Liberty Fund Books

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“Arthur Seldon has, more than most of us, been able to combine realism in prediction with idealism in vision.”
—James M. Buchanan

Arthur Seldon was born in 1916 and has lived through the most dynamic and volatile century in the history of humankind. His advocacy of and undeterred belief in classical liberalism have sought to combat the intoxicating and deceptive “comfort” of collectivism created by the instability of two world wars and unprecedented technological and sociological change.

From the late 1950s Seldon’s partnership with Ralph Harris (later Lord Harris), as Editorial Director and General Director respectively, made the Institute of Economic Affairs (IEA) the bellwether for classical liberal thought throughout England and eventually the world. In their early years, when very few people dared dispute Keynesian thought, Harris and Seldon argued against its determined centralization and its consequent collectivist tendencies. In the face of the status quo, IEA provided astute defenses of market solutions to various societal problems. Their arguments, always coherent, were often bolstered by case studies and compelling empirical evidence. They sought market alternatives to government-manipulated programs concerning such issues as public pensions, public education, public health care, social welfare, and corporate welfare.

Gradually, as collectivist programs started to break down of their own weight, IEA’s writings became the intellectual underpinnings to alternative solutions to the welfare state. In the early 1980s, IEA’s various themes on smaller government became a substantive part of Prime Minister Margaret Thatcher’s reforms. Such reforms led to the privatization of nationalized corporations, labor union reorganization, and abolition of exchange controls. IEA’s efforts for change did not stop in England. According to Nobel laureate Milton Friedman, the influence of IEA has “contributed greatly to the change in the intellectual climate of opinion around the world.”

Seldon’s writings are clear and accessible. He has the uncommon ability to translate complex information, often fraught with esoteric philosophical and technical jargon, into clear, understandable prose for both intellectual and lay consumption.

The Collected Works of Arthur Seldon spans 65 years of Seldon’s influential thought and elaborates on the genesis of almost all the public/private debates currently before the world. His arguments are as compelling and relevant today as they were over a half century ago.

Each volume of this series has a contextual introduction and, except for Volume 3, an individual index. Volume 7 contains an index to the entire series. Everyman’s Dictionary of Economics, cowritten with Fred G. Pennance, Volume 3 of this series, is an essential tool for anyone who wants a better understanding of political economics.

Colin Robinson was a business economist for eleven years. He was then appointed to the Chair of Economics at the University of Surrey, Guildford, United Kingdom where he founded the Department of Economics and is now Emeritus Professor. For many years he has been associated with the London-based Institute of Economic Affairs and from 1992 to 2002 he was the IEA’s Editorial Director.

The entire series includes:

Volume 1: The Virtues of Capitalism (September 2004)
Volume 2: The State Is Rolling Back (November 2004)
Volume 3: Everyman's Dictionary of Economics (January 2005)
Volume 4: Introducing Market Forces into "Public" Services (February 2005)
Volume 5: Government Failure and Over-Government (May 2005)
Volume 6: The Welfare State: Pensions, Health, and Education (October 2005)
Volume 7: The IEA, the LSE, and the Influence of Ideas (December 2005)

Table of Contents

The Virtues of Capitalism

General Introduction to the Collected Works of Arthur Seldon ix
Biographical Note xvii
Introduction to Volume 1 xxi

PART I: Corrigible Capitalism, Incorrigible Socialism

Preface by Lord Harris of High Cross 3
1. Mobilising Humanity for Progress 5
2. Market Success: Curable Defects 15
3. Government Failure: Incurable Defects 27
4. The Reigning Error: State Holism v. Market Experimentation 37
5. Reversing the Tide 40
6. Finale: Summary and Policy 47
A Short Reading List 49

PART II: Capitalism

Foreword by Lord Chapple of Hoxton 53
Preface 55
Acknowledgements 59
1. The Stake 61
2. Indoctrination against Capitalism 81
3. The Inevitability of Capitalism 108
4. The Return and Advance to Capitalism 132
5. Political and Market Democracy 158
6. The Capitalist Open Secret 184
7. Intellectual Reinforcement for Capitalism 205
8. More Intellectual Reinforcement for Capitalism 227
9. The Criticisms of Capitalism 247
10. The “Vision ” of Capitalism 280
11. The Galloping Horses 310
12. The Values of Capitalism 342
13. The Verdict 376
14. Prospects 405
Envoi: A Promise Kept 435
Descriptive Guide to Readings 437

Appendix: Contents of The Collected Works of Arthur Seldon 467
Index 469


The State Is Rolling Back

Introduction, Colin Robinson xi
Preface, Colin Robinson xxiii
Foreword, Simon Heffer xxv
Foreword, Patrick Minford xxvii
Foreword, John Redwood xxix
Acknowledgements xxxi
Prologue xxxiii

