×

Thanksgiving: A Time to Celebrate the Free Market

When the pilgrims who came to Plymouth, they initially established a system of holding all property in common, pooling the proceeds from their hunting and farming. The predictable results of this small-scale socialism ensued, producing corruption, famine and death, because the colonists lacked incentives to work.

Thanksgiving_Turkey_200.jpg
Image Source|Getty Images

It's a well-known story that has been told for over fifty years. The most widely circulated version of the capitalist morality tale of Thanksgiving probably comes from Richard Maybury, who wrote "The Great Thanksgiving Hoax" in 1985 for a newsletter published by the Ludwig von Mises Institute.

Recently, however, this version of events has come under a bizarre attack from the left. Kate Zernike, who covers politics for The New York Times, penned an essay in the "Week in Review" section that attempts to set the record straight. Unfortunately, her understanding of free markets is so garbled that she only winds up creating confusion.

First, let's quote Maybury's story:

In his 'History of Plymouth Plantation,' the governor of the colony, William Bradford, reported that the colonists went hungry for years, because they refused to work in the fields. They preferred instead to steal food. He says the colony was riddled with "corruption," and with "confusion and discontent." The crops were small because "much was stolen both by night and day, before it became scarce eatable."

In the harvest feasts of 1621 and 1622, "all had their hungry bellies filled," but only briefly. The prevailing condition during those years was not the abundance the official story claims, it was famine and death. The first "Thanksgiving" was not so much a celebration as it was the last meal of condemned men.

But in subsequent years something changes. The harvest of 1623 was different. Suddenly, "instead of famine now God gave them plenty," Bradford wrote, "and the face of things was changed, to the rejoicing of the hearts of many, for which they blessed God." Thereafter, he wrote, "any general want or famine hath not been amongst them since to this day." In fact, in 1624, so much food was produced that the colonists were able to begin exporting corn.

What happened?

After the poor harvest of 1622, writes Bradford, "they began to think how they might raise as much corn as they could, and obtain a better crop." They began to question their form of economic organization.

This had required that "all profits & benefits that are got by trade, working, fishing, or any other means" were to be placed in the common stock of the colony, and that, "all such persons as are of this colony, are to have their meat, drink, apparel, and all provisions out of the common stock." A person was to put into the common stock all he could, and take out only what he needed.

This "from each according to his ability, to each according to his need" was an early form of socialism, and it is why the Pilgrims were starving. Bradford writes that "young men that are most able and fit for labor and service" complained about being forced to "spend their time and strength to work for other men's wives and children." Also, "the strong, or man of parts, had no more in division of victuals and clothes, than he that was weak." So the young and strong refused to work and the total amount of food produced was never adequate.

To rectify this situation, in 1623 Bradford abolished socialism. He gave each household a parcel of land and told them they could keep what they produced, or trade it away as they saw fit. In other words, he replaced socialism with a free market, and that was the end of famines.

Zernike doesn't take any issue with the facts. What she does dispute is that the system of communal ownership is socialism. In fact, she quotes a historian who think it is capitalism.

Historians say that the settlers in Plymouth, and their supporters in England, did indeed agree to hold their property in common — William Bradford, the governor, referred to it in his writings as the “common course.” But the plan was in the interest of realizing a profit sooner, and was only intended for the short term; historians say the Pilgrims were more like shareholders in an early corporation than subjects of socialism.

“It was directed ultimately to private profit,” said Richard Pickering, a historian of early America and the deputy director of Plimoth [sic] Plantation, a museum devoted to keeping the Pilgrims’ story alive.

It's hard to know where to begin with this.

In the first place, shareholders in corporations do not own all of their property in common. If you own stock in Goldman Sachs , for instance, you don't have to share the profits from your day job with the rest of the owners of Goldman Sachs. What's more, you can freely sell your shares at any time, without asking permission from your fellow shareholders. And you can sell them to whomever you please. The shares you own aren't held in common with other shareholders; they are yours.

Zernike seems to think that the presence of a profit motive made the Plymouth colony capitalist, even during the period of communal ownership. This is a weird metaphysical claim, in which the intention—profit—trumps the reality—communal ownership. It's a kind of historical spoon-bending, emphasizing mental motives over reality in the way a hoax mentalist claims to be able to warp silverware with telekinetic powers.

It also displays a misunderstanding of what distinguishes free markets from socialism: the operation of markets.

This Thanksgiving, we can all be thankful that the pilgrims were able to make this distinction better than the political reporter for The New York Times.

______________________________________________________

Questions? Comments? Email us atNetNet@cnbc.com

Follow John on Twitter @ twitter.com/Carney

Follow NetNet on Twitter @ twitter.com/CNBCnetnet

Facebook us @ www.facebook.com/NetNetCNBC