The Power of Freedom
WARNING: After reading this column, many of you will want to send me emails condemning me for my apostasy or telling me why I am mistaken. I welcome your feedback as I beg your indulgence. So, here goes: I don’t believe that the welfare state, or the regulatory state, inevitably leads to widespread poverty or to oppressive collectivism.
There was a time when I worried that the dependency and inefficiency caused by government interventions would create a vicious, self-reinforcing cycle that fueled more calls for even greater intervention—a process that would continue until the State suffocated all individualism and initiative. But I no longer believe that such a progression—or, better, retrogression—is inevitable.
Two reasons explain my change of mind. The first is observed reality, and the second is what I (perhaps too vainly) believe to be a better understanding of society, politics, and economics.
Let’s first look at reality. From at least the 1930s—or as scholars such as Arthur Ekirch argued, from a much earlier time—government’s role in the American economy has expanded dramatically. And yet we continue to grow more prosperous. Beyond any doubt, Americans of 2010 are better fed, clothed, housed, informed, educated, medically cared-for, traveled, rested, and entertained than were Americans of 1930—or even of 1980. Despite some tax relief and deregulation since the late 1970s, these improvements in our living standards occurred with government taxing and regulating and redistributing as never before in the United States.
Look also at other countries. Although ordinary people in nations such as France and Sweden aren’t as wealthy as ordinary Americans, they are nevertheless extraordinarily wealthy by historical standards. And they’re getting wealthier despite their governments’ heavy interventions in their economies.
It’s a fact that real and growing prosperity is not necessarily quashed by government intrusion. This does not mean, of course, that these intrusions do not reduce the level of prosperity and the rate of economic growth. I’ve no doubt that they are harmful—that ordinary men and women would be wealthier and more secure (and freer) were the State to remove its tentacles and tax collectors from the economy.
But these tentacles and tax collectors are not necessarily fatal.
Nor are such interventions the leading edge of totalitarianism. As obnoxious and as intrusive as, say, the IRS and the FDA are, modern America is not remotely comparable to the Soviet Union under Stalin (or even under Gorbachev). Americans are incomparably more free than were the subjects of the Soviet regime.
Some readers of this magazine will dispute my observations of the real world. I report them not to be controversial but merely to be honest.
Assuming that my empirical observations are sound, what explains these facts? Why haven’t 80 years of a national government unmoored from constitutional restraints—and with an unending itch to poke, prod, and tax nearly every aspect of Americans’ lives—resulted in economic stagnation and Big Brother of the kind that haunts the characters in George Orwell’s great novel 1984?
I believe that the answer is the power of freedom.
Freedom is a beautiful flower with more robustness than crabgrass. Freedom is not delicate or easily uprooted. Like crabgrass, freedom is not indestructible; it can be killed. But freedom is not a frail institution that collapses and dies the moment it is attacked by some element foreign to its nature. If it were, we all would long ago have been well and truly enslaved.
The human spirit seizes opportunities to flourish even with less-than-maximum scope; it naturally resists being confined to the arbitrary will of others. We do not all fall in line behind the commissar or Congress’s commands simply because we’re ordered to do so. (How many Americans really care if the busboy at a restaurant is an “illegal” alien?) And even when we abide by the letter of legislation, we are wonderfully crafty at violating its spirit if that legislation is felt to be inappropriate.
So, too, with the free market. It is perhaps the most remarkably vigorous of all human institutions. Heavily taxed and loaded with arbitrary regulations, the market keeps on keeping on. Entrepreneurs creatively find ways around government intrusions or they discover techniques for reducing the intrusions’ ill effects.
Everyone who understands the logic of markets knows that, say, the unexpected destruction of a factory by an earthquake will barely slow the market’s relentless push to improve living standards. We understand that markets are remarkably resilient at dealing with—and reducing the bad effects of—natural obstacles such as mountains that separate suppliers from customers, or weather disasters that destroy existing inventories and supply lines.
Although we’d be even wealthier if these obstacles and weather disasters never materialized, their existence does not condemn us to everlasting poverty. Entrepreneurs—given sufficient freedom—are guided by prices and profits to overcome these obstacles. Likewise, entrepreneurs—given sufficient freedom—are guided by prices and profits to overcome government-erected obstacles.
The vital question here is, how much freedom is sufficient? I have no answer, except to say, ”Freedom is sufficient for economic growth even when it is far less than we should have and are capable of having.”
