This past weekend, heavy rains resulted in a power outage at our home. We went to bed early, as millions did before there was electricity, and then were awakened by a knock at the door at 10:30—a town policeman advised us to evacuate because the only road to our home was washing out from swollen brooks. There was some chance, he added, that the road would collapse on us if we attempted to leave. Fortunately, our home was not in danger of being flooded, and so we opted to stay put but move our car to a neighbor’s lot on a road out of danger. I did so successfully, and then I walked back to our home through the cascading water and stones swept by the brook onto the road.
Having lived in or near major cities for most of my life, and now living in a rural area, I am very conscious of the differences in the two. Living in a rural area, I am more conscious than I am in the city of just how interdependent we all are. The cycles and vagaries of nature are more palpable; and unlike a city where you may know just a few of the neighbors on your block, you get to know on more than just a “say hello” level, your neighbors, the mailman, the farmer who grows your food, your painter, and your shopkeepers. Unlike what many naively believe, shutting the door on the rest of the world is less of an option in a rural area than it is in the city. In a rural area, it is hard to maintain the fiction—as some city dwellers do—that we are independent captains of our own lives.
I often try to generalize from my experiences and see what lessons I can learn—sometimes it is a familiar one, an old lesson looked at through fresh eyes. Nothing like going without to help one appreciate the familiar; I began to reflect on electricity. Electricity is an invention that has transformed the world; yet before it was available to the public, the idea of an electric current powering machines and lighting homes was not conceivable to almost all individuals.
You may be familiar with the recent surveys that show that high school seniors lack basic knowledge of history, that they have no knowledge of the principles of American government, and that they have no knowledge of geography.
As importantly, many are ignorant of how “anything happens” in the course of a market process. What do I mean? Well, take electricity. If you asked most how or by whom electricity was discovered, they would probably search their minds for familiar names and guess that Ben Franklin or Thomas Edison discovered electricity. They would have little knowledge or appreciation for the fact that research into electricity began thousands of years ago, and it took the efforts of many individuals in multiple societies across epochs to finally bring electricity into our homes as a usable tool.
In the 1957, the BBC presented a mock documentary on the Swiss spaghetti harvest which “explained” how a mild winter had resulted in a bumper spaghetti crop. The documentary fooled millions who had little idea of how the food they eat was grown, harvested, manufactured, and then transported and sold in stores.
This ignorance of history, economics, and our natural worlds is destructive to the maintenance of a free society. Why? If many can believe that a single individual can invent electricity, it is not much of a leap to believe that if government gets to harness more resources, it can improve our lives faster than the market process can. After all, if one man can invent electricity, think of how quickly the government can solve the problem of high energy prices. Indeed, polls show that most support the government spending billions to do just that.
Whenever a problem or a need arises, “someone should do something about it” is the rallying cry of the ignorant. The ignorant believe in the silly fairy tale that some politician can wave a “magic wand” and make something, like a new form of energy, happen. When that politician fails at what never can be done, the ignorant turn to the next political hopeful while maintaining their own ignorance. And there is, of course, an endless supply of politicians who are ready and willing to exploit their ignorance.
Nobel laureate Friedrich Hayek’s great insight was that socialism could never work because it could never solve the knowledge problem—that is, it could never obtain but a fraction of the information necessary to build a modern economy. The corollary of his initial insight is that a free-market economy uses far more information and thus solves problems far faster than a socialist economy ever could. The idea that socialists could conquer the knowledge problem and wave the “magic wand” to shape the world according to their “superior” knowledge was what Hayek called the “fatal conceit”—fatal because it results in poverty, starvation, and war.
There has been more material progress in the past century than in all of recorded history up to that time. The ignorant have no idea that this progress is due to the efforts of free-men and women and not to the directions of politicians.
Many among the ignorant believe in a relatively static world, and so it is natural for them to believe that government can fine tune what is fixed. They have only the vaguest idea that others in the past lived far differently than we do now and that those who will come after us will live far differently than we do—if the blessings of liberty continue to be enjoyed. Their fatal ignorance of how progress happens is crippling the American experiment in liberty.