Two Ways of Life; R. Anderson

IN his 1859 classic, On Liberty, John Stuart Mill observed that, ((The only freedom which deserves the name, is that of pursuing our own good in our own way, so long as we do not at tempt to deprive others of theirs, or impede their efforts to obtain it." The application of this philosophy of freedom to economic affairs sim ply means freedom of choice in the marketplace. It means the freedom, in our dual role as producer and consumer, to conduct our own daily affairs without interference from others. Throughout the world it may be observed that individuals do not have this kind of freedom of choice. Not only communist nations regu late and control the lives of the citi zens, but even in noncommunist Mr. Anderson is executive Secretary, The founda tion for Economic Education. Robert G. Anderson_.....II• •••~. ~ countries these freedoms once en joyed are being rapidly lost. Nowhere, it seems, is freedom de fended as a philosophical absolute.

At best, it is tolerated as a pragmat ic necessity rather than upheld as a sovereign principle. The structure of society is all important in its impact on individ ual freedom. The institutions of so ciety may be designed to maximize individual liberty, or society may be designed to give a ruling elite power over the citizenry. To put the matter more simply-a society may be structured for freedom and produc tion, or it may be structured for slavery and plunder. The extent to which individual behavior is influenced by external forces is far more profound than may first be realized. The so-called u way of life" in India, Russia, Argentina, 579 580 THE FREEMAN October or the United States dramatically affects human action. How the indi vidual lives and acts is ultimately dependent upon values learned from the society in which he lives. While all individuals have a common source in their Creator, our formula tion of values radically differs as each of us is exposed to different living experiences.

This uniqueness of each individ ual possessing values different from all other individuals can be the source of a free society based on peace and harmony. Unfortunately, this condition of differing values can also lead to the structuring of a totalitarian society based on conflict and violence. The great question is why this latter structuring of society has been the most prevalent one throughout human history. Axioms of Economics While it is true that men can impose artificial structures upon so ciety, nevertheless, there exist cer tain universal laws which operate irrespective of these structures. Cer tain economic axioms can be ob served from our very nature. They have guided mankind from the be ginning, and will continue to do so as long as man's nature is un changed. Four of these axioms need to be mentioned. Axiom number one: we live in a world of scarcity. It is true that the general wellbeing of individuals is better today than in the past. But this improvement has in no way eliminated scarcity. It merely reflects a reduction in the degree of scarcity, and could be transient, depending on the decisions we make in the present and future. As long as man exists, the problem of scarce re sources exists.

The condition of perpetual scar city follows from axiom number two: man's insatiable appetite . No matter how many of man's wants are satis fied, there always remain additional wants to be fulfilled. There are never enough resources to supply all of our wants: Unlimited wants, but only limited means for satisfying them. This combination of insatiable wants and scarce resources is a uni versal condition of man's existence. It has always been true, it is true today, and it will remain true as long as man lives. And it is in terms of this condition that the economic questions of production, distribu tion, and consumption must be re solved. The reality of our basic economic problem leads to axiom number three: we must constantly make clwices. The determination of what to produce, by whom, when, where and how much must be made. In addition, these same questions must be answered regarding distribution and consumption. Who gets what, and when, where, and how much.

1979 TWO WAYS OF LIFE 581 What is certainly clear is that not everyone can have everything, now. One final observation about man's nature should also be made. Axiom number four is that we all want more for less. This trait can lead to either good or evil. Perhaps above all else it explains why the path taken by man in the structuring of society has been so consistently au thoritarian. The acquisition of more through plunder under socialism rather than more through produc tion under capitalism has always marked the difference between these two systems of social organiza tion. The present-oriented mentality of individuals has too often con cluded that plunder is the better way because it seems the quicker way to obtain more for less. The Role of Private Property No type of society established by man can in any way avoid these universal economic axioms, though the nature of the system determines how these universal laws will man ifest themselves. The basic problem of allocating scarce economic re sources toward the satisfaction of human wa~ts must be faced in every society.