Economics and Ethics; E. P. Coleson

This has been even more of a mys tery because, according to modern Western social theory, man is in herently good. Beginning with Rousseau a couple of centuries ago, philosophers, social theorists, Dr. Coleson is Professor of Social Science at Spring Arbor College in Michigan. 646 and even theologians had decided that human beings were really very nice creatures and that their known failings could be readily eradicated by education and cul ture, because mankind was almost infinitely perfectible. In the late Victorian period with nearly a cen tury of relative peace in Europe since Waterloo, with increasingly democratic governments on every hand, with decades of social and political reform an accomplished fact, and with many improvements which resulted from a host of sci entific achievements in medicine and engineering, the utopian dreams of the ages seemed on the verge of fulfillment. It became the fashion then for people to look back with horror and amazement on the atrocities committed in the dark ages of the past. The follow ing quotation from a popular writ er of the "Gay Nineties" well illus1971 ECONOMICS AND ETHICS 647 trates this attitude: The world contains no sadder me morial of man's inhumanity to man than London Tower. For centuries it was the home of sorrow and despair.

The record of the victims of despotic cruelty who have endured imprison ment and suffered death within its walls renders one sick at heart, until he realizes that increasing civiliza tion has at last made such atrocities impossible. 1 Increasing civilization - nonsense! Any vicious, diabolical act perpe trated on mankind in the history of the world has been re-enacted in our time and on a mass produc tion scale. The burning questions are why it has happened and what we can do to prevent further dis asters. The Classical Tradition of Natural Law Our present dilemma is strange ly reminiscent of other crises in history. After the Golden Age of . Athens in the midst of the fifth century B.C. the Greek city states fell to fighting among themselves and well-nigh destroyed Greek civilization. After such a glorious epoch the collapse was a dramatic contrast, indeed, and the Greeks, always the theoreticians, busied themselves trying to figure out why the glory had so swiftly fad1 John L. Stoddard's Lectures, Vol. IX, p.259.

ed. It was then that the aged Soc rates and his youthful student, Plato, attempted to diagnose the Greek ills and prescribe a remedy. Out of their soul searching and the later work of Plato's pupil, Aristotle, came the foundations of Western social, political, and eco nomic theory. One aspect of this pioneer effort is of particular in terest to us - the birth of the tra dition of Natural Law. The con cept of a Higher Law was not wholly new to Greek thought: years before, Sophocles had his heroine, Antigone, assure her mon arch: Thy writ, 0 King, Hath not such potence as will overweigh The laws of God ... fixed From everlasting to eternity. During the so-called Golden Age, however, a new breed of thinkers, the Sophists, had undermined the Greek character by teaching their students to be clever rather than ethical. Moral standards were re jected: "Man is the measure of all things." The people of the time were well aware of the decline in character and there was the usual urge to return to the "good old days," but the decay was not ar rested although they understood their problem. They seemed to be quite aware that the new relativ istic code of the Sophists was their undoing: "Whirl is king," said 648 THE FREEMAN November Aristophanes, "having deposed Zeus." Therefore, with Plato and Aristotle we find the urge to dis cover a norm for human conduct which would be stable and perma nent, a standard above a'nd beyond ourselves. Aristotle 2 urged that "God and Reason alone [should] rule, . . . he who bids man rule adds an element of the beast .... "

The tradition of the Natural Moral Law was continued by the Greek Stoic philosophers who passed it on to the Romans. One of the fin est statements of legal philosophy was written by Cicero, the great orator, who lived when the Roman Republic was in its death throes. He speaks of a Higher Lavv that ... cannot be contradicted by any other law, [which] neither the Sen ate nor the people can give us any dispensation for not obeying .... It is not one thing at Rome, and another at Athens; one thing today, and an other tomorrow.... God himself is its author, its promulgator, its en forcer. 3 The Christian Church and the Higher Law With the rise of the Church within the Roman Empire it be came the task of Christian think ers to decide what they were going to do with Greek, to them pagan, 2 Brendan F. Brown, The Natural Law Reader, p. 51. 3 Ibid., p. 54. philosophy (the Christians back then were much less given to play ing "follow the leader" than they have been more recently). The Natural Moral Law sounded ac ceptably pious but the Greeks and Romans derived their guidance from "right reason," while the Hebrew-Christian tradition went back to the giving of the Law of God to Moses in the midst of thun der, earthquake, and smoke on Mount Sinai. The first was the prod uct of ded ucti ve reasoning and conscience for the most part but the latter was simply given given by God himself. Centuries later St. Thomas Aquinas (1225? 1274 ?) resolved the dilemma by an ingenious synthesis of both traditio'ns ~ Thomas Aquinas made four cate gories of all law. At the top of his legal hierarchy he placed the Eternal Law of God which comprehended ev erything else. Beneath this was that portion of the Eternal Law which was revealed in the Bible and the Church. Next came Natural Law which was that part of the Eternal Law which man could comprehend by unaided reason. Finally, at the bottom, he placed the laws of par ticular governments which might be called Human Law. 4 Back in 1215, however, before Saint Thomas was born, some 4 Irving E. Howard, "The Theology of the Declaration of Independence," Chris tian Economics (June 11, 1957), p. 1.

