Ownership: Free But Not Cheap; G. North

knotty question of stew:ardship. The roots of Western Civiliza tion extend back to the Hebrews. The message of the law and the prophets of the Old Testament returned again and again to the issue of ultimate sovereignty. The message was clear enough: God is sovereign, and not men, nor any human institution. All earthly, human sovereignty is therefore derivative and limited. The advent of rationalist and 401 402 THE FREEMAN July outright anti-Christian philoso phies shifted the language of the sovereignty issue, but not the dif ficulties. If God were removed from the day-to-day operation of the uni verse, then sovereignty would have to be found elsewhere. Eighteenth-century rationalists from Adam Smith to Jean Jacques Rousseau, from the Physiocrats to the J acobins - attempted to dis cover where sovereignty lies, in principle, in human affairs, and their answers concerning the ab stract locus of sovereignty de termined the kind of society they hoped to attain through the use of political action.~ Obviously, they arrived at very different answers.

It is possible, of course, to imagine full sovereignty apart from organized institutions pos sessing the right of legal com pulsion. Sovereignty might be claimed strictly on the basis of conscience: voluntary tithing to a church, for example, or volun tary taxation by the state (as some market advocates have ar gued). As a rule, however, where we find any institution which claims sovereignty and receives support from a majority of the citizenry, we also find compulsion. In the United States, the classic example is the shift in sovereignty from the state-established relig ious denominations that once re ceived tax funds to support their operations to the government edu cational institutions. The public schools became the institutional ized churches of the local commun ties, and recent court decisions indicate that they are about to become national churches. 3 Those who officially denied that church and state ought to be linked, in most cases simply substituted a new. priesthood for the· older one, Le., the one which no longer could convince a majority of citizens of its claims of sovereignty.4 In modern, industrialized na tions, the conflict over sovereignty is between the state and the mar ket. In the Soviet Union, and pre sumably in the other iron curtain countries, the conflict is four-way: national state, planning region, market, and Communist Party.G As Ludwig von Mises puts it, the control of scarce economic resources can be handled in two ways: profit management or bureaucratic man agement. G Both are legitimate in their own spheres, but in the mod ern economy, statist bureaucratic management seems to be trium phant everywhere we 100k.7 Our universe operates in terms of the fact of economic scarcity.

A t zero price, thE;re is greater de mand for than supply of economic goods and services. (If there is an equality of demand and supply, or an excess of supply, the goods are not economic goods, and therefore 1972 OWNERSHIP: FREE BUT NOT CHEAP 403 they are not objects of human action. S ) Those who possess skills or resources that are desired by the public at a price greater than zero must, by definition, act as stewards for those who are will ing and able to purchase these desired products. No matter how secure his legal title to ownership, each owner must face the eco nomic responsibilities of steward ship. This, in fact, is one of the miracles of market arrangements. The requirements of the many, considered as a collective unit, are met by the activities of individual men and women. The philosophi cal problem of the one and the many, which transforms itself into the problem of the collective and the individual, is answered in the realm of economics by the opera tion of the market. The fact that few men take the market seri ously is indicative of the collapse of philosophical inquiry into this crucial intellectual problem over the last century.!) The Mixed-up Economy The so-called "mixed economy"

is one of the means by which men attempt to avoid the implications of the market's solution. "We are neither socialists nor capitalists" is a rallying cry for contemporary economists, theologians, and "prac tical" businessmen. These people think that they are saying something quite profound and very modern when they promote such a slogan. What they are saying is in reality quite muddled - the product of a lack of serious thought. To say that you favor neither full collectivization nor full economic anarchy is not say ing anything at all. Noone in a position of political authority ad vocates full collectivization, as the survival of the Liberman reforms and the private farm plots in the Soviet Union ought to indicate. Pure anarchism, while it may find more vocal and intelligent advo cates than pure collectivism, has always been a tiny intellectual stream in human history. So the "neither socialist nor capitalist"

