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Knowledge Is Power
Knowledge is power. It is one
of the most oft-quoted expressions I can think of. But in political
philosophy, where one believes the knowledge resides influences where one
believes power should reside; it is this fundamental difference, what economist
Thomas Sowell calls the "conflict of visions", that determines
whether one advocates a more centralized, statist, powerful government
that controls the economy and outcomes, versus a more limited, decentralized,
less powerful government that serves to protect an electorate that is empowered
and free to make decisions for themselves.
What are the practical implications of this conflict of visions?
A politician (or voter) who believes that knowledge is concentrated in a select, elite few is willing to promote more government control over the economy, rather than leaving decisions about what products to buy, what health insurance to purchase (or not), or what food to eat to individuals and families. Think about the politicians you hear each election cycle who promise to fight "big corporations", claiming they make "obscene profits". What special knowledge does a Congressman have about profits? Think about politicians decrying the pay of CEOs; what makes a governor or legislator or even a President more knowledgeable about what are "fair" CEO salaries?
As we allow more and more government control over the economy — whether through stricter government regulation, or through outright government takeover — we are concentrating power in a select group of people who claim to know better than we do what is right and best. They have the knowledge so they deserve the power, we seem to be saying. Yet in many cases, we're giving over decision-making responsibility to people and entities who not only don't have special knowledge or insight, but they bear no responsibility or accountability for bad decisions.
A classic example is that of corn-based ethanol subsidies. Politicians decided that the best way to combat vehicle emissions and global warming was to subsidize the manufacture of corn-based ethanol. Yet very few people advocating that policy had special knowledge about what goes into making ethanol. Very few members of Congress are agriculture specialists; fewer still are scientists; few are economists; and I'm willing to bet that none of them have any actual experience in ethanol manufacture. The result of this misguided policy was high corn prices and shortages of other food products (as farmers who would otherwise have been engaged in growing soybeans, wheat, etc. chose to take the subsidies available for corn). There are other negative impacts as well; growing additional corn, especially in locations not especially suited for corn production (which is why the land was being used for other produce) results in use of additional pesticides and fertilizers, which further pollute our lakes and rivers, and even results in a "dead zone" in the Gulf of Mexico. It is nearly impossible to calculate how much additional fossil fuels are used in the production of those pesticides and fertilizers; most experts say that an overall energy balance shows ethanol to be neutral at best.
What price do the politicians pay for such misguided misadventures? Most likely none, since the call continues for increased subsidies for corn-based ethanol, as well as for other “alternative fuels”; is it not reasonable to believe that many of those alternatives might have similar unintended negative consequences? Yet advocacy of even greater government control over health care is a central theme in this election.
On the other hand, there are some who believe that knowledge is not concentrated, but rather is spread out among the electorate. As free people act in their own self interest, and as entrepreneurs innovate and businesses react to peoples’ needs, overall efficiency increases. This view holds that individuals and families know best what is best for them, and that decentralization provides the best path to prosperity. The “wisdom of the market” is really the wisdom of individuals, each one assessing his own unique situation and acting accordingly.
If knowledge resides with the market rather than the elites, then there is less need for sweeping government programs and increased regulation. Consider health insurance: as a single man with no children, I might find a high-deductible policy perfectly fine for me; I am protected against catastrophic bills, and I can do my routine care wherever I wish. A family of four might not find that option so appealing. How would, say, a Senator for Illinois or New York know what is best for me? Likewise, consider the energy situation. Living in an urban area, I might decide that a hybrid vehicle is cost efficient; however, for someone living on a farm, a diesel truck might still be the best option, even with high oil prices. Or, an enterprising entrepreneur might bring a new, innovative product to market that revolutionizes transportation altogether. How in the world would a government official, even one with specialized training in energy issues, be able to predict what might be the best alternative for each citizen in each part of the country?
Ultimately, I believe that the purpose of government is to protect liberty – the life, liberty, and the pursuit of happiness described by Thomas Jefferson in the Declaration of Independence. Each decision that the government makes is a decision not made by individuals and families, and I believe that individuals and families know better than the government what is best for them. I don’t believe in a government where elites command and control decisions; it is neither the path to greater efficiency and prosperity nor to greater freedom and liberty. Knowledge is power. The greater knowledge resides among the people, not the government; so, too, should the power.
