Milton Friedman on the Power of Freedom: “There Is Not a Single Person in the World Who Could Make This Pencil”

December 3, 2010

If we want to continue the movement towards limited government and increased freedom that has been re-energized by the Tea Party resisting Obama’s socialism, we need to continue educating Americans on how our economic system works.

Liberty Pen regularly posts great videos featuring leading voices on freedom like Milton Friedman, Friedrich Hayek, Thomas Sowell and others.

Here is a classic example, featuring Milton Friedman explaining how no individual could have created a seemingly simple product like a pencil. It took thousands of people across the world who don’t know of each other to create a pencil. With this simple example, Friedman demonstrates the folly of socialism and central government planning. No government has the knowledge to coordinate people to create something as simple as a pencil. Instead the mechanisms of free market capitalism create cooperation between people resulting in achievements that a central planner could never achieve.

To reverse President Obama’s attempt to interject the government in every facet of the economy, picking winners and losers, more Americans need to understand Milton Friedman’s message:

Friedman’s talk about a pencil is based on Leonard Read’s classic essay “I, Pencil” first published in 1958 by The Freeman. Here is an excerpt:

I, Pencil, am a complex combination of miracles: a tree, zinc, copper, graphite, and so on. But to these miracles which manifest themselves in Nature an even more extraordinary miracle has been added: the configuration of creative human energies—millions of tiny know-hows configurating naturally and spontaneously in response to human necessity and desire and in the absence of any human master-minding! Since only God can make a tree, I insist that only God could make me. Man can no more direct these millions of know-hows to bring me into being than he can put molecules together to create a tree.

The above is what I meant when writing, “If you can become aware of the miraculousness which I symbolize, you can help save the freedom mankind is so unhappily losing.” For, if one is aware that these know-hows will naturally, yes, automatically, arrange themselves into creative and productive patterns in response to human necessity and demand—that is, in the absence of governmental or any other coercive master-minding—then one will possess an absolutely essential ingredient for freedom: a faith in free people. Freedom is impossible without this faith.

Once government has had a monopoly of a creative activity such, for instance, as the delivery of the mails, most individuals will believe that the mails could not be efficiently delivered by men acting freely. And here is the reason: Each one acknowledges that he himself doesn’t know how to do all the things incident to mail delivery. He also recognizes that no other individual could do it. These assumptions are correct. No individual possesses enough know-how to perform a nation’s mail delivery any more than any individual possesses enough know-how to make a pencil. Now, in the absence of faith in free people—in the unawareness that millions of tiny know-hows would naturally and miraculously form and cooperate to satisfy this necessity—the individual cannot help but reach the erroneous conclusion that mail can be delivered only by governmental “master-minding.”

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