How to Be a True Benefactor in Society


Gary Galles – November 1, 2020

One of the most striking things about electioneering is that every politician and sycophant claims to be a benefactor to Americans, ever more stridently as the election approaches. But every one of them seeks to help Pauls out of the pockets of Peters, which is being a thief when both sides of that equation are counted rather than being a benefactor. And even the best-intended government efforts in such areas rely on a false “pretense of knowledge,” as Friedrich Hayek put it, that limits their ability to transform promised benevolence into actual improvement.

Leonard Read addressed this issue a half century ago in “How to Be a Benefactor” in his book Then Truth Will Out. He focused on the information problem facing government benevolence and the necessity of extracting the resources necessary from others. Perhaps even more important, he makes the case that acts coordinated through voluntary exchange in markets provide vastly more benefits for those they deal with than do efforts labeled as benevolence. Consequently, government actions to acquire the resources to “do good,” inevitably wipe out joint gains that would otherwise have been produced by specialization and exchange, undermining by far the greatest mechanism of producing mutual improvement that exists. As a result, the good intended to be done (but not necessarily accomplished) may often be outweighed by the harm “successfully” imposed on others, even when such harm is not intended.

In a world where many praise every well-intended act to help someone, even when it fails to do so effectively, but denigrate anything that might be said to be “tainted” by self-interest, that message is well worth remembering in evaluating the promises made in search of our votes in November.

  • When we get it into our heads that other people’s problems are our responsibility to solve, we “rise” to a level of utter incompetence. However good our intention, our meddling makes matters worse rather than better.
  • Elect me to Congress and I remain as I am, my competence not improved one whit…Nor will it upgrade my competence to place me in the highest political office in the land.
  • Before considering how we can become true benefactors…reflect on the mischief done in the belief that social responsibility requires everybody to solve everybody else’s problems.
  • Public policy…should be geared to consumer interest—that’s all of us…men will serve us best in every way—including alleviation of our poverty and so on—when they stick to their own knitting!
  • John Stuart Mill…grasp[ed] the pursuit of self-interest as an efficacious way of life: “The only freedom which deserves the name is that of pursuing our own good in our own way, so long as we do not attempt to deprive others of theirs, or impede their efforts to obtain it.”
  • Earlier Adam Smith had observed that: “by directing that industry in such a manner as its produce may be of the greatest value, [the individual] intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention…By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it.”
  • [One] should observe the rules and pursue his own self-interest. Thus will he best serve others.
  • The pursuit of self-interest as one’s objective is not widely applauded. Generally, such action is associated with greed, avarice, selfishness…[but] self-interest is the ultimate given.
  • [At issue is] how intelligently self-interest is interpreted…the thief thinks of his interest as best served by stealing from others. This is an interpretation so narrow and antisocial that the more it is pursued, the more is the public good subverted.
  • There are, on the other hand, those who so intelligently interpret their self-interest that they would never think of trying to pursue their own good by depriving others of the same right, or in any way impeding the efforts of others to obtain their own good…serving or observing the self-interest of others in order to best serve one’s self. This is an interpretation so intelligent that the more it is pursued, the more is the public good served.
  • The ardent pursuit of self-interest is the way to social felicity or the public good, presuming that individuals are not allowed (by government) or do not allow themselves to act at cross purposes with the freedom of others, thereby damaging their own interests…the more powerfully the individual is motivated to pursue his enlightened interests, the better.
  • What are…misinterpretations of self-interest? All will agree that theft is wrong. But of the millions who wouldn’t personally steal from any other, what about those who will, without the slightest qualm, get the government to feather their own nests at the expense of others?
  • What, then, is the alternative to the pursuit of self-interest? It is that these people who do not even know their own interests should pursue your and my good….This is to compound ignorance in society. For, surely, an individual who does not know his own interest cannot remotely know mine, let alone the countless interests of millions.
  • How best can I become a benefactor to mankind?…Number one is to do all in my power not to interfere with the business of others….Number two is to mind my own business….Number three is…practicing as best I can the difficult and sensitive Judeo-Christian philosophy of charity.
  • Every man and woman in society has one big duty. That is, to take care of his or her own self…the duty of making the best of one’s self individually is not a separate thing from the duty of filling one’s place in society…the latter is accomplished when the former is done.
  • Minding one’s own business is the doctrine of liberty. Admittedly, this has no glamour for the “friends of humanity,” the social architects, the ones who would mind other people’s business. To rule out their masterminding of others is to deny their peculiar pursuit of happiness.

Unlike so many people, now as in the past, Leonard Read recognized that it does count against government charitable efforts when they violate the universal moral condemnation of theft from others, but it doesn’t count against voluntary, mutually beneficial social cooperation when it results from enlightened self-interest. Without that mechanism, we would all be immeasurably poorer, both doing less for others and having others do less for us. As Read put it, “Minding one’s own business…serves self by serving others…self-interest in its most intelligent conception.”

Originally published at Gary M. Galles is a professor of economics at Pepperdine University. He is the author of The Apostle of Peace: The Radical Mind of Leonard Read.

Image source: hermosawave via Getty

Leave a Reply

Your email address will not be published. Required fields are marked *