Capitalism is freedom – the consensual pursuit of happiness, free from the interference of conceited, coercive bureaucrats who think they know better – they don’t. Our next section in Chapter 5 of George Will’s new book The Conservative Sensibility (2019) is The Fatal Conceit. That’s also the name of the last book written by Friedrich Hayek. His thinking built upon the ideas of Adam Smith who made it absolutely clear that government has no business “superintending the industry of private people, and of directing it towards the employment most suitable to the interest of society”.
Hayek obliterated any argument that central planning can ever succeed in creating and maintaining a successful political economy. The study of economics used to be, and still should be, called Political Economy. Politics is inescapable no matter how hard economists try to ignore it. Ironically, markets freed from government control are the creation of government control. Laissez-faire was planned. It’s the only prosperous way to arrange economic affairs. Chapter 5 begins with Hayek’s wisdom: “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.”
There is an irremediable impediment to government successfully constructing a rational economic order. Hayek explained why in 1945. “The knowledge of circumstances of which we must make use never exists in a concentrated or integrated form, but solely as the dispersed bits of incomplete and frequently contradictory knowledge which all separate individuals possess.” Mankind stumbled upon the pricing system without understanding it. And it works very well – except when damaged by the “impertinent obstructions” of conceited government planners.
George Will concludes this section with a vital point – everyone knows almost nothing about almost everything. And fortunately (yes fortunately because it is growing increasingly undeniable) this fact becomes truer every day. As humanity’s stock of knowledge grows, so to does the amount that theoretically must be known, but practically and increasingly, cannot be known to the would be, overconfident, self-righteous social planner.
Evil dictator Benito Mussolini argued in 1929 that the more complicated civilization becomes, the more restricted the freedom of the individual must become. The exact opposite is true! George Will concludes: “The more complex society becomes, the more government should defer to the spontaneous order generated by the voluntary cooperation of freely contracting individuals”.
Next week, we meet the Grumpy Economist. He’s a blogger so observant and on-point with issues addressed here that I’m surprised I’ve not encountered his work before.