The subtitle of its October 18, 2026 post by the Institute of Economic Affairs (London) carried this tantalizing statement: “Rethinking How We Care for an Aging Population”. The IEA carried part one of a three part essay pushing a scheme called “Social Providence Accounts (SPA’s)”. I will not go into the details of this alternative scheme of how Great Britain can care for the aged, frankly because I found it too complex to follow despite the claim that it would be simple and easily understood. What caught my eye was the “we” as in how “we” can care for the aged. Right away my anti-socialist/Austrian School of Economics antenna went on full alert. This one statement embodies all that is not only wrong but also impossible about any proposed mandatory scheme for any kind of social service.
The Necessity of Free Markets
Ludwig von Mises explained this problem in his first great book Economic Calculation in the Socialist Commonwealth. The essence of his critique is that absent free markets there is no way to determine 1) what to do, 2) how to do it, 3) what materials to use, 4) how much to produce, etc. The only segment of society that can answer all of these questions and more is a free market in which each individual answers that question for himself based on his individual preferences.
Who among us can say that he knows exactly how many hospitals to build or even if we should build hospitals, urgent care centers, home care services, some other type of care, or all of the above? Then we move to where to build them, how to build them, how big to build them, ad infinitum. Absent some kind of free market these questions and many, many more are impossible to answer. Just ask anyone who was an adult in Russia during the Soviet era.
The Riots in France
At the present time (I write this on October 19, 2026) France is suffering violent and destructive riots in much of the country, especially the larger cities such as Paris, Marseilles, and Lyon. As is usual with riots in France, it all started in the schools and colleges. What do the students want? One word—More. They want more money funneled to the schools, most of which apparently are state funded, in order to reduce large class sizes, upgrade physical facilities, etc. Of course the teachers’ unions have joined the students over supposed inadequate pay. Is the pay inadequate? Who knows? Without a free, competitive market there is no way to determine if teachers are underpaid or overpaid. Same with class sizes and the state of facilities. As is the normal progression of these protests that begin with picketing and are fairly peaceful, a criminal element has latched onto the mayhem to set fire to schools and has moved onto looting shops. The public safety agencies are being criticized for failure to stop the violence, even though many thousands have been arrested.
It may seem a stretch for many to believe that all this violence has, at its base, a failure to understand the limits of government as understood by Austrian economists, but that is the case. It is hard enough for a nation to determine how much to spend on national defense and from which of the many means available to fund. Most free market economists do not oppose common defense as a legitimate function of government despite these difficulties. Few among us need to study international politics or are capable anyway. But most of us have a legitimate idea of how much or how little is needed for their individual healthcare, schooling, and other necessities of life. And we all understand that it is not possible to find common ground on funding these necessities of life. So why does the electorate and common citizen believe that transferring the provision of these necessities to government removes these barriers?
The Pretense of Knowledge
The citizenry must understand that they cannot shirk their personal responsibilities to provide for themselves in all things apart from international relationships and military preparedness. Not only is providing for oneself and one’s family an ethical issue, it is impossible to transfer this responsibility to others. For a definitive argument explaining this in further, exhaustive detail, I suggest Friedrich Hayek’s Nobel Speech The Pretense of Knowledge, or this article.
© Patrick Barron 2026 Website
