Leonard Read the founder of FEE and a champion of the Freedom Philosophy published his most famous work “I, Pencil” in 1958.
“I, Pencil” is a short, succinct story that dispels at once the “know-it-all-ness” of central planners by illustrating how not a single man on Earth knows how to make a simple wooden pencil.
By tracing the manufacture of himself, the “pencil” reveals that millions of individuals had their hand at helping him come into being. The story brings to life the miraculous “spontaneous order” that the “invisible hand” brings about when individuals free of coercion exchange upon the Free Market.
“I, Pencil, am a complex combination of miracles: a tree, zinc, copper, graphite, and so on. But to these miracles which manifest themselves in Nature an even more extraordinary miracle has been added: the configuration of creative human energies— millions of tiny know-hows configurating naturally and spontaneously in response to human necessity and desire and in the absence of any human masterminding!”
The pencil traces its genealogy from a single tree to all the other natural resources and human energy needed to bring about its existence. He explains that it’s not just the person who fells the tree, mines the graphite or runs the machines in the pencil factory that are responsible for his creation. What is unseen in the creation of the pencil is the millions of individuals who mined the ore for the steel to make the saws and machinery and the ships and trucks. Then there are the men who are unseen who are involved in getting oil out of the ground, refined and transported. Taken a step further there are the other individuals who go unseen who produce the food, clothing and housing for the workers who build the saws and machines, drives the trucks, mines the ore, fell the trees, produce the lacquer and finally runs the pencil making machines.
The revelation that millions of people are needed to produce a single pencil changed the way I viewed the world. Sir Isaac Newton is credited with saying that “We stand upon the shoulder of giants” when he referred to his accomplishments . “I, Pencil” illustrates a similar truth that we all are dependent upon on the millions of people around the world who everyday have a hand in making the things we buy.
Stressing the need for “faith in Free People” the pencil implores the reader to contemplate that these millions of exchanges that must occur for him, a simple pencil, to come into being are not directed by anyone in government. They are the result of free individuals using their small amount of knowledge to produce their small piece of a product that others want in exchange for products and services they want.
This story is similar to what Bastiat wrote a hundred years before “I, Pencil”. In Natural and artificial Organization Bastiat uses a humble carpenter instead of the manufacturing of a pencil as a means to illustrate the complexity of relationships in the Free Market. He writes that the humble carpenter enjoys in one day goods and services that he in a life time could never come close to producing. And all the individuals produce the goods and services he consumes not out of altruism or societal good but out of self-interest. They act because they know that Production must proceed Consumption.
Bastiat quoted Rousseau in his Natural and artificial Organization : “Much Philosophy is needed for the correct observation of things which are in front of our eyes.” Throughout their stories Bastiat and Leonard Read help us see the “Unseen” efforts that create the abundance and variety of physical goods we are able to buy on the Free Market. They stress that they exists because individuals are free to act and enjoy their Natural Right to their Life, Liberty andPproperty without interference from the State.
“I, Pencil” is the shortest most concise explanation of the Free Market that I’ve found. It takes less than fifteen minutes to read and it could change the way you view the world for the rest of your life.
And that’s my Take