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Fellows with Friedman

The Economic Gains Of Risk-Taking

David Davenport

Rugged individualism and American character are inextricably intertwined, the one essentially defining the other. Perhaps no expression better describes the uniqueness of America and its people than rugged individualism, a key component of America’s DNA and a vital ingredient in what makes America “exceptional.” Underlying all the freedoms that the pioneers and founders sought to establish in the new country was individual liberty. It would be the individual, not the monarchy or the social class, who would be the essential unit of analysis and action in the New World. Herbert Hoover, who coined the phrase “rugged individualism” in 1928, contrasted it with the soft despotism, “paternalism,” and totalitarianism of Europe.

As we travel the road of rugged individualism from the founding to today, we note persistent efforts to detour from that path, or even to destroy it. Nonetheless, we look with some optimism toward new frontiers of the twenty-first century that may nourish this American virtue. The famous philosopher Yogi Berra said, “It’s tough to make predictions, especially about the future.” To predict the fate of rugged individualism in America, it should help to recount briefly what it is and is not.

Read “Rugged Individualism” by David Davenport here.

Richard A. Epstein

In principle, libertarian paternalism consciously hopes to preserve freedom of contract by eschewing mandatory rules and relying instead on a framework of default rules. In practice, however, its approach is deeply flawed for both conceptual and practical reasons. Its initial conceptual mistake is to interpret paternalism far too broadly. In some cases, paternalism is absolutely necessary. Consider parenting. Parents, of course, nudge children to say “thank you” when they receive a present. But such nudges are only a small part of any legitimate system of parental control. Parents also defend their children against outsiders and impose highly coercive sanctions against children who misbehave. The logic in favor of this paternalism is that there is no superior alternative. Children cannot fend for themselves, and, for good biological reasons, parents are more invested in the well-being of their children than any stranger. Accordingly, in a free society, the state intervenes in parent-child relationships only in cases of abuse or neglect—when it is clear that the parents’ interests are no longer aligned with those of the child. That same level of state intervention may also make sense in extreme cases of suicidal and self-destructive behavior. But as libertarians of all stripes recognize, it is a dangerous premise for the decisions of everyday life—like where to work, how to save money, whom to marry, whether to have children, and how to raise them.

Read “The False Allure of Libertarian Paternalism” here.

Herbert Hoover

The American pioneer is the epic expression of that individualism, and the pioneer spirit is the response to the challenge of opportunity, to the challenge of nature, to the challenge of life, to the call of the frontier. That spirit need never die for lack of something for it to achieve. There will always be a frontier to conquer or to hold as long as men think, plan, and dare. Our American individualism has received much of its character from our contacts with the forces of nature on a new continent. It evolved government without official emissaries to show the way; it plowed and sowed two score of great states; it built roads, bridges, railways, cities; it carried forward every attribute of high civilization over a continent. The days of the pioneer are not over. There are continents of human welfare of which we have penetrated only the coastal plain. The great continent of science is as yet explored only on its borders, and it is only the pioneer who will penetrate the frontier in the quest for new worlds to conquer. The very genius of our institutions has been given to them by the pioneer spirit. Our individualism is rooted in our very nature. It is based on conviction born of experience. Equal opportunity, the demand for a fair chance, became the formula of American individualism because it is the method of American achievement.

Read “The Future of American Individualism” by Herbert Hoover here.