by Fred L. Smith, Jr.
May 28, 2008

Our theme tonight is Revolution. Revolution is a double-edged metaphor. It can be bloody or peaceful, tyrannical or liberating, physical or intellectual.

Our revolution is against the Politically Correct notions pushed by chattering-class intellectuals. A revolt against conventional wisdom, ossified hierarchies, and expanding bureaucracies.

We seek a revolutionary expansion of freedom, and of the institutions of liberty that make it possible.

Nineteen years ago, the world witnessed a wave of incredible revolutions sweeping through Eastern Europe. Totally unexpected, astoundingly peaceful, and amazingly swift.

A popular saying summed it up: “Poland—10 Years; Hungary—10 Months; East Germany—10 Weeks; Czechoslovakia—10 Days; Romania—10 Hours”

Well, the obvious implication for tonight’s talk is that I take no more than 10 minutes! If I stay within that time limit, it will be truly revolutionary.

Let me thank Jonah Goldberg for acting as our Master of Ceremonies tonight. Jonah's new book, Liberal Fascism, is truly excellent; I’m enjoying it. Still, I couldn’t help editorial comment: "Liberal Fascism is a fine title, but wouldn't Liberal Statism have been even better?"

“Too late”, Jonah responded, but I wonder if that was the real reason. My research shows that, while Microsoft Word’s spellcheck recognizes fascism as a word, it doesn’t recognize statism! Surprised me – I thought that the software industry above all others would have recognized that threat!

But maybe they do. If you type the word statism, then Spellcheck offers a very interesting replacement – "SADISM"!

The Twentieth Century witnessed many intellectual revolutions. It was century where ideas did have consequences. Unfortunately, most 20th century ideas were collectivist, statist, with consequences ranging from the horrendous to the bad – from communism and Nazism to socialism, liberalism and environmentalism. Initially, the statists argued optimistically: Give up freedom and we’ll create Heaven on Earth. Today’s Gloom and Doom Alarmists still want our freedom but now promise only to fend off Hell on Earth.

Our challenge is to mount a revolution that will expand – not shrink – our freedoms. And the times today, as described by Charles Dickens’ at the initiation of the French Revolution are appropriate:

“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, … it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair ….”

Think for a minute – where, today, do we find wisdom, light and hope? Where do we find foolishness, darkness and despair? You find the first wherever man is free and markets are operating; wherever technologies are born and flourish on their own merits.

But if you look in the realm of government – be it state, national or god forbid global – you find foolishness, darkness and despair 24/7.

Consider:

• Economic globalization has done more to help the poor of the world than any government relief program in history. But it is global trade that is under attack; it is global government that is on the rise.

• Technology has opened up new vistas, from nanotechnology to private space flight. But even as technology advances, government control advances even faster. …And rationales for government control grow even faster yet.

Jonah warms of all this, quoting de Tocqueville:

“it is especially dangerous to enslave men in the minor details of life.”

Yet our politicians, those presumed worthy of wearing the mantles of our Founders, those who debate and pontificate only a few hundred yards from here, have decided to…ban the incandescent light bulb?!

Americans are trusted to choose our candidates at the polls, but Americans are no longer free to choose our light bulbs at the hardware store.

This is insanity. It’s the embodiment of what Jonah in his book has labeled “the totalitarian temptation” – to micromanage every detail of our lives.

CEI’s job is to deliver an intellectual “smack-upside-the-head” to this sort of lunacy;

• to demonstrate that man’s ingenuity is the brightest hope for prosperity;
• that man’s freedom is the best way in which to empower that ingenuity;
• and that the institutions of a free market—property rights, free trade, the rule of law—are the best framework for these miracles.

CEI does all this and more, championing the technology revolution, focusing on how the risks of technological innovation pale in comparison to the risks of technological stagnation… how the risks of regulation – unseen and off-budget – are among the greatest threats mankind faces.

Our revolutionary goal is to promote capitalism – the brilliant dynamic system in which the “good” products, firms and technologies of today are continually displaced by tomorrow’s better ones. Sixty-six years ago the Czech-born economist Joseph Schumpeter labeled this process “creative destruction”.

Schumpeter also warned that capitalism carried the seeds of its own undoing. Capitalism, he argued, would produce massive prosperity. With mankind freed from a subsistence existence, an Intellectual Class would arise that, in time, would become envious of entrepreneurs. That envy would soon be diverted into arguments designed to de-legitimize that creative revolutionary force. And the opposition of intellectuals was dangerous, for as Hayek noted, intellectuals create the narratives through which people see the world. Anti-market narratives would proliferate, stressing the promises of an expanded state, the pervasive failures of markets.

The result? Government would grow and the market would become ever more regulated. And who would fill the swelling ranks of the state? Who would best fill the positions within business needed to deal with the regulators? Who else but the anti-market Chattering Class. Soon, business would find itself on the losing side of a cultural war of attrition, increasingly banished from the war of ideas.

Was Schumpeter right? He was a pessimist. I am not. Schumpeter seemed not to realize that not all intellectuals would be infected by the collectivist virus. Nor did he anticipate intellectual counter-revolutions for economic liberty, such as those sparked by von Mises, Hayek and Friedman. Most importantly, he didn’t realize that creative alliances between wealth creating entrepreneurs and pro-market intellectuals might evolve to counter the unholy alliances between statist intellectuals and rent-seeking economic interests.

Schumpeter never envisioned a gathering like this.

Thus, our challenge is to mount a revolutionary counter-offensive – to craft and expand a freedom enhancing global alliance of entrepreneurs and intellectual activists. On the success of such a program may well hinge the future of freedom, of civilization itself.

Can such a counter-offensive succeed? Can – Schumpeter notwithstanding – capitalism survive? As partial answer, let me paraphrase William Faulkner – a southerner like me, a shy, soft-spoken person (not quite like me).

During the Cold War, he stated, in his 1950 Nobel Prize speech:

“Our tragedy today is a universal physical fear expressed in only one question: When will I be blown up?”

I was a kid then, and nuclear holocaust was a truly frightful question. Compare Faulkner’s concern, though, to the supposedly central questions we face today:

 

• Will the earth warm up another degree?
• Which is more sustainable – fair-traded coffee or reheated tofu?
• Which has the larger carbon footprint – plastic or paper?

These arguments for global controls aren’t quite as persuasive.

But CEI takes ideas seriously, as did Faulkner. He ended his Nobel Speech by stating,

“I believe that man will not merely endure: he will prevail.”

At CEI we hope that capitalism will not merely survive – not merely prevail – but that it will flourish!

And later tonight, from the President of a land that now enjoys the fruits of its own liberating revolution, we will learn more about why.