Many libertarians will read this column and wince, thinking I’m discounting the importance of freedom. But they would be mistaken. In fact, the theme of this column is to celebrate the great and creative power of freedom. To point out that freedom can be hobbled and hamstrung by a predatory State and nevertheless continue to shower blessings on ordinary men and women is to praise freedom—to applaud it loudly and lovingly.
Additionally, those persons who recognize the resilience and vigor of freedom and free markets gain even greater credibility when insisting that the role of the State should be reduced. If it were true that the slightest burden government placed on freedom led inexorably to tyranny and poverty, then anyone who champions freedom might be thought to do so for purely pragmatic reasons. But the champion of freedom who recognizes that the economy might still be reasonably dynamic in the face of government regulations, and who doubts that such regulations will lead to his or her being tyrannized, is an even more believable spokesperson for freedom, for that person can speak more from principle than from narrow pragmatism.
He or she can say, ”Look, even though eliminating this tax or repealing that regulation will not mean the difference between poverty and plenty, I still believe that the tax should be eliminated or the regulation repealed. The reason is that they are immoral. There’s a practical case for reducing government’s role, but even when practical considerations do not loom large, ethical considerations do. Even though this tax or that regulation won’t condemn us to a material hell, they nevertheless violate human rights that ought never be violated.”
Comment by Jameson Graber on 23 October 2010:
There’s a great passage from the Wealth of Nations that illustrates the ideas expressed here. In it Adam Smith compares the economy to the human body, which can remain quite healthy despite having a less than perfect regimen of diet and exercise.
He says, “If a nation could not prosper without the enjoyment of perfect liberty and perfect justice, there is not in the world a nation which could ever have prospered. In the political body, however, the wisdom of nature has fortunately made ample provision for remedying many of the bad effects of fully and injustice of man; in the same manner as it has done in the natural body, for remedying those of his sloth and intemperance.”
I can think of no better words to inspire optimism among lovers of freedom.
Comment by Lee Waaks on 23 October 2010:
I am in total agreement with this article. Although Ludwig von Mises demonstrated the folly of intervention, he mistakenly thought that the logic of intervention would lead to full-scale socialism. But as D.R. Steele discusses in _From Marx to Mises_, it is not necessarily true that intervention automatically begets more intervention — this is only a tendency. Sometimes governments will just accept the negative consequences of one (or many) intervention(s) and not go any further. The consequences of current and past interventions are to be greatly lamented — many millions have suffered and continue to suffer because of them. But prosperity and progress continue. Boudreaux is right to sound a note of optimism.
Comment by Richard W. Fulmer on 26 October 2010:
While a welfare state can lead to poverty and tyranny (see Roman Empire, fall of), I agree with Dr. Boudreaux that such an end is not inevitable. As long as people have free will, nothing is predestined. Trends toward centralized control can be, and have been, reversed.
While decline is not inevitable, though, neither is progress. It is true that people are increasingly prosperous in a number of European welfare states. At least some of that prosperity, however, has been subsidized by the United States. American technology has played a significant role in increasing the material well-being of people in Europe as well as around the world. But, the inventive genius that has marked America’s history will be dealt a severe blow if we continue down the path of European socialism.
Moreover, Western Europe had a superpower keeping the barbarians at bay while they beat their guns into butter. Rome did not. Neither will we.
Comment by Ron Johnson on 26 October 2010:
I wrote something along the same lines a few months ago. You expressed it far better, far clearer, than I did. See my article “It’s Not All or Nothing”
http://personallibertarianism.blogspot.com/2010/06/its-not-all-or-nothing.html
Comment by Zak on 26 October 2010:
You logic is a little twisted. Like there is mafia that kills some of us sometimes, but we are better off now now than we were during the 30′s, wouldn’t you agree? So we should protest against the mafia on purely moral grounds.
My point is it’s not just pure moral “academic” grounds. It’s hurting real bad some of us. Because of income tax alone we have to work extra 20-30 years for the government – it’s not just moral grounds, that’s slavery, man.
Comment by jorod on 26 October 2010:
Sounds like a new campaign slogan…Love the Sinner Hate the Sin.
Comment by Greg Ransom on 26 October 2010:
Hayek never believed in such an inevitable retrogression either.
But note well. Read blogs written by workers within the British Welfare/Regulatory State and you will be dumbstruck by the decline of character and morals and small human achievement and individual responsibility and basic human dignitiy — and you’d weep for those trapped living such lives, both those who are wards of the state and those who are functionaries and time servers within it.