slogan is not relevant as a philo sophically unique statement. Mises, as usual, has seen the emp tiness of such slogans, and he calls our attention to the crucial contribution the market makes in solving the problem of steward ship: All attenlpts to abolish by a conl promise the contrast between conl mon property and private ownership in the means of production are there fore nlistaken. Ownership is always where the power to dispose resides. Therefore State Socialism and plan ned economies, which want to main tain private property in name and in law, but in fact, because they subordi nate the power of disposing to State 404 THE FREEMAN July orders, want to socialize property, are socialist systems in the full sense. Private property exists only where the individual can deal with his pri vate ownership in the. means of pro duction in the way he considers most advantageous. That in doing so he serves other menlbers of society, be cause in the society based on division of labour everyone is the servant of all and all the nlasters of each, in no way alters the fact that he hinlself looks for the way in which he can best perform this service. 10 Mixed economies do not stand still. They do not allocate re sources and tasks according to permanent, fixed definitions. The mixed economy is a battleground for competing ideologies; without solid, concrete definitions of sphere sovereignty - rules that specifically limit, in principle, the operations of bureaucratic man agement and profit managen1ent the idea of the mixed economy will remain an intellectual monstrosity and, in practice, a very poor means of getting things accomplished.

It is not possible to compromise, either, by putting part of the means of production at the disposal of so ciety and leaving the remainder to in dividuals. Such systems simply stand unconnected, side by side, and oper ate fully only within the space they occupy. Such mixture of the social principles of organization must be considered senseless by everyone. No one can believe that the principle which he holds to be right should not be carried through to the end. Nor can anyone assert that one or the other of the systenls proves the better only for certain groups of the nleans of production. Where people seem to be asserting this, they are really as serting that we must demand the one system at least for a group of the 111eanS of production or that it should be given at nlost for a group. Com pronlise is always only a momentary lull in the fight between the two prin ciples, not the result of a logical thinking-out of the problem. Re garded from the standpoint of each side, half-measures are a tenlporary halt on the way to complete suc cess. ll Serving Others Is it really true that the mar ket, as an impersonal mechanism, pressures individual citizens, in their role as economic actors, to satisfy the needs of their fellows?

A brief analysis should help to answer this question in the af firmative. Consider the occupation of'the farmer. He owns land and tools. He possesses skills and spe cialized knowledge. The more pro ducti ve he is, the more specialized his labor and, presumably, his tools. These assets constitute his capital. The very fact of his legal ownership brings the problem of cost into the forefront: how much does it cost him to own his assets? The doctrine of alternative costs 1972 OWNERSHIP: FREE BUT NOT CHEAP 405 tells us that he must forfeit the use of all those economic goods and services that he could pur chase if he were to sell or lease his capital (including his human cap ital). He has chosen to remain the owner of these particular assets, but he must forfeit all those assets that are lower on his scale of values, but that might be pur chased if he divested himself of the ownership of his present scarce economic resources.

There is only one way in which his legal ownership, and therefore control, of these scarce economic resources would cost him nothing. If he has absolutely no other de sires than to be exactly what he is, where he is, controlling just these economic resources and no others. This is the ultimate goal of economic perfection toward which men strive, of course, but it does not describe the conditions of real, acting men. But it is only under this assumption, that a man has no other alternative uses for his capital or the assets that could be gained in voluntary exchange, that zero opportunity costs would pre vail. So long as men have unful filled desires for additional scarce economic resources, they will bear the burdens of opportunity costs. They must choose one goal or set of goals and not another; they must select the appropriate means of achieving their economic goals; they must exercise responsible choice.

