Economic Power; J. Fulda

Any analysis of economic power must begin with a clear conception of power and its an tithesis, liberty. Power, as I understand it, is the capacity to rule others: to make decisions for them without their consent and, in partic ular, to allocate their time and direct their en ergies. Liberty, in contrast, is a condition of noninterference and self-rule in which people make decisions for themselves without asking any man's leave and in which they themselves apportion their time and channel their energies in such manner as to them seems most satis fying. An Unholy Alliance If the capacity to coerce is the sum of power, it is hard to see how it inheres in a pile of riches. The usual reply is that wealth can be used to obtain instruments of coercion along Joseph S. Fulda, a regular contributor to The Freeman, is Assistant Professor of Computer Science at Hofstra Univer sity and resides in Manhattan.

with those willing to use them, and that power can indeed be found in a stockpile of weapons and men of violence. Now this is all very true, but inasmuch as the unholy alliance between wealth and force, public and private, is univer sally proscribed in free republics, it cannot ac count for the tirades, so common in the media, against economic power. Neither bribery nor organized crime, typical examples of the alli ance, is the object of their fulminations. Eco nomic power in that sense has no apologists and, therefore, no detractors. Nor is it the holders of power, as we have defined it, who stand accused of its use in the economic realm. Indeed, government is seen as the enemy of economic power, Galbraith's ,'countervailing power," the embodiment of Kristol's populist temper. Government may in deed tax, subsidize, regulate, and monopolize, but it is rather the wealthy and the corporations who are said to enjoy economic power. But the only power which properly attends on wealth alone is dominium: "the complete power to use, to enjoy, and to dispose of property at will" (The American College Dictionary). But is this power? That is, is it control over one's own domain or control over the domain of others? Far from being a "power," dominium is a liberty, the liberty to do with the fruits of one's labor and the return on one's investment as one wills.

Market "Power" Thus, proponents of the concept of economic power must be referring to something other than power over the economy. What they mean, in fact, by "economic power" is the ability to influence a variety of social and eco nomic conditions through the use of one's wealth in a volitive, rather than coercive, manner. In a market society, those with the most purchasing "power" ultimately decide what will be produced in greater measure than those with less purchasing power. Likewise, those with the most to invest will proximately decide what goods will be produced and what services will be offered in greater measure than those with less to invest. Yet this influence over the free economy is central to its operation: Either what is produced will determine what will be consumed, as in the command economy, or what will be consumed determines what is produced, as in the market economy. Likewise, either profits and losses will take capital from those not satisfying con sumer wishes and reward those more sensitive to others' needs, or capital will be allocated and production decisions will be made in accor dance with political, rather than economic, cri teria.

The notion of economic power, then, is really nothing other than what an honest so cialist would admit is economic freedom, what Marx called "that single, unconscionable freedom." This freedom, mistakenly labeled power, is often resented when it comes to play in the political sphere; this resentment leads to all manner of "election reforms. " It is also re sented in the economic sphere, and leads to a variety of anti-competitive "regulatory re forms. " It is perhaps most resented in the so cial sphere-just recall Mrs. Reagan's difficult first months as First Lady-and results in sweeping demands for a new social order. In the March Freeman: 65 What is really resented is the necessarily un equal nature of this influence that will always obtain when men are left free. The gurus of the far left denounce concentrations of wealth as power, because the resulting influence over who will lead and what will be produced and consumed is something they feel is best left with them and their plans for our future.

The Hypocrisy of Collectivism What other explanation can honestly be put forth for collectivist denunciations of wealth in capitalist society, in view of their decidedly hypocritical "solution"? After all, they pro pose to combine all corporations into one giant Corporation, to endow it with all natural re sources, to arm it, to invest it with legislative and judicial powers, to grant it the police power, to imbue it with quasi-spiritual au thority, to place its public relations department in charge of the media and its acquisitions de partment in charge of the military and then, as final sublimating acts, to replace a much-de cried self-perpetuating board of directors with a self-perpetuating Party elite and to simply rename this new Corporation, the State. That is the socialist prescription for concen trations of both wealth and power, and it is a very clear guarantee of poverty, misery, and tyranny, the three things alone which socialism has produced beyond comparison. Not for nothing is socialism thus sometimes, however inaccurately, described as "state capitalism"!

If one is truly interested in limiting economic power, one should consider limiting govern ment-for that is where power properly under stood lies. 0 " 'Blat': Corruption in Eastern Europe" by Michael Brewer "Rewarding Uniformity" by Kenneth A. Bisson "The Great Depression" by Hans F. Sennholz 66 The Self-Interest of Self-Regulation by J. Brian Phillips P roponents of government regulation often overlook the many ways in which the free market itself polices producers, without the need for government involvement. Let us make a quick survey of these ways, in the hope that it will help us better to understand the market process, as well as shed further light on the wisdom of government intervention. Almost all businessmen realize that· to suc ceed they must please the buying public. A sat isfied customer most likely will become a reg ular customer. A dissatisfied customer will not return, and too many dissatisfied customers will cause a business to fail. Consequently, the businessman has an interest in providing his customers with quality products and services at reasonable costs.