Political Economist

Knowledge and Decisions.
by Thomas Sowell.
Basic Books. 422 pp. $18.50.

During the past decade Thomas Sowell, who is professor of economics at UCLA, has made evident through a considerable range of books and articles that he is one of our most penetrating social critics. His basic cast of mind is that of the economist, with a strong orientation toward the free market, but he writes authoritatively in areas more commonly thought of as provinces of the sociologist and political scientist. Political economy, in the sense current in Western writing down through the early part of this century, probably best describes the direction and substance of his interests.

If free choice as understood by the economist is Sowell’s model or metaphor for the good society in all its spheres, he nevertheless cannot be accused of indifference to the consequences of free choice. And if those consequences may occasionally seem harsh, at least on the surface or in the short run, Sowell can supply us with an impressive diversity of instances of how much harsher in fact are the consequences of governmental repression of individual choice, most especially the repression that comes clothed in humanitarian rhetoric.

The book is divided into two broad parts: “Social Institutions” and “Trends and Issues.” The first is analytical in character, often drawing upon highly sophisticated problems and paradigms which are essentially economic in character. We are taken through such thorny areas as the role of knowledge in society—the individual’s personal knowledge, which is and must be pathetically small, and the organized, systematic knowledge by which government, economy, and society survive; the nature of decision-making at all levels; and, in three successive, engrossing chapters, the vast problem of the mechanisms or “trade-offs” by which the ambiguities and paradoxes of economic, political, and social life are somehow resolved.

Throughout this first part of the book it is the nature and application of knowledge that is in the forefront of the author’s mind. “How does an ignorant world perform intricate functions requiring enormous knowledge?” Individually, Sowell observes, “we know so pathetically little, and yet socially we use a vast range and complexity of knowledge that would confound a computer.” The same question is in effect asked by the author about the infinity of decisions that are made by human beings in their highly circumscribed personal lives and in the measureless public domain in which these lives take place. We are dealing here with questions which first became imperious in the 18th century and were faced by such diverse writers as Mandeville, Hutcheson, and, most impressively in the long run, Adam Smith. But the age of the questions does not in the least diminish their evocative power. With different assumptions perhaps, and certainly with new and different techniques, we still wrestle with the central problem of 18th-century moral philosophy: how do individuals with their innate passions form a collective order that meets the criteria of justice, productivity, and legitimacy—and above all of sheer survival?

Thomas Sowell’s answer, or principal answer at least, lies in the huge realm of what he calls tradeoffs. The innumerable trade-offs each day in the marketplace are the most obvious examples of the mechanism that for Sowell is crucial to our society. But, as he makes evident in rich detail, there are just as many such exchanges in the political and social spheres:

Social decision-making processes, whether formal or informal, face the same basic problem of seeking to maximize well-being subject to some inherent restraint—whether of time, wisdom, or economic resources. . . . Social values are in general incrementally variable: neither safety, diversity, rational articulation, nor morality is categorically a “good thing” to have more of, without limits. All are subject to diminishing returns, and ultimately negative returns.

The same principle of pragmatic trade-offs extends to the political sphere. “One of the most important trade-offs is between the amount of freedom and the amount of other characteristics desired in a society.” Necessary as freedom is to a creative and progressive culture, it is far from the only requisite. For freedom to flourish, there must be a prior social contract of order and justice, as Adam Smith fully recognized when he wrote his classic testament to “natural liberty.” Sowell trenchantly observes:

Totalitarian governments, by definition, have no significant trade-offs of freedom left to consider, since freedom has already been sacrificed for some alternative consideration, whether rhetorical or actual. Democratic governments are constantly weighing incremental trade-offs toward or away from freedom. Indeed democracy itself is a consideration that is traded against freedom, and at one time this tradeoff was both recognized and feared.

Needless to say, Sowell distinguishes trade-offs respecting freedom in a democracy from the Newspeak corruption according to which non-freedom (however necessary it may be in fact) is described in Rousseauian fashion as but a higher form of freedom.

