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Chapter 27: Moral, Political, and Metaphysical Beliefs - Dane Starbuck, The Goodriches: An American Family 
The Goodriches: An American Family (Indianapolis: Liberty Fund, 2001).
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Moral, Political, and Metaphysical Beliefs
The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed, the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist. . . . soon or late, it is ideas, not vested interests, which are dangerous for good or evil.
john maynard keynes, The General Theory of Employment, Interest and Money
While Pierre Goodrich was no friend of John Maynard Keynes’s economic or political views, he no doubt embraced the British economist’s insight that ideas ultimately control much of human behavior. Thus, the ideas that a person studies and discusses are critical. As former Wabash president Byron Trippet recalls, Goodrich “saw no reason why a college needed a library of more than about 5,000 books, provided they were the right books,” meaning that they contain the right ideas.1
Goodrich’s own thought, as reflected in such writings as the Basic Memorandum, “Education Memorandum,” “Why Liberty?” and his letters, is not particularly noteworthy for its originality or cogent expression. His thinking is important, however, in its attempt to examine critically both human understanding and the forces that compel human action; moreover, his philosophical perspective also reveals a strong influence by many great thinkers of Western civilization. Goodrich’s voracious appetite for books enabled him to become extremely knowledgeable about both the literature of his time and, more important, works that have influenced ideas for centuries.2 While it is not possible to trace Goodrich’s thinking to any particular writer, it is clear that many of his beliefs were shaped by classical thinkers. The core ideas of these scholars of ethics, political theory, epistemology, and metaphysics deserve a brief exploration.
Early on in the Basic Memorandum, Goodrich takes up a philosophical matter that the Greek moralist and political philosopher Plato (427–347 ) is particularly known for—the nature, origin, scope, and limits of human knowledge (epistemology). Plato believed that man often goes astray because he is ignorant of what the right action is. Therefore, doing right is a matter of proper education and, ultimately, knowledge. Similarly, Goodrich recognized that “all individuals have an imperfect knowledge of man, his origin and his destiny, and the universe in which he exists.”3
Man’s imperfection, his imperfectibility, and his inability to obtain perfect knowledge are common themes that run throughout Goodrich’s writings. This is why proper education is so important to Goodrich’s worldview. Goodrich believed that whenever man becomes unshackled from perceiving the world primarily through sense experience and begins the difficult journey toward using reason to apprehend reality, it is possible for him to acquire at least a partial understanding of the world. He denies, however, the possibility that man can ever obtain perfect knowledge or escape the influence of sense experiences. Furthermore, Goodrich recognized that doing wrong may not be merely a matter of lack of knowledge, but also a result of “weakness of the will” (lacking the fortitude to do what one already knows is the right thing) or even of heredity.4
Goodrich departs from Platonic thinking regarding who should exercise decision-making powers. He denies outright Plato’s notion of the philosopher-king as the proper decision-maker for a society. Plato believed that those who have the greatest aptitude for ruling should be placed in absolute authority. Goodrich refutes the whole notion of Plato’s philosopher-king by means of a two-pronged attack. First, “the very nature of a society of imperfect human beings excludes the possibility of a perfect choice”;5 therefore, it is not necessarily true that the philosopher-king is capable of making better decisions for others than those others, who have greater knowledge of their own abilities and desires, can make for themselves.
Second, “it is self evident that man’s faculties (for example, physical, reason, integrity . . . ) decline or improve by lack of use or use thereof, and the nature of that use.”6 In other words, the individual loses something important if he continually delegates the responsibility for making decisions in his life to a ruler. Soon, he will not be able to make the critical decisions nor undertake the actions necessary to keep himself free and able to make use of his potential. If this continues, man will ultimately degenerate, becoming dependent upon others for his welfare. According to Goodrich, a society preferable to Plato’s would allow all men sufficient freedom that “some men, less fallible than others, may move closer to man’s ultimate destiny than other men, and in so doing help all men.”7
British empirical thinker John Locke (1632–1704) is probably the theoretical architect most responsible for democracy as it exists in the Western world today. Locke’s Treatise of Civil Government contains many of the ideas that formed the basis for the political philosophy of the founders of the American and French republics. Moreover, the Treatise also contains the primary framework for many of Goodrich’s own beliefs about the nature of private property, the existence of natural rights, the origins and scope of government, and the separation of governmental powers.8
Goodrich believed that the primary purpose of government is to ensure that no person or group can coerce another into doing something he or she does not want to do. This belief in minimal government is grounded in Lockean theory. Locke’s “law of nature” espouses that “no one ought to harm another in his life, health, liberty or possessions.” Moreover, Goodrich, like Locke, believed that the state exists to prevent coercion at the hands of others and to address disputes that arise when individuals form organized societies for mutual benefit under a social contract. Obviously, then, a mechanism must be established to resolve these disputes in an efficient, orderly, and fair way. Such a mechanism is a judiciary system based upon integrity and law.9
Goodrich believed that law, not force, should be the basis upon which government operates to prevent coercion of the individual by others. Moreover, perhaps even more important to Goodrich, adherence to law is necessary to prevent those cloaked with governmental power from ruling tyrannically. Adherence to the rule of law, then, by elected officials as well as by the populace is absolutely necessary in an orderly society where free and voluntary exchanges are possible.
