]]]]]]]]]]]       THE TRIUMPH OF STATISM:         [[[[[[[[[[[[[[[[[[[[
      The political Economy of the French Revolution       (12/81989)
                   Richard M. Ebeling
   Ludwig Von Mises Professor of Economics, Hillsdale College
          From IMPRIMIS Hillsdale College Nov. 1989
           [Kindly uploaded by Freeman 93401DORM]

[Editor's preview: Here Hillsdale professor Richard M. Ebeling
discusses the effect of inflation, deficit spending and regulation in 18th
century Fances economy He concludes that the French Revolution
represented not a triumph of the bourgeoisie but an ominous extension of
the centralized state. Originally presented during a Center for Constructive
Alternatives seminar "promises Unfufilled The French Revolution After
200 years," in February 1988, this essay will appear with other
presentations from the same program in a volume to be published by
Regnery Gateway, Inc. this spring.]

       Ours has been the century of the total State. When, in the 1920s,
Benito Mussolini coined the term totalitarian,'' he captured the spirit ot the
age. In no other period in man's history have so many human beings been
sacrificed on an altar engraved with the words, "For Reasons of State."
Millions have been treated as refuse fit only for disposal in ovens. Tens of
millions have been starved to death, worked to death, tortured to death in 
the cause of constructing utopias on a grand scale. For most of our century, 
over large portions of the earth, humane behavior towards one's fellow man 
has been the bestowing of death with a bullet to the back of the neck.
       Nor is it surprising that war in our cen tury has often been total war. 
In an epoch in which the distinction between society and the State has been 
blurred at the minimum and erased in the extreme ``The Enemy" is no 
longer the ruler and his ar my of hired professionals, as it was in the 
Middle Ages an earlier age in which all sides followed an etiquette of war, 
in which the status of noncombatant was recognized and his life and 
property were meant to be respected. In the total State, the individual has 
no existence outside of his role and function within the collective plan. He 
and everything he possesses is the property of the State to which he belongs. 
Victory in war, in such a world, requires the combatants to view all those 
who live and work on the other side of the battleline as ``The Enemy," 
because all who live and work across that line do so at the command of the 
opposing State. To defeat the enemy requires the destruction of the people in 
the opposing State and all that they have or could produce.
       In the total State, therefore, the concept of private property loses its 
meaning. Even if property has not been nationalized, even if individuals are 
not meticulously regulat at every moment in every detail of their economic 
activities, the logic of this system is that at any moment, for any purpose, 
the individual, his property, and his productive energy are at the 
unreserved disposal of the State.
       As we approach the end of the 20th century, the age of the total State 
seems to be coming to a close. The trauma and destruction of two world 
wars have faded into memory. The decline of the collectivist ideal, even in 
the socialist countries, makes it appear that the worst is over. The next 
hundred years may, indeed, be an era of limited and free government, a 
period of individual liberty and free market prosperity. But it is worth 
recalling that at the beginning of the 20th century there were few seers who 
expected these hundred years to turn out the way they have. The belief then, 
too, was that the future would contain nothing but expanded freedom and 
increasing prosperity. After all, the thinkers of 1900 argued, we had 
learned the lessons of the French Revolution; we created in its place 
civilized regimes based on a sense of humanity and a respect for the 
individual and his rights to life and property; the succeeding years would 
merely provide improvements on this liberal ideal. But we know now that 
the men of 1900 were wrong. Not all the lessons that the French Revolution 
could teach were learned, and, what was worse, some of the lessons that 
had been learned for a time have been forgotten.
Statism in the Ancien Regime
       Among the lessons forgotten were those that economics can teach. 
Almost every one of the mistaken and disastrous policies that we have 
pursued in our own times were applied and experimented with during the 
French Revolution: deficit spending; regulation of private enterprise; 
nationalization of property; wage and price controls; and inflationary 
destruction of the monetary system.