What Sowell sees around him is a vast network of systems, ranging from those involved in organic evolution all the way to the economy and the polity. Only, he argues, by looking at the economic, social, and political orders as systems in which results are achieved independently of, and very often in stark contrast to, the motives and stores of knowledge of the participating individuals, can we understand the real role of knowledge in society.

The systemic approach, Sowell notes, is the methodology of both Adam Smith and Karl Marx:

In Smith’s classic, . . . laissez-faire capitalism was advocated—as a system—because of (beneficial) systemic characteristics which were “no part” of the “intention” of capitalists, whom Smith excoriated. . . . By the same token Karl Marx’s Capital condemned capitalism for (detrimental) systemic characteristics which Marx refused to attribute to the individual moral feelings of the capitalist.

Adopting a systemic view of the institutions which make up society does not, Sowell suggests, entirely exclude the individual factor. Saints, prophets, geniuses, and villains do exist, and leave their individual impacts upon the public mind. Still, close awareness of reigning values in the systems around us is useful for predicting the probable areas or spheres within which geniuses and villains make their appearance.



The second part of Sowell’s book is essentially historical, and is designed to show in temporal flow some of the analytic elements examined in the first part. Decision-making remains the author’s primary concern, but in this part of the book it is dealt with in the light of historical trends in three major areas: economy, law, and politics. One cannot praise too highly the combination of perspective, insight, and detailed learning found in these three chapters.

If there is a single tendency that Sowell finds common to the recent history of economy, law, and politics, it is this:

Even within democratic nations, the locus of decision-making has drifted away from the individual, the family, and voluntary associations of various sorts, and toward government. And within government, it has moved away from elected officials subject to voter feedback and toward more insulated governmental institutions, such as bureaucracies and the appointed judiciary. These trends have grave implications, not only for individual freedom, but also for the social ways in which knowledge is used, distorted, or made ineffective.

It will come as no surprise to those already familiar with Thomas Sowell’s work that among the matters brilliantly dealt with under “trends in law” are affirmative action and, in general, the devolution of policies meant to remove discriminatory barriers between the races into policies meant to coerce them into some predetermined and inevitably false relation of “equality.” I know of no one who has exposed in more authoritative, coruscating fashion the whole succession of non sequiturs, judicial invasions, and administrative tyrannies that may be seen following the historic Brown decision of 1954. The very sociological basis of the Supreme Court’s decision—that segregated schools lead necessarily to inferior education—is challenged by Sowell:

Within walking distance of the Supreme Court was an all-black high school whose eighty-year history prior to Brown denies the principle. As far back as 1899, it had higher test scores than any of the white schools in Washington, and its average IQ was eleven points above the national average in 1939—fifteen years before the Supreme Court declared such things impossible. There have been other such black schools elsewhere, and indeed NAACP attorney Thurgood Marshall in the Brown case was a graduate of such a school in Baltimore. The history of all-Oriental and all-Jewish schools would reduce this ponderous finding to a laughingstock, instead of the revered “law of the land.”

There are other examples, no less stark, that Sowell gives us of the ravages of morality and convention—and of sheer rationality—which have been the consequences of judicial activism during the past few decades. Among them is the pathetic state we have been brought to with respect to capital punishment. “It would be inexcusable even to shoot a mad dog if we knew how to catch him readily and safely, and cure him instantly.” But we do not. Nor do we know how to “rehabilitate” the individual who over a period of years sodomized, killed, and buried beneath his house several dozen boys and young men. Are we in fact playing God, Sowell asks, when we act to protect society from habitual or systematic murderers through the use of the death penalty? “We do not play God when we act—as we must—within our limitations. We play God when we pretend to an omniscience and a range of options we do not in fact possess.”



