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SVETOZAR PEJOVICH, Community, Leadership and Progress - Ralph Raico, New Individualist Review [1961]

Edition used:

New Individualist Review, editor-in-chief Ralph Raico, introduction by Milton Friedman (Indianapolis: Liberty Fund, 1981).

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Community, Leadership and Progress

SVETOZAR PEJOVICH*

LET US BEGIN OUR discussion with a few observations of basic characteristics in every human community. First, the members of a community are unequal with respect to both the distribution of their abilities as well as the hierarchy of their wants and aspirations. Secondly, we can distinguish between two forms of social life in every community: the communitarian forms of life and the contractual forms of life. The former we define as the accepted principles of behavior, such as justice, truthfulness, and love, which each member of the community is expected to observe. The latter serves the purpose of harmonizing, or equilibrating, different interests of the community members through exchange. Thirdly, the relationship between the two forms of life is one of mutual interdependence. The communitarian forms of life determine the quality and content of contractual agreements; that is, the quality of contractual agreements is constrained in a specific way by the prevailing communitarian forms of life. At the same time, any deviation of contractual agreements from the principles of behavior would, if that deviation is accepted by the community, force the communitarian forms of life to adjust in order to embrace the novelty. Consider for example the history of the institution of marriage in a number of European communities. For some time the communitarian forms of life had prescribed that a mature girl must show an unquestionable obedience to her father including, of course, the acceptance of the man whom he selected to be her husband. When in the course of time young people had begun to choose their own partners, the quality of contractual agreement with respect to the institution of marriage changed and its acceptance—notwithstanding the resistance of the prevailing communitarian forms of life—brought about changes in the accepted principles of behavior. It became possible for a girl to reject her father’s choice of mate without fear that it could result in her eventual alienation from the community.

Finally, the interaction between the communitarian and contractual forms of life in a community leads to the emergence of a number of social institutions. Some of those institutions are impartial, that is, they serve the purpose of reducing social conflict created by the confrontation of all the different interests and aspirations of the community members (e.g., open-market competition, democratic elections), while some others are founded with the explicit purpose of promoting the self-interest of specific groups in the community (e.g., trade unions, government-sheltered monopolies).

Consider a community as it moves along through time. If there were no changes in the quality of contractual agreements the community life would flow through time undisturbed. The role of its rulers would be limited to the supervision of contractual agreements and to keeping them in agreement with the prevailing principles of behavior. A number of communities in Africa and Asia, where life has not changed for centuries, offer a good example of this type of communitarian life.

It is true, of course, that the years of accumulated experience must contribute to some improvements in the execution of contractual agreements. Those improvements, however, would only introduce changes in the data of the system but not add new phenomena. In other words, only some quantitative changes could be expected to take place within the firmly established framework of a “routine” life community. The meaning of time in a “routine” life community, as it emerges from our discussion, is an objective one: the sequence of events is independent of the action of the actor; man’s activity can be predicted, i.e., it is given to him objectively from without. Life in a community of this type is unimaginative and uninspiring.

IT WAS SAID THAT the contractual forms of life serve the purpose of satisfying human wants through exchange. We must now make a clear-cut distinction between the “existing” or “known” wants and “newly created” wants. The former are wants which have been accepted by the community for some time and whose satisfaction can be attained through the prevailing contractual forms of life. The latter are wants—let us call them potential wants—which someone would like the community to become aware of, try them out, accept, and thus include in the sphere of “existing” wants. For example, the concept of equality before the law had not belonged to the sphere of “existing” wants in medieval Europe, but its later acceptance by the majority of European communities indicates that it was a definite potential want.

The introduction of potential wants calls for a change in the quality of contractual agreements; but the acceptance of a change in the contractual forms of life must lead, as we have seen, to a re-adjustment in the communitarian forms of life. It follows that the actualization of potential wants, i.e., the injection of a novelty into the community’s life is an act of social-reorganization. This kind of social change we shall call progress, because the community’s voluntary acceptance of new wants and, consequently, of new forms of life indicates that it considers them superior to the old ones. We conclude that progress involves a double variation: the quantitative changes, i.e., more of the same, and the qualitative changes, i.e., successful actualization of potential wants.

