All advances in natural specialization improve the standard of living. It is true that interdependence increases with its growth, but without peril, for economic interdependence is founded on consent; the countless relationships are as firmly rooted in general harmony and acceptance as is the free exchange of 30 cents for a can of beans. In a free market transaction each party chalks up a gain, for each values what he receives more than what he gives; each party is in a thank-you mood. Check this assertion with your own shopping experiences.
Specialization of the free market variety develops an integrated interdependence because each person is his own man—the whole man; all the faculties are called upon in his interrelationships. The premium is on self-responsibility and honesty, these being the cohesive ingredients which make specialization and exchange a workable arrangement. To prove the validity of these affirmations, simply reflect on one’s daily free market experiences with the purveyors of countless specializations: groceries by the hundreds, milk, school supplies, footwear, clothing, gas, electricity, on and on. The natural, peaceful, unfettered free market rewards—and gets—the honesty on which it relies.
Unnatural specialization, on the other hand, decreases rather than increases the standard of living. It does not have its origin in consent but in force. It is not the result of millions upon millions of judgments voluntarily rendered. It is, instead, founded on the whims, caprices—call these judgments, if you choose—of political persons and committees, the few who have gained power over the rest of us. When these political “ins” take over a sector of society, they remove it from the area where free choice may be exercised by the millions of “outs.” Our faculties are less and less called upon; self-responsibility shifts to government or authoritarian responsibility—that of the political “ins.” The premium on honesty disappears as prizes are given more and more for bending to expediency, trading influence and special privileges, log-rolling, and the like. From this turnabout, the individual tends to become someone else’s man; that is, not the whole man but the fragmented man. Having forsworn independence or being deprived of it, men lose the incentive to be honest and self-responsible, and thus become incapable of true interdependence.
As I see it, socialization harms the economy (1) by spawning unnatural specializations and (2) by demoralizing the citizenry. Such moral qualities as self-responsibility and honesty are not exercised under socialism, and thus tend to wither away. And without these qualities, interdependence is unworkable. Moral qualities are gone with the wind when uprooted; it is self-evident that they do not exist except as they are practiced.
Natural specializations emerge from the willing exchange (free) market at work. The unnatural and unhappy alternative is for the government to forcibly collect income from citizens to employ individuals to specialize in occupations the willing exchange market would not support.
Exploring the Moon
Instead of trying to pick the danger point in this situation from the hopeless governmental complex in which it is embedded, let us first examine a single facet.
Take, for example, the moon project. What its ultimate, useful purpose is I cannot imagine. But putting aside personal prejudices against this multibillion dollar project, it is obvious that it would not, at this time, emerge from the free market. Now, consider the countless specializations that this single governmental project calls into existence.
Take only one of them: finding out how to cushion the landing of a TV set on the moon. The specialists who devote themselves to this problem, and all who are dependent on them, have no way of living except as they are able to exchange the income given to them by government for food, clothing, housing, and so on. But this income of theirs is not voluntarily supplied in the market place; government has forcibly taken it from the rest of us. Who would willingly exchange the food he raises for this service to the moon project? This project qualifies as an unnatural specialization; it is not bound into the economy by mutual consent as reflected by willing exchanges in a free market; it is bound into the economy by the exertion of governmental force or coercion.
That some unnatural specializations are economically tolerable is conceded, but this is an exceedingly limited tolerance. Merely imagine everyone specializing in activities for which no one would willingly exchange his income!
All governmental intervention has as its object a forcible altering of what people would do were they unrestrained. To the extent that government intervenes in free action to that extent is unnatural specialization brought into play. While most of us will concede that government should forcibly restrain fraud, violence, and the like, it does not take a skilled sociologist to understand what would happen to the economy were all citizens to specialize in policing. While the proper function of government is to keep the peace, citizens must be on the alert lest the bureaucracy pervert even this laudable objective. Too many soldiers and policemen are possible, as history attests. Not every corner requires a stop light. It is easy to be talked into a battleship or a supersonic bomber binge. If the bureaucracy is not checked, it will tend to build, in the name of peace, a defense against every conceivable contingency—so much “security” that “the secured” are without resources—helpless and hopeless.
However, my aim in this chapter is not to discuss the merit of this or that type of forcible intervention; it is, rather, to suggest that there comes a point in unnatural specializations beyond which extension is impossible without the economy flying to pieces. Suppose that everyone were engaged in one of the nonexchangeable services such as designing and constructing devices to cushion the landing of TV sets on the moon!