1971 ECONOMICS AND ETHICS 649 practical Englishmen took affairs in their own h-ands and wrested an historic document from their des potic king. This, of course, was the Magna Charta and the tyrant was King John, the Norman king of England, but even this was not a wholly pragmatic affair. Soon Henry de Bracton was to supply the theological foundation: "The King is under God and under the Law." Centuries later Englishmen would appeal to Bracton when they resisted Charles and James. It is interesting to note that the American colonists two hundred years ago used William Black stone's Commen.taries on the Laws of England in much the same way in their quarrel with George III. The first volume of Blackstone's famous Commentaries came from the press in 1765 but the Ameri can colonists were so cordial in their reception of his ideas that a decade later Edmund Burke could tell Parliament on the eve of the American Revolution that "they have sold nearly as many of Black stone's Commentaries in America as in England." The appeal was Blackstone's doctrine of Natural Law: This law of nature ... dictated by God himself, is of course superior in obligation to any other. It is binding over all the globe in all countries, and at all times: no human laws are of any validity, if contrary to this; and such of them as are valid derive all their force, and all their authority ...

from this origina1. 5 When Hitler came to power a few hardy Germans reminded him that God was their "Fuehrer," but the Higher Law was well-nigh for gotten and Hitler had his way with the German people. It is high ly disturbing to compare the ease with which despots take over na tions today as compared with the heroic resistance of our fathers to tyranny in the past. Evidently the iron has gone out of the soul of modern man. As William Penn said: "If men will not be governed by God, then they must be gov erned by tyrants." God's Law and Economics Now it would be a mistake to assume that back in some golden age there was a Christian com monwealth in which all the virtues flourished and men lived together as brothers. Every system devised by man since the beginning of time has been disfigured to some degree with the marks of human frailty. Nevertheless, we need not give up in despair: mere mortals have done quite well at times and no doubt could do so again. It is interesting to note that the great conscious attempt to let the eco nomic life of the nations conform 5 William Blackstone, Commentaries on the Laws of England, Vol. I, p. 31.

650 THE FREEMAN November to some abstract Higher Law was not during the Reformation era or the Puritan period in England, for instance, when men were presum ably doeeply concerned about fol lowing the divine mandate, but during the Age of Reason when theology was out of fashion. The religion of the times was Deism, a rather detached belief in a Su preme Being who created the uni verse and set it going according to Newton's Laws of Motion. Asa result of the scientific revolution in astronomy and physics, dating back to Copernicus, Kepler, and Galileo which became the basis of the so-called Newtonian Synthesis somewhat later, the social philos ophers of the time were convinced that there were also laws of hu man behavior, both individual and in the mass. Their belief in "law and order" contrasts strangely with the relativistic philosophies of our time as the familiar lines by Alexander Pope so clearly show: Nature and Nature's laws lay hid in night.