 But if the French Revolution is to be an object lesson in bad economics, its 
prologue lies in the policies of the ancient regime. Imbued with the spirit of 
mercantilism, the royal French government viewed it as its responsibility to 
regulate and oversee all he economic activities of France. From imports 
and exports to production and investment and the pricing of commodities, 
the State concerned itself with every aspect of commerce. There is no better 
guide for a brief summary of the patterns of royal regulation than Alexis de 
Tocqueville. In his book, The Ancien Regime and the French Revolution, all 
the pertinent details are spread before the interested reader. A few 
passages will give the necessary flavor of the period:
       Orders were passed prohibiting the cultivation of this or that 
agricultural produce in lands which the Council [the economic authority in 
Paris] considered unsuited to it. Others required that vines planted in what 
the Council regarded as bad soil should be uprooted. To such an extent had 
the government exchanged the duties of sovereign for those of guardian.
 The government had a hand in the management of all the cities in the 
kingdom, great and small. It was con sulted on all subjects, and gave 
opinions on all; it even regulated festivals. It was the government which 
gave orders for public rejoicing, fireworks, and illuminations.
       The church, which a storm had unroofed, or the presbytery wall 
which was falling to pieces, could not be repaired without a decree of 
Council. This rule applied with equal force to all parishes, however distant 
from the capital. I have seen a petition from a parish to the Council praying 
to be allowed to spend twenty-five livres.
       A very extensive machinery was requisite before the government 
could know everything and manage everything in Paris. The amount of 
documents filed were enormous, and the slowness with which public 
business was transacted was such that I have been unable to discover any 
case in which a village obtained permission to rise its church steeple or 
repair its presbytery in less than a year. Generally shaking, two or three 
years lapsed before such petitions were granted.
       To quote one more authority, the French classical liberal, Charles 
Dunoyer, from his book, The Passage to Liberty:
       "The State exercised over manufacturing industry the most 
unlimited and arbitrary jurisdiction. It disposed without scruple of the 
resources of manufacturers; it decided who should be allowed to work, 
what things it should be permitted to make, what materials should be 
employed, what processes followed, what forms should be given to 
productions. It was not enough to do well, to do better; it was necessary to do 
according to the rules."
       And while the King's Council regulated the economic affairs of his 
subjects, the King's Court consumed the national wealth. Louis XVI's 
military guard numbered 9,050 persons; his civil household numbered 
around 4,000; thirty servants were required to serve the King his dinner, 
four of whom had the task of filllng the King's glass with water or wine. 
The King had 1,857 horses, 217 vehicles and 1,458 men in liveries. In 1786 
there were 150 pages in the palace, 128 musicians, 75 religious officials, 48 
doctors and assistants 383 officers of the table, 103 waiters and 198 persons 
for the personal domestic services of the King.
       To pay for this extravagance and the numerous other expenses of the 
Court, as well as the foreign adventures financed by the King (such as the 
financial help extended to the American colonists in their war for 
independence against the British), the King had to rely on a peculiar tax 
system in which large segments of the entire population primarily the 
nobility and the clergy - were exempt from all taxation, with the "lower 
classes" bearing the brunt of the burden. One of the most hated of the taxes 
was the levy on salt. Every head of a household was required to purchase 
annually seven pounds of salt for each member of his family at a price fixed 
by the government; if he failed to consume all the salt purchased during the 
previous year and, therefore, attempted to buy less than the quota in the 
new year, he was charged a special fine by the State. The punishments for 
smuggling salt and selling it on the black market were stiff and inhumane.
       The discrepancy between what the Royal government spent and what 
it collected in taxes was such that at the time of Louis XVI's accession to 
the throne in 1774, the accumulated Royal debt was 2,470,000,000 livres. (A 
livre was then worth about 20 cents.) The expenses for that year alone were 
399,200,000 livres, with tax receipts of only 371,980,000 livres, leaving a 
deficit of 27,220,000 livres. Loans had made up the difference in the past and 
would continue to be used in the future.
