My latest column for AIER was inspired by a recent rest-area stop on the New Jersey Turnpike. A slice:
Nearly every adult in that rest area with me is – or was, before retirement – a highly specialized producer of some useful good or service, a good or service that is a drop in the gigantic prosperity pool in which we all swim. There’s a slim chance that some of the individuals visiting the rest area that day once assisted me in some way directly – say, by having delivered a package to my door, or by shepherding my mortgage application toward approval. Yet most of the rest-area visitors, and likely all of them, never assisted me directly. Nearly all of them, however, assisted me indirectly – indirectly but no less surely than had that assistance been direct.
Maybe one of the rest-area visitors is a hotel clerk. In the course of her job she contributes to lowering the cost of business travel and, in turn, lowers the cost to airlines of putting their flight crews up for the night. As a result, my airfare to visit my son, and your airfare to visit a client, is a few cents lower than it would otherwise be.
Another rest-area visitor might operate a crane that unloads and loads cargo ships. This worker indirectly assists me (and you) by improving my (and your) access to goods from foreign producers. Yet another rest-area visitor perhaps is a lab technician at a pharmaceutical company and, thus, helps to lower my and your health-care costs.
Whatever are the detailed facts of the employment of each of the hundreds of ordinary people who shared with me the rest-area space that day, almost all of them regularly help each other – and me. Indeed, we all routinely help each other. And we do so despite the fact that we’re all strangers to each other and are unaware of this connection that we have to each other.
The single most important contributor to the successful coordination of the productive economic efforts of hundreds of millions of strangers is the system of market prices – the prices that tell (and incite) producers to produce less of this good whose price has fallen and more of that service whose price has risen; the prices that tell (and incite) producers to use more of this input whose price has fallen and less of that input whose price has risen. Without market prices, each of us would be able to coordinate our productive efforts only with the relatively minuscule number of individuals with whom we are able to conduct a verbal dialogue. The number of individuals who would routinely help us would be, at most, a few dozen instead of the hundreds of millions who help us today.
However, as crucial as are market prices to a successful modern economy, no less crucial is the ethos of liberalism – the liberalism of John Locke, Adam Smith, Frédéric Bastiat, F.A. Hayek, James Buchanan, and Robert Nozick. Liberalism is what allows strangers with very little in common with each other nevertheless to co-exist peacefully and productively. Each of the individuals who were that day my fellow visitors to the rest area on the New Jersey Turnpike has his or her own preferences and dreams. I don’t know what these are, and none of those people knows my preferences and dreams. But we nevertheless daily and successfully cooperate with each other – and with hundreds of millions of other strangers – in the market.
The liberal market order doesn’t require that I share your particular preferences or dreams, or that you share mine. All that is required by the liberal market order is that each person respects the same rights in others that that person wants others to respect in him or her. The ‘thinness’ of this liberal requirement leaves each of us free to pursue our own individualized dreams without having to secure the approval of others. I’m confident that everyone at the New Jersey Turnpike rest area, if pressed to think seriously about this feature of the liberal market order as he or she surveyed fellow rest-area visitors, would heartily applaud.
