Spencer Heath Archive

Item 2169

Carbon of typed pages by Heath reviewing Henry Hazlitt’s Economics in One Lesson (Harper & Brothers, 1946). No indication where or if this was published.

 

 

 

ECONOMICS IN ONE LESSON.  By Henry Hazlitt.  New York and London: Harper and Brothers.  1946.  222 pp.

 

Review by Spencer Heath

 

This book is what it claims to be: an exposition of errors. It makes no claim to originality, offers no advance or discovery, refers to no basic premises. But it does contradict, perhaps the most excellently to date, what has been contradicted before. Its author lays no broader foundation, makes no more “fresh start” than did his predecessors.

 

     Those before him founded no acceptable science because they offered no positive technology, only a counsel of what not to do, of what to minimize and resist. They saw no functioning entity but the individual. Their broadest generalization was the interest (satisfaction) of individuals as an aggregation — “the interest of everyone.” They saw that the individual interests were similar and parallel (ultimately) instead of oppositional as many suppose.

 

     But individual interests are merely additive. Only actions, nothing but functions can be reciprocal. The need is for a “fresh start” from a broader base, — namely, the organic unity or interfunctioning activity of men in society, of men in  reciprocal relations, functionally united in the activities of making contracts and performing the obligations to one another thus voluntarily assumed. In this free activity individuals (unconsciously) unite themselves functionally into a social organism.

 

     This new organism constitutes a new kind of human environment for each of its constituent individuals. They and it occupy a new kind of environment created by it and called a community, primarily, as etymologically, a place of common defense. The function of each individual is to act freely, that is, contractually, with others. The unique function of society, the over-all functioning of its individuals, is constantly to create and re-create its physical world, to make its habitat ever more habitable for its individuals.

 

     This higher physical as well as social environment results not from their aggregative “interests” but from their free and reciprocal activities, which constitute their organic unity. In this organic unity they attain leisure, conserve increasing energies for self-realization, and with this also a progressive lengthening of their lives.

 

     When the Science of Society is based on such as this as its fundamental premises, it will have a technology. It will disclose the rationale of and show the wide ends served by the free actions of men in contractual relations, each directing and committing his services and/or properties(capital) to the interests of others, doing this on a measured scale and being equally recompensed in return. And it will show that this applies not only to private and personal properties and services but that it is presently also operating, though all unknowingly, as the very basis of community existence and that it is ripe for a vastly profitable extension into the whole field of community protection and other common needs — the whole field of public affairs now politically dominated by force and fraud, whether benign or malign the intent.

 

     When this knowledge dawns, free enterprise will extend its solvent services into the whole public field and will there perform such services, receive such income and create such values as have never yet been dreamed.

 

     Like all his warning and protesting predecessors, Mr. Hazlitt suggests no way to pay for even “necessary public services” or public works except by taxation in either its violent or in some insidious form. He affirms, as at page 20, that all government expenditures depend on taxation and that a “certain (?) amount of government spending is necessary.” He thus accepts violence as a public necessity, but he suggests no point where nor in what manner it can or could be curbed. He is mindful of its baleful effects, as at page 187, but how does he balance the good obtained against the evil wrought to obtain it? Can high ends be served by such low means? Are there no other means? He shows how taxation does harm that is never redressed (page 189). But not until his last several pages does he suggest any remedy for economic distress. And here he considers no cause of distress but technological unemployment, an evil that redresses itself, and his remedy is only “that the plight of these groups be recognized, that they be dealt with sympathetically, and that we try to see whether some of the gains from this specialized progress cannot be used to help the victims find a productive role elsewhere.

 

     Mr. Hazlitt has written an enormously useful book but, like Dr. Hayek’s and many others, it is a warning not against violence but against too much of it and against the extreme and ultimate results of it. The road down to serfdom is now quite well charted and marked. Who shall uncover the technique and the vast potentialities of freedom? Who shall unveil Free Enterprise in all her latent scope, that she may richly serve not only private but also public needs without any violence but in the strength and security of the ways of peace? ²¹⁶⁹