The Sphere of Government;H. Hazlitt

I should like now to turn to some of the answers offered in the nineteenth century. Henry Hazlitt, noted economist, author, editor, re viewer and columnist, is well known to readers of the New York Times, Newsweek, The Freeman, Bar ron's, Human Events and many others. Among the more recent of his numerous books are The Inflation Crisis and How to Resolve It and a revised edition of Economics in One Lesson. 26 To try to present the whole of nineteenth century thought on this subject would in itself require at least a full-length book and proba bly a repetitious one. So I shall con fine myself to the answers offered by three or four outstanding writers who seem to me to offer representa tive approaches-John Stuart Mill, Herbert Spencer, Thomas Huxley, and Auberon Herbert. Mill's main discussion of the prob lem occurs in Volume II (Book V, Chapters I and IX) of his Principles ofPolitical Economy, first published in 1848. When one recalls that Mill was brought up in the laissez-faire tradition, some of his conclusions may seem surprising.

He begins by distinguishing be tween the ~~necessary" and the ~~op tional" functions of government. The first are those which ~~are either SPHERE OF GOVERNMENT: J .S. MILL 27 inseparable from the idea of gov ernment, or are exercised habitually and without objection by all gov ernments." The second are those functions of which the ((expediency of its exercising them does not amount to necessity" and ((on which diversity of opinion does or may exist." Mill's Extended List of Necessary Functions of Government The necessary functions of gov ernment, he insists, are ((considera bly more multifarious than most people are at first aware of." The contention, for example, that ((gov ernments ought to confine them selves to affording protection against force and fraud," and ((that, these two things apart, people should be free agents," is much too narrow. What about, for example, the laws of inheritance? Not only is the government obliged to decide what happens to an estate when there is no will; it must pass on the validity of a will; it must decide among litigants.

Again, the government must en force contracts. It must decide what contracts are fit to be enforced. (A contract to do something contrary to law? A contract to sell oneself into slavery?) The state must also es tablish civil tribunals to settle dis putes. It must keep a registry of facts, such as births, deaths, mar riages, wills and contracts, andjudicial proceedings. It must decide on the legal competency of children, or alleged lunatics, and provide for guardians. It may undertake the function of coining money, and of prescribing a set of standard weights and measures. It may make or improve harbors, build light houses, make surveys for accurate maps and charts, raise dykes to keep the sea out, or embankments to keep rivers in. National governments may build roads, and municipal governments may pave, light, and clean the streets. ((Examples might be indefinitely multiplied without intruding on any disputed ground."

In a later chapter, Mill considers some of the reasons for limiting gov ernment power. ((There is a part of the life of every person who has come to years of discretion, within which the individuality of that per son ought to reign uncontrolled either by any other individual or by the public collectively .... A second general objection to government agency is that every increase of the functions devolving on the govern ment is an increase in its power" which may soon become ((arbitrary." . . . ((A third general objection to governmental agency rests on the principle of the division of labor. Every additional function under taken by the government is a fresh occupation imposed upon a body al ready overcharged with duties. A natural consequence is that most 28 THE FREEMAN January things are ill done; much not done at all." There follows a long description of the reasons why, in general, private enterprise and initiative are more efficient than government in carry ing on any enterprise. In every in stance these reasons are more than sufficient, Mill concludes, to throw Uthe burden of making out a strong case, not on those who resist, but on those who recommend, government interference. Laisser-faire, in short, should be the general practice: every departure from it, unless required by some great good, is a certain evil." He supplements this with a recital of the incredible restraints on business imposed historically in seventeenth-century France and elsewhere.

But then Mill turns to what he regards as the ((exceptions" to the, gen~rally beneficent rule of Iaissez faire. uThe proposition that the consumer is a competent judge of the commodity, can be admitted only with numerous abatements and exceptions ..... The uncultivated cannot be competent judges of culti vation: Those who need most to be made wiser and better, usually de sire it least, and if they desired it, would be incapable of finding the way to it by their own lights. . . . Education, therefore, is one of those things which it is admissible in principle that a government should provide for the people. . . . UWith regard, to elementary edu cation, the exception to ordinary rules may, I conceive, justifiably be carried still further .... It is there fore an allowable exercise of the powers of government, to impose on parents the legal obligation of giv ing elementary instruction to chil dren. This, however, cannot fairly be done, without taking measures to in sure that such instruction shall be always accessible to them, either gratuitously or at a trifling ex pense." The one safeguard Mill in sists on is that Uthe government must claim no monopoly for its edu cation."