It appears that human progress is triggered by a group of men whose vision is not constrained by the prevailing forms of life, and who are capable of overcoming the inevitable resistance of the prevailing social institutions. The fact that the action of these men—let us call them free agents—means an injection of something new into the community’s life implies that the outcome of their action can only be anticipated, not predicted. The free agent, therefore, must knowingly and willingly accept the risk of seeing his ideas and, consequently, himself rejected by the community.

While wear and tear of time and the passivity of matter naturally dissipate the things of this world and the energy of history, the creative forces which are characteristic of the spirit and freedom and are also their witness and which normally find their point of application in the effort of the few—thereby destined to sacrifice—constantly revitalize the quality of this energy. Thus, the life of human societies advances and progresses at the price of many losses.1

Thus, in a “progressive” community a new meaning for time emerges: the sequence of events becomes dependent on the action of the free agent. In Western Europe free agents emerged from the ranks of small traders, bankers, artisans, and craftsmen, i.e., from the ranks of the rising middle class. The middle class wanted to distinguish itself from the lower classes of wage and farm labor, while at the same time it was envious of all the honors, privileges, and status enjoyed by the nobility. The members of this class turned their attention to commercial activity and the accumulation of wealth, and in doing so they re-organized the social structure of the West.

SO FAR WE HAVE discussed two types of communities: the “routine” life community and the “progressive” community. The former is leaderless, that is, there exists no man in that community capable of disrupting the circular flow of life by offering something new to its members, something which they have not known or tried before. A “routine” life community has its own elite and rulers, to be sure, but those people are not its leaders; their job is to preserve peace and order within the existing social framework. The “progressive” community has its true leader: the free agent. He is the man who injects into the community’s life, usually at a great risk to himself, something essentially new, something which is not an outgrowth of the past. He provides his community with an energy capable of disrupting its routine life and with a choice between new and old forms of life.

If our concept of progress—social changes voluntarily accepted by the community—is a sound one, then we can conclude that human progress depends on the rate at which free agents are able and willing to suggest changes; and the number of suggestions must, obviously, depend on the number of the people who are given freedom to make them. It follows that the central problem of human progress is to find the social organization, or environment, most conducive for carrying out innovating actions. I submit that the environment in which each and every man is allowed to be his own exclusive agent, in which each and every man enjoys freedom from organized groups, and in which no social institutions serving some specific group interests are sheltered by the community rulers, will make each and every man a potential leader (free agent).

The presence of the class of free agents in a community is likely to mean the difference between degeneration and creation, mechanical life and inspiring life. In a “routine” life community the leaderless man adjusts himself to the world. In a “progressive” community, thanks to the presence of free agents, man constantly improves the world.

In addition to the two types of communities discussed above there exists a third type which we may call the “changing” community. Consider for example what is happening today in a number of emerging countries in Africa and Asia. The idea of progress had hit the elite rulers of those communities from without long before the class of free agents emerged, thus forcing the respective elite governments to assume the role of sole innovator and to “legislate” progress by compelling the people to accept new forms and ways of life.

The trouble is, of course, that in the absence of impartial social institutions such as open-market competition and democratic elections it becomes quite difficult if not impossible to ascertain whether social changes imposed by the government have been voluntarily accepted and, thus, considered superior to the old forms of life by the community at large. Since the acceptance of social changes instituted by the government is coercive rather than voluntary it may well be that the government sponsored changes do not mean the actualization of people’s potential wants and, hence, progress. While it is often argued that an important advantage of the “changing” community is that it helps its members to break away from the old forms of life, the fact remains that this type of community is promoting change rather than progress. Consequently, there is no reason to believe that social changes which people are compelled to accept represent the pattern of social development preferred by them.

The conclusion of this paper, of course, is that progress cannot be legislated from without, or suppressed altogether from within, although it can be impeded. It depends on the presence of free agents, a group of people not constrained in a specific way by prevailing forms of life and who are willing to accept the risks of carrying out their vision; it accelerates when the right of each to act as his own exclusive agent is protected; it grows in the absence of social institutions promoting some specific interests; and because it depends on the community’s freedom to accept or reject proposed social changes, it depends on the existence of impartial social institutions. Only those social changes which the community voluntarily accepts can be properly called progressive, and social restrictions on the non-conforming lifestyle of free agents represents as mistaken an approach to society’s optimal welfare as forced adoption of changes from outside.

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[* ] Svetozar Pejovich is Associate Professor of Economics at Texas A&M University.

[1 ] J. Maritain, The Rights of Man and Natural Law (New York: Charles Scribners’ Sons, 1943), p. 30.