Democracy, When It Suits Me

Tibor R. Machan

Back in the 1970s I think it was, California had one of those referenda on whether to slap huge taxes on oil companies and the thing lost. The person who was an avid supporter—maybe even the main organizer—of the effort, Bill Press, was very unhappy with the result. If I recall correctly, he alleged that the election was rigged, that Big Oil bought off the voters, etc., etc. Press didn't simply accept that his side lost.

Democracy has this about it: most people don't much like being subjected to a vote when it comes to their basic beliefs and conduct. If Big Oil really owes huge bucks to the rest of us, it shouldn't be a matter of a vote whether it will pay up. Indeed, a great many matters on which people get to vote should not be subject to a vote at all. A system of limited government means, among other things, that government doesn't get to intervene with our lives, even when a majority of the voters would prefer that it did. Notice, for example, that no referenda are acceptable about whether Catholics, Methodists, Jews, Moonies and other faithful are free to practice their faith. The First Amendment to the U. S. Constitution, combined with the doctrine of incorporation that applies the amendments to the whole country, rules out voting on people's religious practices. Or what they may publish in their newspapers.

Sadly, however, democracy today is taken to apply to nearly everything else. Voting on whether one may elect to die with the aid of a willing assistant? It is no one's business but the parties who are directly involved and thus voting on the issue is in essence like voting on whether some of us should be enslaved!

This is how it is with California's recent vote on whether gay marriages should be banned. It is no one's business apart from the couple's whether they should get married. Sure, tradition promotes only heterosexual marriages but tradition is no guide since it is all over the place, proposing this here and that there. So long as gays marrying each other forces no one to do anything—and, yes, there are problems with that since once married, the government requires others to treat the couple in certain ways no one should be forced to treat them—it is no one's proper authority to prohibit it.

Because with marriage come various legal privileges that others must provide, the matter isn't all that simple. We aren't just talking about the freedom of gays to marry, to do what they choose to do without compelling others to do anything. Married couples have mandated privileges at work, in renting their homes or apartments, and so on.

So when it comes to the right of gays to marry it turns out that is not all that's involved. That right would appear, at first sight, to simply establish a freedom from interference but, in fact, it also establishes entitlements. People who believe that gays are breaking God's law, for example, will have to fork out support for gay married couples unless there is a ban of the kind that passed in California. Yet, of course, the mandated support for gays is matched by mandated support for heterosexuals. Bottom line: both gays and bigots have rights, including the right of disassociation!

Yet, that should be dealt with apart from the marriage issue. Should people receive legally mandated benefits from being married? No. Anyone has the right to marry and that's it. Others may not be imposed upon by this and one reason there may be resistance to gay marriage is that it requires those who object to it to provide it with certain kinds of support, not simply to tolerate it.

More generally, though, people have all kinds of rights to act one or another way and no one ought to have the legal authority to interfere. To make it possible to vote on such issues—like whether one must take sensitivity classes at a university (another California law)—is already to pervert democracy, which must be limited to issues that do not involve rights violations (like who will be the president or the local sheriff).

The illiberal kind of democracy now running amok everywhere is likely to destroy democracy where it is quite justified. After all, unlimited democracy can be used against itself and has been in many instances that even saw dictators come to power "democratically." In the California case gays should have no obstacles placed before them when they want to marry but should also not demand that their critics be required to support them.

American Commissars

Tibor R. Machan

Back in 1859 Abraham Lincoln noted that “All this [the economic success of America] is not the result of accident. It has a philosophical cause. Without the Constitution and the Union, we could not have attained the result; but even these are not the primary cause of our great prosperity. There is something back of these, entwining itself more closely about the human heart. That something, is the principle of ‘Liberty to all’—the principle that clears the path to all—gives hope to all—and, by consequence, enterprise, and industry to all.” In a related vein, Lincoln also said that “No man is good enough to govern another man, without that other’s consent.”

However much actual public policy may have departed from these strong moral convictions, it was at least acceptable back then to openly declare them.

In contrast, what many very prominent public thinkers proclaim these days has a rather different ring to it. At a recent presentation of his ideas, the political economist James K. Galbraith made no secret of his enthusiasm for the state’s regulation of American citizens. He spoke with open nostalgia about the times when he was in Washington making rules for people to follow. (And I am convinced he is looking forward to be asked by the next US president to return to his favorite job as an economic regulator.)

Another famous American public thinker, a Nobel Laureate no less, MIT’s Professor Robert Solow, pontificated along similar lines in a recent review he penned, in The New York Review of Books, of Peter Gosselin’s book, High Wire: The Precarious Financial Lives of American Families (Basic Books, 2008). The review essay abounds in paragraph after paragraph of elitist proclamations about how government ought to regulate people’s lives because that is the best way for them to be insured against various disasters. No need to go into the details here—the theme is a very familiar one, especially in the pages of TNYRB. The following passage should, however, give one a very clear flavor of the thinking behind these elitist notions:

“The standard argument for leaving all the responsibilities and decisions to the individual in the free market is that, in appropriate circumstances, that is the route, and maybe the only practical route, to economic ‘efficiency’.”

There is more but that is no relevant here. My reason for focusing on these ideas is not so much to dispute them from the viewpoint of sound political economy but to examine them as instances of rank and immoral political elitism. Galbraith, Solow, et al., are the kind of people who take it as unquestioningly given that they are entitled to regiment the society in line with their superior vision. Never mind the consent of the governed, never mind “liberty to all.” Such notions appear to strike these people as primitive and no account needs to be taken of those who might protest being nudged about, regulated, regimented by these high minded intellects, the government’s eager chevaliers.