       But out of this regulatory and fiscal madness, France was given the 
opportunity for economic redemption. The new King appointed Anne Robert 
Jacques Turgot as controller of the finances. A follower of the Physiocrats, 
an articulate proponent of free trade and laissez-faire, Turgot had been a 
brilliant administrator of one of the French provinces and brought it 
increased prosperity by establishing a general free market policy in the 
area under his jurisdiction. As finance minister of the entire country, 
Turgot now instituted an economic revolution: He abolished all grain tariffs 
between the provinces of France; he abolished the practice of forced labor for 
road building and other public works; and then he abolished the trade 
guilds and the government-protected manufacturing monopolies. And, 
incredibly, he declared that the Royal deficits would be solved through cuts 
in government spending and not through increases in taxes.
       But every lowering of a tariff, every elimination of a trade guild, every 
removal of a monopoly privilege, increased the array of special interest 
groups determined to defeat Turgot. Their chance came with the King's 
recall of Parliament, for here was their opportunity to veto Turgot's free- 
market reforms and protect their privileges and monopolies. And on May 
12, 1776, the King dismissed Turgot under the pressure of the special 
interests. Thus, France's one chance before the Revolution to establish an 
economic regime of free markets at home and free trade abroad was lost.
 Those who followed Turgot as controller of the nation's finances lacked his 
vision or integrity. The fiscal crisis merely grew worse and worse. As 
Thomas Carlyle summarized it in his study of The French Revolution:
       "Be it `want of fiscal. genius,' or some far other want, there is the 
palablest discrepancy between Revenue and Expenditure; a Deficit of the 
Revenue..... Fatal paralysis invades the social movement; clouds of 
blindness or of blackness envelop us; are we breaking down then, into the 
black horrors of NATIONAL BANKRUPTCY?"

Monetary Collapse and Revolution
It was the Royal finances that was the immediate cause for the calling of 
the Estates-General at the beginning of 1789. And it was the chaos of the two 
months following the fall of the Bastille in July 1789 that set the stage for the 
economic policies which would dominate early revolutionary France. In the 
words of the Italian historian, Guglielmo Ferrero, in his work, The 
Principles of Power:
       "All over France ... [t]he majority was carried away by an unaccount 
able frenzy, the minority followed willingly or unwillingly, convinced up to 
a certain point only; but the fact remains that everyone revolted. Barracks 
and monasteries were emptied as soldiers and monks deserted, the army 
scattered to the four winds, the administration was dislocated, neither 
courts nor police functioned any longer, taxes and seignorial dues were no 
longer paid, everywhere monasteries and castles were stormed and 
pillaged... inafewweeks [t]he aristocratic and monarchic hierarchy ... 
vanished into nothingness, dis appeared into an enormous crevasse of 
history that all at once opened up beneath its age-old foundations."
       In August the French National Assembly was told that practically no 
taxes had been collected for three monthsand this at a time when more 
than 160,000 livres a month were being spent in Paris alone for the creation 
of public works jobs; and this following a spring during which the National 
Assembly had ``lent'' the people of Paris almost 17,000,000 livres out of the 
national treasury to buy food.
       In November 1789, Mirabeau proposed an answer to all of the 
government's fInancial difficulties. In the previous month, the National 
Assembly had nationalized all the estates and properties of the Church. 
Mirabeau now suggested that paper notes be issued by the National 
Assembly with the Church lands as collateral. The notes would fIrst pass 
into circulation as spending for public works and other expenses of the 
government. They would be redeemable at face value in the form of 
purchase price for Church property. At the same time, it was argued, the 
added circulation would give a stimulus to industry, create jobs and put 
money in the pockets of the working classes. (Later it would be the 
confiscated lands of the nobility who had fled France that would be used as 
the fIctitious collateral behind a flood of paper money.)
