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COUNCIL OF ECONOMIC ADVISERS WASHINGTON, D. C. FOR RELEASE UPON DELIVERY Commencement Address Paul W. McCracken Chairman, Council of Economic Advisers Huron College Huron, South Dakota May 24, 1970 UNITY IN DIVERSITY What is to be the strategy for assuring orderly social and economic progress as we move through the remaining decades of this twentieth century? This question is not, of course, to be answered by producing a list of specific problems that we would like to see resolved or programs that we would like to see implemented. All of us have our lists of problems, of personal aspirations, of goals and objectives for ourselves and our nation. The question posed here is more fundamental. Can we reach that degree of agreement about our strategy which is so essential if we are to have some assurance that these decades, which will close out the twentieth century and begin the third hundred years of our nation's independent existence, will be an era of hope and promise and accomplishment? 2 This question is an important one for all of us, but it is particularly urgent for the young men and women whom we honor here today. during this period that their careers will be unfolding. It is They will be reaching the peak of their productive years as the bells on that midnight toll in the third millenium of our Christian calendar. And the dollars deducted from their initial pay checks for social security will not return to them until well into the second decade of the twenty-first century. These are, therefore, their years about which we are concerned here today. Indeed, the traditional name for this occasion itself emphasizes not the conclusion of college years but the commencement of those for which these college years were made. I The first element in our strategy for the future must be the assurance of that open system where there is full scope for trying out the new -- new approaches to education, new products and services in the economy, new art forms in music and the theater and literature, new techniques in agriculture. By definition progress means moving on from the old to something new and better. If we are to realize our full potential for progress, our social and economic system must then obviously accord to all the opportunity for the full expression of their creative and innovative powers. A society that confines itself to the innovations and creativity that can be initiated by only a small part of the population is limiting itself to a small fraction of the creativity that is potentially available. A people 3 that excludes from the creative process members of racial or religious or political or class minorities is, of course, perpetuating an immoral arrangement, but it is also sacrificing a part of its potential for innovation and progress. This point is more important than it seems. One of the striking features about mankind's long march upward is that the creative acts making possible each advance have not usually come from a "logical" source. Was it logical to expect that the son of a Michigan farmer would revolutionize the world of transportation? Was it logical to assume that a Kentucky farmer of no great pretense would be the father of the Great Emancipator? We shall never know if through the centuries a profound philosopher or a major contribution to medicine or a musical genius or a great and wise political leader may have been denied to this country and to the world because some of our people were forced to live as second class citizens, never having the opportunity for a full development and expression of their creative powers. tion are so costly to any society. This is why all forms of discrimina One recalls here the words of Talleyrand, "It is more than a crime, it is a blunder. " Our failure through the years to bring racial minorities fully into the mainstream of the national life has had incalculable moral and social costs, and they are the most important, but the economic cost can be measured. If the productive and earning power of these citizens had not been subject to special limitations through a cumulative heritage of poverty 4 and inadequate education from discrimination, our productive capability today would be greater by about $25 billion per year. This shortfall is exceeded by the gross national product of only 13 other nations of the free world. II Now progress is not assured by dreaming up new and different things. The new is not always, or even usually, better. Indeed, most ideas for new things are visionary, impractical, and not relevant to the needs of the world. This brings us to the second element in any effective strategy for progress. Our social and economic systems must have a way of sorting out oddball from the relevant among the new ideas, and then have a means to assure that the new does not remain an isolated fact. The new that is better must also be diffused widely across our society. It must prevail. This is the second element of any strategy for progress, and it is the most difficult. It has been the most difficult for nations and societies to solve because it threatens the displacement of the old and established and entrenched. It involves the necessity for continuing disestablishmentarianism -- to use a leading candidate for the longest word in our language. A totalitarian system or society is not well organized, in principle, to accomplish this disestablishmentarianism. In highly centralized decision making systems people with an inherently vested interest in the status quo 5 tend also to be the ones who must rule on whether something new might be better. This, naturally, they are disinclined to do. That is why highly totalitarian societies or systems, whatever1 the brand name, are almost always ultraconservative operationally. And it is here that a free and open society has, in principle, the great advantage. Do you have a new style of fiction? Try it out. If people, free to read it or not as they prefer, like it, the new will prevail and the old will be displaced. There is no Department of Fiction in Government, which by definition would be dedicated to the old, whose approval must be obtained. If Henry Ford, with his new idea for trans porting people, had then faced the necessity for approval from a Ministry of Transportation (which would certainly have been dominated by the rail roads), most of us would not be here at all today. The new prevailed because people were free to make a choice, and then established and powerful organizations (the railroads) gave way to something which people clearly considered to be better. Indeed, if this comment is not inappropriate from a Michigan citizen, the automobile, with all of our current problems of congestion and pollution, has made a singular contribution to freedom by emancipating the ordinary citizen from the tyrannies and regimentation of awkward timetables, trains and buses not on time, and even the bilious conductors of justly legendary fame. It is this freedom from control of 6 others -- a fifth freedom, Walter Reuther once called it -- that goes a long way to explain the preference of people generally to have command over their transportation -- vexing as this is to those who would like to package them up morning and evening into neat bus-sized