"Every man has his price." Most of us believe this to be valid as a regulatory principle, despite the fact that we know that on some points in time, some men could not be compelled by the whip or ind uced by the carrot to respond to the desires of other men. Men are always trying to improve the economic conditions. This means "that they must bear the costs of change in a world of limited re sources. Even a decision to remain inactive is a decision: one forfeits the benefits that change would have brought. In short, there is always a trade-off in economic choosing, even in decisions not to trade at all. Ownership, a Social Function Any resource - human, animal, inanimate - which can command a price imposes costs on its owner. Each individual must use the re sources under his authority in order to serve others, either through the mechanism of the market or the coercive power of the state. To the extent that the market is allowed to function as the sovereign authority over eco nomic transactions, individual owners must attempt to meet the demands of other possessors of scarce economic resources, as reg istered on the market in terms of 406 THE FREEMAN July discrete prices. Hence, total hu man autonomy is inconceivable.

Those who argue that the market involves anarchy are unaware of how the market operates. Economic actors must meet the demands of the public if they are to survive. The farmer in our original ex ample is required to use his land, tools, brains, and skills more ef fectively than do his competitors. If he obstinately or ignorantly re fuses to do this, he will lose con trol over his resources. Under the market economy, a man holds his goods as a steward for other men; he cannot hold his goods auton omously. Under the free market, ownership is a social function. The meaning of private property in the market society is radically different fronl what it is under a system of each household's autarky. Where each household is economi cally self-sufficient, the privately owned means of production exclu sively serve the proprietor. He alone reaps all the benefits derived from their employment. In the market so ciety the proprietors of capital and land can enj oy their property only by enlploying it for the satisfaction of other people's wants. They must serve the consumers in order to have any advantage from what is their own. The very fact that they own means of production forces them to submit to the wishes of the public.

Ownership is an asset only for those who know how to employ it in the best possible way for the benefit of the consunlers. It is a social func tion.l~ Is this a denial of the free own ership of private property? Abso lutely not; it is the necessary concomitant of such ownership. It is therefore a denial of the gratuitous ownership of property. Nothing is free from costs under a market economy - not lunches, not talents, not even dreams, for dreams must use up that highly valuable and irreplaceable scarce economic resource: time. Opportunity Costs Men, in their decision to com pete for access to some particular resource, bid up its price. By bid ding up the price of an economic good, they impose higher and higher costs of ownership on all those who hold legal, exclusive titles to the good. These costs come in the form of opportunity costs. Since the scarce economic resource is now more valuable in the opinion of the public, it com mands a higher price, and there fore the value of the resources that the owner could gain access to by selling his title of exclusive control to someone else is continually increased. He pays a price, mo ment by moment, for his refusal to part with his property; if he retains title. to one piece of 1972 OWNERSHIP: FREE BUT NOT CHEAP 407 property, he is thereby prevented from gaining access to other goods and services that his property could be exchanged for. If some thing commands a price, it is not gratuitously possessed. Free ownership may command very heavy costs. It is the right of free, exclusive control over property which makes the economic burden inescapable; the free market im poses responsibility with every grant of economic power.

The farmer who does not wish to sell his land, whether for senti mental reasons, or a fear of change, or a commitment to the ideals of rural life, or just to keep old Charlie Drackett from getting his dirty hands on the bottom forty, is thereby compelled to pay for his use of that land. He has to defend his possession of exclusive control, daily, in the market place. It is not his legal title that is in question; it is his economic abil ity to defend it against others who think they could use his property in order to better service the needs of the public. He does not have to defend it in the way his great-grandfather did - shooting Indians or revenuers or Hatfields or McCoys - but by using it to satisfy the incessant demands of an unsentimental public. If he fails to do this, he suffers economic losses. He may have to dip into his life savings to keep his farm going. He may have to go deeper into debt. Finally, if he continues to fail to meet the public's de mands for more food, cheaper food, better quality food (or even lower quality food, nutritionally, if that is what the public wants), his mortgage will be foreclosed.