       On March l7, 1790, the National Assembly voted for the issuance of 
the Assignats, as the paper notes were called. And the first issue was 
released in April in the amount of 400 million livres. But by the end of the 
summer the government was again short of funds and 800 million more 
Assignats were printed by the government. The argument for issuing these 
additional quantities of paper money had to overcome the fears of some of 
the Assembly that the prosperity that the proponents of the Assignats spoke 
of would only lead to the destructive forces of inflation. But the Assembly 
was swayed by the appeal of Mirabeau, once again, that only the bankers 
and capitalists might be harmed, and their interests were not those of 
       Andrew Dickson White points out his classic monograph, Fiat Money 
Inflation in Face, that the first issues of the Asugn'ais were passed by the 
Assembly only with great diffIculty, because of fearful reluctance to risk the
monetary stablility of France. But having once tried the forbidden fruit, it 
became increasingly easy for the government to go back for more, and 
more. And with increasingly regularity the Assembly did. In his famous 
study of The Assignats, Seymour Harris divided the history of the paper 
money into six periods, in which he estimated the quantities of the 
Assignats in circulation and their decrease in value. But it is sufficient to 
look at these numbers at the beginning, the middle and the end of their 
history. At the end of 1791, 1,490,000,000 llvres were in circulation and 
during these first two years of their existence their market value had 
depreciated (in terms of their buying power against goods) by 14% By 
August 1793, there were 4,050,000,000 livres in circulation; their value had
depreciated by 60 percent. And by November 1795, total Assignats in 
circulation had risen to 19,700,000,000 livres, with its buying power having 
diminished by 99 % since 1790. In a matter of five years, the revolutionary 
money of France had become worth less than the paper upon which it was 
       The effects of this monetary collapse upon French society were 
fantastic. A huge debtor class was createdwhich had a vested interest in the 
continuation of the inflation, because this would allow them to pay back 
their debts in increasingly worthless money. Others had used the 
Assignats to purchase former Church or noblemen's land, and their 
fortunes were now dependent upon inflationary hikes in land values; the
lure of larger and larger monetary profits to be reaped during the inflation 
led to vast speculative transactions. Nothing was important anymore, other 
than the pleasures and opportunities of the moment. Heinrich von Sybel, in 
his four-volume History of the French Revolution, writes:
       "None felt any confIdence in the future in any respect; few dared to 
make business investment for any length of time, and it was accounted a 
folly to curtail the pleasures of the moment, to acquire or save for an 
uncertain future Whoever possessed a handful of assignats or silver coins, 
hastened to spend them in keen enjoyment, and the eager desire to catch at 
every passing pleasure filled each heart with pul sations. In the autumn all 
the threatres had been reopened, and were frequented with untiring zeal
       The cabarets and cafes were no less fllled than the theatres. Evening 
after evening every quarter of the city resounded with music and dancing
       These enjoyments, too, received a peculiar coloring - glaring lights 
and gloomy shadows from the recollections and feelings of the Revolution 
In other circles no one was received who had not lost a relative by the 
guillotine; the fashionable ball-dress imitiated the cropped hair and the 
turned-back col lar of those who were led to exe cution; and the gentlemen 
challenged their partners to the dance with a peculiar nod, intended to 
remind them of the fall of the severed head."
       As inflation grew worse, everything became higher in price and 
scarcer in supply. In 1793, soap had become so scarce that the
washerwomen of Paris demanded that merchants who refused to sell soap 
for Assignats should be put to death. Andrew Dickenson White recounts 
       "... on February 28, 1793, at eight o'clock in the evening, a mob of men 
and women in disguise began plundering the stores and shops of Paris. At 
first they demanded only bread; soon they insisted on coffee and rice and 
sugar; at last they seized everything on which they could lay their hands 
cloth, clothing, groceries, and luxuries of every kind. Two hundred such 
places were plundered. This was endured for six hours, and fInally order 
was restored only by a grant of seven million francs to buy off the mob.
       Nor did the promised infIationary prosperity of the inflation last very
long. To quote White again, ``Under the universal doubt and 
discouragement, commerce and manufacturing were checked or 
destroyed. As a consequence, the demand for labor was stopped; laboring 
men were thrown out of employment, and, under the operation of the 
simplest law of supply and demand, the price of laborQthe daily wages of 
the laboring class went down..."