Locke opposed monarchy and dictatorship for the very reason that a true monarch or dictator is above the law; in fact, a monarch or dictator is the law. Such a government operates solely at the caprice of the authoritarian ruler, and the society he or she controls is correspondingly unstable.10 Locke’s rationale for opposing a monarchy is logically consistent with the reasons Goodrich opposed absolute power held by any one person or group: (1) as a practical matter, no correctional force exists to curb the power monger’s abuses; and (2) morally, absolute power is opposed to the idea of the “rule of law” and the universality of action (for example, Kant’s categorical imperative). Goodrich’s constant warning about the abuses of power is evident in his repeated references to Lord Acton’s admonition that “power tends to corrupt and absolute power corrupts absolutely.”
Locke’s theory of rights was important to Goodrich as well. As to property rights, Goodrich believed deeply in the Lockean notion that such rights arise from man’s “mixing his labor” with things originally given to mankind in common.11 An example of how seriously Goodrich believed in property rights occurred in the early 1970s. The incident arose when a presenter at an early Liberty Fund seminar on education gave a paper that had actually been written by Dorothy L. Sayers. Sayers, a distinguished English writer, had been deceased for more than a decade at the time. The presenter gave the paper without making any reference to the true author of the work. It was two weeks later that the plagiarism incident became known. Goodrich was livid that such a violation had occurred at a Liberty Fund seminar where the primary purpose of bringing the conferees together was to examine education’s role in furthering freedom and virtue.12
Locke’s other views about individual rights also heavily influenced Goodrich. For instance, Goodrich embraced Locke’s theory about when and to what extent governmental intervention is appropriate in curbing such rights. Goodrich, like Locke, believed that all men are equal in the sense that they have rights that are anterior to those given them by society. Since these natural rights are not given to them by society, society cannot take them away.13 There is no definitive list of these natural rights, but Goodrich no doubt believed that they include at least the rights recognized in the United States Constitution; for example, private property, free speech, freedom of assembly, and freedom of association and religious expression.
What Locke and Goodrich did not believe is that somehow government could create rights; Goodrich did not believe, for instance, that there is such a thing as a right to housing, to an education, to a job, or to health care. These may be benefits, but they are not rights. Thus, they are not entitled to the same protections as, for example, the rights to property and freedom of speech. Therefore, Goodrich would have been totally opposed to a 1970 United States Supreme Court decision that held that “welfare entitlements [are] more like ‘property’ than a ‘gratuity.’ Much of the existing wealth in this country takes the form of rights that do not fall within traditional common-law concepts of property. It has been aptly noted that ‘[s]ociety today is built around entitlement.’”14
Goodrich believed that the confusion in distinguishing between rights and benefits (so-called entitlements) actually results in the violation of others’ rights. That is why he was so adamantly opposed to what he considered were simply the “man made rights” (and therefore not really rights at all) of academic freedom and tenured faculty protection. Also, Goodrich did not believe that any definition of equality should extend beyond “equality before the law.” The principle that “all men are created equal” is only applicable to this limited meaning, Goodrich contended. Otherwise, it is silly to suggest that individuals are born equal in terms of talent, intelligence, family wealth, physical appearance, prowess, and so forth. Any attempt to extend equality to these other areas means that government must constantly intervene to remake a level playing field.
