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I,Pencil

MyFamilyTreeastoldtoLeonardE.Read

Iamaleadpencil—theordinarywoodenpencilfamiliartoallboysandgirlsandadultswhocanreadandwrite.*

Writingisbothmyvocationandmyavocation;that’sallIdo.

YoumaywonderwhyIshouldwriteagenealogy.Well,tobeginwith,mystoryisinteresting.And,next,Iamamystery—moresothanatreeorasunsetorevenaflashoflightning.But,sadly,Iamtakenforgrantedbythosewhouseme,asifIwereamereincidentandwithoutbackground.Thissuperciliousattituderelegatesmetothelevelofthecommonplace.Thisisaspeciesofthegrievouserrorinwhichmankindcannottoolongpersistwithoutperil.For,thewiseG.K.Chestertonobserved,“Weareperishingforwantofwonder,notforwantofwonders.”

I,Pencil,simplethoughIappeartobe,merityourwonderandawe,aclaimIshallattempttoprove.Infact,ifyoucanunderstandme—no,that’stoomuchtoaskofanyone—ifyoucanbecomeawareofthemiraculousnesswhichIsymbolize,youcanhelpsavethefreedommankindissounhappilylosing.Ihaveaprofoundlessontoteach.AndIcanteachthislessonbetterthancananautomobileoranairplaneoramechanicaldishwasherbecause—well,becauseIamseeminglysosimple.

Simple?Yet,notasinglepersononthefaceofthisearthknowshowtomakeme.Thissoundsfantastic,doesn’tit?Especiallywhenitisrealizedthatthereareaboutoneandone-halfbillionofmykindproducedintheU.S.A.eachyear.

Pickmeupandlookmeover.Whatdoyousee?Notmuchmeetstheeye—there’ssomewood,lacquer,theprintedlabeling,graphitelead,abitofmetal,andaneraser.

InnumerableAntecedents

Justasyoucannottraceyourfamilytreebackveryfar,soisitimpossibleformetonameandexplainallmyantecedents.ButIwouldliketosuggestenoughofthemtoimpressuponyoutherichnessandcomplexityofmybackground.

Myfamilytreebeginswithwhatinfactisatree,acedarofstraightgrainthatgrowsinNorthernCaliforniaandOregon.Nowcontemplateallthesawsandtrucksandropeandthecountlessothergearusedinharvestingandcartingthecedarlogstotherailroadsiding.Thinkofallthepersonsandthenumberlessskillsthatwentintotheirfabrication:theminingofore,themakingofsteelanditsrefinementintosaws,axes,motors;thegrowingofhempandbringingitthroughallthestagestoheavyandstrongrope;theloggingcampswiththeirbedsandmesshalls,thecookeryandtheraisingofallthefoods.Why,untoldthousandsofpersonshadahandineverycupofcoffeetheloggersdrink!

ThelogsareshippedtoamillinSanLeandro,California.Canyouimaginetheindividualswhomakeflatcarsandrailsandrailroadenginesandwhoconstructandinstallthecommunicationsystemsincidentalthereto?Theselegionsareamongmyantecedents.

ConsiderthemillworkinSanLeandro.Thecedarlogsarecutintosmall,pencil-lengthslatslessthanone-fourthofaninchinthickness.Thesearekilndriedandthentintedforthesamereasonwomenputrougeontheirfaces.PeoplepreferthatIlookpretty,notapallidwhite.Theslatsarewaxedandkilndriedagain.Howmanyskillswentintothemakingofthetintandthekilns,intosupplyingtheheat,thelightandpower,thebelts,motors,andalltheotherthingsamillrequires?Sweepersinthemillamongmyancestors?Yes,andincludedarethemenwhopouredtheconcreteforthedamofaPacificGas&ElectricCompanyhydroplantwhichsuppliesthemill’spower!

Don’toverlooktheancestorspresentanddistantwhohaveahandintransportingsixtycarloadsofslatsacrossthenation.

Onceinthepencilfactory—$4,000,000inmachineryandbuilding,allcapitalaccumulatedbythriftyandsavingparentsofmine—eachslatisgiveneightgroovesbyacomplexmachine,afterwhichanothermachinelaysleadsineveryotherslat,appliesglue,andplacesanotherslatatop—aleadsandwich,sotospeak.SevenbrothersandIaremechanicallycarvedfromthis“wood-clinched”sandwich.

My“lead”itself—itcontainsnoleadatall—iscomplex.ThegraphiteisminedinCeylon.Considertheseminersandthosewhomaketheirmanytoolsandthemakersofthepapersacksinwhichthegraphiteisshippedandthosewhomakethestringthattiesthesacksandthosewhoputthemaboardshipsandthosewhomaketheships.Eventhelighthousekeepersalongthewayassistedinmybirth—andtheharborpilots.

