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ONE OF THE FASCINATING
THINGS ABOUT STUDYING HISTORY IS
to see the way in which man's extraordinary creative and inven-tive faculties
are in a continual battle with his critical and destructive faculties. If only
the first were in operation, human-ity would have advanced far more rapidly. We'd
now be enjoying living standards we won't reach until 3000 A.D. to 4000 A.D. We'd
be making regular trips to our solar system's planets (and exploiting them) and
possibly to the stars beyond.
But the other aspects of man's nature act as a continual brake on progress. I'm
not thinking so much of war, since it's as effective at promoting invention and
creativity as it is at destroying existing wealth. World War II, for instance,
accelerated enormously the development of radar, electronics, jet propulsion and
nuclear energy What I mean, rather, is our negative propensity to find reasons-especially
moral or scientific ones-to oppose the cre-ative forces in the world. A primary
example of this was the mid-19th-century reaction to the capitalist Industrial
Revolution.
Just as a disruptive and painful period of capital accumulation was coming to
an end in advanced economies such as Britain's- wages were rising, working hours
decreasing and factory conditions improving-along came thinkers like Karl Marx,
who argued that capitalism was an unprecedented threat to human happiness. They
succeeded in setting up a collectivist counterforce to capitalism that maintained
itself intellectually for a century and at one time con-trolled nearly a quarter
of the world's surface area, killed scores of millions and wasted untold trillions
of dollars of wealth. This force was not discredited until the late 1980's when
Soviet Communism began to collapse and its Chinese cousin embraced capitalism.
Clever Critics
During the 20th century a series of revolutions in technology again made it possible
to accelerate the production of wealth and im-prove the ways in which it is distributed
to reach even the poorest enclaves of the world. But once again the negative critical
and de-structive forces have combined to put the brakes on and, if possi-ble,
reverse this process. Clever people calling themselves environ-mentalists, human
rights campaigners, tort lawyers, etc. have played on fears and superstitions
and employed ingenious arguments based on science and pseudoscience to mount a
counteroffensive against capitalist advances. They have used the courts, media,
international conferences and laboratories-all with enormous cunning and effrontery-to
win many partial and some absolute victories.
One of their biggest successes has been to halt the building of nudear power plants
in the U.S., Britain and other countries. This has seriously increased the destructive
impact of the oil shortages brought on by China's and India's industrialization.
At the same time envi-ronmentalists, daiming that global warming is the result
of industrial activity, seek to force compulsory limits on greenhouse gas emis-sions,
which will hugely reduce industry's efficiency and profitabil-ity. This frontal
attack on the production and profitability of the capitalist system is, in its
own way, as dangerous as Marxism was.
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Capitalism is also being slowed down and damaged by tens
of thousands of lawyers who have discovered they can use the courts to transfer
vast sums of money from business to individuals who believe they've been harmed
by business, in the process enriching the legal profession and its more active
entrepreneurs. In this war between business and its enemies, the brains are evenly
divided on both sides of the trenches. There are as many clever young men and
women pouring out of college and going into jobs that make them critical of capitalism
as there are going into junior-executive work in finance and industry-a fact of
life likely to continue.
Government's Role
Criticism is a luxury advanced civilizations can afford, but creativ-ity is an
essential. Government must uphold the rule of law. But if it becomes too evenhanded
in the battle between the creative and the critical and leaves the creators to
fend for themselves, it's certain that growth will eventually slow down and the
economy stagnate.
This is what's happened in the Eurozone over the past
decade. The result: huge unemployment and about zero growth. This also happened
in Britain in the 1960s and l970s, until Margaret Thatcher took office. By swinging
government heavily onto the side of wealth production, she changed Britain from
a low-growth to a high-growth economy. But the positive effects of this are now
wearing off. The impact of New Labour-in power for nine years-has been to align
government behind the critics and negative forces in society. The economy is slowing,
and bad times are ahead for capitalism in Britain.
U.S. administrations over the past 25 years have, on the whole, given business
a square deal, and the American economy has con-tinued to grow. President Bush's
refusal to sign the Kyoto treaty was symbolic, signal act of courage reflecting
the economics of common sense. But there are many signs that the critics are gath-ering
strength. More regulations being imposed at state and fed-eral levels, rising
antibusiness litigation and hostility in the media, fueled by criminal trials
and scandals, bode ill for growth.
Left to themselves, the creative forces in society will always deliver, but keeping
them reasonably free to do so is a perpetual, grinding battle. It is one that
must never be lost.
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