from The Psychology of Liberty
Capitalism And Current Political Views
Now that we have examined government in greater detail, we can scrutinize dominant themes and political viewpoints tied to it. All of these ideologies take place in a market of human interaction of coursean economic system. While most believe that the United States has a capitalistic economic system, the term capitalism requires a good deal of clarification.
Capitalism is briefly defined in the Oxford American Dictionary as an economy in which trade and industry are controlled by private owners. In regard to property, the term private owners is basically a redundancy, on account of the fact that public property is basically a contradiction in terms. In order to own anything, one must have an identitythat is, be a specific person. The term public deceptively means everyonewithout any specific identity allowing one to use and/or dispose of property as the owner(s) sees fit. Again, ownership is an individual affair, however large the group of contracted individuals. This thereby facilitates absolute rights to the property at hand.
Trade and industry are meant to encompass the actions between human beings. Trade involves material as well as spiritual values. Exchanging and offering things of value, such as ideas, physical products, or servicesall lie in the realm of trade. Industry depicts the modern technological era in which complex productivity that involves specialization and division of labor is the norm.
Notice that the above definition for capitalism makes no mention of the type, or even the existence, of government. However, it does imply that economic situations exist in which private owners do not control trade and industry. In actuality, nowhere in Homo sapiens past or present can one find an example of real capitalism.
Classical Liberalism of the nineteenth century in America is the closest human beings have come to unchaining themselves from coercive government. Even then, however, government ran its enterprises on extorted wealth (i.e., taxation). And, in addition to many personal infringements during this period, larger businesses were already gaining from government more aid and regulations biased in their favor.61 Though the U.S. government subsequently grew too large and intrusive to be considered a Classical Liberal system, a revival in Classical Liberal ideas is now occurring in America.
The main section of the Libertarian Party has an agenda that upholds the essential principles of Classical Liberalism. Its presidential candidate, Harry Browne, promotes a well-outlined set of policies that would reduce government to its real Constitutional limits (as intended by the Framers). Additionally, many current Libertarian think tanks, such as the Cato Institute, can be classified as advocates of limited government and more individual libertydefinitely vast improvements over status quo policy institutes.
The Libertarian agenda provides a strategic interim base from which to achieve a noncontradictory political system. At this point, though, certain philosophical inconsistencies among its proponents remain in the background. Libertarianisms proponents actually can be divided into three ideological classes: those advocating limited government funded through minimal taxation (i.e., a Classical Liberal system); those advocating limited government funded through voluntary contributions (i.e., a Laissez-faire capitalistic system); and lastly, those advocating free market justice services instead of government (i.e., an Anarcho-capitalistic system).
Obviously, these differing viewpoints need to be logically scrutinized. Since the next section will analyze Laissez-faire Capitalism in detail, and subsequent sections will analyze Anarcho-capitalism (in this book called Self-Governing Capitalism), we will now further inspect the system designed by the Framers.
As noted, Classical Liberalism contains a fatal flawit permits the initiation of force by government (taxation being merely one example). A sample of modern Classical Liberal thought was outlined by political theorist Milton Friedman:
Such reasoning represents philosophical pragmatism, which means doing what works, despite possible violation of logical principles (e.g., of morality). Pragmatic thinking permeates many aspects of our culture. The moral and the practical are sometimes considered to be mutually exclusive. Ethical contradictions aside, fabrication of a balance sheet to determine the pros and cons of using initiatory force is an affront to human dignityeven with the best of intentions or to achieve possibly otherwise unreachable ends.
Rights are simply not at the disposal of a well-meaning bureaucrat or the populace. At base, liberty is not open for debate. When government decides to use coercion to help others, it has forgotten the real meaning of human liberty. Another statement by Friedman reveals this:
Unfortunately, a world of imperfect men can be immortalized by way of such a view, a world of men who resort to government to cure their ills (and create many more). Here we need a specific definition for freedom. Freedom, as a political concept, depends on the concept of rights. By having inalienable rights enacted each human being is free. This necessarily entails not infringing on the rights of others; one can never be free to take away the freedom of others. Absolute freedom is ensured not by limiting freedom, but by protecting it. Therefore, absolute freedom means having absolute rights. They are basically one and the same.
Though Classical Liberalism is, again, a better system than those in existence, it differs only in degree. Governmental intervention and violation of rights still remain. Currently in any part of the world, one can find social systems that pay lip service to freedom of trade and industry. But with minor inspection, these so-called free systems reveal themselves for what they are: economies ruled by the State. What we have in the United States today is an economy that contains many aspects of Fascism and Socialismin sum, a Semi-Fascist Welfare-State.
