Regressive, Not Progressive

"We all want progress, but if you're on the wrong road, progress means doing an about-turn and walking back to the right road; in that case, the man who turns back soonest is the most progressive."
C. S. Lewis 

I've been thinking about MSNBC's new tag line, "Lean Forward" with its progressive political implications and was reminded of a past post here.  Progressive policies and moving forward as a society are antithetical, not complimentary.  Delving into the topic is a wonderful opportunity to rediscover both the principled and utilitarian reasons for embracing freedom.  Below is a Chalk Talk post from July: 

Regressive, Not Progressive
Progress is the act of moving forward toward good things. Regress is the act of sliding backwards away from good things already enjoyed.

With this understanding of progress in mind, turn the clock back to 1700. Turn it back further, to the Middle Ages. Keep going backward.

Do we see anywhere in the world economic prosperity, affluent societies, and high standards of living? Do we see sustainable and forward-looking economies? Do we see the flowering of the sciences, arts, and learning?

No, we don’t.

When did social progress begin? Where in history do we see the liberation of millions from hand-to-mouth existences, poverty, and static societies?

Societies progressed by embracing freedom. Progress began wherever there were free markets, free trade, and government policies that allowed for the unplanned progress of society. Regress occurs every time governments suppress freedom and seek to turn the clock back to the mercantile-style government planning of economies, and attempt to shape societies into the image of their choosing.

Back to historical examples.

Prior to the expansion of free market capitalism in19th century Europe, economic activity was dictated by the mercantile policies of a handful of people in governments. In Liberalism, The Classical Tradition, Ludwig von Mises reminds us that for western Europeans in the period between the end of the Napoleonic Wars (1815) and the beginning of the first World War (1914) an unprecedented improvement in the standard of living took place alongside a quickly rising population.

Mises explains that, because of free market capitalism, millions of would-be serfs became the consumers businesses sought to please. Because people wanted a higher standard of living and because other people were free to provide so much for them, society progressed. This “democracy of the market” unleashed the creative and productive power of societies: "By the time of the start of the Great War, the average industrial worker in England and the U.S. lived better and more graciously than the nobleman of not too long before.”

In Basic Economics, Thomas Sowell highlights the rapid progress countries experience when they loosen government restrictions on trade and price controls. India, New Zealand, Sri Lanka, South Korea, and China all experienced progress by permitting more freedom, not less, in their economies. In 1978, for example, “less than 10 percent of China’s agricultural output was sold in open markets, but, by 1990, 80 percent was.”

This increase in output and resulting boon to the living conditions of everyday Chinese citizens was the result of more freedom, not less. From 1978 to 1995 China experienced an annual economic growth rate of 9 percent.

As for aversion to freedom and regressive policies think of the living conditions in Cuba, North Korea, the former eastern European communist countries, and third world countries ruled by authoritarian governments. The contrast could not be sharper. These examples mark a regression to precapitalistic times, that is, before freedom in the market place was tried and embraced.

Listen to Milton Friedman’s summation of the issue:




It is interesting, if not befuddling, then, that the economic and social policies of self-described “progressives” (or, generically, “liberals”) point us backward to the kinds of mercantilistic, central planning authority in governments that predates any real progress in the world.  Viewed in light of human progress, their economic solutions and initiatives are regressive.

Returning to Friedman, he bemoans a similar frustration with the term “liberal”:

“In the name of welfare and equality, the twentieth-century liberal has come to favor a revival of the very policies of state intervention and paternalism against which classical liberalism fought. In the very act of turning the clock back to seventeenth-century mercantilism, he is fond of castigating true liberals as reactionary!”

Liberal has come to mean illiberal, and progressive has come to mean regressive.

The more Americans understand that freedom is not an abstraction but at the heart of the only real progress in the world, the closer we’ll come to approximating a reinvigorated belief in freedom into real policy. We still live in a constitutional republic, and when the voice of the people is consistent enough and clear enough, public opinion will echo in the halls of legislatures.

A belief in freedom is a belief in the resourceful, creative, and productive powers of Americans themselves. Insisting on a policy of freedom is our best way of progressing forward.

Otherwise, we have no where to go but backward.

"Nobody Knows"

Barney Frank is right. It was "dumb" to believe a handful of people could predict the unemployment rate. (Click here for the video of the entire interview. The "dumb" remark begins at the 3:20 mark)

If only the chairman of the House Financial Services Committee would exercise that bit of economic humility every time he and his colleagues attempt, and continue to attempt, to legislate the economy into the image of their choosing.

"In the first place, nobody knows..." (Emphasis added.) Now that Mr. Frank realizes the futility of predicting unemployment rates, let's hope he realizes the futility of controlling the economy in general.

Historians and economists who take history and the lessons of basic economics seriously take considerable time trying to convince us that "nobody knows" enough information to command and control economies. The lesson of history is this: Since there has never been a person or group of experts endowed with both the intellectual powers and angelic nature it would require to wisely and justly plan the choices before millions of people seeking to buy, produce, and create wealth, the market is better left unplanned by central authorities, politicians, and bureaucrats.

When politicians take it upon themselves to order the economy through excessive regulation and historically short-sighted legislation, consumers and producers in society (the rest of us) become less free to interact in our respective self-interests. When this happens the overall productivity and dynamics of the market suffer because the capital in the market is not efficiently directed where it should be.

Thomas Sowell reminds us: "The efficient allocation of scarce resources which have alternative uses is not just an abstract notion of economists. It determines how well or how badly millions of people live." (Basic Economics: A Citizen's Guide To The Economy)

Who, then, "knows"? Who is capable of making these decisions that determine the material welfare of millions of people?

You know. You neighbor knows.  That cousin whose name you cannot remember when you see him every seven years at a family reunion knows. We, the market, know best.

When politicians express no confidence in the "private sector" or "the market" and attempt to regulate the economy in the direction of their choosing, they are presuming to have the knowledge it requires to do so; they are distrusting We The People of The Market with the freedom it requires to function a diverse market economy.

True, "nobody knows" what the unemployment rate will be in six months, but somebody does know how to run the market. And that somebody is us, uncoordinated and pursuing our respective self interests, not a group of preening economic divines inside the Beltway.

In his classic work, The Road To Serfdom,  F.A. Hayek carefully explains that the central characteristic of the authoritarian regimes of twentieth-century Europe was an outright rejection of the unplanned, free market activities of nineteenth-century classical liberalism.  This authoritarianism resulted from the desire to move all decision-making of the market to government central planning boards.

(Hayek also wrote a book devoted solely to the fallacy of central planning by a group of elites, properly titled, The Fatal Conceit) 

In chapter 5, Planning and Democracy, Hayek explains:

“That our present society lacks such ‘conscious’ direction toward a single aim, that its activities are guided by the whims and fancies of irresponsible individuals, has always been one of the main complaints of its socialist critics.”

The more our "whims and fancies"--freedom, that is---annoys the elites in Washington, the better.  The more they act on their annoyance, the worse off we become, materially and politically.

The more of the economy that is diminished by government control, the less free we are as the market to determine our respective welfare. And the less free we are individually, the less prosperous we become as a society.

This much history tells us, and this much we know.  Acting contrary to this knowledge would be just plain "dumb."