Collective Control a Necessity, Assets Lippmann to Third Capacity Audience

"It would be necessary to ruin millions of people before the American attachment to capitalism could be broken. Some such thing has happened in Germany," asserted Walter Lippman before his third capacity audience in New Lecture Hall. The last in this series of Godkin lectures will be given this afternoon and the whole series on "The Method of Freedom" will appear in book form next week.

"Almost the first thing that an American regains when business recovers a little is his resentment to administrative interference in his affairs. Upon such a complex it would be impossible to impose a planned economy. There are other reasons why such a scheme is impracticable. The existence of plenty is a condition of liberty and multiplies the individual choices thus making it intractable to planning. In an economy of plenty the consumer is the master of the situation, while a planned economy demands that the producer be the master.

"Therefore, since centralized direction, is impossible, collective control must be substituted. Compensation is necessary and it can be shown that only compensatory measures had a powerful effect in overcoming the depression of 1929. We have tried regimentation with such measures but out A.A.A. and N.R.A. have failed to produce results commensurate with the amount of labor expended. We are no farther along the road of recovery than are the British countries which failed to use them.

Compensatory Economy

"The most serious doubts as to the practicability of a compensatory economy must come when we consider our present democracy. Under popular rule the assumption is that the government should be governed by popular opinion. But the compensatory method of control requires that the state shall act almost continually in opposition to the will of the majority. Such a system is as incompatible with our popular democracy as is communism or socialism, but it is the only assurance that the transient majority will not injure the permanent interests of the nation."