The Evening Post WELLINGTON, SATURDAY, SEPTEMBER 8, 1945. THE PLANNERS' "NEW ORDER"

Evening Post, Volume CXL, Issue 60, 8 September 1945, Page 6

The Evening Post

WELLINGTON, SATURDAY, SEPTEMBER 8, 1945.

THE PLANNERS' "NEW ORDER"

A case for complete planning and an implied case for collective ownership were stated yesterday by Mr. George Lawn, economist to the Reserve Bank. He explained that the views were personal and in no way official. "The supporters of private owriership of natural resources or productive entei> prises," he declared, "are today on the defensive. They have to prove, if they can, that private ownership results in a better use of resources, a more equitable distribution of wealth, greater economic progress, greater economic security, and more satisfactory social conditions than can be achieved under a system of collective ownership." But are the supporters of private ownership on the defensive? It might be said with equal force, and with greater reason, that, rathex-, the boot is on the other foot —that it is for the advocates of planning and collective ownership to prove that the changes they advocate (changes involving disturbance and dispossession) will give better results in efficiency and higher living standards than the system which they so strenuously and roundly condemn. "The war," says Mr. Lawn, "has shown what can be achieved by bold and vigorous planning, efficient organisation, the mobilisation of resources, and the unity of people. We must carry this over to the tasks of peace. . . .

When we consider the wonderful possibilities of the future, if people co-operate to make full use of expanding productive capacity, it is clear that there is scope for stating the objective in terms that will stir the imagination and rouse and maintain public interest. Peace must have her victories as well as war."

It would be idle to deny that in war great things have been achieved under State direction, but it would be just as idle to deny that these things have been achieved without the sacrifice of a large measure of the liberty of the individual—personal, social, and economic. For war achievements a great personal and material price has been paid. Under the spur of war the people have accepted without undue complaint a degree of regimentation which normally would have been wholly repugnant to them. For instance, in ordinary circumstances the individual enjoys the right to choose his or her own form of employment. For many thousands of people this right disappeared during the war—they were directed away from the jobs they knew to jobs which the State decided were more essential. In an emergency created by war conditions, when the whole effort of the nation is tuned to achieve one objective, the right of the State to control, among other things, the direction of labour is undoubted, but we doubt whether, under peace conditions, the people would willingly confer such all-embracing powers on the State. Yet the form of planning and collective ownership which Mr. Lawn appears to envisage could not be operated unless the State possessed those powers. Mr. Lawn can see no middle course under which the people themselves, by their everyday acts —the right to change their employment, the right to buy this, or the right not to buy that—dictate the plan to be followed. He describes as pathetic a belief that "somehow or other the | vast number and variety of plans made separately by individual owners [of natural resources and capital equipment] will integrate themselves and produce an orderly and systematic unity," and he can see no virtue in any system that does not vest complete authority in the planners and lead from collective production to collective ownership. "The natural corollary of collective production," he says, "is collective ownership."

As an introduction to the chapter on planning and democracy in his book, "The Road to Serfdom," Professor Hayek makes the ■ following quotation from Adam Smith: "The statesmen who should attempt to direct private people in what manner they ought to employ their capitals, would not only load himself with a most unnecessary attention, but assume an authority which safely could be trusted to no council and senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it." In this chapter Professor Hayek makes the following comment: "The 'social goal' or 'common purpose' for which society is to be organised, is usually vaguely described as 'the common good' or the 'general welfare' or 'the general interest.' It does not need much reflection to see that these terms have no sufficiently definite meaning to determine a particular course of action. The welfare and the happiness of millions cannot be measured on a single scale of less and more. The welfare of a people, like the happiness of a man, depends on a great many things that can be provided in an infinite variety of combinations. It cannot be adequately expressed as a single end, but only as a hierarchy of ends, a comprehensive scale of values in which every need of every person is given its piace. To direct all our activities according to a single plan presupposes that every one of our needs is given its rank in an order of values which must be complete enough to make it possible to decide between all the different courses between which the planner has to choose. It presupposes, in short, the existence of a complete ethical code in which all the different human values are allotted their due place." And, later, Hayek says this: "The effect of the people agreeing that there must be central planning, without agreeing on the ends., will be rather as if a group of people were to commit themselves to take a journey together without agreeing where they want to go: with the result that they may all have to make a journey which most of them do not want at all." Under the system advocated by Mr. Lawn the planners count for everything and those for whom they plan for very little. All that the many must do is to fit into a scheme propounded by the few.

There are many planners, not all agreed on their plans, or even on their objective. Their support of central planning mostly assumes that they will be the planners and that the plan to be adopted will be what they have in mind. New Zealand people have already had some experience of what comes from a system under which a Minister of Finance decides more and more how their money shall be spent, whether they shall spend it here or overseas, and what they shall get for it.

They want 'to retain what voice they nave under the commercial system in the plans for their work and reward, and not surrender all to a central planning authority. Before agreeing that private enterprise and ownership are on the defensive, they will listen to Mr. Winston Churchill's warning: "We must beware of trying to build a society in which nobody counts for anything except a politician or an official, a society where enterprise gains no reward and thrift no privileges."