The Role of the Economist in a Free Society: Friedman to Coase

"Which then is to be preferred—a dialogue among preachers, or a deep discussion among students of civilization over the liberal principles of justice and the good society? To hark back to Knight, the intellectual agenda in the second half of the 20th century could be summarized as the effort to elaborate a new liberalism for the post-war era. Civilization had just stared down its impending demise in the 1930-1950 period with the Great Depression and World War II, and three things seemed necessary to breathe life into a new and renewed liberalism worthy of that name. First, it was vital to cultivate an appreciation for economic principles and the operation of a free market economy, as well as their limitations as guides to understanding.. The economic way of thinking had tobe practiced and taught effectively, and that begins with teaching price theory, and exposing popular fallacies. Secondly, a democratic people needed to come to recognize not just the benefits, but also the limitations of political solutions to social problems. Intelligence in democratic action can result only through open and critical dialogue—democracy is essentially government by discussion—and thus the potential for fraudulent speech and political salesmanship must be recognized as a threat to the free society, and to the acceptance of the exploratory nature of all social action. What Knight, and later James Buchanan would stress as the “relatively absolute absolute” is an essential component to any discourse about freedom and reform within a democratic society. Truth seeking in science is foundational to the enterprise, but the assertion of truth claims in politics are the path toward tyranny, and must be guarded against constantly. Finally, according to Knight, a free society requires free and responsible individuals willing to shoulder the burden of living and thinking, so a renewed liberalism must be accompanied by an independent conception of the ethics of freedom. Knight’s conundrum, as he put it, was that it was unclear that our human nature would be adaptable and resilient enough to live up to the challenge that liberation from the oppression of authoritarian rule demands."