Sowell’s chapter on “Trends in Politics” is at the same high level of scholarship and insight as the chapters on law and economics. He makes us see in admirable clarity the sheer necessity of a system of constitutional division of powers in America, given the Framers’ understanding of the institutional basis of liberty. Yet over the years, as is only too painfully obvious, the constitutional divison has been destroyed or eroded. Sowell points out that while preservation of the division was in the care and responsibility of the Supreme Court, that Court from the beginning had a vested interest in the concentration of power in the federal government and of course also in the extension of judicial power into legislative and executive areas. How else could we have wound up during the past decade with a federal judge in Boston serving as de-facto superintendent of schools? Can one easily imagine Congress or even the President, through a series of discrete and explicit mandates, requiring under penalty of fine and imprisonment cities threatened by bankruptcy to enter such areas as the busing of pupils to their schools, and in calculated indifference to the astronomical costs? But what might daunt even a Caligula does not, on the gathering evidence, so much as interrupt the repose of the federal judiciary.

Sowell returns frequently in the historical sections to the key role of knowledge and of decision-making, a focus that yields fresh or at least uncommon perspectives even on such by now well-worn issues as equality/inequality. The passions and convictions of intelligence-testers in the early part of this century may appear opposite to the devotions and dogmas of current egalitarians. But there is, Sowell maintains, an overriding likeness between the two groups, one that reflects a dogmatic certainty about race and ethnicity coupled with a boundless willingness to use the powers of the political state in support of that certainty. Some of the early prophets of IQ saw the results of their tests—which, they said, proved the existence of innate and ineradicable differences of mentality springing from race alone—in the same light physicists did the laws of motion. It was an easy step for these true believers to become impassioned advocates of laws which would bar entry into the United States of the “mentally inferior peoples” from Eastern Europe and Asia and would, within the country, segregate the innately superior from the inferior in school, occupation, and, above all, marriage. Such views, as Sowell notes, were not those of village racists but of “top contemporary authorities in the field, based on masses of statistical data, and virtually unchallenged either intellectually, morally, or politically within the profession at the time.”

But, Sowell argues, professional dogmas of hereditary inequality which held the field during the first decades of the century are fully matched today by “equally dogmatic conclusions about scientific proof of racial equality,” conclusions which began to flourish nationally in the 1940’s and 1950’s. Whatever may be the eventual resolution of the wildly conflicting claims—if indeed such a resolution is even possible in so dogma- and ideology-ridden a matter—the inescapable fact is that the egalitarian-ism of today is buoyed up by forces of passion and bigotry that are precisely the equal of those which supported the IQ eugenists of an earlier day. Egalitarians in our time are quite as willing to use political coercion, to base tactics on contumely, vilification, and even violence, and to allow one value to dislodge or destroy other values as ever were the Nordicist or Anglo-Saxonist true believers of 1920.



Both phases of the innate-intelligence controversy, Sowell declares, “illustrate a more general characteristic of socially and politically ‘relevant’ intellectual activity—an unwillingness or inability to say, ‘We don’t know,’ or even to admit that conclusions are tentative.” And that general characteristic, he further concludes, is part and parcel of what he calls “The Intellectual Vision.” Where that vision exists—as it did in the Enlightenment and the French Revolution, and then again, powerfully and transformingly, in the societies of Lenin and Hitler and today in China and a host of Third World countries—the clear danger also exists that dogma will trample mere conclusion or fact and that a rush to capture absolute power will occur of the same kind that took place in Paris commencing about 1790 and in Russia in late 1917.

But it is one of the strengths of Thomas Sowell that he does not put the economic, social, and political trends he perceives under any rubric of historical necessity, in any rhetorical guise of a wave of the future. A brilliant and profoundly knowledgeable social scientist, he is willing to leave waves of any kind to the quacks and to those whom Burckhardt called the terribles simplificateurs: He prefers the company of those who want only “the right of ordinary people to find elbow room for themselves and a refuge from the rampaging presumptions of their ‘betters.’”

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