God said, "Let Newton be!" and there was light. One of our clever contemporaries brought the couplet up to date: But not for long. The devil howling, "Ho! Let Einstein be!" restored the status quo.6 ---6 Richard C. Bernhard, Economics, P. 733. An Orderly Universe The pioneer economists believed that there are abiding principles in all of life, "laws" which man did not make and cannot alter. By con trast, as the second couplet sug gests, our contemporaries believe that all is rela tive, that they can make up their rules as they go along and that, like prices nowa days, they are "subject to change without notice." It is beginning to appear that certain time-honored principles such as Gresham's Law are still with us and are rising from the rubble of our shattered schemes to mock us. Perhaps we will find that our Fathers were right after all. Akin to the doctrine of Nat ural Law in human affairs was the conviction that there is a Nat ural Order, what should and could be a harmonious working to gether of everyone's interests, if each would play the game of life fairly. This concept reminds one of the familiar Balance of Na ture, much talked about by ecol ogists today who fear we are up setting Nature's plan. Much the same idea is expressed by St. Paul in the familiar dictum that "all things work together for good," if we but obey the Supreme Law giver (Romans 8: 28). If the econ omy would run by itself, better than any Keynesian bureaucrat ever could succeed in running it, 1971 ECONOMICS AND ETHICS 651 let's let Nature do it for us then.

The government - Jefferson's "simple, frugal affair" - could then retire to the side lines to serve as "umpire" with the rule being simply "no force and no fraud," as Robert M. Thornton 7 wrote re cently. It was upon this self-regulating Natural Order that Adam Smith based his economics: "There is an astonished tone in his work, as if he could hardly believe his own discoveries and sensed a quality of magic in them," as Richard C. Cornuelle 8 wrote a few years ago. There is impressive evidence, both positive and negative, to suggest that just perhaps Adam Smith was right after all-Victorian prosperi ty a century ago and the "German Economic Miracle" un der Erhard after World War II as proof of what the free economy can accomplish and the dismal failure of a lot of socialist schemes as examples of the alternative ap proach. Virtues of Self-Reliance In an age of disintegrating so cial, political, and economic pro grams - New Deals, Great Leaps, and Five Year Plans - the claims 7 Robert M. Thornton, "The War on the Poor," Religion and Society (Dec.

1970) , p. 24. 8 Richard C. Gornuelle, Reclaiming the American Dream, p. 48. of the self-regulating free economy deserve further consideration. In addition to the simplicity and econ omy of the approach, there is the very important fact that self-re liance and personal responsibility are encouraged. Like Horatio Alger, people take out their frus trations working instead of riot ing, since they don't expect the government to take care of them. This approach maximizes produc tivity and minimizes violence: with famine a global threat and strikes, riots, and war a present reality, we could certainly use more productivity and less vio lence. Almost inevitably if people have been schooled to expect the good things of life in ever increasing quantity from the hands of gov ernment, they will rebel when the promised abundance is not forth coming - and if they sit and wait for it to come, it won't be forth coming. People do not shoot the weatherman when there is a drought, because they don't think he is to blame. If people believed once more that God is the source of material blessings and that "God helps those who help them selves," violence would cease to be a factor in politics - we survived the Depression with little of it.

Adam Smith's thesis that the eco nomic problem will find its solu tion, as well as any human prob652 THE FREEMAN November lem ever is solved, when men work diligently and efficiently, and are fair in their dealings, is a propo sition .that deserves serious con sideration once more,' since alter native approaches have failed so miserably. In an age when most people be lieve that the right is somehow impractical and unworkable, a noble ideal but hardly a guide for everyday action in business or on the international scene, Adam Smith's doctrine of the harmoni ous outworking of the true self interest of all of us can scarcely be emphasized too strongly. What is truly good for labor is good for management, too, and the appro priate international economic pol icy for us would be good for our neighbors - Germany, Japan, and the rest. In the popular mind free enterprise means Darwin's doc trine of "survival of the fittest," a brutal struggle to the death, but The W ealth of Nati·ons was pub lished in 1776 and the Origin of Species did not appear until 1859.

A few years before Darwin the famous French economist, Fred eric Bastiat, 9 asked: "How could God have willed that men should attain prosperity only through in justice and war?" To Bastiat, this doctrine of conflict is based on the "frightful blasphemy" that God 9 Frederic Bastiat, Economic Sophisms, p.88. created the world in such a fashion that decency and humanity are im possible. This is the Great Divide, the basic difference between mer cantilism, ancient and modern, and laissez faire economics in the original meaning of that much misconstrued and misunderstood French phrase for the market economy. As the dean of American free enterprisers, the distin guished Austrian economist, Lud wig von Mises, wrote a few years ago, Adam Smith and the classical economists believed that . . . harmony prevails among the rightly understood or long term in terests of all individuals and groups of individuals. Earlier ages had la bored under the misapprehension that no man or group of men can profit but by the loss of others. In entirely demolishing this fallacy, economics paved the way for the un precedented achievements of modern Western civilization.I 0 Capitalism: Debits and Credits The question always arises why, if free enterprise was that good, the system did not continue to this hour. A number of circumstances, mostly beyond the early econo mists' power to alter, conspired to give laissez faire a bad public im age. The part of the difficulty 10 Ludwig von Mises, "Economic Free dom in the Present-day World," Christian Economics (Oct. 14, 1958), p. 1.

