Photo credit: Karen Horton

Is political self-interest truly nobler than economic self-interest? That’s the question famous Nobel Prize-winning economist Milton Friedman put to liberal television talk show host Phil Donahue in 1980 at another economically perilous time for the United States. If we, as a nation, have learned nothing else these last four years, hopefully we have learned the answer is an unequivocal “no.” A trip to George Orwell’s Animal Farm will make the point.

As you may recall (Is Animal Farm still required high school reading?), the story begins on Manor Farm, which is owned and operated by a man named Mr. Jones. Like all businessmen, Jones’ goal is to maximize profits. Life goes along fairly well until Jones loses a lot of money in a lawsuit. He becomes disheartened, taking to drink, and fails to care for his farm as he once did. The animals grow increasingly discontent with Jones’ management of the farm.

The prize boar Old Major (a Frank Marshall Davis-like thinker) seizes upon the opportunity to call all the animals together and voice his long-standing dream of the animals taking over the farm from Jones. Major expounds that they would run it as one for the benefit of all, not to make profit for Jones or any other man. His eloquence sets his audience on fire with the possibility of fundamentally transforming farm life.

Major dies before his vision can be realized. However, younger boars take up the mantle and begin to teach and to organize others on the farm so when the opportunity comes, they will be ready. Finally, after a particularly bad day when Jones becomes so drunk he fails to feed the animals, they rebel and force the farmer from his land.

At first, there is exhilaration in the air. The animals adopt commandments based on Major’s vision, which first and foremost guarantees that all animals should receive equal amounts of resources. However, slowly, almost imperceptibly, things begin to change. One boar, Napoleon, consolidates power on to himself. He institutes rules based on his political self-interest. He ends up living high on the hog, so to speak, with a much more privileged life than Jones ever had.

One of Napoleon’s ill-conceived, pork-spending initiatives, supported by increased taxes and deficit spending, is building a windmill (green energy). The windmill is supposedly intended to help better the lives of everyone. But when it’s finally completed, it’s used to line the pockets of those who support the regime (i.e., Solyndra-style crony capitalism).

A ruling class, which lives off the fruits of others’ labor, arises to support Napoleon’s reign. The overall wealth of the farm declines as taxes rise and worker productivity decreases. However, whenever anyone questions the wisdom of the decisions being made, Squealer, Napoleon’s spin-doctor, is always ready to cite some statistic “proving” how things are much better than they were under the greedy Jones. “You don’t want to go back to those days, do you?” he asks.

Milton Friedman could have easily predicted this outcome: He had witnessed it first-hand when he worked as an economist for President Franklin Roosevelt during the Great Depression. Friedman watched the federal government expand greatly in order to use political power to control the economy and spread the wealth around. FDR increased taxes on the “rich” to a top marginal rate of 79% and on corporations (even their supposed “undistributed profits”) to try to pay for all the new agencies. He also instituted our largest entitlement program, Social Security. His actions were guided by the belief that political self-interest is nobler than economic self-interest.

The results were disappointing.

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