Comment by Scott G on 27 October 2010:
This is a great article because it’s honest about a topic that’s not easy to be honest about. I would like to be where Don is, but I’m not. I’m one of those people who is often negative about what government is doing to me. I often get stuck thinking how wonderful things could be if only government would stop interfering in my life.
What Don knows better than I do is how bad others have had it and how good we have it. I guess it’s time for me to get off the web and get back to reading Rational Optimist.
One last thing though. This passage is stood out for me:
“Freedom is a beautiful flower with more robustness than crabgrass. Freedom is not delicate or easily uprooted. Like crabgrass, freedom is not indestructible; it can be killed. But freedom is not a frail institution that collapses and dies the moment it is attacked by some element foreign to its nature. If it were, we all would long ago have been well and truly enslaved.
The human spirit seizes opportunities to flourish even with less-than-maximum scope; it naturally resists being confined to the arbitrary will of others.”
That’s a nice image.
I have another, darker image:
“Young people entering adult life are like young foxes on their own for the first time. They keep warm, sleeping close to each other in the den at night, thinking about the harsh world outside of the den. They sometimes cry themselves to sleep at night wishing things would be easier. Together they suffer. Together they suffer.”
Comment by Karen on 27 October 2010:
I’m reminded of Harrison Bergeron (not including the scene with the government shotgun.) But the overall societal quality of thinking and logic declines when we spend so much time just paying for and coping with overgovernment and jackbooted bureaucrats. Cultivating a way of thinking about how things really work, and trying to live free are perhaps the most important things libertarians and anarchists can do — and it has long been this way! For sure, the astoundingly positive response of young and not so young alike to Ron Paul’s straightforward, consistent and principled words reveals the sometimes dormant but always at-the-ready flower of freedom.
Comment by DownsizeDC on 27 October 2010:
This is a good explanation how the freedom that does exist thrusts society forward to greater wealth and ease.
The Carpe Diem blog provides evidence daily of economic recovery. Hyper-inflation hasn’t hit. It may even be reasonable to be optimistic about the future.
In the aggregate, freedom seems to overcome. But in the specifics, there are tens of millions of Americans victimized every day by the government because of lost opportunities from over-taxation and over-regulation. We have no idea how much we are being held back by these unseen costs.
Comment by Guillermo Barba on 27 October 2010:
The harmful effects of many efforts to improve human nature and regulate markets have been less damaging, so far, than the beneficial outcomes of creativity and technology. Also, the perception of market failures and human greed have promoted even further interventions and the entitlement and dependence culture.
Additionally, more individuals are aware that it is more profitable to partner with politicians and burocrats to extract rents.
Interventionists would use your article as ‘proof’ that even a Libertarian has finally seen the ‘light’ and approve the evident and enlightened benefits of social engineering.
Comment by SweetLiberty on 27 October 2010:
“I don’t believe that the welfare state, or the regulatory state, inevitably leads to widespread poverty or to oppressive collectivism.”
This discussion is about relative comparisons versus absolutes. I’m sure Don would agree that, relatively speaking, America has more widespread poverty now than it would without the current regulatory state (poverty as defined by America’s standards, not third world standards). I would also assume he would agree that individual freedoms are being oppressed by collectivist regulations more so now than ever before (airport security, smoking bans, mandatory health insurance, etc.). So while he may chose to focus on the bright side of ever shrinking liberties, I for one refuse to go quietly.
Pointing out that we are better off than Stalinist Russians is like thanking our jailor for only torturing us three days out of every week instead of seven. Would it be fair to say that most Russians are much better off in the past century than they were during the Dark Ages? If so, then why not celebrate the success of communism? The debate should not be whether or not our species can survive under less than ideal conditions, but rather how best to remove the crab grass that prevents the flowers of freedom from truly flourishing the way they could. Focusing on the fact that we live better today than yesterday misdirects us from the unseen – which is how well we could be doing without the welfare or regulatory state. Don’s slogan for this article seems to be, “Don’t panic, things could be worse.” My response would be, “Panic now, things could be much, much better!”
Comment by Hayek's Disciple on 27 October 2010:
I have no quarrels w/the author’s assertions. Even Hayek admitted that being on “The Road to Serfdom” was not a guarantee of ending up in a totalitarian state. As the author notes, real-world evidence shows that the social-welfare states in the Euro-zone provide for their citizens, but the cost is crushing government deficits, high tax rates, reduced individual liberty and stagnant economic growth. But the Eurozone is not comprised of totalitarian regimes.