What are the practical implications of this conflict of visions?
A politician (or voter) who believes that knowledge is concentrated in a select, elite few is willing to promote more government control over the economy, rather than leaving decisions about what products to buy, what health insurance to purchase (or not), or what food to eat to individuals and families. Think about the politicians you hear each election cycle who promise to fight "big corporations", claiming they make "obscene profits". What special knowledge does a Congressman have about profits? Think about politicians decrying the pay of CEOs; what makes a governor or legislator or even a President more knowledgeable about what are "fair" CEO salaries?
As we allow more and more government control over the economy — whether through stricter government regulation, or through outright government takeover — we are concentrating power in a select group of people who claim to know better than we do what is right and best. They have the knowledge so they deserve the power, we seem to be saying. Yet in many cases, we're giving over decision-making responsibility to people and entities who not only don't have special knowledge or insight, but they bear no responsibility or accountability for bad decisions.
A classic example is that of corn-based ethanol subsidies. Politicians decided that the best way to combat vehicle emissions and global warming was to subsidize the manufacture of corn-based ethanol. Yet very few people advocating that policy had special knowledge about what goes into making ethanol. Very few members of Congress are agriculture specialists; fewer still are scientists; few are economists; and I'm willing to bet that none of them have any actual experience in ethanol manufacture. The result of this misguided policy was high corn prices and shortages of other food products (as farmers who would otherwise have been engaged in growing soybeans, wheat, etc. chose to take the subsidies available for corn). There are other negative impacts as well; growing additional corn, especially in locations not especially suited for corn production (which is why the land was being used for other produce) results in use of additional pesticides and fertilizers, which further pollute our lakes and rivers, and even results in a "dead zone" in the Gulf of Mexico. It is nearly impossible to calculate how much additional fossil fuels are used in the production of those pesticides and fertilizers; most experts say that an overall energy balance shows ethanol to be neutral at best.
What price do the politicians pay for such misguided misadventures? Most likely none, since the call continues for increased subsidies for corn-based ethanol, as well as for other “alternative fuels”; is it not reasonable to believe that many of those alternatives might have similar unintended negative consequences? Yet advocacy of even greater government control over health care is a central theme in this election.
On the other hand, there are some who believe that knowledge is not concentrated, but rather is spread out among the electorate. As free people act in their own self interest, and as entrepreneurs innovate and businesses react to peoples’ needs, overall efficiency increases. This view holds that individuals and families know best what is best for them, and that decentralization provides the best path to prosperity. The “wisdom of the market” is really the wisdom of individuals, each one assessing his own unique situation and acting accordingly.
If knowledge resides with the market rather than the elites, then there is less need for sweeping government programs and increased regulation. Consider health insurance: as a single man with no children, I might find a high-deductible policy perfectly fine for me; I am protected against catastrophic bills, and I can do my routine care wherever I wish. A family of four might not find that option so appealing. How would, say, a Senator for Illinois or New York know what is best for me? Likewise, consider the energy situation. Living in an urban area, I might decide that a hybrid vehicle is cost efficient; however, for someone living on a farm, a diesel truck might still be the best option, even with high oil prices. Or, an enterprising entrepreneur might bring a new, innovative product to market that revolutionizes transportation altogether. How in the world would a government official, even one with specialized training in energy issues, be able to predict what might be the best alternative for each citizen in each part of the country?
Ultimately, I believe that the purpose of government is to protect liberty – the life, liberty, and the pursuit of happiness described by Thomas Jefferson in the Declaration of Independence. Each decision that the government makes is a decision not made by individuals and families, and I believe that individuals and families know better than the government what is best for them. I don’t believe in a government where elites command and control decisions; it is neither the path to greater efficiency and prosperity nor to greater freedom and liberty. Knowledge is power. The greater knowledge resides among the people, not the government; so, too, should the power.
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