The bank will sell it, or the tax collector will sell it, to the highest bidder. This highest bidder is a middleman. He is acting on behalf of the public. He thinks he can use the land and other capital assets more efficiently than any one else can. If he is wrong, the process will start over again. Private property is held in stew ardship for the public. Title to property is not held by "the public." Titles are ~eld by individual owners. But the market combines the myriad of discrete demands of many individuals and imposes costs on the possessors of all desired economic resources. No owner can resist the pressure of market demand without bearing these costs. Day after day, market pressures force all owners to ask themselves, "What's it worth to me to hold onto this?" The public responds, through the market, "You'll have to meet our price if you want to keep it." Day after day, all those who retain free title to a particular piece of property meet this price. They pay in the forfeited opportunities that might 408 THE FREEMAN July have been: the vacation, the new car, the shares of IBM, and silence from "the little woman" who wants to sell out. This is the law of survival in the free market.

May the best (most efficient) man win. Ownership Contingent on Right Use During the English Reforma tion the problem of the j ustifica tion of ownership came to a head with the confiscation of the prop erty of the monasteries. "The Reformation theorists," writes Richard Schlatter, "failed to solve their first great problem. They were not able to work out a theory which would justify large-scale confiscation and at the same time mesh with their other ideas about the nature of private ownership and its rights. For a consistent theory they substituted an emo tional attack."1:~ They attacked clerics for their alleged misuse of wealth. But Sir Thomas More, the great Roman Catholic layman, an swered this argument in A Suppli cation of Souls. If this is a valid premise for expropriation, he wrote, then there will be no end of expropriation. The King may use it against the church, but then the people will use it against the mer chants (who bought the land from the King). Thus, concludes Schlat ter, "The theorists of the Reforma tion could-not answer More's' arguments without admitting the prin ciple that all ownership was con tingent upon right use. But no property owner was willing to grant that that principle should be enforced by any authority in this world. The theoretical prob lem was left unsolved."14 Economic vs. Legal Control The solution to this theoretical problem is found in the analysis of the operation of the free market.

Yes, ownership does depend, eco nomically, on proper use of re sources. The legal title, however, does not rest on economic founda tions but on historical or formal legal principles. Jt is the magnifi cent fusion of the right of free legal ownership. and cost-bearing economic control of resources which the free-market common wealth provides that overcomes the theoretical dilemma of medieval property theory. Laws against the confiscation of private property insure the smooth operation of the free market, and this in turn pro duces a system of economic organi zation which requires each owner of property to assume the costs as sociated with the control of prop erty. Mises summarizes it quite well: Private property is a human de vice. It is not sacred. It came into existence in early ages of history, 1972 OWNERSHIP: FREE BUT NOT CHEAP 409 when people with their own power and by their own authority appro~ priated to themselves what had pre viously not been anybody's property.

Again and again proprietors were robbed of their property by expro priation. This history of private property can be traced back to a point at which it originated out of acts which were certainly not legal. Virtually every owner is the direct or indirect legal successor of people who acquired ownership either by ar bitrary appropriation of ownerless things or by violent spoliation of thei r predecessor. However, the fact that legal for malism can trace back every title either to arbitrary appropriation or to violent expropriation has no sig nificance whatever for the conditions of a market society. Ownership in the market economy is no longer linked up with the remote origin of private property. Those events in a far-distant past, hidden in the dark ness of primitive mankind's history, are no longer of any concern for our day. For in an unhampered market society the consumers daily decide anew who should own and how much he should own. The consumers allot control of the means of production to those who know how to use them best for the satisfaction of the most urgent wants of the consumers. Only in a legal and forn1alistic sense can the owners be considered the succes sors of appropriators and expropria tors. In fact, they are Inandataries of the consun1ers, bound by the op eration of the 111arket to serve the consumers best. Under capitalism, private property is the consumma tion of the self-determination of the consumers.l 5 The confusion in men's minds between the concept of free legal title and gratuitous ownership has led to numerous injustices in politi cal and economic affairs. Mistakes in analysis at this point too often lead to cries of political interven tion to right some supposed wrong.