Modern day free-marketers and lovers of liberty must provide the bulwark against the slow, but ceaseless encroachment of the state over the citizens’ liberty. This encroachment has continued at varying paces in the US for the last 100 years, and is currently evoking a backlash by the electorate (assuming the accuracy of current pols is borne out 11/02).
Indeed, as the author eludes to, the real question is how much more prosperous as a country would the US be w/o the last 100 years of “progressivism” inflicted on our economy, and how much more are we willing to endure at the price it entails?
Comment by Dennis on 27 October 2010:
Mr. Boudreaux you make some interesting points. However, there still has to be a point of critical mass where regulation, subsidies, and taxation actually do lead to a reduction in the wealth of its citizens.
Also, if we compare today’s growth to the disastrous days of mercantilism we have far more rights and more people have a greater ability to achieve success even when we are shackled with the burden of an overprotective government. Therefore, one would expect to see a growth in prosperity even we all feel as though we are running a race through a mine field.
Comment by Mark on 27 October 2010:
Don’t get too confident in freedom’s ability to keep markets going. This ability is dependant on free thinkers’ ability to skirt the power of rule, thus remaining free. If lawmakers continue to close these loopholes, eventually free thinkers will be left with no free alternatives, and thus lose productivity. Yes, freedom is resilient among those who value it, but history shows that the craving for security and protection tends to grow faster and stronger than the desire for freedom in most. The fight for freedom must always be active.
Comment by Dr. T on 27 October 2010:
Recognizing that big, obtrusive, controlling governments will not always destroy capitalism, the free market, and entrepreneuriialsm is sensible. But, becoming complacent about such governments is not sensible. Consider Greece, a nation about to implode because of bad government. It is not hard to imagine a repressive dictatorship arising from the rubble of its current government. Thus, it is not hard to imagine the same scenario in the USA within a generation unless we actively fight our government’s seemingly insatiable desires to grow larger and control more.
Comment by Anonymous on 27 October 2010:
Rejoice, fellow livestock! In this great new century, we are all free to pull our plowshares nearly as freely as we please. Our barns are safe and warm (those of us who have them, at least), and most of us sleep on fresh straw. Why, just look at the old soviet farms; remember how thin the russian cattle were, or how their farmers beat them? Sure, the barns may be drafty sometimes, and if we’re honest, we must admit that these days we dine on the last of the seed corn – our farmers have squandered the harvest – but I’m certain the plow can save us, our farmers, and our dear, free farm too.
Comment by Eric Hosemann on 27 October 2010:
Professor Boudreaux, I don’t disagree. But I think you make your point in a sort of roundabout and confusing way. You confuse freedom with the human spirit. You begin by talking about your old fears of encroachments on freedom, and then you talk about how freedom can grow and flourish in spite of those encroachments. You then mention how hardy the human spirit is, how it resists falling in line with the commissar and congress.
But freedom and the human spirit are two utterly different things. The human spirit is what is responsible for creating all of the wonderful things we enjoy today. Freedom is the context within which the human spirit best operates, but it still operates in other contexts too. The free world had a difficult time determining how much less free the Soviet Union was because the human spirit persevered there despite apparently crippling constraints.
A person can be completely free of government constraints and yet produce very little of good for himself or others. Contrariwise, a person can be saddled with an oppressive government but still produce much good for himself, his family, and the society around him.
I have heard you remark, perhaps in an Econtalk podcast, that libertarians are not to be confused with libertines. I agree, and along those lines I think libertarians should focus more on the flourishing of the human spirit within the context of freedom, rather than freedom itself.
Pingback by Contra Don Boudreaux, the Boot does not have a Soft Sole « Libérale et libertaire on 28 October 2010:
[...] Boudreaux predicts his recent article in the Freeman, The Power of Freedom, will raise the ire of some libertarians. Boudreaux’s thesis is based an empirical [...]
Comment by Julien Couvreur on 28 October 2010:
I think you are correct in your observation that liberty and its effects are surprisingly enduring.
It took a long time for the soviet union to collapse, it will probably take longer for countries with milder degrees of socialism. As a Frenchman, I often wonder about the future of my native country, where political action is slowly taking more importance than productive development.
