“How should prices be determined?” To this question we could make a short and simple answer: Prices should be determined by the market.

The answer is correct enough, but some elaboration is necessary to answer the practical problem concerning the wisdom of government price control.

A correspondent recently asked me why it was that Soviet Russia seemed to be suffering in recent years from chronic “crop failures,” and found itself forced to import increased quantities of foodstuffs from the United States and other capitalistic countries. She understood, she wrote, that the most frequent explanation offered for this was that Russia operated under “communism” and that the countries exporting food to her were “capitalistic.” But she wanted to know more in detail just why these different results came about.

For more than a century socialist writers have leveled two main charges against capitalism: 1. It is not productive (or only wastefully productive, or far less productive than some imaginable socialist system would be). 2. It leads to a flagrantly unjust “distribution” of the wealth that it does produce; the workers are systematically exploited; “the rich get richer and the poor get poorer.”

The Foundation for Economic Education, which publishes The Freeman, was set up in 1946. This seems to me as appropriate a time as any to review what has happened since its establishment in the realm of the government interventions and economic controls—the prohibitions and compulsions—that FEE was set up to combat.

All over the United States, if you are reading this in a daylight hour, there is a ceaseless downpour of new laws. Every day some of us, somewhere, are being encumbered or shackled by still more restrictions. There are just too many laws.

But how do we tell how many laws are too many, and which ones are pernicious?

In 1884, Herbert Spencer wrote what quickly became a celebrated book, The Man Versus the State. The book is seldom referred to now, and gathers dust on library shelves—if, in fact, it is still stocked by many libraries. Spencer’s political views are regarded by most present-day writers, who bother to mention him at all, as “extreme laissez faire” and hence “discredited.”

When we discuss “economic planning,” we must be clear concerning what it is we are talking about. The real question being raised is not: plan or no plan? but whose plan?

Each of us, in his private capacity, is constantly planning for the future: what he will do the rest of today, the rest of the week, or on the weekend; what he will do this month or next year. Some of us are planning, though in a more general way, ten or 20 years ahead.

The socialists and communists propose to cure poverty by seizing private property, particularly property in the means of production, and turning it over to be operated by the government.

What the advocates of all expropriation schemes fail to realize is that property in private hands used for the production of goods and services for the market is already for all practical purposes public wealth. It is serving the public just as much as—in fact, far more effectively than—if it were owned and operated by the government.

John Maynard Keynes was, basically, an inflationist. This has not been clearly recognized because he never spelled out, step by step, the consequences of his proposed remedy for unemployment and depression. That remedy was deficit spending by the government. He recognized that increased government spending paid for by equally increased taxation would not “add purchasing power.” The increased taxation would offset any “stimulus” that the increased government spending would provide. What counted, he confessed, was the government deficit.