People want the state to enforce false analyses that seem, in the short run, to benefit some special interest group. Some men believe that free own ership is gratuitous, and that the deviation from such a hypotheti cal universe is the result of "ex ploitation." They do not compre hend that they must defend their ownership in the market, satisfy ing the demands of the public ef ficiently. An example of this kind of erroneous thinking can be found in the case of American farmers during the great depression. of the 1930's. It was not uncommon for farmers to face the foreclosure of their mortgages by the local bank, or .else by the solvent bank \vhich had acquired the assets of the bankrupt rural bank. (Over 9,000 banks suspended payments in the years 1930-33, not counting banks that merged,vith others and those closed temporarily by the states or the Federal government during 410 THE FREEMAN July "bank holidays."16) Sometimes tax foreclosures would occur. In any case, local farmers would occasionally attend the auction, and a group of them would surround or threaten potential bidders, espe cially if they were outsiders to the community. Violence, or the threat of violence, was used directly to reduce the price of the bids, thus lowering the particular farmer's costs in regaining title to his farm.

The true costs of operating the farm were therefore artificially re duced, thereby lowering the own er's burden of responsibility to the public, as registered on the open market. Agricultural Legislation This, however, was too crude and direct a form of violence to be used often, even when local law en forcement authorities permitted it. Violence could be applied far more effectively through state legisla tures and the United States Con gress. In 1934 three acts were passed by the Federal government, adding even further intervention into an already controlled farm market (e.g., the Farm Credit Act of 1933) : the Farm Mortgage Re financing Act, involving Federally insured loans; the Farm Mortgage Foreclosure Act, extending the au thori ty to the Land Bank Commis sioner to enable him to make loans to farmers, allowing them to redeem their farm properties prior to foreclosure; the Frazier-Lemke Bankruptcy Act, allowing the farmer who had lost his farm through foreclosure to demand a "fair and reasonable" appraisal and to repurchase his property over a period of six years at one per cent interest (interest rates were fairly low in the free market in these years, however). This last act was declared unconstitu tional in 1935, but a similar act, shortening the repurchase time to three years, was upheld in 1936.

In short, the coercive monopoly of legitimate power which belongs to civil government was applied in order to thwart the operation of the free market. Men successfully reduced the costs of ownership through collective violence or the threat of violence. Harold Under wood Faulkner, no supporter of the free market, has commented on the implications of these early policies of New Deal agriculture: A survey of the farm legislation passed during the five years 1933 1938 make clear certain facts. First of all, "economic planning" was car ried further with respect to argicul ture than to any other economic in terest. The government took upon it self the responsibility of attempting to determine both production and prices as well as maintaining soil resources and handling most of the 1972 OWNERSHIP: FREE BUT NOT CHEAP 411 credit resources of the farmers. In the second place, this program was carried out at the expense of the consumer. Agriculture was to be a favored industry, with the taxpayer and consumer paying the bill. This, of course, did not disturb the farmer; he insisted that agriculture was now merely receiving protection as indus try had long received it through the protective tariff. Finally, it should be noted that the government en tered so definitely into the program of financing agriculture that by 1937 its agencies held about half of the long-term agricultural paper of the country. This was indeed a big step from the laissez-faire policies of a quarter century earlier. 17 Exclusive Right of Access Not only do men erroneously be lieve that free title to a piece of property ought to bring with it gratuitous ownership, but they also err in believing that the right to bid on another's property is, in and of itself, an exclusive pos session of one bidder or one group of bidders. Such ~xclusive access involves a legal title, by definition.

In' other words, they think that their legal right to increase an other's opportunity cost for re taining possession of his property is, in effect, their own gratuitously held prerogative - a titled right to exclusive control of one segment of the market. Trade unions, for example, call in the coercive power of the Federal government (through the Wagner Act and the National Labor Relations Board) to defend their exclusive right to bid, on a particular labor contract, utterly free from the outside com petition from other workers who might be willing to work for less money. The members of such or ganizations assume that they have a legitimate right to hold a job (or gain access to one through the union) apart from the daily com petition necessary to defend their presence in that particular occu pation. They call in the state to create by fiat a title to that occu pation by arbitrarily excluding others from bidding.