       On whom did the major burden of the inflation ultimately fall? None 
other than those in whose name the inflation was introduced: the working 
classes. The wealthy, the fInanciers, the merchants who dealt in 
international trade had both the eans and often the opportunity to protect 
themselves from the ravage of the inflation. They hoarded gold and silver or
sent their supply of specie abroad; they invested in art or precious jewels. 
Their speculative expertise enabled many of them to stay ahead of the 
inflation and gain from currency movements. The lower income and 
working classes had neither the means nor the knowledge to protect 
themselves. ``On them finally came the great, crushing weight of the loss,'' 
as the Assignats ended up left in their hands the more the inflation ran its 
       Finally, by late December of 1795, it was decreed that the printing of 
the Assignats would end. Gold and silver transactions were permitted 
again and recognized as legally binding. On February 18, 1796, at nine 
o'clock in the morning, the printing presses, and the plates and paper used
in the printing of the Assignats were taken to the Place Vendome and 
before a huge crowd of Parisians were broken and burned.
Price Controls, Regulation and the Collectivist Vision.
       But the inflation of the Assignats was only one failed economic 
instrument of revolutionary France. With the Jacobins' accession to power 
in 1792, the rest of the policies soon fell into place. The collectivist vision of 
the Jacobins submerged the individual into the body of the nation. The 
individual had no existence outside of such a body. ``The Republic must 
penetrate the souls of citizens through all the senses,' declared Barere in 
1794. The individual's life, his work, his very being belonged to the State. A 
year earlier Barere had made this very clear:
       "Some owe [France] her industry, others their fortune; some their 
advice, others their arms; all owe her their blood. Thus, then, all French 
people of both sexes and of all ages are called upon by la Patrie to defend 
liberty ... Let everyone take his post in the national and military move ment 
that is in preparation. The young men will fIght; the married men will 
forge arms, transport bag gage and artillery, and provide sub sistence; the 
women will work at the soldiers' clothing, make tents, and become nurses 
in the hospitals for the wounded; the children will make lint out of linen; 
and the old men, again performing the mission they had among the 
ancients, will be carried to the public squares, there to enflame the courage 
of the young warriors and propagate the hatred of kings and the unity of the
republic. The houses of the nation shall by turned into barracks, the public 
squares into workshops, the cellars into factories of gunpowder."
       All laws, customs, habits, modes of commerce, thought and 
language were to be uniform and the same for all. Not even the family had 
autonomous existence; and children? They belonged to the State. ``The 
principles that ought to guide parents are that children belong to the 
general family, to the republic, before they belong to particular fitmilies,'' 
insisted Barere. ``The spirit of private families must disappear when the 
great family calls. you are born for the republic and not for the pride or the 
despotism of families.''
       The Jacobin view of economics, therefore, should not be surprising.
To quote Barere one more time:
       "The vice we ought to cure in this country is the versatility of 
principles of political economy. ... What we need is a system of national 
works, on a grand scale, over the whole ter ritory of the Republic."
       In the winter of 1791-92, prices in France began to rise signiflcantly, 
partly due to the effect of the flooding of the economy with the Assignats and 
partly due to a bad harvest in 1791. When war was declared on Austria on 
April 20, 1792, cries were heard for price controls on commodities, and 
government relation of industry and commerce. Standing before the 
National Assembly on April 25, 1793, as representative of the Committee of 
Agriculture and Commerce, Boudin declared, ``No individual has exclusive
rights to the fruits of the earth ... All citizens have equal rights to the 
products of the earth upon paying a just indemnity to those who cultivate 
it.'' He recommended to the Assembly that a ``maximum price'' be placed 
on grain. Santerre assured the Assembly that the higli price of grain was 
due merely to the avarice of merchants and farmers.