ThegraphiteismixedwithclayfromMississippiinwhichammoniumhydroxideisusedintherefiningprocess.Thenwettingagentsareaddedsuchassulfonatedtallow—animalfatschemicallyreactedwithsulfuricacid.Afterpassingthroughnumerousmachines,themixturefinallyappearsasendlessextrusions—asfromasausagegrinder-cuttosize,dried,andbakedforseveralhoursat1,850degreesFahrenheit.ToincreasetheirstrengthandsmoothnesstheleadsarethentreatedwithahotmixturewhichincludescandelillawaxfromMexico,paraffinwax,andhydrogenatednaturalfats.

Mycedarreceivessixcoatsoflacquer.Doyouknowalltheingredientsoflacquer?Whowouldthinkthatthegrowersofcastorbeansandtherefinersofcastoroilareapartofit?Theyare.Why,eventheprocessesbywhichthelacquerismadeabeautifulyellowinvolvetheskillsofmorepersonsthanonecanenumerate!

Observethelabeling.That’safilmformedbyapplyingheattocarbonblackmixedwithresins.Howdoyoumakeresinsandwhat,pray,iscarbonblack?

Mybitofmetal—theferrule—isbrass.Thinkofallthepersonswhominezincandcopperandthosewhohavetheskillstomakeshinysheetbrassfromtheseproductsofnature.Thoseblackringsonmyferruleareblacknickel.Whatisblacknickelandhowisitapplied?Thecompletestoryofwhythecenterofmyferrulehasnoblacknickelonitwouldtakepagestoexplain.

Thenthere’smycrowningglory,inelegantlyreferredtointhetradeas“theplug,”thepartmanusestoerasetheerrorshemakeswithme.Aningredientcalled“factice”iswhatdoestheerasing.Itisarubber-likeproductmadebyreactingrape-seedoilfromtheDutchEastIndieswithsulfurchloride.Rubber,contrarytothecommonnotion,isonlyforbindingpurposes.Then,too,therearenumerousvulcanizingandacceleratingagents.ThepumicecomesfromItaly;andthepigmentwhichgives“theplug”itscoloriscadmiumsulfide.

NoOneKnows

Doesanyonewishtochallengemyearlierassertionthatnosinglepersononthefaceofthisearthknowshowtomakeme?

Actually,millionsofhumanbeingshavehadahandinmycreation,nooneofwhomevenknowsmorethanaveryfewoftheothers.Now,youmaysaythatIgotoofarinrelatingthepickerofacoffeeberryinfaroffBrazilandfoodgrowerselsewheretomycreation;thatthisisanextremeposition.Ishallstandbymyclaim.Thereisn’tasinglepersoninallthesemillions,includingthepresidentofthepencilcompany,whocontributesmorethanatiny,infinitesimalbitofknow-how.Fromthestandpointofknow-howtheonlydifferencebetweentheminerofgraphiteinCeylonandtheloggerinOregonisinthetypeofknow-how.Neithertheminernortheloggercanbedispensedwith,anymorethancanthechemistatthefactoryortheworkerintheoilfield—paraffinbeingaby-productofpetroleum.

Hereisanastoundingfact:Neithertheworkerintheoilfieldnorthechemistnorthediggerofgraphiteorclaynoranywhomansormakestheshipsortrainsortrucksnortheonewhorunsthemachinethatdoestheknurlingonmybitofmetalnorthepresidentofthecompanyperformshissingulartaskbecausehewantsme.Eachonewantsmeless,perhaps,thandoesachildinthefirstgrade.Indeed,therearesomeamongthisvastmultitudewhoneversawapencilnorwouldtheyknowhowtouseone.Theirmotivationisotherthanme.Perhapsitissomethinglikethis:Eachofthesemillionsseesthathecanthusexchangehistinyknow-howforthegoodsandservicesheneedsorwants.Imayormaynotbeamongtheseitems.

NoMasterMind

Thereisafactstillmoreastounding:theabsenceofamastermind,ofanyonedictatingorforciblydirectingthesecountlessactionswhichbringmeintobeing.Notraceofsuchapersoncanbefound.Instead,wefindtheInvisibleHandatwork.ThisisthemysterytowhichIearlierreferred.

Ithasbeensaidthat“onlyGodcanmakeatree.”Whydoweagreewiththis?Isn’titbecausewerealizethatweourselvescouldnotmakeone?Indeed,canweevendescribeatree?Wecannot,exceptinsuperficialterms.Wecansay,forinstance,thatacertainmolecularconfigurationmanifestsitselfasatree.Butwhatmindisthereamongmenthatcouldevenrecord,letalonedirect,theconstantchangesinmoleculesthattranspireinthelifespanofatree?Suchafeatisutterlyunthinkable!