Goodrich departed from Locke’s thinking concerning the virtues of majoritarian government (democracy). Locke believed that authority lies with the people who elect government. Government is merely the means of carrying out the people’s will. But Locke did not seem to realize or appreciate, Goodrich would contend, that the majority can become a tyranny; the majority, like any monarch, can become a despot by suppressing the desires of the minority. Therefore, Goodrich was very skeptical of trusting the will of a majority: “In a large corporation the stockholders, who operate as a majority, are a kind of democracy (I am afraid of democracies; for example, I cannot select the necessary element of a good common law judge by a majority vote . . . ) and they have no right to dispose of the assets of the minority stockholders.”15
The German philosopher Immanuel Kant (1724–1805) was an original thinker who had a tremendous influence on shaping Goodrich’s views of ethics and morality. In Kant, Goodrich found a philosopher who had systematically examined the ethical underpinnings of a morally responsible society. Kant’s categorical imperative was the center of Goodrich’s ethical life.16 Kant’s appeal to Goodrich lay primarily in three fundamental premises upon which the philosopher built his overarching moral framework: rationality, universality, and freedom of will.
Kant contended that, to the degree we are rational, morality is simply the expression of our own free will. We can establish a moral law of conduct simply by being obedient to our conscience. Therefore, our behavior is guided by both reference to and reverence for our “higher selves.” The need for an external influence such as government to coerce us to do the right thing should be unnecessary or, at the very least, minimal. Goodrich believed that Kant’s maxim of the categorical imperative, if strictly followed, rendered government largely superfluous. Goodrich writes in the Basic Memorandum:
The Will to Liberty as referred to in the Liberty Fund Basic Memorandum is of a higher order than, for example, the will to satisfy one’s own liberty only.
It is a will which recognizes as a practical necessity a concern about the liberty of others.17
Thus, how do we know whether our conduct is ethical or not? Like Kant, Goodrich believed that if a person can will an act that should be “universalized” (meaning that the act should be permissible for everyone to do), then that act is morally allowable. Therefore, lying is not an act that is ethically permissible, because it would be disastrous if falsehoods were universalized (it would destroy the important institution of trust).18 Nonetheless, in Kantian thinking, the intent, not the utility, of a law or principle is what creates moral worth. Similarly, the actor’s intent, not the result of the act, is what gives an act its ethical character. For instance, a passerby who attempts to save a drowning person but who ends up drowning himself is a morally good person despite the fact that the result is disastrous.
According to Kant, the principle’s intent should be based on a sense of duty. Duty is to be performed entirely for its own sake, not in order to promote human happiness or fulfillment.19 Goodrich suggested, however, that ethical behavior produces both of these human qualities, although they are not the overriding reasons why a person should be ethical. Goodrich wrote: “It seems observable that the nature of ethical capacity is such that it has its own reward. The greater an individual exercises his ethical capacity the greater is his self and the greater are the happiness and health of the inner peace which exists.”20
The German theologian Martin Luther (1483–1546) and the French Protestant reformer John Calvin (1509–64) also significantly influenced Goodrich’s moral, ethical, and political beliefs. Pierre was raised in the Presbyterian Church, in which Calvin is historically considered the single most important figure. Luther and John Knox (1505–72), the latter of whom led the Protestant Reformation movement in Scotland, closely followed. Goodrich knew these theologians’ teachings intimately. In the Basic Memorandum, both Luther’s and Calvin’s writings are prominently listed, and the Basic Memorandum has a strong Calvinist strain.
Luther’s and Calvin’s writings are responsible for much of modern society’s conceptions of sin and salvation as well as for the virtues of capitalism, political liberty, and obedience to state authority. Their writings also helped to form common spiritual, social, political, and cultural beliefs that we have failed to associate with these two towering sixteenth-century figures simply out of ignorance of their historical importance. Goodrich knew that as founders of the Reformation, Luther and Calvin were so powerful that even popes and emperors were intimidated by them. Why? The two theologians were not supported by great armies; on the contrary, both men were opposed to force and violence. Their power lay in the widespread acceptance of their teachings. These teachings boldly challenged the authority of the Catholic Church and, to a lesser degree, the political hierarchy of the time.