       On May 4, 1793, the price control on grain was passed, with the 
further regulation that all grain was to be only sold in public markets; 
severe penalties were imposed at the same time for all illegal dealings. ``All 
merchants, cultivators, and proprietors of grain and flour shall be required 
to declare, at the municipal bureau nearest their homes, the quantity and 
nature of their grains and flours and, by approximation, the quantity of
unthreshed grain in their possession,'' declared the new law. ``Directors of 
districts shall name commissioners in the divers municipalities to observe 
the execution of this measure.'' The municipal authorities were given the 
power to arrest ``spectators'' and ``hoarders'' and permitted to enter the 
homes of any citizens suspected of fraudulent declarations. Confiscated 
grain and flour were to be distributed to the poor at no charge.
       Farmers rapidly and creatively found ways to evade the new law. 
Fearing that the price controls would spread to other parts of the economy, 
the prices of other goods rose in price. Hoarding of grain became 
widespread; to counter this, the Assembly made forestalling a capital 
offense on July 26, 1793. Even the destruction of any commodities under the
price controls was declared to be a capital offense. Public warehouses were 
established to guarantee government supervision of grain and its sale. On 
August 19, the controls were extended to flrewood, coal, peat and pit coal. 
And finally, on September 29 1793, the General Maximum was passed, 
placing all commodities of ``primary necessity'' under the price control 
regulation. All prices were to be fixed at no higher than one-third higher 
than their 1790 level.
       Commodities soon disappeared from the markets. Paris cafes found 
it impossible to obtain sugar; food supplies of all kind decreased in supply 
everywhere as farmers refused to send their produce to the cities.
As explained by economist, Edwin Kemmerer:
       "Among the methods employed for evading this price-fixed system 
the following may be cited: the with drawal of goods from the market and 
the failure to produce new supplies when the existing stocks were 
exhausted; the production and sale of inferior quality; the feeding of grain 
to farm animals at times when the prices of grain were subject to the 
Maximum and the prices of live animals were not; the milling of wheat into 
flour be the farmers when the price of wheat was controlled and the price of 
flour was not. Farmers sold their produce at home clandes tinely, instead of 
bringing it to market. When the prices of raw materials were controlled, 
the price of manufactured articles frequently rose abnormally, and, when 
the prices of necessities were held down, the prices of luxuries soared.
Evasion of the law yielded large profits, while the pen alties for evasion, if 
one were caught, were extreme. This led to much official corruption. The 
supply of goods available in the markets at the controlled prices were often 
inadequate and the queue, as in Russian cities of today, became a familiar 
       Nor were wages free from the supervision and control of the State. In 
the spring of 1794, tobacco workers demanded and were refused an increase 
in their pay. A week later, similar demands were made by transportation 
workers; they were told that their labor had been requisitioned by the State. 
Bakers were warned that wage demands on their part would place them in 
the category of suspected'' persons - sufficient grounds to face the
       Only on December 27, 1794, was the Price Maximum finally repealed. 
By this time the anti-Jacobin Thermidorians had the upper hand. The 
advocates of the market economy were able to make their case. On 
December 7th, for example, Eschasseriaux delivered a speech before the 
Assembly in which he concluded:
       "A system of economy is good when true principles are spread 
throughout a state and when people have con fidence in their execution; 
when work and the products of the earth are regarded as the primary 
wealth of the nation; when national pros perity rests upon the two primary 
bases of all prosperity, agriculture and commerce; when the farmer, the
manufacturer, and the trader enjoy the full liberty of their property, their 
production, and their industry.
He was joined by Thibaudeau:
       "I know that unlimited liberty can cause the greatest of 
inconveniences but I also know that, while you violate commercial liberty, 
you are subjected to even greater incon veniences. I know that when the gov 
ernment attempts to regulate everything, all is lost."
 During the Jacobin Republic of 1792-1794 a swarm of regulators had spread 
across France imposing price ceilings and intruding into every corner of 
peoples' lives; they imposed death sentences, conflscated wealth and 
property, and sent men, women and children to prison and slave labor. In
the name of the war effort all industries in any way related to national 
defense or foreign trade were put under the direct control of the State; the 
prices, production and distribution of all these private enterprises were 
under the direct command of the State. A huge government bureaucracy 
emerged to manage all of this, and the bureaucracy swallowed increasing 
portions of the nation's wealth.