The government allows people to own and run businesses (although not all) while it controls aspects of the profits, spending, investment, supply and distribution, prices, and many other management practices. In addition, thousands of laws against more personal freedoms are enforced on a daily basis. Just as devastating is the fact that government controls the primary medium of exchange in the market system, the standard of value for goods and services traded between individualsmoney.
In this country and throughout the world, children as well as adults are taught that capitalism means any kind of market situation in which goods and services are traded. The restrictions present in the marketregulations, levies, tariffs, taxes, duties, directives, subsidies, special favors, and exclusive privilegesare barely mentioned. Clearly, one can begin to understand why the world is in its present condition, at least from a politico-economic perspective.
So embedded do ideas about basic human ineptitude and iniquity become, that most view coercive forms of government as necessary. The monstrous contradictions involved are casually brushed aside. Impositions are commonly defended with the idea that the market simply cannot operate properly without them. While the ideas of total social planning and pervasive welfare systems are running thinner today, they are far from dying out. The ethical behavior of the marketthe morality of the marketstill remains in question. Overwhelming evidence has shown people the effectiveness and efficiency of the market; the responsive forces of supply and demand are undeniable. Yet such evidence needs to be viewed with logical principles in order to be ethically convincing.
Even though the market is the place in which people voluntarily exchange values, some view it in other terms. Some make remarks about an evil profit motive, selfish greed of businessmen, unfair distribution of wealth, and immoral actions of citizens. Flaws in the system are seen as residing with others and rarely with self. Of course, by making it a battle between my good nature and their bad nature, one never need address more fundamental and personal issues of psychology and philosophy.
The common criticism is that capitalism is practical but not moral; it may work fine in terms of economics, but it fails in the realm of treating people fairly and with compassion. Let us define our terms in this context. Practical is defined as that which works, and moral is defined as that which is good. As mentioned, individual life is the ultimate standard of value. If the good is that which benefits individuals, and what works is that which achieves of the good, then something practical should be that which is moral. Accordingly, something moral should be that which is practical. Obviously, those who reject the capitalistic economy on moral grounds do not have the welfare of individuals in mind. If they do, then they are entertaining a large ethical contradiction.
As noted, fairness and compassion are not created by the negation of rights. In any discussion, definition of the concepts and types of actions involved is critical. Running on what feels right or simply what one uncritically believes often produces contradictory results. Before one can consider something good or bad, one must determine what that something is (i.e., understand the nature of what is being judged). Even though feelings are tremendously useful indicators, one still needs to logically identify their nature. The Austrian economist Ludwig von Mises commented on the arguments for socialistic systems:
Mistaken philosophical premises play a large part in these views. Such premises enable the exchange of rational values to be seen as wrong or immoral. They enable denunciation of the only system capable of creating enormous amounts of capital, which raises everyones standard of living (many times over those in communistic systems). Mistaken philosophical premises also enable criticism of large-scale production of goods and services that conveniently and cheaply take care of most existential needsbeyond the wildest imaginations of primitive people (or even past kings for that matter).
Some of these premises are indeed the result of todays tremendously distorted capitalistic system. The two ever-thriving political parties, Democratic and Republican, create many of the problems with the current system. They are part and parcel of the maintenance of irrational premises. The Democratic Party, often associated with being a Liberal, advocates more freedom of trade in the mental realm (e.g., more freedom of personal choice and expression); freedom of trade in the material realm, however, should be controlled to a greater degree (e.g., more restrictions, regulations, and taxes on businesses).
In order to obtain a developmental and historical perspective of this attitude, we turn to the words of advocate of freedom R.A. Childs Jr.:
Probably many of us have encountered similar notions more than once in our academic experiences. Such emotional propaganda is taught to millions of adolescents in high schools and colleges. Among other things, it is designed to rationalize the current corrupt state of affairs. Politicians and lobbyists utilize it to continue enhancing their own positions at the expense of justice and rights. Yet such misinformation appeals to those who feel they have little control over their purchases and employment.
The idea that big businesses engage in concerted efforts to chain customers to particular products and services is simply an impossibility under true capitalismthat is, where there is no coercion. Only by virtue of the State can businesses coercively control their markets and disrupt a competitive economy.77 Apparently, some would rather blame the voluntary actions of others for societys problems, rather than the forceful actions of governments and their abettors.
Alternatively, the Republican Party, often associated with being a Conservative, advocates more freedom of trade in the material realm (e.g., less taxation, less regulation of businesses, less bureaucracysupposedly); freedom of trade in the mental realm, however, should be controlled to a greater degree (e.g., harsher laws against certain personal choices and socially unacceptable behavior).
