Why Pay for Things? F. Harper

This simple question caught father with his sheepskin up in the· attic. So as a stall for time, the question was referred to an older sister who was· a college student. Since she had never had a course in economics, it seemed safe to predict that she would fumble it for a few min utes. She first asked how else it would be decided who should have things. And then she explained two choices -theft or payment for things-brieRy but clearly. This approach struck me as an excellent alternative to either the rod or parental mandates by which children might be taught to respect the property of others. The argu ment, in amplified form, follows. How might it be decided who gets what? There are Dr. Harper is a member of the staff of the Foundation for Eco nomic Education. [ 14] not enough things to go around, you know. There never will be enough. We always want more things than there are to be had. Who will go without? Who will get what there is?

The Rule of Might One way to do it would· be for everyone to grab what he can. That is the way things tended to be done once, long before we were born. Under that way of doing things in its pure form, people fight over what little there is to be had. The man who works hard to get some food must either eat it at once or fight all the time to keep it.. Nobody heeds his plea that it is his because he worked to get it. When things are done that way, you would not really own anything. You would just have it, and anyone could have it who could take it away from you. A boy's bicycle, for instance, would not really be his. Any bully could take it away from him; a bigger bully could take it away from the first thief, and so forth. People would lie and do all sorts of mean tricks to get things away from one another. The strongest and meanest and worst persons would get more and more things, so that most everyone would become meaner and meaner. Unless they did, they would have to go without things. They would have to be mean and physically strong, or die-under a system like that.

Who gets the bloody noses and broken heads under that system? Mostly it is the little folks, of course, if they [15 ] have anything anybody else wants and if they try to keep it. The old persons suffer, too, as do the crippled and the sick. The other way to decide who gets what is for each person to own things. That is the system we have, gen erally. You own what you make. No bully has any right to it simply because he is big enough or mean enough to take it away from you. If he does take it, we say that it is still yours and he should return it to you. Dnder this system, the person who makes anything may sell it or give it to other people. If as a small boy you had been given a bicycle, or had bought a toy ship, for instance, these are yours until you want to give them away or sell them. When they are sold, somebody must pay to get them. The Private Property Idea That is why we have to pay for things. It is because we consider things to be owned by each person instead of belonging to nobody. If you want something you have not produced, and which has not been given to you, you must pay for it. The only other way to get it would be to steal it, which is the other system. People don't have to pay for things.under the other system, but many starve because there are so few things produced.

It is normal for little boys, who want many things and don't have much money, to wonder why they should have to pay for things they want. But if we operated our affairs the other way and fought over things rather than owning [ 16] them, little folks wouldn't have much of a chance of ever getting a bicycle at all. The system whereby each person owns things-which means you have to pay for things you want-is really the cheapest and best police force in the world, in addition to being the only system that will defend the weak and the infirm. If we would all conduct ourselves by that rule, we would need no policemen at all because everybody would be serving as a policeman over himself. He then serves without pay. He can spend all his time producing things and enjoying life in whatever way seems best. That answer to the question of why we have to pay for things, expressed in terms a Rve-year-old could under stand, seemed to leave little more to be said.

[ 17] THE PERFECT PRICE WHAT determines the price of a ton of steel? Who sets it? Just what is the policy of United States Steel as to prices? Along with other successful American industries, we in the steel business learned a long time ago that the following economic principle is true and sound: Each manufacturer must learn how to produce and sell his products as efficiently and cheaply as his competitors. If he doesn~t, he will soon find himseH without customers because of the competitive struggle for markets in a free economy. Any successful business must necessarily con form to that fact of the market place if it is to prosper and fulfill its obligations to its employees, its owners, and its customers. A by-product of this competition among producers is the best possible product and service at the lowest possible price. Actually, I could state-simply and truly-that in the long run it is the customers who primarily set the price Mr. Fairless is Chainnan of the Executive Advisory Committee, United States Steel Corporation. This essay is from an address of October 8, 1955, to members of the Pennsylvania Newspaper Pub lishers' Association.