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The Economics of Freedom
ment and the only valid inducement of effort which will hold good in area and time.
The conception that economic value is no more or less than measurable freedom applies to the breathing of air, or the drinking of water—two favorite examples of the economist. If we cease the almost automatic effort to convert these into value, there step in to help us, at the invitation of our relatives, a surgeon with a silver tube, or a doctor with a cylinder of oxygen; and when we get the bill we realize acutely that the economic value due to the conversion of air and water into means of freedom is measurable in the dollar of the day—whatever that may chance to be. If we cannot settle our obligations immediately, we sign a promissory note, which reads “For value received I promise to pay, etc.” In the last analysis, if we care to learn how little abstract is the contention that economic value and human freedom are identical, the reader may take from his pocket a Federal Reserve Note and contemplate it. All that it is necessary to do, to close the logical circle, is to assume that the promissory note mentioned above was taken in payment by some commercially organized hospital and counted, quite properly, among its assets. These assets are later made the basis of credit by a wholesale drug dealer, and, still later, again made the basis of credit by a firm of drug importers; and last of all, if backed by two signatures and passed through a suitable bank, made the partial basis of the Federal Reserve Note under contemplation. Part of the value certified is bodily freedom, the ability to drink and breathe, for obviously no so-called “tangible” value, such as an ounce of gold, was created by the surgeon or the doctor. They saved one factor of one unit of value—a man—and his promise to pay is a promise to exert effort. The Federal Reserve System validates this anonymous promise among many others and on the strength of it issues vouchers of value to the extent of several hundred dollars. We would be getting on, if we only knew where we were going, and if we were sure we might not have hurriedly to retrace our steps. If anyone should state that the Federal Reserve Note is a promise to pay in gold and does not rep-