Since conservatism concedes the same premise as liberalismpermission of initiatory forceit merely differs in the degree to which the material realm should be controlled; the same can be said for the spiritual realm. The two ideologies just have different versions of the good. This is why Republicans (or Conservatives) sometimes charge Democrats (or Liberals) with stealing their agenda whenever the latter advocate cuts in programs and reductions in bureaucracy. Democrats, in comparison, sometimes accuse Republicans of being less moral, because the latter (at times) may favor less governmental welfare programs and less taxation on wealthy, productive (so-called greedy) members of society.
Nevertheless, in principle both viewpoints are the same political philosophy. Both favor illogical laws and regulation of capitalism, albeit in vaguely different ways. Any distinctions tend to be superficial and illusory. Neither one allows absolute freedom in all realms of trade among consenting individuals.
Democrats tend to see governmental impositions as a way to bring fairness to the marketplace. Republicans tend to see governmental impositions as a way to bring morality to the marketplace. In either case, they attempt to impose their particular moral and economic values on the marketplace; everyone has to conform to their supposedly proper viewpoints.
No matter what goals one has for people or society, example and persuasion are the only ways to espouse values (regardless of their rationality). Forcing people who disagree or are ambivalent is completely wrong. Only when someones rights have been violated is force allowable (which, of course, is retaliatory force).
An example of trying to force ones morality on the marketplace concerns the issue of abortion. Fortunately, the Supreme Court has rightly judged abortion to be legal. Every woman has dominion over her own body and, hence, physiology. Since a fetus is tied to and part of a womans body, it is in her domain.
Nonetheless, abortion is controversial for certain reasons. The fetus comes to resemble an actual baby during its development, so some believe that it should have rights of its own, able to be violated. Yet one cannot reverse cause and effect by saying that a fetus has a right to a womans body and a right to life, for rights can only reside in the creator of rights, the woman. The dividing line between rights and non-rights is not fertilization of an ovum. Nor is it any other particular stage in fetal development. A zygote and all its subsequent amazing transformations cannot have rights that supersede the rights of the individual in which it transforms.
Despite claims that abortion is murder, murder by definition can only be done to an actual person, not a fetus. Certainly, doctors who perform abortions are highly aware of the ethical issues. Competent physicians attempt to act in the best interests of those who seek their services. When a woman decides, or a physician recommends, aborting a fetus in the later stages of development, the health of the woman is usually at stake. If the fetus can remain viable outside the womb, anyone is free to take responsibility for it. Viability outside the womb basically determines the right to life. While this issue will undoubtedly become more complex as medical technology progresses (for instance, enabling younger fetuses to remain viable outside the womb), the rights of the woman will always remain.
As some individuals strive to institute rights for the embryo or fetus, they may ignore the existential, developmental, and psychological contexts of potential mothers. To force a woman into motherhood (or into a dangerous black market abortion) is definitely not compassionate, let alone logical or legal. If ones goals are to prevent unwanted pregnancies and to ensure the birth of healthy babies with physically and psychologically healthy mothers, one must uphold the right of individuals to choose their own destinies. Additionally, one must believe that human beings naturally desire to see life flourishwhich must start with their own adult lives.
Force is currently used in the United States in thousands of ways to achieve allegedly otherwise unachievable ends. A prominent and emotionally charged example is discrimination laws, or rather, anti-discrimination laws. Government requires property owners (i.e., businesspersons and employers) to cater to all individuals equally (e.g., those with any type of genetic lineage, physical appearance, age, anatomical structure, and so onthe list is practically endless).
Essentially, if one can posture as a victim, one can use the barbaric methods of government to make others (viz., employers) provide for oneself. This appears to be the political version of the parental intimidation technique, You will do this because I say you will do this. But victim is a legal concept requiring a perpetrator who initiates force in some form. Being denied employment has nothing to do with rights infringement.
Anti-discrimination laws disregard that employers have the right to do what they want with their propertyin this case, to decide who works with them and for how long, as well as who patronizes their establishments. If employers fail to select individuals based on their particular merit, employers are the ones who lose; people will work and shop elsewhere.
Why would one desirethrough legal mandateto work with someone who entertains particular inane prejudices? Maybe on account of feelings of injured self-worth after being treated unreasonably. Usually this self-worth has been sought in all the wrong places (everywhere but the mind), and so it hangs in the balance of others decisions and actions.
Those who seek fair treatment typically do not reflect on the real legal nature of the supposed wrong. They may contend that the whole process of punishing employers and their businesses is carried on in the name of liberty. Yet such laws are by nature anti-liberty. They incapacitate a property owners sovereign right to choose. Even when others perceive an owners choices as unpalatable, rights must still be honored. Again, no other rights are possible when property rights are not upheld.