Luther struggled with the amount of legitimacy to give to secular government. He recognized that the state played an important role in maintaining minimal order in a violent, sinful (non-Christian) world. But he also believed that such authority was limited, did not extend into matters of faith, and must be exercised justly.21 Luther’s teachings about freedom in an ethical and spiritual context were more edifying to Goodrich.22
Politically, Calvin is a more important historic figure than Luther. “Calvin rendered incalculable service to modern liberty by showing how political tyranny could be constitutionally checked, and by cultivating the qualities necessary to revolution and self-government.”23 Before Luther and Calvin, Christians were generally not involved in the affairs of state, for two reasons: First, the devout follower believed that his business did not involve the material world, but God’s Kingdom; and second, the feudal subject had been raised to believe that kings and feudal lords were the natural holders of authority, sanctioned by God, and the caretakers of the peasant and his family. But Luther and Calvin, especially Calvin, helped to change these beliefs.24
Luther’s and Calvin’s teachings formed the basis for protest (the root of the word Protestant) against what they believed to be abuses by the established Church. Moreover, this protest grew to include political protest. It was based on the idea that every person—including ordinary men and women—had a duty to be politically active in order to realize a God-fearing world here on earth. Thus, the idea of the citizen came to the fore. The Christian was not to divorce himself from this world in anticipation of a greater and holier life to come. This “Calvinist conscience” formed the basis for an “extraordinary view of politics as work and of work as a permanent effort and an endless struggle with the devil.”25 The roots of James Goodrich’s political and business prowess may be partially explained by these prevailing Protestant beliefs.
Pierre was fascinated with the ways in which Luther’s and Calvin’s teachings influenced the English and American Puritans. Calvin’s political theory, with its clear democratic tendencies, helped to pave the way for the American Revolution and the United States Constitution.26 Both Luther’s and Calvin’s teachings, therefore, commanded political participation by the believer. Their teachings also emphasized the importance of work, revolution, and warfare as means of resisting temptation, instilling discipline, and overcoming misguided, concentrated, or tyrannical forces.27
Goodrich’s beliefs were also shaped by dozens, perhaps hundreds, of other great scholars and theologians. Many of them and their works are memorialized in the Liberty Fund Basic Memorandum book list (see appendix B). These great thinkers were included in the list because Goodrich believed that their works had helped to lay the cultural and intellectual foundation for Western democratic society in general and the beliefs of the Founding Fathers in particular.28 Some of the most important thinkers, in addition to those discussed above, were Aristotle, Edmund Burke, David Hume, Adam Smith, William Blackstone, Alexander Hamilton, James Madison, John Jay, John Stuart Mill, and Lord Acton.29
Because this chapter began by mentioning the British economist John Maynard Keynes, perhaps it is fitting to close with a brief comparison of Goodrich’s and Keynes’s beliefs. The two men had similar backgrounds: They lived during approximately the same period, they were the offspring of upper-middle-class parents who were raised during Victorian times, and they shared similar educational and religious upbringings. There, however, the similarity ends.
John Maynard Keynes (1883–1946) is one of the most significant economists of the twentieth century because his views on state planning have been so broadly adopted by Western democratic governments. Keynes believed that inequality came about because of “risk, uncertainty, and ignorance” and that society could be advanced by the elimination, or at least a considerable reduction, of all three.30 His prognosis for the problem, as far as this goes, is not unlike Goodrich’s.
Keynes’s prescription for removing these obstacles, however, was for “the state to act as the director of investment to smooth the flow of investment so as to reduce uncertainty and increase the capital stock and the level of output.”31 How exactly does the state act, and at whose direction? Keynes believed that the state should be guided by an intellectual elite that would place social progress ahead of its own class interests. In short, an intellectual elite acting under the notion of “noblesse oblige” (privilege entails responsibility) should properly make the choices in a democratic society.32 The principal challenge was to make the intellectual elite understand and accept its responsibility. In responding to Friedrich Hayek’s The Road to Serfdom, Keynes wrote to Hayek, summarizing his views on this point:
Moderate planning will be safe if those carrying it out are rightly oriented in their own minds and hearts to the moral issue. This is already true of some of them. But the curse is that there is also an important section who could almost be said to want planning not in order to enjoy its fruits but because morally they hold ideas exactly the opposite of yours, and wish to serve not God but the devil. . . .
What we need is the restoration of right moral thinking—a return to proper moral values in our social philosophy.33
Keynes rejected Adam Smith’s theory of the “invisible hand,” and he wrote in 1938 “that self-reliant individuals acting in their own interest cannot reach a maximum for society.” Therefore, what self-interest cannot achieve, Keynes argued, an intellectual elite could—namely, an optimum society—by directing society toward worthy ends.34
Goodrich rejected the very heart of Keynes’s philosophy. He did not believe that the intellectual elite for which Keynes had such high hopes could carry out the task that Keynes expected it to accomplish. Goodrich believed that ignorance was far too pervasive to enable even an elite body to make decisions in the best interests of others. Moreover, Goodrich believed that Keynes failed to “ponder why society would delegate so much authority to a small, non-elected group.”35 In Goodrich’s judgment, Keynes’s proposal would sacrifice specific individual freedoms in order to obtain a higher social standard. As will be seen in the next chapter, this was a notion that Pierre Goodrich was unwilling to accept.
