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Spontaneous Order

Comment

You are our Ruler. An entrepreneur tells you he wants to create something he calls a "skating rink." Young and old will strap blades to their feet and speed through an oval arena, weaving patterns as moods strike them.

You'd probably say, "We need regulation — skating stoplights, speed limits, turn signals — and a rink director to police the skaters. You can't expect skaters to navigate the rink on their own."

And yet they do. They spontaneously create their own order.

At last month's State of the Union, President Obama said America needs more passenger trains. How does he know? For years, politicians promised that more of us will want to commute by train, but it doesn't happen. People like their cars. Some subsidized trains cost so much per commuter that it would be cheaper to buy them taxi rides.

The grand schemes of the politicians fail and fail again.

By contrast, the private sector, despite harassment from government, gives us better stuff for less money — without central planning. It's called a spontaneous order.

Lawrence Reed, of the Foundation for Economic Education, explains it this way:

"Spontaneous order is what happens when you leave people alone — when entrepreneurs ... see the desires of people ... and then provide for them.

"They respond to market signals, to prices. Prices tell them what's needed and how urgently and where. And it's infinitely better and more productive than relying on a handful of elites in some distant bureaucracy."

This idea is not intuitive. Good things will happen if we leave people alone? Some of us are stupid — Obama and his advisers are smart. It's intuitive to think they should make decisions for the wider group.

"No," Reed responded. "In a market society, the bits of information that are needed to make things work — to result in the production of things that people want — are interspersed throughout the economy. What brings them together are forces of supply and demand, of changing prices."

Prices are information.

The personal-computer revolution is a great example of spontaneous order.

"No politician, no bureaucrat, no central planner, no academic sat behind a desk before that happened, before Silicon Valley emerged and planned it," Reed added.

"It happened because of private entrepreneurs responding to market opportunities. And one of the great virtues of that is if they don't get it right, they lose their shirts. The market sends a signal to do something else. When politicians get it wrong, you and I pay the price.

"We have this engrained habit of thinking that if somebody plans it, if somebody lays down the law and writes the rules, order will follow," he continued. "And the absence of those things will somehow lead to chaos. But what you often get when you try to enforce mandates and restrictions from a distant bureaucracy is planned chaos, as the great economist Ludwig on Mises once said. We have to rely more upon what emerges spontaneously because it represents individuals' personal tastes and choices, not those of distant politicians."

Another way to understand spontaneous order is to think about the simple pencil. Leonard Read, who established the Foundation for Economic Education, wrote an essay titled, "I, Pencil," which began, "(N)o single person on the face of this earth knows how to make (a pencil)."

That sounds absurd — but think about it. No one person can make a pencil. Vast numbers of people participate in making the materials that become a pencil: the wood, the brass, the graphite, the rubber for the eraser, the paint and so on. Then go back another step, to the people who make the saws and machinery that are used to make the materials that go into a pencil. And before that, people mine iron to make the steel that makes the machines that make the materials that go into a pencil. It's all without central direction, without these people even knowing they are all working ultimately to make pencils. Thousands of people mining, melting, cutting, assembling, packing, selling, shipping — and yet you can buy pencils for a few pennies each.

That's spontaneous order, and it's replicated with every product we buy, no matter how complex.

The mind boggles.

John Stossel is host of "Stossel" on the Fox Business Network. He's the author of "Give Me a Break" and of "Myth, Lies, and Downright Stupidity." To find out more about John Stossel, visit his site at <a href="http://www.johnstossel.com" <http://www.johnstossel.com>>johnstossel.com</a>. To read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate Web page at www.creators.com.

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Comments

9 Comments | Post Comment
Without wanting to defend central planner, I think one must see both sides of our human nature. The desire for freedom and Chaos and the desire for certainty and order in the world. For every man that see chaos as opportunity, there is a man that see chaos as risk to his sense of order.