One who enters a work contract with any particular property owner (i.e., any business enterprise), by definition does so voluntarily. Having the sovereign right to choose in this matter plainly does not entail the right to work with any employer not agreeing to the relationship. Unless stipulated otherwise in the contract, one does not have the right to be treated fairly, or even the right to have a non-hostile work environment. Such situations usually have nothing to do with physical violence or threat of force, but rather with general disrespect. One especially does not have the right not to be fired (at any time or for any reason). This corresponds to being able to quit employment (at any time for any reason). People are not slaves.
All these false rights simply represent the desires and wishes of people. Even though many of them are probably well intentioned, one thing is certain: Wishes will not come true by forcing them to come true. This just precludes hope for a better, saner, social environment, because force is insanity incarnate.
In the end, both Liberal and Conservative views bypass the distinctively human method of survival and tragically choose the inhuman one, the method that destroys ones right to decide. One cannot correctly declare a right to ones actions when they involve violation of the rights of others. To destroy the source of rightsthe choosing mindis not a right.
When force is seen as the most appropriate way to deal with people, liberty quickly becomes an equivocation. Rand noted the hypocrisy in Liberal and Conservative proclamations on behalf of liberty:
When individuals since early childhood continually see people treated as means to other peoples ends, they might conclude that this is natural. They might conclude that they do not have a full right to the wealth they have created and the future wealth they seek; instead, they may feel guilty about amassing it and then give it away in the name of philanthropy. They might believe that they do not have a right to their happiness and achievements without thinking they have somehow violated or harmed other people. They might think that service to the customer is the main validation for running a business; they might render the idea of productive achievement a lesser value. They might even feel that groveling and pandering are good ways to attract customers. They might conclude that to deny their interests is actually in their best interest. They might routinely focus on the interests of others, while those others perform the same act of self-denial. They might think that they are just one person among many; who are they to assert their personal desires and ideas? Who are they to stand by their judgment and declare that human beings have certain inalienable rights, one of which is to not be sacrificed for the common good or the general welfare?
When people have grown up constantly seeing fallacies treated as facts, contradictions ignored, and the effects of these practices strewn all over television, radio, newspaper, and the Internet on a daily basis, they might conclude that human nature will always have a wicked and dark side. They might conclude that, for the most part, trusting a stranger with anything personal will always be an impossibility; they might conclude that having to put locks on every possession and alarms in every house and vehicle will always be a necessary part of living among others. They might determine that values are relative and that one should never question the value systems and beliefs of others. They might think that everyone has a different cultural background, tradition, and different needs; consequently, people will never be united by common truths about the facts of reality (and their subsequent love of life); hence, laws need to be made accordingly to solve the imbalances these beliefs present.
They might think that governments duty is to serve as Robin Hood by stealing from the rich, the not-so-rich, and the poor, in order to give (some of) the money back in a better fashion. They might think that to use government as a tool to care for the needs of society is proper; they might even feel a bit of righteousness as they complete their tax forms, while still pursuing their more selfish interests. They might conclude that the only way people will be generous, benevolent, and have goodwill is by way of coercion; they might conclude that intimidation and fear are the primary methods of moral persuasion. They might decide that the only way to get ahead in the world is not by being sacrificed to others but, rather, by sacrificing others to self; they might conclude that in this competitive world (i.e., the rat race) the nice guy finishes last (for he is frequently the sacrificee caught in this psychological paradigm).
Finally, people might conclude that there are no absolute truths, logical principles, rational codes of morality, and noncontradictory ideas. Thus, they might believe that endeavoring to truly and permanently remedy the current existential situation is both futile and foolishfutile because human nature cant be changed, and foolish because people will never allow anything different to develop. They might instead believe that the best we can do is address the currently prevalent issues and problemssuch as the homeless, infrastructure deterioration, urban sprawl, low wages among workers (and the appropriate legislated minimum wage), various minority rights, illegal immigration, corporate downsizing (and excessive CEO salaries), teenage pregnancy and abortion, school violence, drug abuse, discrimination and sexual harassment, the national debt, etc., etc.while specifically disregarding any wider abstractions (i.e., principles) involved.
Accordingly, the news media ritually takes polls and conducts surveys in this climate. But the emotional state of most participants is usually not conducive to intellectual clarity. Feelings of apathy, emptiness, confusion, defensiveness, indignation, contempt, and anxiety, typically affect the forum. Such emotions can perpetuate the whole process and cause debate to degenerate into misguided criticisms of personal, economic, or political vicissitudes.
In these matters, we need to distinguish the essentials from the nonessentials. We need to grasp what beneficial human relationships entail (and why). Capitalism need not become an equivocation, and society need not lose its vision of what is possible.
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