When at a recent presentation of his views I challenged Professor Galbraith to address the argument of public choice theorists—that school of economists who contend that government regulators are entirely unsuited to be entrusted with regulating us, with exercising the power of government so as to set things right in society—he simply ignored the question. It was evidently beneath him to pay heed to those who express skepticism about the suitability of the likes of Solow and Galbraith as paternalistic regulators who use the vague notion of the public interest as their excuse to govern other people.

I don’t know about you, dear reader, but I am baffled why there are such people, especially in America, how they manage to convince themselves that they may govern others without those others’ consent. I remember similar but rougher versions of these people, back in communist Hungary, the commissars who unhesitatingly ordered us about, knowing full well that their authority arose from sheer power, period. Sadly, the likes of Solow and Galbraith probably imagine themselves more sophisticated than those commissars. But, of course, they are every bit the same.

Obama, Franken & Socialism

Tibor R. Machan

The race in Minnesota was still too close to call on Friday, November 7th but the fact that Senator Obama, who had by than become president elect of the United States, made a strong plea for electing Mr. Franken is a significant and distressing clue to what we are in for over the next several years. Senator Obama sent this message to Minnesota voters:
“I will say that your candidate in Minnesota, Al Franken, is going to be an important part of a coalition that brings about change. He’s really, I think, in this to fight for working families. I’m looking forward to seeing him serve in the Senate.
“And if people are looking for fundamental change over the next eight years, then I think an Obama-Biden ticket, Al Franken in the Senate, is going to be the best answer for working families all across the state.”
Al Franken would indeed strive for fundamental change in America’s system of political economy. “Fundamental” means that the change would amount to completely, basically altering America’s political system. This is also what was suggested in the interview that came to light late in the presidential campaign, one given by Senator Obama in 2001, where he complained about the Declaration of Independence and the Bill of Rights because these did not include a basic right to have the wealth redistributed throughout the country. He also expressed dismay with the legal reforms brought about by the Civil Rights legislation of the 1960s, lamenting the fact that the rights enacted as laws of the land did not include the fundamental human right to be provided with economic support.
After Senator Obama had his brief exchange with “Joe the Plumber,” a debate ensued about just how fundamental a change his doctrine of wealth redistribution would amount to. It was noted by some commentators that holding this doctrine does not make one a socialist. And that is strictly speaking right--advocates of the welfare state, Europe’s Third Way, the mixed economy, and similar hybrid systems of political economy aren’t full blown supporters of socialist systems akin to those in Cuba, North Korea or the former Soviet Union. To become such a full blown socialist, one would have to embrace the idea of the public ownership of the major means of production and of the view of human beings as cells in the larger, more important organism of society or humanity.

But one can come pretty close to this kind of a socialist by wanting to bring about fundamental change in America’s partial capitalist system, one that embraces, at least rhetorically, the basic right of everyone to private property, to freedom of contract, freedom of association, etc. Wanting to change from this kind of system to one that promotes wealth redistribution as a basic feature of society does come very close to embracing the basic tenets of socialism. The idea that it’s the public that owns the country’s wealth, and that government has the role of allocating this wealth among us, may not be soviet socialism but it is very likely a so called democratic version of that system. The difference is that under soviet socialism the strong central government runs the economy according to a blueprint whereas under democratic socialism the government runs the economy in line with what the majority of the voters decide.

In practice, however, the difference is not great. The democratic process isn’t equipped to provide detailed guidelines for managing the economy. At most it can send presumably skilled representatives who will take up that task but then they will carry on pretty much as would the planners in the soviet system.

I remember when Mr. Franken was doing some of his comedy routines for Saturday Night Live and recall how I could detect a very strong tendency toward egalitarian, socialist, and even communist principles. No one made much of it then, given his role as a comic. But anyone who is aware of alternative systems of political economy could tell well enough which way Mr. Franken was politically inclined.

America is, of course, a mixed economy but it does appear that with the leadership of Barack Obama and the help of the likes of Al Franken it will be guided away from virtually all of its capitalist features and head decisively toward socialism.

How Big a Change?

Tibor R. Machan

Supporters of Barack Obama regard his election as promising significant change. If what they mean is that America has elected someone resident who is widely taken to be black or African American, the change is culturally significant, yes. But is it politically?

Senator Obama does appear to openly champion certain ideas that few others on the national scene have in American political history. Yes, there have been some who have promoted wealth redistribution, and one or two has actually run for president, none has come even close to winning such high office.

Senator Obama’s wealth distribution ideas are important because they challenge a basic tenet of America’s founding documents, both philosophical and legal. In the Declaration of Independence everyone is said to have an unalienable right to his or her life and liberty, as well as to pursuing his or her own happiness. Of course, never has American political reality fully implemented this idea but lip service has been paid to it all along. No major candidate has explicitly challenged the Declaration’s ideas, especially the one about one’s right to liberty. When one advocates wealth redistribution by the federal government, one is challenging the idea that a person has a right to liberty—the liberty to obtain and use wealth as one sees proper is contradicted by it. Put generally, in line with the philosophy of the Founders it is individual citizens who get to distribute their wealth as they want to. Senator Obama, in contrast, openly advocates that government be the wealth distributor in society, not individual citizens and groups of them (in their various interactions).
But the Senator may bring one change that Americans ought to welcome a great deal, namely, put an end to America’s foreign military adventurism. However, wealth redistribution by government is no great novelty since the practice has been going on in American forever. Indeed, America has been, like so many other countries in the so called free world, a mixed system, combining elements of several theories of political economy, socialist, fascist, capitalist, etc.