[1. ]Byron K. Trippet, Wabash on My Mind (Crawfordsville, Ind.: Wabash College, 1982), p. 185 (emphasis added); see also Plato, Republic, trans. H. D. P. Lee (Middlesex, England: Penguin Classics, 1972). Plato states: “Then it seems that our first business is to supervise the production of stories, and choose only those we think suitable, and reject the rest. We shall persuade mothers and nurses to tell our chosen stories to their children and so mould their minds and characters rather than their bodies. The greater part of the stories current to-day we shall have to reject” (p. 115).
[2. ]A number of people I interviewed mentioned how well read Goodrich was. Russell Kirk wrote: “He subscribed to, and read, a wide—very wide—variety of periodicals. I was surprised that he had encountered an essay of mine in the pages of The Monist, the Jesuit magazine published in London.” Letter to author, February 8, 1992.
[3. ]Pierre F. Goodrich, “Why Liberty?” p. 10; Basic Memorandum, pp. 13, 21–22 (exhibit I-a).
[4. ]Goodrich states that man “as we know him . . . has some imperfect capacity for reason and for communicating his ideas, past and present, by means of words.” Goodrich also believed, however, that man “learns through his senses, and through a conception we hardly know how to describe except through the term mysticism.” Moreover, man “acts in response to love, compassion, and fortitude”; “acts in response also to envy, hate, and jealousy” (“Why Liberty?” p. 6). Here, Goodrich describes man as “he is.” It seems that Goodrich is not always consistent in his views about whether man is that way (that is, governed primarily by the senses) and cannot change or whether man is capable of apprehending knowledge by a more reasoned way.
[5. ]Goodrich, Liberty Fund Basic Memorandum, p. 15.
[6. ]Ibid., p. 17.
[7. ]Goodrich, “Why Liberty?” p. 11. This idea is also contained in the Liberty Fund Basic Memorandum (p. 17). Goodrich’s thought appears very similar to one expressed by F. A. Hayek in The Counter-Revolution of Science: Studies on the Abuse of Reason (Glencoe, Ill.: Free Press, 1952; Indianapolis: Liberty Fund, 1979): “Many of the greatest things man has achieved are the result not of consciously directed thought, and still less the product of a deliberately coordinated effort of many individuals, but of a process in which the individual plays a part which he can never fully understand . . .” (p. 150).
[8. ]John Locke, Treatise of Civil Government and A Letter Concerning Toleration (New York: Appleton-Century Co., 1937). One of Goodrich’s favorite modern thinkers was Gottfried Dietze, an emeritus professor at Johns Hopkins University. Goodrich thought highly of and was influenced by Dietze’s book, which discussed the potential tyranny of majoritarian rule (American Political Dilemma, Johns Hopkins University Press, 1968). Stephen Tonsor, interview, December 5, 1992.
[9. ]Locke, Treatise of Civil Government, pp. 5–12 (“Of the State of Nature”), pp. 13–15 (“Of the State of War”), and pp. 63–81 (“Of the Beginning of Political Societies”).
[10. ]Ibid., pp. 115–18 (“Of Paternal, Political, and Despotical Power Considered Together”), pp. 134–41 (“Of Tyranny”).
[11. ]Ibid., pp. 18–33 (“Of Property”).
[12. ]Stephen J. Tonsor, interview, December 5, 1992. The paper, “The Lost Tools of Learning,” was written by Sayers, a British academic and novelist, but delivered, unacknowledged, by a presenter. Sayers’s paper was eventually published under her name in Education in a Free Society, ed. Anne Husted Burleigh (Indianapolis: Liberty Fund, 1973), pp. 231–63.
[13. ]Locke, Treatise of Civil Government, pp. 5–12 (“Of the State of Nature”).
[14. ]Goldberg v. Kelly, 397 U.S. 254, 295 (1970).
[15. ]Letter from Goodrich to Friedrich A. Hayek, December 24, 1970. F. A. Hayek Collection, box 22, folder 6, Archives, Hoover Institution.
[16. ]Stephen J. Tonsor made this observation in a December 5, 1992, interview.
[17. ]“The Will to Liberty,” Basic Memorandum, p. 28.
[18. ]See The Moral Law: Kant’s Groundwork of the Metaphysics of Morals, translated and analyzed by H. J. Paton (London: Hutchinson Publishing Group, 1948), pp. 24–38.