bundles. This, then, is the strategy for progress. We must have individuals giving full scope to their creative and innovative powers. And for the new that is better to prevail it must pass only the impersonal "market place" test of whether people, free to express their preferences, choose the new over the old. Ill If our strategy for progress is to work, we must keep certain things in mind. One is that we shall call upon Government at all levels -- Federal, state, and local --to accomplish for us some urgently needed things. We cannot ignore the fact that people begin the race of life unequally positioned around the starting line. People have little to say about the family circumstances into which they are born. Some through good fortune are born into families with the means and the concern for education, for a secure family life, and for other factors that contribute to effective adult hood. That is why many of you are here today. Others, through accidents over which they also had no control, find their lives shaped in ways that, if events are simply allowed to take their course, tend to put effective 7 adulthood beyond their horizon. today are not. That is why some who ought to be here A society committed to equality of opportunity cannot ignore these uneven advantages with which people reach their adult years, and it must constantly probe for ways to moderate the starting handicap of those who would otherwise be disadvantaged. We must also recognize that, through no fault of their own, others falter along the way. obsolete. Skills which they had painstakingly acquired became Some breadwinners are a casualty of poor health. A society of growing affluence and sensitivity to the needs of society will insist on sharing the fruits of its abundance more equitably to all. And much of this will be through government. There was a time when Mother Nature herself could easily handle the smoke and debris and wastes that the few people in this relatively empty land created. With vastly more people organized into an increasingly urbanized and industrialized society, we can no longer count on Mother Nature for automatic absorption of wastes and thermal and noise pollution. The solution is not, of course, to lash out at economic progress but to recognize that some part of our growing productive capability must be devoted to greater regard for our environment. And this will tend to add to the budgets of Federal, state and local governments. This is not to say that the nation has been miserly in the resources devoted to things we want to do through government. The increase in total 8 taxes paid since 1965 is equal to 55 cents for each increase of one dollar in the national income. And the increase in non-defense government spending at all levels has been equal to 31 percent of the increase in our gross national product since 1965. Much has been done, but demands and needs for more remain insistent. We must also remember, however, that most of our material, social, and spiritual needs will continue to be taken care of in the private sector. It is there that we can accommodate ourselves to that complex diversity which can contribute so much to the richness of life in a free and open society. This is why the nation can have the unique contributions to higher education from our small colleges and from our large universities. Both are needed, and many of us are the beneficiaries of having been the product of that unique contribution which each can make. The government process does tend to give all of us what only the majority want. The great virtue of making provision for our needs through the private sector as much as possible is that we can thereby be more sensitive to the diverse and varied needs and preferences of minorities, of small groups, even of individuals. The majority "vote" for Chevrolets, but a smaller group prefers Fords, another small group Plymouths, and there is the sensitive tailoring of resources to differing preferences required to satisfy those who do not want a car at all but prefer something else. Humanity took a 9 great step forward when political and social institutions made it possible for the majority to rule, but a still greater step forward occurred when we recognized that our society and our economy must be organized so that the majority cannot tyrannize the minorities. IV Perhaps the most urgent need at this hour in our history, if we are to move with confidence through the years ahead, is a ministry of reconcilia tion. Our people are divided. Deep fissures have emerged. There is an embittering sense of alienation among different groups in the nation. Each has its own just grievance but all bear a heavy responsibility for reconcilia tion. Many in our colleges and universities feel a sense of estrangement from certain currents of contemporary life and society. They do see inequities and hypocrisies and callosities that older eyes, too long familiar with these conditions, see less vividly. Their seeing these evils more sharply and their impatience about getting on with this unfinished business are a great force that can lead to a better world for us all. There are others in the nation, among them young people who moved directly into employment after high school, who reflect a growing sense of alienation toward the academic community. As one only momentarily on leave from academe, I have found myself increasingly disturbed by the emerging hostility of even thoughtful citizens toward our colleges and universities. 10 The insistent question of the hour is how we can achieve a sense of unity in our diversity. The answer is clear. It is to be found only in the basic liberalism that had been fundamental to any free society. This is the principle that each person be as free as possible to pursue as fully as possible the preferences and the goals that to him seem good. It requires that in our diversity we shall agree to defend and to respect the rights of others to hold views with which we do not agree. If any one group insists that only it possesses the Truth, and that other views are Error and should suppressed, we are then inevitably on the way to grave and bitter polarizations in our society, a stifling atmosphere of intellectual totalitarianism, and Holy Wars. V As we look ahead to the four decades or so that will constitute your working years, we can see great problems but also great potential for further social and material and spiritual progress. the material means. We shall possess Our already great affluence will grow further. We can confidently expect that our productive capability will grow 50 percent in each of these decades. The great challenges will come in things of the mind and spirit and heart. We should set as our objective nothing less than to be the first nation where people of sharply differing ethnic features and social and religious beliefs live in full amity and true equality. We must regain that sense of 11 dynamics and progress that comes from unity in our differences and rich differences fiercely defended within our basic unity. your challenges, your confrontation with destiny. but in the words of Emerson: "So nigh is grandeur to our dust, So near is God to man. When Duty whispers low, Thou must, The youth replies I can. " These will be The stakes are high,