1971 ECONOMICS AND ETHICS 653 which was of their own making we will dispose of first: Smith's fol lowers, much more pessimistic than he, dreamed up "Iron Laws" of starvation wages and the like which soon gave economics its rep utation as "that dismal science" (the economists of·that era should have been aware that this was hardly good public relations). Other things happened they couldn't prevent, but capitalism (to use Marx's phrase) got the blame. For instance, there were nearly twenty-five years of war between the fall of the Bastille in 1789 and Waterloo in 1815 - in deed, a global war. These years were hard for most people. This was followed by a severe postwar depression, as has commonly hap pened after modern wars. The In dustrial Revolution was still in the primary stage of heavy invest ment (their children and grand children were to reap the benefits many years later). Then, of course, industrialists did take advantage of their help when they could, just as the hired man has taken ad vantage of the boss when. he was able to do so more recently.

Many tears have been shed over such things as sanitary conditions which they neglected, in part through ignorance (Lister did not perform the first antiseptic opera tion in the history of the world until 1865); and also long hours of labor which seemed less shock ing to ex-farmers back then than to generations of city slickers more recently (also the long labor day is misleading - the people back then tended to work in spurts and were not very steady on the job). All in all, they had problems back then, although their socialist grandchildren may have worried more about it than the folks who survived this rather difficult pe riod of history. Because of the real and imaginary failures of these old industrialists, the Capitalist era was relatively short. But be fore we take a look at the "Wel fare State," which has its prob lems, too, we need to summarize the accomplishments of the Capi talist era and note how it was in itiated in the first place.

Free Trade for England We are perhaps inclined to be lieve that free enterprise sprouted spontaneously in England the day after Adam Smith's Wealth of Nations came from the press in 1776. The book was popular and greatly enhanced the author's rep, utation but it did not make much difference in practical policy until many years later. Although things had been loosening up for some time, the truly dramatic switch in English policy came with the Re peal of the Corn Laws in 1846, which led to a policy of free trade 654 THE FREEMAN November in general shortly thereafter. The Corn Laws were Britain's "farm program," a tariff policy that kept out foreign grain and thus made food unnecessarily expensive in England. With considerable help from a natural calamity, the tragic Irish Potato Famine, the Anti Corn. Law League, under the lead ership of Richard Cobden and John Bright, succeeded in getting Peel's government to repeal the protective tariffs on grain. To Cobden and Bright this was a holy crusade, a campaign to make bread cheap and abundant for the mass es as this ancient poem, dedicated to "R. Cobden," clearly shows: God said, "Let there be light"; and 10, Light sprang forth at His word.

God said, "Let there be bread"; but no, l\Ian heeded not the Lord. But Cobden rose like wisdom's star Ii·trom knowledge's bright sea, And knaves were hush'd and tyrants crush'd And labour's bread was free. The other nations of Western Eu rope followed the British lead and for a few decades in the latter part of the last century there was relatively free trade throughout much of the world. The relationship of the United States to the open markets of Western Europe is most fascinat ing in view of our historic prefer ence for protective tariffs. Actually we gained greatly by their deci sion to let us in. By some happy chance the opening up of the Eu ropean market to foreign. food stuffs came just as we were get ting ready to deliver a flood of it to them. About the time they de cided to let our new -found abun dance come in, we developed the tools to produce and market it. To mention a few innovations, a new plow was invented by John Deere which would break the prairie sod, and a reaper by McCormick which made commercial grain produc tion possible; in the meantime a railroad system was laid out across the country which would get the crops to market. For in stance, in 1853 Chicago ll handled six million bushels of wheat, in 1855 the figure jumped to sixteen million bushels which then almost doubled to thirty-one million by 1860 (little wonder that Malthu sian pessimism went out of fash ion about 1850, as Lord Keynes tells us) .12 All Nations Gain But we must remember that Eu ropean free trade made much of this possible: we would have had a staggering "agricultural sur plus" by 1860 if all of this had 11 John Chamberlain, The Enterprising Americans, p. 98.