PART I: The Battle of Ideas for the Good Society

1. The State v. the Market: Socialism v. Capitalism [1937] 3
2. Liberalism and Liberty: The Diffusion of Property [1938 ] 10
3. The New World Order — H.G. Wells ’ Myth [1940 ] 17
4. The Contribution of Economics to Policy [1955 ] 21
5. Citizenship — The Cul-de-Sac [1958 ] 28
6. The Perpetual Welfare State [1968 ] 33
7. Conservatism and Liberalism [1968 ] 38
8. Individual Liberty and Representative Democracy [1979 ] 46
9. La Trahison des Clercs [1980 ] 49

PART II : Classical Market Thinking Applied to Industry

10. The Brewers’ Dilemma [1950 ] 63
11. Reform the Licensing Laws [1957 ] 69
12. Best Friends of Shoppers: Which? Or Competition? [1963 ] 73
13. Markets in Welfare to Strengthen the Economy [1966 ] 77
14. Wind Up National Insurance [1971 ] 81
15. Inflation Is Crueller than Unemployment [1972 ] 84
16. Police: Compete or Retreat [1977 ] 88
17. The Truth About Unemployment [1982 ] 94
18. Underground Resistance to Over - Government [1986 ] 98

PART III: Wither the Welfare State
A: The Growing Disquiet, 1950 – 1964

19. A Private Welfare State? [1957 ] 103
20. Why State Pensions? [1958 ] 106
21. Contract In or Out? [1960 ] 110
22. Pensions and Property [1960 ] 114
23. Social Services in the Late Twentieth Century [1961 ] 119
24. Social Services for the Future, Not the Past [1962 ] 127
25. Universities Out of Politics [1962 ] 131
26. Beveridge Came Too Late [1963 ] 136
27. Homes: Clear the Obstacles [1963 ] 148
28. Wanted — Home Entrepreneurs [1964 ] 153

PART IV: Wither the Welfare State
B:The Mounting Attack, 1965 – 1970

29. Shop with Welfare Vouchers [1965 ] 163
30. A Free Market — or Political Mortgages [1965 ] 167
31. Privatise Welfare: A New Strategy [1965 ] 173
32. Politics Looms Too Large [1966 ] 177
33. Tax State Benefits [1966 ] 181
34. Make Social Services Selective [1967 ] 186
35. Workers Reject State Welfare [1969 ] 191
36. Roll Back the State [1969 ] 196

PART V: Wither the Welfare State
C: First Steps in Reforms, 1970 – 1992

37. The Great Pensions Swindle [1970 ] 203
38. Top Up the Poor Man ’s Pay [1971 ] 207
39. Tory Advance: Reluctant Officials [1971 ] 211
40. Timid Tories and State Welfare [1972 ] 215
41. The State Is Usurping Parents [1978 ] 222
42. Move Universities to the Market [1980 ] 227
43. Political Bar to Economic Progress [1988 ] 233

PART VI: The Excesses of Over - Government

44. Whose Obedient Servant? [1969 ] 245
45. Can Bureaucrats Be Neutral? [1972 ] 248
46. Phase Out the Civil Servants [1979 ] 252
47. Government of the Busy, by the Bossy, for the Bully [1980 ] 256
48. Price - less Opinion Polling [1980 ] 260
49. “New Right ” and New Government [1983 ] 264
50. New Left: Beware Politics [1988 ] 268

51. Capitalism Is More Corrigible Than Socialism [1986 ] 272
52. Policies: The Difficult and the “Impossible ” [1988 ] 276
53. Too Little Government Is Better Than Too Much [1990 ] 287
54. Laissez - faire in the Twenty-?rst Century [1992 ] 290

Index 297

Everyman's Dictionary of Economics

Introduction, Colin Robinson ix

Introduction to the Second Edition xvi

Acknowledgements xix

Introduction to the First Edition xxi

Related Subjects Index xxv

Reading Lists xlvi


The Dictionary 1


Introducing Market Forces into "Public" Services

Introduction by Colin Robinson ix

WHICH WAY TO WELFARE? 1

TAXATION AND WELFARE: A Report on Private Opinion and Public Policy 19
1. The Relation Between Opinion and Policy 21
2. Opinion on Changes in Taxation and Social Benefits 25
3. Knowledge of Taxation 33
4. Opinion on the Level of Taxation 37
5. Readiness to Pay Taxes in Terms of the Use Made of Tax Revenue 40
6. Preferences in the Form of Social Benefits 44
7. Reliability and Significance of the Findings 48
8. Implications for Policy 51
9. Social Policy in the 1970s 76
Select Bibliography 79