More Exceptions Mill continues with his ((excep_ tions" to the principle of laissez faire. HInsane persons are every where regarded as proper objects of the care of the state." Ult is right that children and young persons ... should be protected, as far as the eye and hand of the state can reach, from being over-worked." HCruelty to animals" should be forbidden. uThe law should be extremely jealous" of all ((engagements for life" -in cluding marriage. If it grants a monopoly for a private road, canal, or railway, the state ((should retain, and freely exercise, the right of fix ing a maximum of fares and charges." The state should have the right to diminish the hours of adult labor.

1980 SPHERE OF GOVERNMENT: J .S. MILL 29 Mill approves the Poor Laws, and endorses the principles of the Poor Law of 1834. ~~The claim to help, created by destitution, is one.of the strongest that can exist." But the problem is ~~how to give the greatest amount of needful help, with the smallest encouragement to undue reliance on it." For ~~if the condition of a person receiving relief is made as eligible as that of the laborer who supports himself by his own exer tions, the system strikes at the root of all individual industry and self government." Yet we cannot depend on ~~voluntary cparitj.~~ ~~In the first place, charity almosf!'always does too much or too little: it lavishes its bounty in one place, and leaves peo ple to starve in another. Secondly, since the state must necessarily provide subsistence for the criminal poor wbile undergoing punishment, not to do the same for the poor who have not offended is to give a pre mium on crime."

Mill goes on to recommend gov ernment subsidies for colonization, for ~~scientific researches," and for other modes ~~of insuring to the pub lic the se·rvices of scientific· discov erers." And as a final argument for ex tending government power still further, he adds: ~~The intervention of government cannot always prac tically stop short at the limit which defines the cases intrinsically suita ble for it. In the particular circumstances of a given age or nation, there is scarcely anything really important to the general interest, which it may not be desirable, or even necessary, that the govern ment should take upon itself, not because private individuals cannot effectually perform it, but because they will not." An Open-Ended Formula This last argument is capable of serving as an excuse for almost any arbitrary government intervention whatever. Mill ends by granting most of the contentions of the present-day statists. As he keeps adding to his list of ~~exceptions" to the general rule of laissez-faire, he gradually seems to forget all his earlier warnings against piling an unmanageable· number of functions on the state and building excessive powers that can more easily be abused. In many of his exceptions he unconsciously takes it for granted that the state will necessarily do better than .private initiative. He overlooks the possibility that scien tists may be subsidized on the basis of favoritism or that the subsidized projects will be selected on the basis of political rather than scientific ap peal.

After having warned us that the state may carry out its delegated powers very badly, he assumes in particular instances that they will carry out these powers very well. He 30 THE FREEMAN rightly approved the restrictive principles of the Poor Law of 1834, which required from the applicant for relief, as Nassau Senior put it, ((monotonous and uninteresting" toil in a workhouse, so that he would retain an incentive to become again as soon as possible an independent laborer. What Mill did not foresee was the immense political difficulty of retaining such a disciplinary sys tem once relief was embarked upon. He did not foresee that this discipli nary system would soon come to be regarded by a large part of the pub lic as needlessly harsh and even heartless. The sentimental but pow erful pen of Charles Dickens, for example, was shortly to make the retention of the workhouse system impossible. The almost inevitable tendency in any relief system is for demagogic politicians to remove one by one all the original restraints and safeguards and to load the relief rolls to the point where work incen tives are destroyed, the national budget becomes chronically unbal anced, and a progressive inflation sets in.

Even more broadly, what Mill Alexis de Tocqueville overlooked was that once these broad powers of control were put in the hands of the state, under a popularly -elected government, that government would be very unlikely to adhere to the sound economic (and anti-interventionist) principles that Mill, and other economists of his school, were recommending in their textbooks, but would enact popular prejudices leading to infla tion, to price-controls, to Hsoak-the rich" taxes, to the redistribution of wealth and income, to anti capitalistic and anti-productive policies of every other kind, and in cidentally to the eventual destruc tion of liberty. In his essays on Liberty, on Repre sentative Government, and on The Subjection of Women, Mill made im portant contributions to political theory. But on the central question of what ought to be the limits of government power, he clearly granted too much. He left unan swered the great problem: How can we retain interventionist demo cratic government and yet prevent majority rule from degenerating into mob rule? i IDEAS ON UBERTY To manage these minor affairs in which good sense is all that is wanted, the people are held to be unequal to the task; but when the government of the country is at stake, the people are invested with immense powers; they are alternately made the playthings of their ruler, and his masters-more than kings, and less than men.