LET SKILLS FLOURISH
The way some people, more especially some politicians, economists and com- mentators, go on, the public might well be forgiven for concluding that 'growth' in the economy was a consequence or a multiple of governmental 'decisions, and that governments choose whether the country is to have growth or not, or whether it is to have more, or less, of it. Growth in the economy is nothing but the creation of new wealth exceeding the wastage of old wealth. One house put up and one house pulled down is not growth. Two houses put up for one pulled down is. Any government, of whatever political or ideological persuasion, cannot but desire that as much new wealth be created as possible. All governments want growth, just as all people want to improve the standard of their living, and it follows therefore first, that no government will seek deliberately to restrict growth, and second, that no government knows for sure how to encourage it (for if any government did know how, it would be impossible kir it to keep the panacea secret; and all governments would act appropriately; and we would always have growth, that is a constant real increase in our standard of living). Although frequently government activities have had the effect, deliberate or otherwise,• of restricting growth, such re- stricted growth is invariably defended and justified by the argument that it is neces- sary to produce greater or stronger future growth. In this respect, restrictive or defla- tionary decisions of Chancellors may be and often are likened to a gardener who prunes a rose in order for it to flourish more strongly and abundantly in the forth- coming summer.
But horticultural or agricultural meta- phors should not be pushed too far; and in an ideal world might be better not used at all. The mixed economy is not like a field which the farmer-Chancellor ploughs and tills and sows and which, in due course and weather permitting, brings forth a crop which is a tribute to his good husbandry, or a rebuke to his farm man- agement. Nor is the economy a thing like a cake, to be sliced up and given, follow- ing appropriate housewifely decisions, to clamant. but not equally deserving chil- dren. It is not a business, either, nor is it even like a business, for at the end of the day or year a business must show a profit or be able to withstand a loss but not an economy; and a business may be bought and sold, but not an economy; and a busi- ness can be done without, but not an economy. The economy is incommensur- ate. It is an aggregation, but it is not some- thing to which something extra can be added. The economy is really nothing but what we are all of us up to.
If, therefore, the horticultural or agri- cultural metaphor is to be employed at all (and despite its risks it is perhaps the best metaphor we have got), we may view the mixed economy as a field in which all manner of plants and insects strive and thrive or wither, which is continually tended, well or badly, by a farmer, but a field which, nevertheless can only be mar- ginally affected by his activity. In particu- lar, it is a field the yield of which the farmer can only improve, and can only harm, by helping or hindering growth to take place. It is not a field in which seeds are sown. It is a field which grows any- how, but in which the growth can be re- tarded by the application of stultifying chemicals or speeded up by the use of fertilisers. But otherwise, the mixed economy can be somewhat or largely en- couraged or somewhat or largely discour- aged by the activities of government: but government activities have nothing to do with that which grows or with that which withers away, except to speed the growth or hasten the withering away.
What makes for 'growth' in the mixed economy, what, that is, produces an in- crease in the wealth of the nation, has little to do with government, except inso- far as government discourages or encour- ages whatever it is that grows and pro- duces this increase in wealth. Growth, this increase in wealth, is produced by men inventing things and processes, discovering new materials and machines, finding out more efficient and economical ways of working, designing objects better, creating needs or desirables that had not been thought of before, making things, selling things. No government by taking thought can add a whit to the growing stature of a free 'country. A government cannot say to itself `I wish more growth to occur: there- fore. let growth take place'. The wealth of this country, or of any other above a sub- sistence or banana eating level, comes from the invention of a spinning-jenny, from the harnessing of the power of steam, from railways, from the better manufacture of better steel, from the more sensible and more profitable use of land, from the better extraction and the better selling of coal or of oil or of natural gas, and so forth: from, .that is, all manner of men with all manner of ambitions and all manner of talents and skills proceeding on with the business of making and buying and saline and getting.
The wealth of a country has, that is, two sources: its initial equipment of land, minerals, Climate, situation and so on; and its people. The growth of its wealth comes from what its people make from their situation. A man who opens up a factory, employs people to make something that had not been made before or to make something cheaper or better than it had been made before, has made himself and his workers better off than they were before, and has to this extent, contributed towards the growth of the wealth of the nation. There is nothing new or mysterious about this. It is old, known about, clear. The government cannot declare to any useful, wealth-producing as opposed to propagandist purpose, `there shall be more (or fewer) such men opening up such fac- tories (or farms, or whatever)'. What the government can do, and what every government in fact does do, is to decide, according to its ideology, to help or to hinder such men opening up, or running or closing down such factories. All govern- ments want to see more wealth created: but they differ in their beliefs as to how such new wealth should be made, and what should be done with it. For more than twenty years. governments of this country have interfered excessively in this process by which men make more wealth for them- selves and their fellows. Governments of this country since the war have shown themselves time and again wholly inept in their interference, and have slowed down by their excessive interventions the rate at which the genius of the people might have been expected to increase the common wealth. Wealth does not grow on its own, or at the behest of government. It is made by the effort and skill and labour of men. The government should, as far as is politically possible, get out of the way, and let inventive and entrepreneurial skills flourish and seek their rewards in the market place. In such fashion, and in no other, will the wealth of the nation increase.
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