I,Pencil,amacomplexcombinationofmiracles:atree,zinc,copper,graphite,andsoon.ButtothesemiracleswhichmanifestthemselvesinNatureanevenmoreextraordinarymiraclehasbeenadded:theconfigurationofcreativehumanenergies—millionsoftinyknow-howsconfiguratingnaturallyandspontaneouslyinresponsetohumannecessityanddesireandintheabsenceofanyhumanmaster-minding!SinceonlyGodcanmakeatree,IinsistthatonlyGodcouldmakeme.Mancannomoredirectthesemillionsofknow-howstobringmeintobeingthanhecanputmoleculestogethertocreateatree.

TheaboveiswhatImeantwhenwriting,“IfyoucanbecomeawareofthemiraculousnesswhichIsymbolize,youcanhelpsavethefreedommankindissounhappilylosing.”For,ifoneisawarethattheseknow-howswillnaturally,yes,automatically,arrangethemselvesintocreativeandproductivepatternsinresponsetohumannecessityanddemand—thatis,intheabsenceofgovernmentaloranyothercoercivemasterminding—thenonewillpossessanabsolutelyessentialingredientforfreedom:afaithinfreepeople.Freedomisimpossiblewithoutthisfaith.

Oncegovernmenthashadamonopolyofacreativeactivitysuch,forinstance,asthedeliveryofthemails,mostindividualswillbelievethatthemailscouldnotbeefficientlydeliveredbymenactingfreely.Andhereisthereason:Eachoneacknowledgesthathehimselfdoesn’tknowhowtodoallthethingsincidenttomaildelivery.Healsorecognizesthatnootherindividualcoulddoit.Theseassumptionsarecorrect.Noindividualpossessesenoughknow-howtoperformanation’smaildeliveryanymorethananyindividualpossessesenoughknow-howtomakeapencil.Now,intheabsenceoffaithinfreepeople—intheunawarenessthatmillionsoftinyknow-howswouldnaturallyandmiraculouslyformandcooperatetosatisfythisnecessity—theindividualcannothelpbutreachtheerroneousconclusionthatmailcanbedeliveredonlybygovernmental“master-minding.”

TestimonyGalore

IfI,Pencil,weretheonlyitemthatcouldoffertestimonyonwhatmenandwomencanaccomplishwhenfreetotry,thenthosewithlittlefaithwouldhaveafaircase.However,thereistestimonygalore;it’sallaboutusandoneveryhand.Maildeliveryisexceedinglysimplewhencompared,forinstance,tothemakingofanautomobileoracalculatingmachineoragraincombineoramillingmachineortotensofthousandsofotherthings.Delivery?Why,inthisareawheremenhavebeenleftfreetotry,theydeliverthehumanvoicearoundtheworldinlessthanonesecond;theydeliveraneventvisuallyandinmotiontoanyperson’shomewhenitishappening;theydeliver150passengersfromSeattletoBaltimoreinlessthanfourhours;theydelivergasfromTexastoone’srangeorfurnaceinNewYorkatunbelievablylowratesandwithoutsubsidy;theydelivereachfourpoundsofoilfromthePersianGulftoourEasternSeaboard—halfwayaroundtheworld—forlessmoneythanthegovernmentchargesfordeliveringaone-ounceletteracrossthestreet!

ThelessonIhavetoteachisthis:Leaveallcreativeenergiesuninhibited.Merelyorganizesocietytoactinharmonywiththislesson.Letsociety’slegalapparatusremoveallobstaclesthebestitcan.Permitthesecreativeknow-howsfreelytoflow.HavefaiththatfreemenandwomenwillrespondtotheInvisibleHand.Thisfaithwillbeconfirmed.I,Pencil,seeminglysimplethoughIam,offerthemiracleofmycreationastestimonythatthisisapracticalfaith,aspracticalasthesun,therain,acedartree,thegoodearth.

*Myofficialnameis“Mongol482.”Mymanyingredientsareassembled,fabricated,andfinishedbyEberhardFaberPencilCompany.

LeonardE.Read(1898-1983)foundedFEEin1946andservedasitspresidentuntilhisdeath.

“I,Pencil,”hismostfamousessay,wasfirstpublishedintheDecember1958issueofTheFreeman.Althoughafewofthemanufacturingdetailsandplacenameshavechangedoverthepastfortyyears,theprinciplesareunchanged.