       All of it followed naturally from the premises of the Jacobin mind. 
Under the shadow of Rousseau's notion of a "general will'' that can never 
be wrong and always reflects the true interest of the nation as a whole, it 
was inevitable that those who could know that ``general will'' and truth 
would see it their dutyQand their ``right''Qto impose it on France. Those
who did not see such a will would be taught; those who refused to accept 
after the teaching would be commanded; and those who resisted would 
perish, because only ``The Enemy" would oppose.
       The Revolution preached that the individual was nothing, the State 
was everything. The individual became the abstraction, and the State 
became the reality. And all were consumed in this bonfire of the insanities.
The Failure of the Total State.
       But why did the Revolution and its peculiar version of the total State 
fail? Why did the people, in whose name all this had been done, constantly 
frustrate and resist those who were estab lishing the ``new order''? The 
answer, I would like to suggest, had been given by Adam Smith, thirty
years before the Revolution in his flrst book, The Theory of Moral 
Sentiments. In his analysis of ``the man of system,'' the social engineer and 
planner who desires to remake society in his own image, Smith said:
       "The man of system is apt to be very wise in his own conceit, and is 
often so enamored with the supposed beauty of his own plan of government, 
that he cannot suffer the smallest deviation from any part of it. He goes on 
to establish it completely and in all its parts, without regard either to the 
great interests or to the strong prejudices which may oppose it; he seems to 
imagine that he can arrange the different members of a great society with 
as much ease as the hand arranges the different pieces upon a chessboard; 
he does not consider that the pieces upon the chessboard have no other
principal of motion besides that which the hand impresses upon them; but 
that, in the great chessboard of human society, every single piece has a 
principle of motion of its own, altogether different from that which the 
legislature might choose to impression upon it. If those two principles 
coincide and act in the same direction, the game of society will go on easily 
and harmoniously, and is very likely to be happy and successful. If they are 
opposite or different, the game will go on miserably, and the society must be 
at all times in the highest degree of disorder."
       Each individual possesses a spirit and a purpose of his own. The 
planner, the social engineer wishes only one spirit and one purpose to 
manifest itself in the worldQhis own. But, the human spirit is greater than
all the power of the planner, even when he possesses the terror of the State. 
Each man attempts to discover his own destiny, to lulflll his own life and to 
make it better as he conceives it. Thus the triumph of Statism is always 
temporary; individuals will flnd means to subvert it even if they cannot 
overthrow it.
       The beauty of the free society and its market order, as Adam Smith so 
brilliantly demonstrated in 1776, in his Wealth of Nations, is that when 
governments recognize the sanctity of the individual, and respect peaceful 
competition and voluntary exchange among free men, then the two 
principles of social order and liberty coincide. Each individual ``engineers'' 
his own life, and, as by an invisible hand, each in his own endeavors often
serves the common good.
       If, in our reflections on the events in France two hundred years ago, 
we relearn the important distinctions between State and society, between 
the peaceful order of the market and the terror of State command, between 
the imposed will of one and the free wills of all, then the French Revolution 
will be a warning and a guide for the decisions we must face in the next 

About the Author.
       Richard M. Eheling holds the Ludwig von Mises chair in economics 
at Hillsdale College Educated at California State University, Rutgers
university and the National University of Ireland at Cork, he is well-known 
as one of the nation's leading Misesiu, scholars and free market advocates. 
A former assistant professor of economics at the university of Dallas, he 
joined the Hillsdale faculty in 1988. He is on the editorial board of the 
Revieu' of Austrian Economics and vice president for academic affairs for 
The Future of Freedom Foundation. The author of the forthcoming book, A 
Hitstory of Austrian Economic Thought, Professor Ebeling has also 
published thirty articles and more than a dozen reviews.

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