12 John Maynard Keynes, The Econom ic Consequences of the Peace, p. 10.

1971 ECONOMICS AND ETHICS 655 stayed home. Many tears have been shed over the sad plight of the European farmers who could not compete, but little Denmark, for merly a poverty-stricken grain producer, demonstrated that it was possible to shift to a cow-pig chicken type of mixed farming, using cheap American grain as feed, and much to their profit. The common laborers of Western Eu rope were now eating better than they ever had in the history of the world in spite of a population ex plosion. Nor were the Europeans and Americans the only ones that bene fited: for instance, the British simply rolled out a railroad system across the Humid Pampa of the Argentine and took beef in return as :payment. Heavy British for eign investment speeded economic development all over the world, including the United States. Al though they sometimes lost money on these ventures, again including some they invested in the United States, part of them were profit able, too, which provided capital for a continuing cycle of economic development in the backward areas of the world. Little wonder that the optimists of that day foresaw a glorious future for the human family. Many Evangelical Christians in the late Victorian period were even certain that the Millennium, that blessed era when the Lord would reign in righteous ness and we would "beat our swords into plowshares," was upon us. But it would be a mistake to assume that everyone was that pleased with the status quo back then; the dissenters were soon going to have their try at ri.ght ing the wrongs of the world.

Socialism, Christian and Otherwise As already mentioned, the obvi ous and simple system of natural liberty which Adam Smith 13 advo cated in 1776, did not fully be come a reality until the years immediately following the Repeal of the Corn Laws in 1846. It is most interesting to note that Marx's and Engels'Communist Manifesto was published in 1848, jp.st as laissez faire came into its own. Of course, there had been plenty of anticapitalist dissent long before this. The .new industrial age was hardly started in the latter part of the eighteenth century, the con sequence of Arkwright's and Watt's inventions, before enraged hand spinners and weavers turned out en masse to destroy the hated contraptions which were putting them out of work. Since they were certain that there was already overproduction, these new devices could only lead to economic di saster (how they could believe 13 Adam Smith, Wealth of Nations (Modern Library edition), p. 651.

656 THE FREEMAN November they had a surplus back then is almost incomprehensible, but then, fears are often irrational). Of course, what saved the day for the textile industry was the willingness of the ladies, and the rest of us, to enlarge our ward robes as cloth became more abun dant and cheap. But that was the next chapter in the economic his tory of the West. Both workers and intellectuals hated the "dark Satanic mills" springing up in the new factory towns and this, along with industrial growing pains plus the Napoleonic Wars and postwar depression, gave dissenters plenty of ammunition for their war on laissez faire economics. The new crop of businessmen and industri alists had enough personal fail ings, made enough blunders and enemies, and in a number of ways alienated the general public suf ficiently to give rise to a growing protest movement. Although Marx was militantly atheistic and hence repelled many devout people, Christian socialism emerged as the ethical answer to the problem of human need: to them Christianity was the religion of which socialism was the prac tice. The social gospel movement emerged in the latter part of the last century and it is no secret that the Church has had a large leftist element ever since, often in high places. This is in no small part the failure of disillusioned men of good will to see that social ism would create, as the late Rein hold Niebuhr 14 finally realized, "pools of excessive power in the hands of those who manage both its economic and political proc esses" - if businessmen could not be trusted with power over their little segment of the national life, what about bureaucrats' who have us all at their mercy?

We had to learn the hard way, too, that socialism is not efficient. Perhaps today, having lived with socialism and communism as well as capitalism these many years, we are now in a position to re evaluate the whole question of ethics as it relates to business and government in a way that our fathers could not. One wonders if we had another crisis like the Crash of '29 and the Great De pression, would people still blame this on the failure of Free Enter prise, or realize that the welfare state might with some logic share part of the blame? Caesar or God? Our Puritan ancestors believed that they, like the early Israelites, were people of the Covenant: obey God and all would be well. The men of the Enlightenment, less devout, believed if we obeyed the 14 Kenneth W. Ingwalson (ed.), Your Church - Their Target, p. 47.

