Part 2 - The Invisible Hand Is a Gentle Hand

Published September 09, 2011 in Talking Points by Sharon Harris

This is part two in a multi-part series. Read part one of the The Invisible Hand Is a Gentle Hand here.

Cooperation

Let's look more closely at cooperation. The gentle invisible hand vs. the visible fist of government.

Here's a question for you: Would you rather visit Wal-Mart or the Department of Motor Vehicles? Of course, at the DMV you get something free — free grief, at no extra charge.

At the Smith Food King market, when there are more than three people in line, they open a new register. At the Post Office, when there are more than three people in line, two of the clerks go to lunch.

In a free society, people are treated as customers or potential customers. The customer is always right — even when he's not.

Yes, there are rude people in the marketplace. But it's easy to quit doing business with them.

Contrast that to dealing with the government. Perhaps no one has ever better summed up what its like to interact with the government than the French political theorist, Pierre-Joseph Proudhon. In 1849, he wrote:

To be governed is to be watched, inspected, spied upon, directed, law-ridden, regulated, penned up, indoctrinated, preached at, checked, appraised, seized, censured, commanded, by beings who have neither title, nor knowledge, nor virtue. To be governed is to have every operation, every transaction, every movement noted, registered, counted, rated, stamped, measured, numbered, assessed, licensed, refused, authorized, endorsed, admonished, prevented, reformed, redressed, corrected.

Sounds like he had some experience dealing with government.

Compare that to the gentle hand of the free market. If you don't like the way one grocery store treats you, you can go elsewhere. If you disagree with your church, you can choose another denomination — or none at all.

But with government, we don't have that choice. What if you don't like the Motor Post Office? Try getting a letter mailed by someone else. Sorry, but you can’t do it, because the USPS is a government-enforced coercive monopoly.

Or try telling the IRS you don't like the way the government spends your money, and see where that gets you.

The gentle invisible hand vs. the visible fist of government.

Adam Smith said "It is not from the benevolence of the butcher, the brewer or the baker that we expect our dinner, but from their regard for their own interest."

In the marketplace, people tend to be well mannered — even if they hate you. The profit motive can even overcome racism, sexism, homophobia, and other prejudices. Even the most racist businessman eventually realizes on some level that "I might hate the color of their skin, but I love the color of their money."

Economist Walter Williams likes to talk about how Texas cattlemen work long hours to make sure that New Yorkers have all the steak they can eat. The ranchers don't do this because they love New Yorkers.

Again, the invisible hand at work, creating cooperation.

In any business situation, success is more likely for the people or companies who treat their customers with respect, kindness, courtesy, friendliness.

Notice the smiley face at Wal-Mart. Do you think there's one at the Social Security office?

If the school system had to compete, do you think children might be treated more respectfully? Would they have better books? More individual attention? Would they perhaps learn… to read?

Cooperation is inherent in the free market. It is absent from the government, because coercion doesn't require it.

The gentle invisible hand vs. the visible fist of government.

Who is more compassionate? Find out how the Gentle Hand of the Free-Market encourages compassion while the Visable Fist of the Government does not in part three.