Monday, February 17, 2014

Two Farms: An Economic Parable

A brother and sister each inherited a plot of land, and they both decided that they are going to use the land as a way to produce the things they need to survive. At first, the lives of the siblings are pretty similar. They each created modest homes out of available wood and assorted objects they can easily find. They each foraged daily for whatever nuts, plants and berries they can find that grow naturally within the confines of their property. Occasionally they traded with each other, if one or the other sibling found something the other wasn’t lucky enough to secure.

Things changed, however, when the sister started to take control of her farm. One spring she started planting crops in a small garden, only to reap the rewards of vegetable harvests in the summer and fall. Over the next years she doubled and tripled the size of her garden, and even started preserving some of the food she reaped by learning the arts of canning and pickling.

So much does she produce that the sister is soon able to trade with other people, bringing great improvements to her modest home, which eventually becomes a beautiful home instead of a ramshackle hovel.

The brother never understands why the sister so tightly manages her farm. Though his sister reaps the rewards of the safer, richer and healthier life her efforts have secured, she is violating the integrity of a natural system, bending it to her will, forcing it to serve her needs. This is philosophically repellent to the brother.

The brother continues to live off the land. He traps rabbits, forages for berries, goes hungry in the winter, and continues to live in his shack.

The sister marries, adopts children, becomes involved in the greater community, acquires knowledge from faraway places, and freely trades the tricks and ideas she has developed on her farm with others. Across the world similar farms also have great success.

Of course, not everything is always perfect. When a drought occurs, the sister is forced to rely on her savings and the help of friends and trading partners to see her through, just as friends and trading partners rely on her when they suffer droughts or similar problems. The drought hits her brother especially hard, and for a time he is even forced to leave his plot of land and live with his sister, because the pickings of his land are scant. Once, in his hunger, the brother picked all his berries, and now there are no more berries on his land.

One night the brother and the sister are sitting on the sister’s porch, sipping cool lemonade and watching her adopted children chase fireflies in the darkness.

“Why don’t you improve your land the way I do, brother?” the sister asks, “Look at all I have accomplished with my managed farm.”

“Though I appreciate the lemonade, Sis,” said the brother, “you have to understand that what you do here on this farm violates my core philosophical beliefs. The plants and animals on my little patch of land are free to grow and live as they want, (until such a time as I am hungry and eat them). The plants and animals of your farm are regulated and controlled. You produce much more, and happiness and goodness abound, but this is done at the price of freedom.”

“But the regulations I’ve imposed on the farm have granted greater prosperity," counters the sister, "Leisure time, learning, art, and technology have all increased and humanity has benefited from the ideas we have developed here and elsewhere. You spend all your time searching, scavenging, hunting and working merely to survive. You talk about freedom, but your idea of freedom is merely the freedom to live and die as the whims of the world dictate. Aren’t all successful human endeavors the result of planning, regulation, study, experimentation and modification?”


A free market economy is a hunter-gathering economy. We get what we get randomly, dependent on “market forces” that must be unregulated and allowed to do what they will. If we are lucky enough to get what we want, great. If not, too bad. Some benefit immensely, others suffer and die.

A well regulated economy produces wealth and can accomplish amazing, long range goals. Arts, science and technology can all prosper, and human potential can be fully realized. A regulated economy can prioritize education, opportunity and the environment. An unregulated economy cannot prioritize anything, it can only do what it is going to do, like the weather, and the best people can do is endure.

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