Planning for Peace; H. Sennholz

PLANNING FOR PEACE HANS F. SENNHOLZ WAR is the brutal and inhuman method of settling differences be tween governments. But no mat ter how great these differences may be, the old arbitrator, time, finds an end to it all. Even the Vietnam war will one day come to its end. War cannot be driven out by war, for the use of evil breeds more evil, hostility more hostility, and the use of force more force. Peace is the natural state of man, war the temporary repeal of rea son and virtue. In the words of James Madison, fourth President of the United States, "Of all the enemies to pub lic liberty war is, perhaps, the most to be dreaded, because it comprises and develops the germ of every other . War is the parent of armies; from these proceed debts and taxes; and armies, and debts, and taxes are the known instruments for bringing the many under the domination of the Dr. Sennholz heads the Department of Eco nomics at Grove City College in Pennsylvania and is a noted writer and lecturer for freedom.

10(\ few. In war, too, the discretionary power of the Executive is ex tended; its influence in dealing out offices, honors, and emoluments is multiplied; and all the means of sed ucing the minds, are added to those of subduing the force, of the people. . . . No nation could preserve its freedom in the midst of continual warfare." If this is the true nature of war we can deduce the problems and tasks of its liquidation. We need no government committees that plan for peace, no politicians or commissioners who draft new laws or regulations, merely peace. Armies can be disbanded with out delay. Free labor markets can absorb any number of veterans discharged from military duty. For, contrary to popular opinion, there is no given number of jobs. The demand for labor depends en tirely on the price of labor. And this price readily adj usts to any change in labor supply. There is no record of any serious unem ployment when millions of Amer ican veterans were discharged 1970 PLANNING FOR PEACE 107 after the CiviI War or the two world wars.

It is true, in labor markets that have been rendered rigid through labor union power, surpluses ac tually may exist. Employment in unionized industries is no longer subject to adjustment through wage flexibility, but is regulated by seniority rule and union deci sion. This is why returning vet erans cannot expect to find em ployment in these industries un less they meet union specifications. Termination of war also should permit repeal of all wartime levies. Tax rates can be reduced to pre war levels unless the government incurred a debt in pursuit of the war. In past American wars, such as the Revolution and the Civil War, the debt was retired in about one generation. The World War I debt was retired rapidly until the Great Depression administrations increased it again. After World War II, no attempt was made at debt reduction. In fact, large bud get deficits have added more than $120 billion to the previous debt.

Wartime taxes are not easily re duced after the war. Government does not voluntarily surrender revenue; its departments and bureaus have insatiable appetites, and powerful pressure groups clamor for government services and benefits. Paraphrasing James Madison, especially -in the postwar period government influence in dealing out offices and benefits is multiplied with the lush revenues from wartime levies, "and all the means of seducing the minds are added to those of subduing the force of the people." Could this be the objective of the government committees and planning boards created by sev eral state governments? Peace needs no commissioners or direc tors, merely reduction and re trenchment of government. The American economy needs no help from government in its necessary readj ustment from war to peace time production. It is true, arma ment and ammunition industries will have' to curtail their opera tions, and consumers' goods in dustries will expand. In a market economy such as ours, labor and capital always respond to the pur chasing power of consumers. And in case tax levies on business should be reduced, the end of war will lead to new capital formation, which in turn would increase eco nomic output and raise standards of living. How can government planning committees aid business in production improvements?

We love peace, but not peace at any price. We do not fear the eco nomic consequences of peace, but the government that is planning for peace. ® it INDIVIDUAL MAN shows a persist ent tendency to organize his think ing and activity. Watch the small child eagerly observing his sur roundings and you will soon note evidences of the desire to systema tize the results of his observations. He starts sizing up, pondering, as well as accumulating information. And if he is not thwarted by the misdirected efforts of parents and teachers he will build up his store of savvy at an amazing rate. This tendency to array, to clas sify, is something for which to be thankful. Without the taxonomic inclination, indeed, it is hard to see how one could cope construc tively with the complexities of life on this planet, especially if he is a member of a "civilized" commuDr. Paton is Professor Emeritus of Account ing and of Economics, University of Michigan, and is known throughout the world for his outstanding work in these fields. His current comments on American attitudes and behavior are worthy of everyone's attention.