Arrogance is in our human nature. Some will always believe their way is the better way and those that bring uncertainty to their sense of order must be forced to conform. You are right about spontaneous order, but that will not stop others from believing they can create both order and provide for others better, then merely letting things work them self out. They can't accept the fact that a good degree of chaos and uncertianty is good.
Comment: #1
Posted by: Glenn G. Smith
Wed Feb 9, 2011 4:24 AM
Well written, easy to understand, and very wise.
How is it that our politicians cannot get it?
It is the free market system allowed by the structure of the original U.S. Constitution which was designed to limit government power that made this nation great overnight.
Freedom is the answer, yet politicians want to regulate our freedoms away disguised as protecting us.
The sad thing is that we love our socialism more than we love our freedom.
Comment: #2
Posted by: Carolyn
Wed Feb 9, 2011 6:35 AM
This article is well written, easy for anyone to understand, and very wise.
It is the original U.S. Constitution which limited government power and allowed the free market system to operate, which made this nation the greatest, freest, and most prosperous nation on earth practically over night.
Why can't the politicians get it? Why don't we get it?
I guess we love our socialism more than we love freedom.
Comment: #3
Posted by: Carolyn
Wed Feb 9, 2011 6:49 AM
Was this written for The Onion? Stossel takes a fairly interesting premise and extends it to the ridiculous. Where is spontaneous order when we are driving our cars? Flying in planes?
I am a totally free market guy...but 100% reliance on spontaneous order gets us outsourcing of jobs, asbestos, pollution and the Snuggie.
Stossel makes his point poorly and using the wrong issue. We *do* know where people live and where they go...there are traffic studies out the wah-hoo on that. General Electric can not afford to build a train line...but they'd be happy to build the trains. Steel workers would love to build track. Americans would love to travel cheaper, safer and with less stress.
Comment: #4
Posted by: Warren
Wed Feb 9, 2011 7:28 AM
Re: Warren
Mr. Stossel is right, and I have an answer Warren, dealing directly with something you mention, cars.
I live in Long Island, NY, and when the electric grid went down in 2003 leaving the north east without power, it happened just in time for rush hour. My trip home required going through a major intersection, crossing three lanes of rush hour traffic in each direction with no working traffic light, and no police presence to direct. But I didn't wait very long. Motorists spontaneously cooperated just as Mr. Stossel's column would suggest.
Now, mind you, I'm not suggesting that we do away with traffic lights and stop signs. It was an emergency situation, and perhaps people would be less generous if it were an every day occurrence. But even that is uncertain. If cooperation is the only way to move forward, we do what's needed. Bottom line, we shouldn't sell the people short.
As for less stressful ways to travel, it sounds good in theory, but in congested areas like here there isn't a lot of land available to lay new track, and even if we did, next comes the issue of getting from your stop to your job, or home at the end of the day. That's inconvenient and stressful too. Around here, having a car means having the option of choosing different routes, stopping at stores, picking up the kid from practice..
I'm with Mr. Stossel.
Comment: #5
Posted by: TrappDog
Wed Feb 9, 2011 10:15 AM
Google for the concept of "shared spaces." Several towns have removed all traffic signal, stop signs, etc. in high traffic areas. They all report a drop in accidents. When people do not have "regulatory signals" to tell them what to do, they are more aware of their surroundings and, for the most part, make good decisions.

Walk down a crowded city street and people automatically navigate around each other. No one has to tell anyone what to do. Occasionally there is a little trouble when someone bumps someone else. But it would be very rare for two people along the same path to simply refuse to give way to the other. We adjust our movements by what we observe ahead of us. It's more spontaneous order. The same thing happens at the beach; people simply pick a spot and they adjust to each others positions. We tend to leave space between us and the next group even though there is no RULE that says we can't plop down in the sand 2 inches from the nearest person; we just don't.

So TrappDog, I am suggesting we do away with traffic lights and stop signs; we'd be better off for it.

As for Warren, you sound like you like a typical Republican union worker. You're all for the free market except when it doesn't suit your purposes or world view. Yes, Americans would love to travel cheaper, safer and with less stress and currently, cars are the best way to do that. You can't build trains to every destination you want to go; cabs are expensive and if people really, really wanted more trains, the market would fill that need at a price that consumers would be willing to pay. The government makes it hard to build new tracks and the total expense of a new rail system exceeds the cost consumers are willing to pay in order to ride it.
Comment: #6
Posted by: Difster
Wed Feb 9, 2011 10:43 AM
Spontaneous order:

In California, a 7.2 earthquake and 14 people die. Code regulations and building inspectors.

In other countries, a 6.0 earthquake and 1000's die. Lousy code regulations? Lousy building inspectors? Why all of the deaths in other countries?

Same about clean water. No regulations means rivers catching fire (40 years ago). Regulations cleaned up those rivers.

Who wants to go swimming in the Ganges? (River in India).
Comment: #7
Posted by: Don Stivers
Fri Feb 11, 2011 3:30 PM
The poster who referred to "Freedom and Chaos" and "Certainty and Order" is missing the point entirely. No one except barbarians view chaos "as an opportunity." Likewise, he is laboring under the misconception that central planning increases order: it merely changes the nature of the order. And it never achieves what it wants to: it always falls short of its ambitions, because spontaneous human behaviour cannot be regulated to anyone's satisfaction. This is why fascism fails. Those that view a lack of oppressive regulations as a threat to his personal sense of order is a bigot in his attempt to transmogrify the world around him to suit his preconcieved prejudices.
Comment: #8
Posted by: Andrew MacEwen
Tue Mar 1, 2011 9:11 AM
Hmm. I responded to the first paragraph by thinking: "Cool, that sounds great. Go do it, and call me when you have something I can tax. Meanwhile get out of my hair while I exploit my Ruler status by spending Quality Time with my harem-- oops, I mean policy advisors-- and planning my next invasion."

This is probably why I don't get to be the Ruler. I'd be the most apathetic dictator there ever was.
Comment: #9
Posted by: R.A.
Mon Mar 7, 2011 3:14 PM
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