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From "I Don't Know" to "I, Pencil"

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Tags Free MarketsEntrepreneurship

11/02/2011Gary Galles

If there were a top-ten list for how many words someone had devoted to the cause of liberty, Leonard Read would surely be on it. The cofounder (along with Henry Hazlitt, who would also make that list) of the Foundation for Economic Education, the first modern libertarian think tank in America, devoted 29 books, hundreds of articles, innumerable presentations and endless energy to making the moral, ethical and economic case for self-ownership.

Those 29 books are available online (for free, reflecting Read's commitment that nothing should stand in the way of the power of freedom to change minds, and thereby change the world) at the Ludwig von Mises Institute. Having profitably read some of his work over the years, I decided to read all of them in search of more insight and inspirational wisdom.

As I have been reading, I have come across some real nuggets of wisdom.

For instance, I am often challenged to defend libertarian principles (as is true of almost everyone at the Mises Institute) by those who demand an exhaustive detailing of everything that would happen, and how, if some aspect of our currently government-dictated lives were to be returned to the private sector. My efforts have been less successful than I would wish. That struggle made me very appreciative of his chapter "I Don't Know" in The Free Market and Its Enemy (1965), which deals with how to successfully advocate for "the free market and its miraculous performances" in the face of such demands.

Making the case for the free market … [one] booby trap … [is] the attempt to explain what would happen were the market freed of state interventionism, that is, were the activities de-socialized.

Skeptics of the free market are forever asking, "Well, how would the free market attend to mail delivery? Education? Or, whatever?" Satisfactorily answer these questions, they imply, or the free market case loses by default … often aspiring libertarians will stumble into the booby trap: they'll conjure up some sort of an answer.

[Unfortunately] a person can no more explain how the free market would attend to mail delivery than his great-grandfather could have explained how television could ever emerge from free market forces!

The listening skeptic will conclude that [your answer] is the free market answer and, if that's the best it has to offer, the free market has no valid case. These futile attempts to answer can accomplish no more than to confirm the skeptics in their socialism.

Answer honestly: I don't know; I never will know; no one will ever know.

On the surface, that sounds like poor advice. Should we just leave liberty undefended against such statist challenges? Doesn't that doom us to the status quo or worse, with our remaining liberty continually eaten away? No. It was just that Read believed the attempt to answer the inherently unanswerable was futile. But there was a better way, using what is in fact knowable.

[If] libertarians have observed and can report on how miraculously the free market performs when not politically aborted, skepticism concerning the free market will lessen, faith in what man will accomplish when free to try will increase.

How would the freed market attend to mail delivery were the postal service de-socialized? I don't know! Nor could anyone have known 100 years ago how the free market would develop the means to deliver the human voice from city to city.… No one could have predicted in 1865 what form these forces would take during the next hundred years.

What emerges from the free market embraces the miracles of Nature, plus the miracles of human creativity.… Nature will continue to produce these lovely miracles, provided conditions favorable to their growth are not aborted. You can derive from experience, not a how-to-do-it knowledge, but a soundly based faith in the dependability of the biological order. Such confident expectation is as close as any man can come to knowing how the free market would attend to an activity, were it de-socialized. All about him, in unimaginable profusion, are miracles of the free market, so commonplace that they are taken more for granted than noted and appreciated.… These, properly apprehended, comprise his experience. But such experience does not give him a how-to-do-it knowledge; it serves only as the basis for a warranted and unshakeable faith, a faith in what free men can accomplish — provided conditions favorable to free exchange are not aborted.

A libertarian … understands that he does not know how to mastermind the life of a single human being.… Even though, from his experience, he does not know what will happen, he gains a faith that miracles will happen if creative energies be free to flow. The accomplished student of liberty acquires a faith that men, when free to try, will perform miracles, a faith extrapolated from experience. But when it comes to predicting the shape of miracles that will show forth from creativity, he takes his place with men, not with clairvoyant demigods.

In other words, Read argued that no one could possibly know exactly what would be the result of the energy, insights, and innovations that would be unleashed by reintroducing freedom where statism now reigns. Therefore, it is a fool's errand to try to do so — by playing into the hands of opponents who stack the deck from the beginning by putting an impossible burden of proof on freedom's advocates. However, the presence of innumerable market miracles all around us, none of which could have been precisely spelled out by anyone in advance, provide us with overwhelming proof of the power of liberty. Free men and women can do not only great but unimaginable things when they own themselves and can make whatever peaceful arrangements they voluntarily choose.

In addition, none of the bureaucrats who now administer the many government enterprises that have grown to surround us could have met that burden of proof when the government began replacing voluntary arrangements with their dictates. And unlike defenders of self-ownership and the market behavior that arises from it, which has produced uncountable successes without theft, there are no such "success stories" that demonstrate improvement at the hands of government. But that is unsurprising. As Read put it, "How can frustration be manipulated into harmony and increased production? Can any interference with peaceful, willing exchange, regardless of who does the interfering, do other than wreak havoc?"

That conclusion, in fact, brings us to Leonard Read's most famous work, which shows how great are the market miracles that go into even something as simple as a pencil.

He demonstrated that no one on earth knows how to make a pencil. Multiplied by millions of other miracles that we rely on with such certainty that we don't give them even a moment's worry, it provides overwhelming justification for trusting what people can do, if government stops frustrating what is possible and allows people the freedom necessary. That work was "I, Pencil" (1958), which also appeared as "Only God Can Make a Tree — or a Pencil," in Anything That's Peaceful (1964):

I, Pencil, am a complex combination of miracles.…

"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 men. Freedom is impossible without this faith. Why? Without this faith there is nothing to believe in except controlled men. It's either a faith in free men and peace — or the lack of it and violence.

The lesson I have to teach is this: leave all creative energies uninhibited, and thus make it possible for people to organize themselves in harmony with this lesson. Let society's legal apparatus remove all obstacles as best it can, that is, let it keep the peace. Merely permit these creative know-hows freely to flow. Have faith in what free men will accomplish. Not only will this faith be confirmed but it has been and is confirmed to us daily, in evidence so abundant that we seldom take notice of it. I, Pencil, seemingly simple though I am, offer the miracle of my creation as testimony that faith in free men is a practical faith.…

Perhaps Jeffrey Tucker best summarized the lesson that runs from "I Don't Know" to "I, Pencil," as well as Leonard Read's other work, in the following description:

He had this gigantic faith in freedom. He often said that he could not and would not predict the outcome of granting liberty to individuals and could not and would not speculate on the shape that society would take under conditions of freedom. But he could say for certain that whatever the results of freedom, they would be more consonant with human rights, more prosperous, more creative, and more orderly than anything that the state could manufacture through coercion.


Gary Galles

Gary M. Galles is a Professor of Economics at Pepperdine University and an adjunct scholar at the Ludwig von Mises Institute. His research focuses on public finance, public choice, economic education, organization of firms, antitrust, urban economics, liberty, and the problems that undermine effective public policy. In addition to his most recent book, Pathways to Policy Failures (2020), his books include Lines of Liberty (2016), Faulty Premises, Faulty Policies (2014), and Apostle of Peace (2013).

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