Contrary to what some prominent but sadly untrustworthy historians of the American economy claim, America has never had a capitalist economy. So Barack Obama’s views are not at all far off the beaten path. His view is the more direct and unabashed articulation of the theory that the government exists in part to take wealth from some people even though they came by it honestly, and transfer it, with or without their consent, to others whom officials in the government decide should have it. That idea has thus far been anathema to America’s official economic philosophy—the exceptions had been just that, exceptions. Now it has ascended to a dominant position in the rhetoric of American public policy.

Does this mean that all the talk of change is but empty rhetoric? That can only be judged by those who know Barack Obama far better than I do. Some of his history, some of what he has said in the past, would point to his wanting to make America into more of a democratic socialist system—the government gets to decided how resources are distributed in the country, nominally based on the voting majority’s priorities. Never mind private property rights or freedom of trade. Yet, as noted already, this has been the reality for a long time. The novelty is its promising to become official public policy.

The fact that Barack Obama is “black,” an African American, also adds a novelty, a change, if you will, but this one is more cultural than political. Had it been a black candidate who defends capitalism the novelty would be the same but the policy implications of it would be none. That indeed is the idea of a color blind political legal system, that a government official’s color, race, ethnicity, etc., matters not a whit.

Culturally, though, Barack Obama’s election has considerable significance since it challenges in no uncertain terms the widely repeated charge that all Americans are racists. (This is not hyperbole—several contributors to The New York Review of Books repeat this every year.) But I do not believe that is what Senator Obama and his supporters had in mind when they talked about making changes in Washington, D.C.

In either case, however, the substance of public policy in the country is not likely to change much at all. We will remain a mixed system, a welfare state, with various factions or groups of Americans aiming to have their government officials transfer wealth to them out of the pockets of those who legitimately own it.

Selling the Rope...

Tibor R. Machan

Lenin--or was it Marx or Stalin--is said to have observed that "The Capitalists will sell us the rope with which we will hang them." (Attribution is mixed!) What this means is that people who are in business aren’t political philosophers or economist but have an obligation to make their firms prosper. Because of this they tend to overlook certain possibly dire consequences of their professional conduct.

Business isn’t the only profession with this tendency. Doctors don't look into the backgrounds of their patients, nor do teachers of their students. Indeed, most professionals offer their services without looking into the motivation of those with whom they are trading. And nearly all of us do this when we trade--we go to the mall and purchase stuff from people and companies we barely know. Who knows what is the politics of one’s barber, butcher or baker? Very few of us. And at times this can be a serious oversight. We could be supporting terrorists or criminals!

On the other hand, taking great care about the beliefs of those with whom we do business can also amount to a mistake. Suppose you are Jewish and after the fall of the Third Reich you decided never to purchase a German made automobile, figuring that many who would profit from the deal were complicit in the Holocaust. Well, but many were not, as well.

The market place is just that, a place where deals are made and very little else occurs except accidentally or unintentionally. Every deal benefits both sides, or so each side believes, and that’s all that is promised, no more. Because of that, no one can complain unless something really big is at stake that lies hidden behind the deal.

In a small measure it is possible to witness this all around us. Television and movie production firms bank roll projects that present business executives as shysters. Just think of Wall Street or Erin Brockovich. Think of Michael Moore's ventures. A very ironic instance of this is the many volumes published by book companies supporting the idea of corporate social responsibility or stakeholder theory or corporate management, an idea that actually undermines capitalism.

The managers of these companies, you see, have the obligation to work for their owners, investors, shareholders, and so forth. This does not preclude some pro bono work or being considerate of the needs and wants of employees or even various organizations seeking support within their communities. But their duty is, first and foremost, to enhance the economic welfare of their owners by means of the tasks they set out to perform, publishing books.

Nonetheless, many publishers put out books that advocate just the opposite. Instead of serving shareholders, the authors and contributors of these books want companies to serve stakeholders or society. Not just as part of some limited pro bono work but full time.

For instance, Ashgate is a company in England, with outreach worldwide, that recently put out a corporate social responsibility series, edited by one David Crowther of De Montfort University in the UK. Each of the ten volumes is filled with essays that defend or analyze the idea that corporate commerce must be in the service of society, first and foremost. The company seems to be totally oblivious to the fact that its own management may be complicit in violating the very principles advocate in this proudly published series of books.

The reason is, of course, that the managers of the firm are looking at one thing primarily, namely, what kind of publishing will garner the best profits. If it turns out that the type of publishing that does this amounts to bringing out books that actually attack, consider it immoral for, companies serving their owners and investors first and foremost, that’s not their concern, not ordinarily.

Not that it should never be. Once the managers can see that publishing these kinds of books undermines the very principles in line with which they carry on their business, they would be remiss continuing their program, at least without also putting out works that are critical of the Corporate Social Responsibility doctrine.

The division of labor is a good thing, economically, but when it comes to the broader area of political economy, one must become a conscientious citizen, not simply a skilled profit seeker. Perhaps those rope-makers and rope-sellers needed to know this before they went into business with Stalin and Co.

Maybe Herbert’s Projecting

Tibor R. Machan

Bob Herbert, The New York Times' columnist who is obsessed with the topic, claims that Tuesday’s election will be about how much voters are concerned about Senator Obama’s race. Well, I certainly have no concern about the senator’s race and Herbert’s thinking that many voters do suggests this kind of faulty judgment on his, not on their, part.

