a special feature the sunduay dQ'ily by lindsay chaney Number 65 Page Four Sunday, October 22, 1972 The A j u.s free- enterprise middler myth: oke on the masses 1. Daily Photo by ROLFE TESSEM THRE is a perverse and dangerous notion permeating the American consciousness This notion is that something called "free en- terprise" exists. Of course, anyone who has taken an elemen- tary course in economics, and most people who have not, realize that free enterprise, in the tradition, of Andrew Carnegie, John D. Rocke- feller, and other turn-of-the-century industrial magnates, no longer exists. What with government regulation, oligopoly control of key industries and so forth, the true "free-market" has been relegated to the imagi- nation of a few quixotic romantics. But, there is still a deep-down conviction in most of us that some key elements of the free enterprise system are preserved in the conomic- political structure of the country. There may be a large amount of government interference in business, and there may be a monopoly here and there, but the basic values of free enter- But competing in an'open market was rough -you had to continually sell goods at the low- est possible price, otherwise someone else would underprice you and no one would buy from you at all. So it was natural that as soon as themost aggressive little men became bigger, they took steps to nullify the rigors of the open market. A favorite tactic was for the biggest man in a particular field to sell his product below cost until everyone else 'Went out of business, on the assumption that he could sustain losses better than his smaller competitors. When ev- eryone else was out of the way, the big man could raise his prices, and have the field all to himself. Another tactic, was to fix prices with competitors to avoid ruinous price competition. IRUT AS THE big men managed to reduce com- petition, a curious thing happened - the more competition was destroyed, the louder they trumpeted the virtue of free enterprise. Thus, in 1898, as Andrew Carnegie was presid- ing over the biggest steel monopoly in the world, he was also saying "an open market- place, free competition, and a business com- munity free from the shackles of government ensure that any man in America can become a success." Free enterprise merged with the Protestant Ethic, and money came to be regarded as a moral good - it was a tangible symbol of its possessor's dedication to hard work. Ministers told their congregations that mon- ey was God's reward for those who worked hard and were good. Free enterprise soon ac- quired a sacred cow status. Of course, not everyone was getting rich. In fact, many people were downright poor and liv- ing on the edge of starvation. But it was their own fault they were poor, since obviously any- one could make it in the free enterprise sys- tem if they worked hard enough. What no one seemed to realize was that al- though anyone could make it, everyone could not. Suppose 100,people enter a race. Anyone can finish in the top ten, but everyone cannot. THE BIG industrialists feared, free enterprise would be dealt a mortal blow when, short- ly after the turn of the century, the govern- ment began to push legislation to establish regulatory agencies such as the Interstate Commerce Commission and the Federal Trade Commission. This was an encroachment on their freedom. The industrialists lost no time in raising the spectre that the government would extend its tenacles into every sphere of human activ- ity, with control over where a person could live, where he must work, with whom he could associate and so on and so forth. m This possible loss of freedom touched home with the little man who certainly didn't want to become a slave. A few people wondered how free a person was who worked ten hours a day, and barely managed to feed and clothe a family-but not many. A S THE 20th century advanced, government j regulation of business increased, accom- panied by yelps of pain from the business ists, and that it is the best system in the world. But what they don't tell the public is that the largest corporations have abandoned free enterprise altogether and are thriving quite well. Last February, Time Magazine, in comment- ing on the wage-price freeze declared, "Presi- dent Nixon made one of the boldest encroach- ments so far on the free-enterprise system." By the end of the fiscal year, all of Detroit's automakers had turned in record-breaking pro- fits - graphically demonstrating that free en- terprise is a hindrance to the pursuit of pro- fit. Examples abound which amply demonstrate that for the big fellow in America, the defini- tive characteristic of free enterprise - the opportunity to fail - has been removed. Witness the ,government bailing out Lock- heed Corp., which through mismanagement and in spite of lucrative government contracts, was about to go broke. Then there is the gov- ernment official who fel, it, was his duty to give the country's six largest grain exporters advance notice of a government subsidy change -assuring them millions of dollars in profits, at the expense of the taxpayer. Tax laws in combination with benevolent treatment by government mortgage agencies guarantee tthat investors in luxury apartment complexes will make money, even if no one rents the apartments. BUT THE AVERAGE little man doesn't under- stand that the rules of the economic game are rigged. Sure, he realizes that he will never rise to the heigths of industrial tycoonism. But in realizing his own inability, he assumes a kind of superability on the part of the people who are at the top. He harbors a respect for those people, not knowing that they play by a different set of rules. And herein lies the danger in the myth of free enterprise, So long as the middle-cless worker believes that the people on top deserve to be there, the social structure in the country will change -very slowly, and maybe not at all. To a large degree, the members of the work- ing middle class are the most exploited in the country, all the more because they don't realize their exploitation. The attitudes of the middle-class Apericans determine the direction of the country. Through its abiding belief in the myth of free enterprise and the correseponding convictionthat the peo- ple on top deserve to be there, the middle class ensures the reign 'of the upper class. ALL THIS IS NOT to say that no one ever be- comes wealthy by working their way up from the bottom. David Egozi, for example, came to America after the Cuban revolution, and within 10 years had amassed a personal , fortune estimated at $8,000,000. But the success of one indivdual\ in no way shows that the economic system itself is just, although promulgators of the free enterprise myth would have us believe that, Simply be- cause Ralph Bunche became the United States' highest ranking official in the United Nation did not show that the social system in the 1940's granted equal opportunity for blacks. And the same analogy applies to free enterprise. ' I Andrew Carnegie prise - hard work, just rewards for one's la- bors, and the possibility that anyone can be a success-are still present. It is this myth that key elements of free en- terprise exist and are good that is dangerous. RAPID industrialization in the middle 19th century was the harbinger of free-enter- prise (usually associated with "capitalism") as we understand the term today. From the beginning, free enterprise was a system for the "little man". You didn't have to be born into an aristocratic family to become a success. A man could go as far as his intelli- gence, hard work, ruthlessness and cunning carried him. Indeed, most of the older estab- lished families in America looked with distain on the whole rough and tumble business of