- to a Given Job Wha t members of a union do have title to is their ability to work. But members of such co ercive structures think that be cause they have legitimate title to their labor they also should have legal title to an opportunity to exercise their talents in some spe cific occupation, apart from out side competition, thus forcing the employer's costs of operation higher than a free labor market would have permitted. They ex clude other citizens who equally have title to their own labor, but who are not permitted to bid down the cost of hiring labor. By granting, by fiat intervention, ti412 THE FREEMAN July tles of exclusive bidding rights to one group of laborers, the state effectively robs other men of their right to bid, and therefore of their right to exercise their per sonal talents. By this confusion of the right to bid in the market and a title of exclusive access to that segment of the market, the state increases the employer's costs of operation, re duces the union member's oppor tunity costs (it does not cost him as much to retain his job, for out side competition for that job is eliminated, by state fiat), and it deprives nonunion laborers of their right to exercise their par ticular callings before God and society. A man's legitimate right to bargain for his job, continu ously (or whenever his labor con tract is subject to renewal), is transformed by state fiat and le galized coercion into his right to avoid continuous bargaining. A three-way bargaining structure employer, union member, and non union member - becomes, through the threat of state violence, a two .way bargaining structure, as the nonunion member is driven to accept other employment which he would not have chosen voluntarily.

An exclusive title - a property right, in other words - is created by state fiat, where only a right to bargain in an open market had existed previously. - to a Given Market Area Trade union members are not alone in this confusion, unfortu nately. Many, many businessmen involve themselves in precisely the same error. They use the inter ference of state violence to keep outsiders away from the market place. A three-way structure should exist: the consumer, the American producer, and the for eign producer. Instead, the Amer ican businessman seeks to make the structure a two-way arrange ment: the consumer and only the American producer. Like the labor union member, he seeks to trans form a right to bid in the market into an exclusive title of entry into the market. The usual means for this kind of operation is the tariff or the import quota. In principle it is identical to the ac tivity of the state-supported trade union. Ironically, many business men who derive great personal satisfaction from castigating the "immoral" trade unions involve themselves in the same "immor ality." The game is the same; state "protection" from outside interference - the exclusiveness of a legal title to private property.

Instead of a legal title to dispose of their assets and skills as they see fit, in open competition, sub ject to the imposition of the bur dens of the responsibilities of ownership, businessmen want title 1972 OWNERS!IIP: FREE BUT NOT CHEAP 413 to an exclusive right to dispose of their assets, apart from competi tion, apart from the fun burdens (costs) of responsible ownership. Only the intervention of the state can grant such an escape from re sponsibility, so they call for the intervention of the state. Men simply like to enjoy the fruits of ownership apart from the respon sibilities of ownership. They give up some of their freedom (or their neighbor's freedom) in order to escape from responsibility. They call for the creation of legal titles where none could exist on a free market. Conclusion On the one hand, the owner of an exclusive title - a property right - cannot escape the costs of ownership and the concomitant ob ligation to act as a steward of his goods for the public's benefit. He cannot escape so long as political intervention into the market does not occur. The fruits of ownership are not separated from the bur dens of ownership. On the other hand, those who seek to make a bargain cannot, apart from state coercion or private violence, trans form the right to dispose of one's own property (talents) into an ex clusive title to dispose of that property on a specific market apart from entry by other property own ers who wish to bargain with their property. Titles of ownership re fer to the control of property and skills by the owner; they do not refer to reciprocal relationships of exchange, where two owners seek to dispose of their property in a mutually acceptable manner. In fact, if exclusive titles are granted respecting the reciprocal human relationships, the rights of control over one's own assets are thereby diminished. The title to property, which involves the right of volun tary disposal of that property, is compromised when the state inter feres in the market in which men seek to dispose of their property.