I bet that what voters have far more concerns about is Senator Obama’s economic philosophy, just as they probably have concerns about McCain's inept running mate and his apparent refusal to plan to scale down and stop that disastrous war in Iraq!

Actually, race is nothing--might as well be concerned with Obama's height or McCain's lack of it or thinning hair. Bob Herbert appears to be projecting instead of reading the electorate correctly. Yes, there will be those who are thinking about the Illinois senator’s race, whatever that actually is (for that itself is quite ambiguous, not to mention irrelevant). But I would bet that many voters reading Bob Herbert’s ridiculous column are more concerned about the kind of race-baiting he is engaging in than about anyone’s race. What, after all, could race have to do with one’s capacity to perform the job in office he or she seeks?

Even if some voters will vote for the senator just because he is “black,” that is itself may not be so much because they are racists but because they believe that by voting for a black candidate, they are taking a stand against the remaining racists across the country. This is too bad but it is not being a racist to do so. It is more like a reaction to many years of racism people have seen against blacks. One might best construe this as a type of defensiveness.

After all, what are those to do who have been witnessing and decrying racism against blacks throughout their lives when finally a black person does run for office? Most do not know whether Senator Obama has the makings of a good president or whether perhaps it is Senator McCain who does. In our time it seems to be the consensus on strategy that no one lays out his or her basic political philosophy so that voters can make a general assessment of the individual's qualifications. Instead candidates provide lists of promises they propose to fulfill at other people’s expense. Which makes them pretty much indistinguishable. So then given the history with racism in the country, it is not all that surprising that race will be, for some, a kind of last resort factor, especially on the part of blacks who have been targeted with racism far more than whites have been.

What actually is really wrong with racism? It is to judge another individual based on something over which he or she has absolutely no say. As Martin Luther King observed in that famous sentence of his, what matters about someone is the content of his or her character, not the color of his or her skin or, indeed, where he was born, whether man or woman, etc. All these factors about people are beyond their capacity to have any control over. They cannot demonstrate someone’s decency, wisdom, skill or the like.

Racism is an insidious lumping together of people based on having in common something utterly irrelevant, who could differ from one another in matters of substance. Which is why racism is prejudice--pre-judgment. It amounts to judging someone prior to knowing the person’s important attributes, based on ones that matter not even a bit. Such collectivist assessment of others goes hand in hand with prejudices based on ethnic membership, gender, or original nationality, factors over which one has no say, once again.

In contrast, judging someone by his or her political affiliation, even religion, is quite different, or at least can be. These are matters people can certainly choose once they have reached maturity. And some such choices could well be objectionable. Not that some of the assessments based on religion or politics cannot be irrational, when done thoughtlessly, but they need not be. What a person believes is something open to evaluation by others because it matters in how one lives, which can be ranked as good or bad or something in between. All this is very different from judging human beings based on their race.

Sure, there are racists voting in America but I bet that most people worry less than Bob Herbert does about a candidates’ race and more about what’s on their minds and what they might do in office.

What about Wealth Redistribution?

Tibor R. Machan

Ever since Senator Obama’s brief exchange with “Joe the Plumber,” there has been plenty of mention of wealth redistribution in the major media. Then came the recovery of a 2001 interview in which the Senator faulted the framers of the U. S Constitution, and the Founders who authored the Declaration of Independence, for not including a right of everyone to be helped with redistributed wealth. As some have noted, this was all discussed in connection with the Civil Rights legislation which Senator Obama also faulted for its lack of attention to wealth redistribution--maybe reparation, as some have interpreted him. But the central point was more general, clearly.

It is useful, then, to consider just what wealth redistribution is all about. But to do that, we need to consider briefly what wealth is and what amounts to its initial distribution such that some favor its being redistributed.

Wealth is whatever someone owns that he or she and others consider valuable, useful to themselves or others. The ownership, in turn, can arise from working on what is given in nature or by way of earnings from marketable labor, or from gifts and inheritance from those who had earnings in the first place, or from good fortune (as when one wins the lottery or unexpectedly finds oil beneath his land), etc.

There is an ancient dispute about whether such ownership is best regarded as private or as public. At first the dispute was carried on in terms of what type of ownership, private or public, would be most useful or productive. Aristotle gave his defense of private property as follows: “For that which is common to the greatest number has the least care bestowed upon it. Every one thinks chiefly of his own, hardly at all of the common interest; and only when he is himself concerned as an individual. For besides other considerations, everybody is more inclined to neglect the duty which he expects another to fulfill; as in families many attendants are often less useful than a few." (Politics, 1262a30-37)

The historian Thucydides made a similar point when he spoke about owners of public property. He wrote that “[T]hey devote a very small fraction of the time to the consideration of any public object, most of it to the prosecution of their own objects. Meanwhile, each fancies that no harm will come to his neglect, that it is the business of somebody else to look after this or that for him; and so, by the same notion being entertained by all separately, the common cause imperceptibly decays. (Thucydides, The History of the Peloponnesian War, bk. I, sec. 141).

It was, however, not until the English philosopher John Locke laid out his theory of natural rights that more than a utilitarian case was produced in favor the right to private property. For Locke once someone mixes his or her labor with something in the wilds, that thing stops being public--or God’s--and becomes, as a matter of morality, his or her private property. This is because the work invested is properly rewarded with ownership. Thereafter the owner has the right to hold on to the property, exchange it from something else with willing others, give it as a gift to someone, bequeath it to his or her offspring, and so forth. (As to wealth come by via luck, no one is justified to take it from those who are lucky, it can be inferred, otherwise people themselves could be enslaved with impunity.)