The fact that forces of competition appear to prevail from the point of view of standards of living does not show that we are not going down the road to serfdom, or that the situation is somehow acceptable compared to the even better standards of living people would enjoy absent those restrictions.
The problem with your question, “how much liberty is sufficient?” is that it is utilitarian. Sufficient for what?
Utilitarian reasoning has no foundation (value is subjective and cannot be compared between individuals) and cannot lead to moral decisions.
The simple illustration of inconsistency is that of a rape: consider a man raping a woman, then consider a group of sex-starved men raping a prostitute. Utilitarian reason leads to considering both situations are different (the latter being somewhat more acceptable), which is ridiculous.
When it comes to ethics, therefore the only acceptable answer is principled. From that point of view, your question would be ethically offensive (to libertarians at least) as it suggests that some restrictions on non-aggressive liberty somehow could be acceptable to achieve some ulterior goal (some undefined notion of “greater good” or “growth”).
Comment by Todd S. on 29 October 2010:
This entire argument is based on a particular degree of freedom. It is similar to arguments of the superiority of the free market based on what we currently have – which is not a free market. This article seems to assume that we are free when we are really just “more free than some others”. I agree totally with SweetLiberty’s comment above.
Comment by Tibor R. Machan on 31 October 2010:
Don is right–the human soul is far more resilient than some libertarians give it credit. (I used to point this out about all those folks at certain libertarian think tanks who kept warning how the sky is falling!) Just think how many millions of people under communism managed to survive, even flourish. Even in NAZI concentration camps some folks managed to get ahead (see Stalag 17 as a case in point or King Rat). However, imagine what power of creativity, innovation and opportunity for leisure would be unleashed in a fully free society. So just because our level of statism isn’t fatal, it is by no means healthy either.
Comment by Thomas on 31 October 2010:
Despite the title, the real message of this article is as follows: Unless tyranny is complete, there is room for limited progress because of human determination and ingenuity.
But there is much less progress now than in, say, the latter decades of the 19th century, because there is much less freedom now than in the latter decades of the 19th century. (Yes, blacks and women have more freedom now, but only in the context of the massive regulatory-welfare state that has grown up around us.)
The point is that much freedom has been lost (despite the progress of blacks and women). The fact that some freedom remains is hardly cause for celebration, as Boudreaux would have it. Rather, the freedom that remains should be a sad reminder of how much freedom has been lost.
Comment by Roger Koppl on 31 October 2010:
Great comment, Don. Freedom is a weed. The robustness of markets makes it all the more important to know whether riches are the product of freedom or control.
Comment by Douglas on 15 November 2010:
Refreshing article of someone that has been arround. This is an article for anyone, not just for “us”.
Its not more of the same. Cheers!
Comment by N. Joseph Potts on 21 November 2010:
It’s still terrifying to be slipping in that direction.
Dr. Boudreaux’s advice is not to panic, and I take it. But I remain deeply concerned, and forever on the verge of panic.
At the slightest (further) provocation, I remain susceptible to slipping back over the edge. I’ll try to restrain myself, for my own good as well as for others’.
Pingback by A thought experiment on big government | The Thinker on 6 July 2011:
[...] makes an important point in a recent column in The Freeman (and by recent, I mean it was recent a month or so ago when I started this post and then [...]
Comment by Lorena on 12 September 2011:
This is outrageous: “Look also at other countries. Although ordinary people in nations such as France and Sweden aren’t as wealthy as ordinary Americans”. Do you really think that Swedish people aren’t as wealthy as ordinary US citizens? I think you’re being a little bit smug, or maybe you’re not aware of the quality of life of countries overseas.
I really think that Government intervention (economical intervention) can create a wealthier and fairer society, and I plead for a non intervention policy in social/moral matters.
Just a comment, I can say I’ve traveled enough, and US was one of the countries where I’ve felt less free. Bartenders asking for your ID for a beer (I was 26 that time), inmigration officers treating you like shit, my husband being delayed becaused his EU passport had to be analyzed, flights that you lost. Visiting US have became a nightmare and a destination that you need to avoid when connecting flights.
The world is so big and the US citizens are becoming more and more isolated. It’s a pity.
Pingback by The Mind And The Conscience | The Libertarian Economist on 4 January 2012:
[...] are things which are indented to drive home a point which is not explicitly stated. Donald Boudreaux once wrote an article which argued that taxation and regulations though harmful, are not necessarily fatal. Statism is not [...]
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