulers rather than organically by individuals themselves.

In other words, the will of the few–or the one–should be substituted for the will of the many.

The rise of the central planner was most apparent in American politics in early 20th century progressives. As Thomas Leonard writes in his recent book “Illiberal Reformers,”

The United States had abandoned laissez-faire…out of recognition that “the world consists of two classes–the educated and the ignorant–and it is essential for progress that the former should be allowed to dominate the latter.”

Laissez-faire’s mistake was to confuse a person’s desires with what is intrinsically desirable, an error that experts overcame by giving people not what they want but what they should want.

Accordingly, reformers seized the reins of government and began “correcting” the public’s errors with a torrent of prohibitions and mandates. Drug and alcohol prohibition, minimum wage laws, eugenicist sterilization programs, economic controls, censorship of “indecent literature,” and anti-prostitution laws carried the spirit of a new Progressive Era. All of these policies sought to hammer society into the shape its architects found most palatable.

In the following decades, the progressive creed of “better living through dictate” became the primary ethos in the whole of modern politics and economics. Today, the spirit of central planning has become so deeply embedded in the common consciousness that for many it is unthinkable to conceive of solutions to even the simplest issues outside of a political means.

A Question of Who, not What

Economics teaches us that the most important question, prior to what should be done, is who should do it. As Ludwig von Mises explained in Planned Chaos, “[t]he issue is always the same: the government or the market. There is no third solution.”

Because all planning falls into one of these two categories, to advocate one is necessarily to subvert the other. It is, therefore, critical to understand the difference between the two.

The essence of all central planning is unavoidably making ‘collective’ choices that forcefully override peaceful individual choices. The problem with this substitution of local and individual for foreign and collective choices–looking past the moral implications–is the fundamental limitation of central planners’ knowledge and abilities.

A. Hayek called this the “fatal conceit” and wrote,

The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.

To the naive mind that can conceive of order only as the product of deliberate arrangement, it may seem absurd that in complex conditions order, and adaptation to the unknown, can be achieved more effectively by decentralizing decisions and that a division of authority will actually extend the possibility of overall order. Yet that decentralization actually leads to more information being taken into account.”

Like society, the “market” is shorthand for the totality of the billions of interactions between freely acting individuals. It is people pursuing their own purpose, acting on the basis of local, specialized knowledge and preferences.

Market processes constantly occur spontaneously all around us; each individual participates whenever they interact with strangers, give their opinion on art, exchange goods, copy a style that they like, modify learned social behavior, or share experiences with friends. There is nothing mystical about it. It is simply humans cooperating voluntarily–in other words, what happens in the absence of top-down authority.

Nothing exemplifies this more than the destruction wrought by war, the zenith of all central planning.

The sum of this massive, hidden process is the emergence of social phenomena that nobody, in particular, had any intention of bringing about. No individual or group of individuals sitting in a meeting room approved the structure of society on a blackboard. Its inherent interconnectivity was not initiated by a Commerce Board; it arose naturally from people acting on their own, entirely without central direction, with their own property, and within human associations of their own creation in their own interest.

Finite Beings with Imperfect Knowledge

Herein lies the the vital difference between the two systems of human organization: one is dynamic and decentralized, the other rigid and top-down; the former accepts the limits on human design, the latter grows from the belief that humans can and should be ruled by a privileged class. One fosters choice, dignity, innovation, and individualism; the other fosters dependence, subservience, inflexibility, and a continuous struggle to control or be controlled.

Unsurprisingly, the consequences of human error and maliciousness are far less severe in a market than under centrally directed planning. Not only does monopolizing the production of order spawn glaring inefficiency and corruption, but unwitting bystanders are often dragged into far worse circumstances than anything that could be conceived by individual actors. Nothing exemplifies this more than the destruction wrought by war, the zenith of all central planning.

Certainly, letting individuals self-organize based on their situations and preferences does not promise utopia. Nor does it promise Pareto-efficiency, Platonic virtue, wise choices, or even happiness. There’s no ultimate solution to any human problem, but only a continuous process of discovery, adaptation, and creative destruction. Mistakes and failure are inevitable under any system as humans are finite beings with imperfect knowledge of their external world and a flawed capacity to plan for the future–and the effects are compounded under top-down plans.

This subversion of liberalism for state paternalism has wrought horrific results for humanity.

Until men become omnipotent, central planners will continue to not only fail in whatever their pursuits may be but actively create and exacerbate problems that simply never would have existed without their meddling. Not only do we see that advocates of central planning hold a wrongheaded and unrealistic trust in the state’s capacity to plan society, but they completely fail to appreciate the nuanced phenomenon of emergent order.

The natural result of this mindset divides society into rulers and the ruled–with the rulers happy to perpetuate the superstition that their special status is necessary for fostering the advancement of society. This subversion of liberalism for state paternalism has wrought horrific results for humanity.

Like being stuck in the clouds looking down on the pixelated world below, central planners look down on civilization as if it were a mosaic, subverting individuals to their own interpretation of “the big picture.”

Those who think it’s a good idea to subject people to the top-down dictates of central planners need to crash back down to reality.