A very important feature of Locke’s idea, however, was that property doesn’t belong to the king, state, or government but to private individuals. It is they who work on elements of the natural world, of what is not owned by anyone else, so they are free to obtain it, hold it, trade it, etc. For others to stop them is wrong, a violation of natural rights.

Many have criticized all these ideas, especially people who hold that everything belongs to everyone together and so wealth may not be freely used and distributed by individuals, only by "the community." But, as Aristotle and Thucydides and many others since them have made clear, this idea is seriously flawed and entirely impractical. It leads to the tragedy of the commons, of people all grabbing what they want from the common wealth and failing to use it productively.

Both for moral reasons--the “first come, first gain” principle--and for practical ones--community ownership leads to wastefulness--the principle of private property rights gained influence in Western societies, in their legal and economic systems. This is one main reason that when Senator Obama suggested that what this country needs is systematic wealth redistribution--routinely taking from private owners their wealth and having governments distribute it to non-owners--many folks took umbrage. This is quite an un-American, anti-free market capitalist idea and sounds more like what is preached by socialists and communalists (even communists).

Of course wealth redistribution is a big part of existing American society but it is usually defended for special reasons, not as a general policy. Senator Obama elevated what seemed to most to be an exception in this country to a central feature of the society. And his opponent, of course, couldn’t effectively criticize him because Republicans have been just as willing to redistribute wealth as Democrats, albeit not advocate it as a systematic feature of the legal system as Senator Obama did.

Adoration of Government Regulation

Tibor R. Machan

On a recent Monday I went to hear a talk by Professor James K. Galbraith, author of the free market basing book, Predator State: How Conservatives Abandoned the Free Market and Why Liberals Should Too. The talk repeated what so many modern liberals have been saying about the current financial fiasco, namely, that it’s all due to the free market, to the late Milton Friedman’s influence, and that deregulation is mostly to blame.

This is not especially novel, given that nearly everything wrong with America is blamed by such modern liberals on, well, the absence of sufficient modern liberalism in the country’s governance. Why not? Champions of the free market make similar claims when trouble arises—modern liberalism is to blame. And I am often among the latter group. I admit—I am much more favorably disposed toward the principles of a fully free society than toward those of a mixed economy (or even fiercer government involvement in the economy).

Let me spend a line or two explaining why I find the hosannas sung to government regulation by the likes of Professor Galbraith so bizarre. First, government regulators are people, no different from those whom they set out to regulate. Second, governments make use of physical force or its threat in order to achieve their goals, while the free market relies on voluntary interaction by market agents. Third, government regulators lack the restraints that market agents face when they carry out their plans in the market place—namely, the need to earn their resources from willing lenders or buyers. Governments can raise their resources through taxation which is collected whether those paying it chose to pay or not. Fourth, government regulators tend to be far removed from the firms and people they regulate, relying on vague, general information instead of local knowledge that market agents use as they make their decisions.

Other differences exists that, in my view, clearly favor market processes as against government regulation—public choice theory (for which Professor James Buchanan received the Nobel Prize and which was left totally out of consideration by Professor Galbraith in his talk), explains them very well. But let me focus on one particular point made by Professor Galbraith in his support of extensive government regulation. He noted that people in the People’s Republic of China prefer buying goods from America because American goods are produced with the benefit of government regulation. So they can be trusted, while those in regions around the globe that lack government regulation are untrustworthy.

This is what is called in logic a non-sequitor because the conclusion does not follow from the premises. Chinese may buy American goods but that could be for innumerable reasons other than that the production processes are regulated by government. Generally American production has a very favorable reputation around the globe. Yes, American goods tend to cost more but that’s because American labor and management is more expensive than labor and management elsewhere. However, one tends to get what one pays for, namely, pretty good products.

American technology is far more advanced than technology elsewhere, which also contributes to the higher quality of American goods. Science and technology in America is top of the line—just count the number of American scientists who have won the Nobel Prize and consider how many foreigners come to study at American technical universities such as MIT and Cal Tech.

Furthermore, even if some of the confidence in American products stems from the fact that there is government regulation in America, it doesn’t follow that government regulation is indispensable. There are plenty of scholars who have found serious flaws in the regulatory process, such as the slowing down of drugs coming on the market because of irrational rules imposed by the Food and Drug Administration, the capture of regulator agencies by the very firms they are supposed to regulate impartially, etc.

In addition, and very importantly, Professor J. C. Smith’s “The Processes of Adjudication and Regulation, A Comparison,” published in a book I helped edit, Rights and Regulation, Ethical, Political, and Economic Issues (Pacific Institute for Public Policy Research, 1983) lays out the case in favor of changing from government regulation to legal adjudication where now the former is deemed to be necessary.

Finally, there is a fundamental injustice involved in most government regulation. This is prior restraint. Burdens are imposed on citizens who are being subjected to government regulation without it having been demonstrated in court that these burdens are deserved. This amounts to treating citizens as if they had been convicted of a crime whereas, in fact, all that can be held against them is that they might possibly do something wrong, injurious, harmful to someone.

The adoration of government regulation is misplaced and belongs with the ancient practice of deference to the monarch who was deemed to be superior in wisdom and virtue to ordinary “subjects.” This paradigm should be tossed. Free men and women deserve better.

