Freeman Essay #51: “Markets, Politics, and Civility”

by Don Boudreaux on January 18, 2018

in Competition, Doux Commerce, Freeman, Hubris and humility

This July 2000 Freeman column was inspired by a John Stossel t.v. special.  My column is below the fold.

“The teachable—those who aspire to an ever greater understanding—are those with an awareness of how little they know.”

—Leonard E. Read

In March, ABC Television presented “You Can’t Say That!”—another illuminating program by John Stossel. In it, he documented the distressing intolerance that many Americans have for the opinions of others, and a corresponding acceptance of policies that infringe the freedoms of thought and speech.

In one scene, several students at Columbia University are shown contemptuously telling Stossel that they have the right to verbally obstruct Ward Connerly, an opponent of affirmative action who spoke at their school. Stossel asked these students who had given them the power to interfere.

“I’m taking that power, actually,” was the answer offered by a young woman who was clearly proud of her and her cohorts’ obstruction of what would otherwise have been a peaceful exchange of ideas between Connerly and other students who wished to hear him.

At first I was angry with these students. But my anger soon turned to pity. How sad that these students are so certain of their own omniscience. Being so cocksure will keep them from ever learning and growing.

I cheered myself up by reflecting that these young people are unlikely to remain so convinced of their own omniscience. As soon as they must find jobs, each will quickly show more tolerance for others—the reason is that anyone who doesn’t is unlikely to succeed professionally or even to retain any lasting friendships. Decent and productive people gain nothing by associating with those rendered uncivilized by their arrogance.

To succeed in life requires a general respect for others, a Socratic recognition that each of us is far more ignorant than informed, and a broad tolerance for opinions with which we disagree. Those who lack these traits never grow. Their mistaken belief in their own superiority shields them from learning. The ironic result is that those who are most sure of their greater wisdom and knowledge are far more foolish and ignorant than those of us who understand the limits of our own knowledge.

That these students will soon find it necessary to grow more humble heartened me.

“But wait,” my thinking progressed. “What if they seek employment, not in the private sector where such arrogance is intolerable, but in some government bureaucracy shielded from competition?” I can well imagine any of these young people working as a regional administrator for the Department of Housing and Urban Development, as a staff attorney for the Equal Employment Opportunity Commission, or as any one of a number of government functionaries who get to play god with other people’s money and lives. Far from curing arrogance, such government jobs reinforce it.

Gratefully, we live in what is still largely an open society where most decision-making authority is decentralized. If I don’t like the attitude of an employee, I can fire him; if an employee doesn’t like the way I treat him, he can quit; if you dislike the deal that Radio Shack offers you on one of its radios, you can go to Circuit City; if Circuit City doesn’t like the price you offer for one of its radios, it can offer to sell it to someone else.

Contrary to much popular wisdom, the ability of free people to make their own decisions unrestrained by government interference doesn’t lead to arbitrary and capricious choices. Instead, each person outside of political settings improves his lot in life by acting in ways beneficial not only to himself but to those with whom he interacts. If I fire an employee for reasons that are purely malicious, I suffer. I lose a good employee and, in consequence, my profits fall. Other employers with more sense will line up to hire any good people whom I fire capriciously.

Focusing the consequences of decisions on those who make them—as the free market does so well—doesn’t totally eliminate careless and malevolent behavior in private markets, but it surely keeps it to a minimum. More relevantly, it keeps such undesirable behavior scarcer than it would be if political decision-making supplanted private decision-making. Political decision-making is an especially fertile source of arbitrary and capricious decisions.

To see why, imagine one of these arrogant young Columbia students starting, say, a software firm. Perhaps in pursuit of her prejudices, she initially hires people based exclusively on their skin color. She soon finds her balance sheet in the red. If she has any sense at all, she overcomes her arrogance and learns. She learns that she must hire people according to their talent and not according to irrelevant characteristics. The market’s requirement that she interact voluntarily with others compels her to grow smarter, more humble, more aware, more productive, more civilized. She becomes a better person. (If she refuses to overcome her arrogance, her continued business losses ensure that she won’t long remain in a position to make important decisions.)

But now imagine this young woman, not in America, but in a highly centralized society–say, today’s Cuba. Imagine her gaining influence with the party apparatchiks. For purely political reasons, she is given power to decide how thousands of people will live. Her success depends on pleasing only a handful of high government officials and not at all on her ability or willingness to act in ways that better the lives of the multitude of people subject to her authority.

Because ordinary people in such a centralized society are unable to remove themselves from her influence, she gets no meaningful feedback about whether or not her actions help or hurt them. And even if she did get such feedback, she could safely ignore it. Her position and power depend only on how well she pleases party bosses and not on how well she pleases the great majority of people whose lives her actions directly affect. In this setting, this woman will remain as arrogant, as imperious, as ignorant, and as uncivilized as she is as a student.

An important virtue of free markets is that they convert most arrogant, ignorant, and self-absorbed young people into modest, intelligent, and productive adults. A related virtue is that those few people who refuse to break the chains of their own ignorance never reap the full rewards of civilization.

My guess—certainly, my sincere hope—is that the overbearing students interviewed recently by John Stossel will, in time, grow civilized. If so, they’ll look back on their behavior in college with embarrassment. But watch out if these students instead gain political power, for rather than civilize them, such power will cement their ignorance and prevent them from becoming productive members of civil society.


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