By granting titles of exclusive ac cess to certain markets, the state thereby revokes some of the rights of ownership. The rights of own ership involve both the right to bid and the right to be bid against. Compromise either of the last two rights, and you have compromised the original rights of ownership. The right to be bid against is the provision of the legal struc ture which allows individuals in the marketplace to have the costs of ownership imposed on them selves and all other owners. Each time any group gets the state to protect it against the economic bidding of the public, it thereby red uces the efficiency of the mar ket as well· as the members' own responsibility to bear the full costs of ownership. The overall 414 THE FREEMAN July wealth and overall freedom of the community are simultaneously re duced, because without efficiency, wealth is reduced, and without re sponsibility, freedom is reduced.

If men would remain free, they must demand that they and their neighbors retain the rig ht of responsibility. They must resist the attempts of men who would seek to escape both freedom and re sponsibility by lowering their competition from other partici pants in the market. Ownership is free, but not cheap. The same is true of freedom. I) • FOOTNOTES • 1 Ludwig von Mises, Human Action (3rd ed.; Chicago: Regnery, 1966), pp. 311-12. 2 Cf. Robert A. Nisbet, Social Change and History (New York: Oxf9rd Univer sity Press, 1969), ch. 4; Louis I. Bred voId, The Brave New World of the En lightenment (Ann Arbor: University of Michigan Press, 1961). 3 The concept of the public schools as America's only establis·hed church is brought forcefully in Sidney E. Mead's The Lively Experiment (New York: Harper & Row, 1963), ch. 4. Cf. R. J. Rushdoony, The Messianic Character of American Education (Nutley, New Jer sey: Craig Press, 1963).

4 The separation of church and state, it must be stressed, came to the American colonies quite early; Rhode Island ac cepted the principle from the beginning. But orthodox Connecticut was forced to adopt it as a result of the religious tumult caused by the Great Awakening of the mid-eighteenth century; it was brought in to existence by Christians, not secular ists or the tiny handful of Unitarians and Deists: Richard L. Bushman, From Puri tan to Yankee (Cambridge, Mass.: Har vard University Press, 1967), ch. 13. 5 Paul Craig Roberts, "The Polycentric Soviet Economy" The Journal of Law and Economics, XII (April, 1969): Her bert S. Levine "The Centralized Planning of Supply in Soviet Industry," (1959), in Wayne A. Leeman (ed.), Capitalism, Market Socialism, and Central Planning (Boston: Houghton Mifflin, 1963); Gary North, "The Crisis in Soviet Economic Planning," Modern Age, XIV (Winter, 1969-70) .

6 Ludwig von Mises, Bureaucracy (New Rochelle, New York: Arlington House, [1944] 1969). 7 Gary North, "Statist Bureaucracy in the Modern Economy," THE FREEMAN (Jan., 1970). 8 Murray N. Rothbard, 1\Jlan, Economy and State (Los Angeles: Nash, [1962] 1971), p. 4. 9 R. J. Rushdoony, The One and the Many (Nutley, New Jersey: Craig Press, 1971), surveys the history of this vitally important philosophical problem". He argues that modern philosophers prefer to avoid discussing the issue because they have been able to find no secular answer to it. 10 Mises, Socialism (New Haven, Conn.: Yale University Press [1922] 1951), pp. 275-76. 11 Ibid., p. 276. 12 Mises, Human Action, pp. 683-84. 13 Richard Schlatter, Private Prop erty: The History of an Idea (New Bruns wick, New Jersey: Rutgers University Press, 1951), p. 81. 14 Ibid., pp. 86-87. 15 Mises, Human Action, p. 683. 16 Historical Statistics of the United States: Colonial Times to 1957 (Wash ington, D. C.: Bureau of the Census, 1960), p. 636 (explanation of statistics on p. 619).

17 Harold Underwood Faulkner, Amer ican Economic History (5th ed.; New York: Harper & Bros., 1943), p. 656.