M.A.S.H. and Lessons in “Liberalism”

Tibor R. Machan

Many moons ago, when I would now and then check out the very popular TV comedy show M.A.S.H., I noticed that whenever their rightwing villain Frank Burns (played by the late Larry Linville) acted badly, the good guys, lead by Alan Alda’s character, Hawkeye, had no compunction about physically assaulting him. They set traps that would clearly injure him. It was not enough to ridicule him, show up his views as asinine, no. The writers, directors and actors had no problem at all with hurting him.

A few days ago I decided to check out a new legal drama, “Raising the Bar,” and lo and behold the second show featured one of the extremely politically correct guys--you know, the one with the long hair and oozing with sentiment for the little guy, never mind what made him little or how guilty he or she is--punch out one of the politically incorrect ones--you know, the guy who comments on women’s physical attributes and makes nearly racist or ethnic jokes. Evidently, here too, it mattered none that the offense was confined to words. These words deserved to be punished and punished not with equally painful words but with out and out physical assault.

Interestingly both of these shows appear to be emblematic of the political ideology of contemporary liberalism. If something is objectionable, it deserves to be punished good and hard, never mind that no one was actually made to physically suffer, no one’s rights were violated, nada. In the 1980s there was a wing of feminism that made this feature of modern liberalism quite explicit. The University of Michigan law professor, Catharine A. MacKinnon, wrote a book laying out the position. It was titled Only Words and published by Harvard University Press. The thesis put forth was that pornography and other insults toward women need to be banned or punished, if need be by prison sentences. Never mind that the offense consisted only of words. It needed to be dealt with harshly, with physical force.

I mention this because it is often claimed that the Left in America would never go so far as, say, Hugo Chavez of Venezuela, in dealing with opponents to its ideas and policies. But there is reason to think that the American Left can easily degenerate into using physical force when it encounters opponents. M.A.S.H. indicated as much, as did this episode of Raising the Bar and, of course, Professor MacKinnon’s book.

But, you might say, no one in government, however Left leaning it might be, would ever resort to silencing the opposition, not in America. Well, think again.

A little while ago, when the hysteria about global warming was at its highest pitch, when Al Gore’s An Inconvenient Truth made the rounds and garnered its Oscar, some “liberal” members Congress--and I have to put quotes around liberal since it so perverts the meaning of that term--tried to institute certain measures against people in business who would make contributions to think tanks and researchers who were skeptical about global warming. Several such organizations were actually named, including the Competitive Enterprise Institute in Washington, D.C., which had received, I believe, some little support from certain corporations. Whatever governmental favors these corporations received--and, mind you, I think no corporation should receive any such favors--were to be withheld from them if they continued their support of global warming skepticism.

This is worth observing when it is widely believed that only those on the “extreme Right” would use coercive force or its threat against their adversaries. Such policies are usually associated with extreme right wingers or fascists, not with extreme Left-wingers or socialists. But this is entirely mistaken.

In fact, both of these wings, Left and Right, believe in using coercive force to try to have others follow their ways. What else does redistribution of wealth or faith based government funded support amount to than the use or threat of extreme physical force (jail, prison, major fines, etc.) against the non-compliant? And if such non-compliance were to be effectively advocated--say by those who support tax dodging or other means of withholding their support of various public policies the government carries out, be it run by the Left or the Right--certainly the attitude exhibited in M.A.S.H., Raising the Bar, and Only Words could triumph right here in our supposedly free society.

When the libertarian considers both the Left and the Right dangerous and immoral, it is for these reasons, among many others. Right and Left do not want to leave it to free men and women whether their ideas of community life will be adopted. No, both Right and Left want to make sure their ideas will triumph, even if its takes depriving people of their basic right to live as they choose so long as they let others do the same.

Why McCain Cannot Attack Obama

Tibor R. Machan

In The Washington Times Wesley Pruden urges Senator McCain to take the bull by the horn and attack Senator Obama on the basis of the latter’s nearly full blown endorsement of the socialist idea of wealth redistribution. This is indeed a position articulated by Senator Obama in a radio interview he gave back in 2001 and, yes, it does mark him as at least a democratic socialist. (There are, Virginia, different types of socialism, even one called “market socialism.”)

Trouble is John McCain has no credibility, as a loyal Republican, to attack Senator Obama along these lines. Republicans and Democrats both sign up for various measures that could count as socialist. Has John McCain renounced the progressive tax? Has he attacked the idea of taxation as a form of wealth confiscation, arguing that it should be given up in a free society in favor of some kind of voluntary system by which to fund the government? Have Republicans abandoned their support for the heavy hand of government in the economy as exemplified by their age old practice of protectionism and handing subsidies to farms and other businesses? are they against government licensing of various professions? are they against government ("public") educational institutions? (All these are defensible mainly from the premises of a version of socialism.)

Of course not. Nearly all governments, other than the type envisioned by libertarians, happily embrace socialist measures. Indeed, the old system of mercantilism that many conservatives look back to with nostalgia is but a different type of socialism, absent its Marxist trappings. Mercantilists champion the heavy hand of government in the economy and everything else, guided by the monarch--and his minions--or some other revered head of state.

Adam Smith himself wasn’t quite the full blown free market advocate some people imagine him to have been. And his defense of the limited free market was based not on individual rights, as would be a defense based on the ideas and ideals of the American Founders, but on the utilitarian notion that with more freedom, the government will be wealthier than with less--this is the point of the title of his famous The Wealth of Nations. It was not that individuals have the right to accumulate wealth as much as they choose and can, provided they do not violate anyone’s rights. This latter is the defense offered of the capitalist, free market system in the spirit of John Locke, not Adam Smith.