1971 ECONOMICS AND ETHICS 657 laws of "Nature and of Nature's God," we would have the best possible world men could arrange down here below. Most of our contemporaries believe that Adam Smith was an anarchist. Indeed, many people see no possible phil osophical position between laissez faire anarchism and totalitarian ism. It has not always been so. Our Founding Fathers believed in liberty under law - God's Law. It is true that men with tender con sciences who took the Bible seri ously have disagreed on the poli cies they extracted therefrom just as scientists have disagreed on their conclusions, using the ex perimental method. There are some across the ages who have argued that Peter's communal ar rangements after Pentecostl 5 set up socialism as the Christian standard, but there are· others who feel that the experiment collapsed quite quickly just as the Pilgrim attempt at Plymouth did right after 1620. As evidence, St. Paul was engaged in gathering up re lief funds for the Church at Jeru salem later which is a suspicious circumstance - we do not common ly raise money on the mission field to support the home church; also, Paul was eloquent in urging work and personal responsibility.

Whatever the confusion of the saints, religion has been a force 15 Acts 4: 34-37. against totalitarianism over the ages, and there is impressive evi dence to support the contention (the familiar "Weber Thesis" with its "Protestant Ethic") that perhaps the "gospel" of hard work, personal responsibility, and stew ardship of time and money may have had as much to do with the explosive progress of the West in the recent past as did laissez faire economics it la Adam Smith. In deed, would political and economic freedom have been possible with out the moral base? What is the Christian viewpoint in economics and government, by any fair stand ard of interpretation? With the heavy emphasis on humanitarian and ethical values by the Left in our time, these are important ques tions. We simply permitted our selves to be outflanked by the enemy. The defense of free enterprise has commonly been in pragmatic terms - profit and production but not principle. According toAyn Rand, ... capitalism's classical defenders and modern apologists ... are respon sible - by default - for capitalism's destruction .. The default consisted of their inability or unwillingness to fight the battle where it had to be fought: on moral-philosophical grounds,16 16 Ayn Rand, Capitalism: the Unknown I deal, p. vii.

658 THE FREEMAN November I would agree with her contention, though I am not a Randian my self. Since we have been so very busy trying to make a little money in spite of mounting taxes or fight ing a rather ineffective rear guard action against socialism, we have not done our "home work" and have let the socialists get by with a lot of misrepresentations which have been exceedingly damaging to the market economy - we have mostly been content to brag about how many high-powered automo biles and color TV sets we can produce as compared with the rest of the world. Capitalism Not Based on Greed It is a common fallacy that cap italism was founded on greed. Max Weber 17 pointed out long years ago: "Unlimited greed for gain is not in the least identical with capitalism. . . ." Indeed, as he insisted, "absolute unscrupu lousness in the pursuit of selfish interests" has been most domi nant in the lands that are most backward, where capitalism has not yet developed as a system and, one might add, perhaps can not, due to the lack of a moral base. Anyone who has traveled in those countries knows how right Weber was.

17 Max Weber, The Protestant Ethic and the Spirit of Capitalism, pp. 17 and 56-57. A kindred delusion is that Big Government is for the little fel low, that· but for the intervention of a benevolent state Big Business would gobble us up. Since most of us identify with the underdog and hate bullies, this is good po litical propaganda, but may be a long way from the truth. There is considerable evidence to sup port the contention of Walter Adams 18 of Michigan State Uni versity and others who have stud ied the problem that the govern ment has done more to encourage industrial and commercial "ele phantiasis" than to promote Small Business. This has been the his tory of the Farm Program, also, another scheme to rescue the "little fellow." What has resulted instead has been what Clarence Carson has called The War on the Poor, as he entitled a recent book. If the welfare state's campaign for "social justice" has failed on the homefront, what about our attempts to save the starving millions overseas? Evidently our global give-away program has too often been a grab bag for crooked politicians or so I have been told when I traveled in the so-called "backward areas" of the wor ld and by competent observers, both native and American. Further18 Walter Adams and Horace M. Gray, Monopoly in America: The Government as Promoter.

