Chapter X, Excerpt 3 of 3
The Economics of a Free Society

Lord Shaftesbury, the celebrated reformer, admitted privately that he accused the manufacturers though he knew the blame rested equally on the landowners, because he needed a party to pass his laws. What he did not realize was that he also was acting as an aristocrat, for the reform laws he framed were status law in disguise. The mechanism of government it used, status law, is that of the preventative clutch. Its social atmosphere is tinged with despair, misery here and the hereafter.

The advance could not be made until a structure had been erected to accommodate the mechanism, including the type of control which is used in motor mechanics by the various applications known as safety devices. The essential feature of such appliances is that they do not and cannot take effect until the actual need arises. These are not preventive controls, but corrective; the are not primary, but secondary. Contract law is the same type of mechanism in the political organization.

Contract law has no primary authority, no jurisdiction unless invoked by the individual. It is indisputably nothing but an agency, initiative being vested in the individual, which is determined by the previous agreement of the individuals. It is the only method of organization which leaves the creative faculty and corollary productive processes their inherent and necessary freedom. The political instrument must be of a secondary character.