[19. ]Ibid.; see also Richard Norman, The Moral Philosophers (Oxford: Clarendon Press, 1983), p. 95.
[20. ]Basic Memorandum, p. 79.
[21. ]See “Temporal Authority: To What Extent It Should Be Obeyed,” in Martin Luther’s Basic Theological Writings, ed. Timothy F. Lull (Minneapolis: Fortress Press, 1989), pp. 655–703.
[22. ]For instance, Luther taught that true Christian freedom rests in faith, accepting Jesus Christ as lord and savior, not in strict adherence to the Old Testament’s commandments or in the belief in the sanctity of good works. Moreover, Luther taught the importance of the priesthood of all believers. He wrote: “The woman or man who knows the grace of God in Jesus Christ is set free to act on the basis of responding love and the real needs of the neighbor. This action need not be contaminated by the continual pressure of the self wanting justification, praise, or credit for whatever is done” (Martin Luther’s Basic Theological Writings, p. 578). See also Martin Luther’s treatise On Christian Liberty, in Martin Luther’s Basic Theological Writings, pp. 595–629 (“The Freedom of a Christian”).
[23. ]Georgia Hardness, John Calvin: The Man and His Ethics (New York: Henry Holt, 1931), p. 221.
[24. ]For an excellent discussion of the political, social, and spiritual environment leading up to the Reformation, see Michael Walker, The Revolution of the Saints: A Study in the Origins of Radical Politics (Cambridge, Mass.: Harvard University Press, 1965), pp. 4–20.
[25. ]Ibid., p. 21.
[26. ]For more information regarding Calvin’s influence on English Puritans, see Hardness, John Calvin: The Man and His Ethic, pp. 237–57.
[27. ]See the following chapters in Walker, The Revolution of the Saints: A Study in the Origins of Radical Politics: “The Attack upon the Traditional Political World,” pp. 148–98; “The New World of Discipline and Work,” pp. 199–231; “Politics and War,” pp. 268–99. Goodrich’s interest in Luther and Calvin as spokesmen against concentrated religious powers can be seen in a series of letters between him and Roscoe Pound. See Goodrich to Pound, May 6, 1949; Pound to Goodrich, May 9, 1949; Goodrich to Pound, April 7, 1952. Roscoe Pound Papers, Archives, Harvard Law School.
[28. ]See Basic Memorandum, pp. 111–14.
[29. ]The influences of these great philosophers and political scientists were not merely meaningless abstractions to Goodrich. He incorporated many of their ideas into his own belief system and applied them to contemporary problems that confronted him in his pursuit of a truly free society. For instance, Goodrich discusses in the Basic Memorandum the problem of governmental intervention in regulating utilities whose stock is owned by Liberty Fund. Goodrich asks: In light of the fact that Liberty Fund opposes governmental regulation, would it be better to get out of the utility business altogether or to remain in the utility business and fight against state intervention? Goodrich mentions the different approaches of Erasmus, who fought against the oppressiveness of the Catholic Church while remaining within its fold, and Luther, who attacked the Church from outside (Basic Memorandum, pp. 91–92). Goodrich readily admits that both men accomplished much. Goodrich finally acknowledges that which example the board should follow (Erasmus’s or Luther’s) may have something to do with the timing of other events. Since Goodrich drafted the Basic Memorandum, the issue has become moot, since federal and state law forbid a not-for-profit and tax-exempt organization to own more than a small percentage of a company’s stock.
[30. ]Keynes gave a lecture at Oxford in 1924 entitled “The End of Laissez-Faire” in which he stated: “Many of the greatest economic evils of our time are the fruits of risk, uncertainty, and ignorance. It is because particular individuals . . . are able to take advantage of uncertainty and ignorance, and also because for the same reason big business is often a lottery, that great inequalities of wealth come about . . .” (The Collected Writings of John Maynard Keynes, vol. 9, p. 291).
[31. ]Allan H. Meltzer, Keynes’s Monetary Theory: A Different Interpretation (Cambridge: Cambridge University Press, 1988), pp. 304–5.
[32. ]These observations were made by Allan H. Meltzer at a talk he gave about his book on Keynes (Keynes’s Monetary Theory) at the American Enterprise Institute, Washington, D.C., on November 14, 1989.
[33. ]The Collected Writings of John Maynard Keynes, vol. 27, p. 387.
[34. ]Meltzer, lecture, American Enterprise Institute, November 14, 1989.
[35. ]Meltzer, Keynes’s Monetary Theory: A Different Interpretation, p. 317.