In fact, most economists are not pure free market champions since they tend to think that there are market failures which need to be remedied with government intervention. The most prominent such economist was, of course, John Maynard Keynes. In America it was John Kenneth Galbraith, nearly a full blown socialist who worked hard to remake the Democratic party into a socialist one (as his son, James K. Galbraith, is doing now). (Interestingly, there is a parallel in the philosophical relationship between the late Milton Friedman and his son, David Friedman. The former was a committed limited government capitalist while the latter is a committed anarcho-capitalist, someone who denies any justification and need for government!)

In the heat of a campaign, of course, much is said that is only partly meant. Senator Obama is no full blown socialist even though his sympathies lie with an economic system in which wealth is systematically redistributed so as to provide for those who themselves have or make no wealth, never mind why! Senator McCain is certainly no defender of the fully free, capitalist society (as would be the likes of Milton Freidman, Ayn Rand, or Ludwig von Mises). If Senator McCain were to lay into Senator Obama with charges of the latter’s socialism, it would be simple to reply that Senator McCain is nearly as much of a socialist as he is.

So why not stop this name calling and get to the substance, which is whether a free economy is better, in the main, than one that is planned by politicians and bureaucrats. Perhaps this could amount to a topic in the final days of the campaign season that would tell the voters what exactly divides these two candidates.

All This Utter Distortion

Tibor R. Machan

The following letter appeared in my local paper:

"GREENSPAN’S GOOFS It’s nice to see that former Fed chief Alan Greenspan is finally taking the blame for starting the worldwide economic collapse [‘Greenspan,’ Marketplace, Oct. 24]. Former President Ronald Reagan shares in that blame since it was their combined plan to deregulate everything and let the free market ‘take care of itself.’ This has proved that the ‘free market’ without regulations is anarchy."

First, look at the dishonesty: Greenspan did not take blame "for starting the world wide economic collapse." Why should he? He took blame for mistakenly assuming that the self-interest of those running financial institutions would fully coincide with the clients of those institutions and for some of the results of making this assumption. As to Ronald Reagan, he barely managed to deregulate anything at all. His rhetoric was for more individual initiative in the economy and less government involvement but Congress would not budge so nothing much happened.

Then there is the nonsense about the supposedly unregulated free market during the Greenspan and Reagan eras. Government regulation, especially of the financial portions of the American economy, has been in place since the early 1900s. (The very existence of a Federal Reserve [or central] Bank is a regulatory measure that would not be part of a genuine free market!) Regulations were increased enormously during FDR’s ill conceived and ultimately ineffectual New Deal. (The economy recovered because of World War II’s war-time government spending and labor furor.)

Nearly every profession in America, other than the press and the ministry, is highly regulated. Occasionally there is some experimentation with bits and pieces of deregulation but no one escapes all government regulations by the various federal, state, county and municipal bureaucrats who fill government offices throughout the land. The percentage of the wealth in America that has been spent by all these governments has been steadily growing and has never, never substantially subsided.

The other evening I went to hear a fervent champion of government regulations and critics of the free market, Professor James Galbraith, (author of the bizarrely titled book, Predator State: How Conservatives Abandoned the Free Market and Why Liberals Should Too), and in his talk he also kept saying that the free market has failed even while he admitted that there has been no free market in place ever, despite some of the rhetoric supporting such a system. He went after the late Professor Milton Friedman for advocating greater economic freedom but then said that Friedman’s views failed to have a serious impact. And he implicitly admitted that he and his fellow champions of government meddling in the country’s economic affairs have been triumphant beyond expectations both in America and elsewhere (e.g., in China where he has been a consultant to that country’s utterly despicable tyrannical government).

This oft-repeated mantra about how the free market must have been responsible for the current economic fiasco is a colossal distortion probably meant to confused instead of inform. That’s because America has been a mixed economy throughout its existence, with periods of greater dosages of capitalism and greater dosages socialism but always a mixture of the two. When such a system experiences maladies, it is understandable that supporters of one part of the mixture will jump at the chance to blame the other part for the mess. But it would be reassuring if there were just a bit of honesty in the debate.

For example, I have been arguing that the various government interventions in the mortgage industry--Fanny Mae and Freddy Mack were both created and given orders by the federal government to ease the terms of loans for millions of home buyers--have fueled the current mess but I have never argued that Wall Street hasn’t been complicit or that America has had a socialist system which is to be blamed.

Why can’t those championing more government planning and regulation admit that there hasn’t been any free market in place in America for over a century? It is no easy task to assess the soundness of economic theories. There are no controlled experiments that can be conducted, no laboratory tests, only the very messy history that needs to be studied and untangled to learn the needed lessons to avoid similar messes in the future. But only if the students of history will be honest, will not taint the evidence with their wishful thinking, will it be possible to learn from their work.

How Socialist Must One be to be A Socialist?

Tibor R. Machan

In recent days the issue of Senator Obama's alleged socialist leanings has become the focus of considerable attention in the mainstream media. This was provoked by the Senator's rather explicit support of wealth redistribution--which is to say, the policy of politicians and bureaucrats taxing substantial portions of the resources of individuals and deciding to hand it around according to some formula of equality. This is indeed associated with the political economy of socialism and has been used to guide various socialist economies throughout human history, although there have always been widely different degrees of socialism in different human communities, from kibbutzes, communes, nationalist socialist and international socialist systems to small communitarian arrangements.

