22 The Price of Freedom: One Man’s Profit is Another Man’s Loss

This is one of Montaigne’s shortest essays and it includes a deceptively simple message, summed up in these two quotes:

no profit is ever made except at somebody else’s loss

‘No doctor derives any pleasure from the good health even of his friends’ (as was said by an ancient author of Greek comedies); ‘neither does the soldier from peace in his city’: and so on for all the others. And what is worse, if each of us were to sound our inner depths he would find that most of our desires are born and nurtured at other people’s expense.

I highlighted the last clause of the second quote, because it contains an important insight into humanity. No matter how much we like to think of ourselves as guardians of human freedom, none of our choices in life come without some form of restraint on another’s freedom.

An obvious example is gun rights. Advocates of a strict interpretation of the Second Amendment were overjoyed when the Supreme Court ruled the City of Chicago’s handgun ban ordinance unconstitutional. To gun rights advocates, this was a ruling in favor of individual freedom. But while the ruling did support the right of individuals to bear handguns, it also abridged the freedom of Chicagoans to decide for themselves which types of guns its citizens were entitled to own and under what circumstances. One freedom was traded for another; individual rights were gained through a loss of local autonomy.

The same is true when it comes to government matters of taxing and spending. Take, for example, a relatively easy government decision – to fund a bridge construction project. Let’s say that, over the past 10 years, business has boomed in a Chicago neighborhood, but because the road leading from the nearest Interstate to this booming business district must traverse a bridge – and this ancient bridge can only handle two lanes of traffic at time – a major transportation bottleneck has sprung up. Building this bridge should lead to shorter commute times, making the neighborhood even more attractive to shoppers, which leads to higher sales, more jobs and higher tax revenues. Everybody wins, right?

Well, not quite. During the construction process, those commute times will become substantially longer, so before these businesses can grow, they might have to survive a short-term constriction in growth. Once the project is complete, growth may go exactly as planned – but some other shopping district somewhere else in the City will become less attractive. The business gained in the hot new neighborhood will take away from not-so-hot older neighborhood. On balance, the new growth may be a net plus for the local economy – maybe even the national economy. But there will always be tradeoffs somewhere. And for advocates of public transportation, the fact that government funding always seems to become available for road projects but rarely for rail reconstruction is especially galling.

Government funds used to build the bridge aren’t Monopoly dollars. A prudent, well run government will have to make choices between attractive projects – and the winners are more often chosen based on political clout, not a cold hard examination of economic benefit. More imprudent governments may approve more projects than the budget can handle, requiring a tax increase – again, abridging the economic freedom of some for the benefit of others. And the most imprudent governments will pay for the projects with debt, rolling the cost of the project into the future on the assumption that economic growth, spurred by the new projects, will pay for the projects over time. Pretending, that is, that given a long enough time frame, no one really has to pay for anything.

And so we arrive in 21st Century America, the land where everyone speaks up for his or her freedom, but no one is willing to admit or understand the price of those freedoms. We pay for the right to drive big expensive automobiles not only with five year loans and gas taxes, but with wars in the Middle East to ensure oil price stability and support for despots (such as the Saudi royal family) which could lead to future acts of terrorism and more wars. We pay for those home mortgage deduction tax credits with inflated home prices, requiring more artificial props to encourage home buying for people who can’t afford those prices, with all the crazy finance schemes that led to the financial crisis, and finally with budget deficits that will choke off economic opportunities for our children.

Americans refuse to believe that every action has a cost. Even economic growth itself – fueled by inexpensive fossil fuels – has a cost in environmental risk and possibly a future catastrophe once the resources necessary to sustain an ever-growing economy become scarce. Three-percent annual growth is a necessity for a healthy economy, but over time, it becomes impossible on a planet of limited resources. Malthus only has to be right once.

The biggest problem I have with the state of political discourse in America is this blindness – this inability to see that whenever a person defends a certain form of freedom for himself, he’s asking to take away a different sort of freedom for another. This leads, inevitably, to political arguments where both sides contend that if only their side could win 100 percent of the conflicts in our democracy, all problems could be solved.

There’s a word for that kind of political rule: dictatorship. If we’re going to live and survive in this democracy, we’re going to have to appreciate the value of compromise and the real price of everything. We have to stop thinking that can do exactly what we want to do all the time without paying a price for it.

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