Introduction,byMiltonFriedman

LeonardRead’sdelightfulstory,“I,Pencil,”hasbecomeaclassic,anddeservedlyso.Iknowofnootherpieceofliteraturethatsosuccinctly,persuasively,andeffectivelyillustratesthemeaningofbothAdamSmith’sinvisiblehand—thepossibilityofcooperationwithoutcoercion—andFriedrichHayek’semphasisontheimportanceofdispersedknowledgeandtheroleofthepricesystemincommunicatinginformationthat“willmaketheindividualsdothedesirablethingswithoutanyonehavingtotellthemwhattodo.”

WeusedLeonard’sstoryinourtelevisionshow,“FreetoChoose,”andintheaccompanyingbookofthesametitletoillustrate“thepowerofthemarket”(thetitleofboththefirstsegmentoftheTVshowandofchapteroneofthebook).Wesummarizedthestoryandthenwentontosay:

“Noneofthethousandsofpersonsinvolvedinproducingthepencilperformedhistaskbecausehewantedapencil.Someamongthemneversawapencilandwouldnotknowwhatitisfor.Eachsawhisworkasawaytogetthegoodsandserviceshewanted—goodsandservicesweproducedinordertogetthepencilwewanted.Everytimewegotothestoreandbuyapencil,weareexchangingalittlebitofourservicesfortheinfinitesimalamountofservicesthateachofthethousandscontributedtowardproducingthepencil.

“Itisevenmoreastoundingthatthepencilwaseverproduced.Noonesittinginacentralofficegaveorderstothesethousandsofpeople.Nomilitarypoliceenforcedtheordersthatwerenotgiven.Thesepeopleliveinmanylands,speakdifferentlanguages,practicedifferentreligions,mayevenhateoneanother—yetnoneofthesedifferencespreventedthemfromcooperatingtoproduceapencil.Howdidithappen?AdamSmithgaveustheanswertwohundredyearsago.”

“I,Pencil”isatypicalLeonardReadproduct:imaginative,simpleyetsubtle,breathingtheloveoffreedomthatimbuedeverythingLeonardwroteordid.Asintherestofhiswork,hewasnottryingtotellpeoplewhattodoorhowtoconductthemselves.Hewassimplytryingtoenhanceindividuals’understandingofthemselvesandofthesystemtheylivein.

Thatwashisbasiccredoandonethathestucktoconsistentlyduringhislongperiodofservicetothepublic—notpublicserviceinthesenseofgovernmentservice.Whateverthepressure,hestucktohisguns,refusingtocompromisehisprinciples.Thatwaswhyhewassoeffectiveinkeepingalive,intheearlydays,andthenspreadingthebasicideathathumanfreedomrequiredprivateproperty,freecompetition,andseverelylimitedgovernment.

ProfessorFriedman,the1976NobelistinEconomicScience,isSeniorResearchFellowattheHooverInstitution,Stanford,California.

Afterword,byDonaldJ.Boudreaux

Therearetwokindsofthinking:simplisticandsubtle.Simplisticthinkerscannotunderstandhowcomplexandusefulsocialordersarisefromanysourceotherthanconsciousplanningbyapurposefulmind.Subtlethinkers,incontrast,understandthatindividualactionsoftenoccurwithinsettingsthatencourageindividualstocoordinatetheiractionswithoneanotherindependentofanyoverarchingplan.F.A.Hayekcalledsuchunplannedbutharmoniouscoordination“spontaneousorder.”

Themarkofthesubtlemindisnotonlyitsabilitytograsptheideaofspontaneousordersbutalsotounderstandthatconsciousattemptstoimproveortomimictheseordersaredoomedtofail.“Whyso?”asksthesimplisticthinker.“Howcanhappenstancegeneratecomplexordersuperiortowhataconsciousmindcanconceiveandimplement?”Inrespondingtothisquestion,asubtlethinkerpointsoutthatspontaneousordersdonotarisefromhappenstance:thecontinualadjustmentsbyeachindividualwithinspontaneousordersfollowaverystrictlogic—thelogicofmutualaccommodation.Becausenocentralplannercanpossiblyknowallofthedetailsofeachindividual’suniquesituation,nocentralplannercanknowhowbesttoarrangeeachandeveryactionofeachandeveryindividualwiththatofthemultitudesofotherindividuals.

Intheeighteenthcentury,ahandfulofscholars—mostnotablyDavidHumeandAdamSmith—developedasubtleunderstandingofhowprivatepropertyrightsencourageself-regardingproducersandconsumerstoactinmutuallybeneficialways.Spontaneousorderingforceswerethusdiscovered,andwiththisdiscoverymoderneconomicsbegantotakeshape.

Overthenexttwocenturieseconomicsachievedenormoussuccessinfurtheringourund

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