REMOVE THE FINANCING FLAW IN “PUBLIC” SERVICES 81

CHARGE 95
Acknowledgements 97
Part 1: Populism and Prices
1. Pundits, Politicians and People 101
2. Price: Barrier or Missing Link? 114
3. Private “Public” Services 133

Part 2: You Pays Your Taxes, But You Gets No Choice
4. Education: Paying for Consumer Power 151
5. Medical Care: Making the Payment Fit the Case 172
6. Homes: Ending the Rent-Tie 180
7. From Reading to Rubbish 185
8. From Roads to Deck Chairs 202
9. From Coal to Clean Air 219

Part 3: Objections Overruled
10. Socially Undesirable 231
11. Administratively Impracticable 261
12. Politically Impossible 272

APPENDIXES:
1. True and False Measures of Public Preferences 291
2. A Note on Further Readings 294
References 299

MICRO-ECONOMIC CONTROLS: Disciplining the State by Pricing 303

THE RIDDLE OF THE VOUCHER: An Inquiry into the Obstacles to Introducing
Choice and Competition in State Schools 319
Acknowledgements 321
A Political Sequence 323
Preamble: The Economics of Politics in 1986 325
I. A Summary Narrative, 1944–86 334
II. Official Objections, 1981, and Academic Refutations, 1982 340
Appendix 1 to Section II 357
Appendix 2 to Section II 365
III. Approaches to Practical Proposals, 1981–85 367
IV. Political Rejection, 1983: Independent Theories and Official Reasons 376
V. The Forces Ranged Against the Voucher 390
Appendix to Section V 400
VI. Prospects: State and Market 403
VII. Summary and Conclusions 415
Selected Readings 417

Index 419

Government Failure and Over-Government

Introduction by Colin Robinson ix

CHANGE BY DEGREE OR BY CONVULSION 3

INDIVIDUAL LIBERTY, PUBLIC GOODS, AND REPRESENTATIVE DEMOCRACY 23

AVOISION: The Moral Blurring of a Legal Distinction
Without an Economic Difference 51

THE DILEMMA OF DEMOCRACY
Acknowledgements 71
Introduction 73
1. Democracy at the Crossroads 87
2. The Debilitating Disease of Over-Government 101
3. The Escapes from Over-Government 116
4. From Political Democracy to Individual Liberty 142

PUBLIC CHOICE IN BRITAIN
1. Public Choice or Political Sovereignty? 149
2. Government Intentions and Consequences 156
3. Over-Dependence on the Welfare State 161
4. The Weakening of the Family 172
5. Voters Versus Consumers 175
6. The Political Fate of Economic Federalism 179
7. The Escapes from Over-Government 186

ON THE LIBERAL EMANCIPATION OF MANKIND 193

Index 197


The Welfare State: Pensions, Health, and Education

Introduction by Colin Robinson ix

THE RELUCTANT CRUTCH 3

PENSIONS FOR PROSPERITY 9

THE FUTURE OF THE WELFARE STATE 51

AFTER THE NHS 67

THE GREAT PENSIONS “SWINDLE” 105
Acknowledgements 109
Open letter to Mr. Richard Crossman 111
I. Why This Book? 115
II. What Is at Stake 120
III. “Swindle”? 126
IV. The Strain on Political Institutions 129
V. How It All Began 135
VI. Crossman’s National Superannuation 145
VII. Eight Principles—Eight Fallacies 155
VIII. Humanity for the Aged 170
IX. Pensions in Industry 174
X. Saving for Democracy 180
XI. The Contract of the Generations 186
XII. National Insurance and the Civil Servants 191
XIII. Overseas Exemplars—or Warnings? 197
XIV. What Now? 209
Envoi 214
Appendixes 217

The IEA, the LSE, and the Influence of Ideas

Introduction by Colin Robinson ix

THE ESSENCE OF THE IEA 3

NEW HOPE FOR ECONOMIC POLICY IN A CHANGING POLITY 19

RECOLLECTIONS: BEFORE AND AFTER THE ROAD TO SERFDOM 29

ECONOMIC SCHOLARSHIP AND POLITICAL INTEREST: IEA THINKING
AND GOVERNMENT POLICIES 43

FROM THE LSE TO THE IEA 69

THE MAKING OF THE INSTITUTE: A SELECTION OF ARTHUR
SELDON’S PREFACES 1960–1996

The IEA Papers: Subjects and Authors 79
Introduction 83
I. Prefaces to Hobart Papers 87
II. Prefaces to Hobart Paperbacks 233
III. Prefaces to IEA Readings 259
A Last Word 279

Index 281

Index to The Collected Works of Arthur Seldon 287