1971 ECONOMICS AND ETHICS 659 more, foreign aid has fallen woe fully short of world need, accord ing to those sympa thetic to the program, and the enthusiasm of the American taxpayer is dimin ishing. A few years ago Josue de Castro 19 complained that "foreign capital invested in the underde veloped regions is less than $6 billion, whereas ... a minimum of $15 billion would be required" each year to begin to meet the need. Private Investment Abroad But there has been a better way to do this, too. According to pre President Richard M. Nixon,20 writing more than a dozen years ago, the United States alone would have invested $30 billion abroad in 1958 instead of the trifling $4 billion we did loan that year, if we had been investing at the rate the British did in 1910. Think what this would have meant in the way of employment and economic development across the seas, if we had been so doing.

Unfortunately, there are almost no decent places to invest any more. Because of turbulent social conditions, political instability, and outright thievery on the part of governments which will na19 Josue de Castro, The Black Book of Hunger, p. 49. 20 Richard M. Nixon, The Challenges We Face, p. 73. tionalize your investments as soon as you get something profitable started, finding a place to invest is as difficult for the "haves" as finding investment capital is for the "have-nots." They ought to get together on this, and could, if they could learn to trust one an other again - which brings us right back to the moral question once more. Unfortunately, this means that large areas of the world which are poor and back ward, where people are hungry and desperate, must remain that way; they cannot hope to make progress until they straighten out their ethics and economics, for the right is also the expedient in the long run. A wee glimpse of the Victorian age with its free trade and free enterprise, its propriety and progress, its stability and certainty, is quite revealing, as the following quotation which ap peared in 1882 in The Specta.tor, a "sedate, middle-of-the-road mag azine," so eloquently tells us: Britain as a whole was never more tranquil and happy. No class is at war with society or the government; there is no disaffection anywhere, the Treas ury is fairly full, the accumulations of capital are vast. 21 Just as a fascinating experiment, substitute today and the U.S.A.

21 Albert H. Hobbs, "Welfarism and Orwell's Reversal," Intercollegiate Re view (Spring, 1970), p. 107.

660 THE FREEMAN November for 1882 and Britain in the above quotation. Perhaps the "Faith of Our Fathers" was not so misplaced after all. Rebuilding the Foundations It would be a pity to end on such a note of despair. Actually, I am not that discouraged: the very bankruptcy of modern man's utopian schemes has left a vacuum which someone will try to fill. What better time to urge a return to ethical standards, freedom un der law, personal responsibility and the values which made West ern civilization great? We launch space ships according to God's Law; then why not consult Him about reordering this chaotic world down here below? As Ben jamin M.Anderson wrote shortly after the second World War, com menting on Germany's violation of her treaty guaranteeing the neutrality of Belgium in 1914, that famous "scrap of paper" which has been the model of most recent treaties: The greatest and most important task of the next few decades must be to rebuild· the shattered fabric of national and international good faith.

IVIen and nations must learn to trust one another again. Political good faith must be restored. Treaties must become sacred again. A world in which all men are up right and in which all nations are voluntarily decent in their inter :national relations is, of course, too much to expect, but a world in which the ill-intentioned fear the condem nation of the well-intentioned we can rebuild~ The same basic human na ture which created the fabric of na tional and international good faith on which we relied in the century preced ing 1914 exists today - just as we have discovered that the same human nature which animated the Assyrian conquerors and the hordes of Genghis Khan exists today. The raw stuff of human nature is immensely plastic. ... There is no certainty that we can recreate the fabric of good faith which we have destroyed, but there is no higher duty than to make the effort. 22 ~ 22 Benjamin M. Anderson, Economics and the Public Welfare, pp. 4-5.

IDEAS ON $ LIBERTY What Is a "Less-Developed" Country? AMONG the "less-developed" countries, as the term is most often used, almost all have at least one thing in common. They are coun tries that desire capital but have not yet put into practice the methods of capitalism. H A R 0 L D F L E MIN G, States, Contracts and Progress SAMUEL R. ALDRICH MAN and his Environment AGRICULTURE has a tremendous impact on the environment. The farmer's goal, in fact, is to man age .the environment for the long term benefit of mankind. This he has done with eminent success. Decisions about farming to this point in time have been based mainly upon economic considera tions. To put it bluntly, if it paid, we did it (with minor restrictions for known hazards). Recently a new dimension has been added. Society is insisting that long-term effects on all aspects of the en vironment be considered in decid ing practices to be followed.