Full blown socialism amounts to the view that all of humanity is of one piece, one organism. Karl Marx proposed that this organism develops from infancy to full maturity, communism, over human history. Individuals in this conception of socialism are but cells in the organism. There is no private property because there are no private individualism. The wealth is spread just as food is spread throughout the human organism, normally without favor to any part of it.

But no all socialists are full blown, nor view the system along these developmental lines. Some socialists stress that the unity among people is something they must bring about, as a matter of their ethical obligations. And as such the socialism involved can be more or less robust, depending on how diligently the population works to establish socialist institutions and policies.

Now, arguing that Barak Obama is no socialist because there were many features of American society that are already socialist--the progressive income tax, for example, the expansive eminent domain policy recently affirmed by the U. S. Supreme Court, and several other measures recently instituted to bail out banks and other financial companies--is disingenuous. The questions no one raises to him--none of the interviews and debates I am away of indicate this--is how extensively would Senator Obama get the government involved in the American economy, how he views the institution of private property, who does he believe owns the wealth of the country. From his words over the years it seems that he would favor a far more socialist society than American is now, although it is true enough that America (as many other welfare states) is quite socialist already. That is why political economists have been calling it a mixed economy.

The most important issue is whether under Senator Obama's political leadership the country would be directed to be more or less socialist, more or less opposed to individualism, individual rights, private property, and so forth. And the next issue is whether where Senator Obama wants to take the country would be something proper, desirable, just.

The objections people have to socialism are based, after all, on the fact that the system views human beings as part of a collective, of an involuntary team or community, rather than as individuals with independent choices and the right to decided whether they will join some community. As Senator Obama appears to view things, a society is an integrated organism wherein individuals have no rights, no independent choices, certainly not about their productive efforts and the results of these, namely, their resources or wealth. He seems to believe that it is the government--the head of the collective--that ought to be in charge of what the rest of the people ought to do with their lives. Maybe he would accept some input, via a limited democratic approach, from the "cells of the body." But the decision would be made at the top, by the political leaders.

Even though some of America's laws and public policies are somewhat--in certain cases considerably--socialist, the country is still quite far from the total wealth-redistribution idea that socialism endorses. Arguably Senator Obama, just as Senator Hillary Clinton, consider this a liability and want to remedy matters. (Senator Obama explicitly faulted the American Framers back in 2001 for failing to include wealth redistribution as a feature of the U. S. Constitution.)

This is what the current talk about Senator Obama's socialism should be about, not about whether he is a pure, Marxist socialist.

Ethics in Panic

Tibor R. Machan

Some people I have known for ages, who have held firm, as I have, to the conviction that only those public policies are worth one’s support that champion liberty above everything else, appear to me to be shaking their heads just now. They are even talking about how their earlier position may be some kind of idealism or utopianism in need of moderation.

But support for the free society is not idealism or utopianism. It’s the recognition that men and women live best if their communities are governed by the principles of individual rights, to life, liberty, private property, and by the complete renunciation of coercive force among people.

The perfect is, indeed, the enemy of the good and aiming for perfection, some kind of final answer, in human affairs is a mistake—maybe once time ends that will be reasonable to seek but while history is still in process, the best answers will always just be the most up to date, never the last.

Anyway, the current economic fiasco has shaken some people’s confidence in the soundness of the free society. To me that’s akin to being shaken in one’s conviction in an honest and loving marriage because, well, they are rare. Free markets do not produce the mess that we are witnessing. Free market champions have forecast this mess for over a century, making the point that the more we permit government to attempt to direct the economy, the more we are inviting catastrophe, just as this has happened elsewhere. The apparent exceptions occur where for a while some nearly free good, like oil or agricultural abundance, made it possible to be wealthy without free minds and free markets. Even a prison can flourish if supplied with innumerable valuables no one needs to think about and work for.

But that is not the normal state of things in human communities. So the principle that men and women must be free of government regimentation—which is, if you think about it, the regimentation of some men and women of all the rest of them—must not be compromised, let alone abandoned. For a while it is possible to fake reality, to have a measure of economic prosperity without freedom but in time that comes to a screeching halt. Trying to live off money that is borrowed without collateral, without the realistic prospect of paying it back, and with the groundless hope that yet unborn generations will simply take on the debt without protest, is a blueprint for economic disaster. And to try to cope with the disaster with more of the same is catastrophic.

But panic tends to test people’s resolve. Integrity is tough to maintain when the fruits of years and years of economic malpractice become unavoidable anymore. This is true, of course, in all cases of doing violence of good sense, to decency, to virtue, to justice. Such accommodating, “pragmatic” ways tend mainly to beget even worse malpractice.

An when one witnesses the few VIPs in one’s community—who gave at least lip service to the principles of the free market cave in before a bunch of bullies in Washington (and, yes, California Representative Henry Waxman, in front of whom Alan Greenspan betrayed his supposedly free market ideas, is the fiercest bully on the Hill)—no wonder that one’s resolve is weakened. That’s especially so when one’s confidence in liberty is mostly based on common sense, something that tends to become brittle when facing the ill effects of misguided political economy.

It is interesting that many people haven’t a clue as to what alternative to the free market they should support but announce simply that something needs to be done in Washington, the very place where all of this got started to go south. It is as if when a medical charlatan makes a royal mess of one’s health one insisted to going back to that quack for emergency treatment!

No. The answer is to ride this out with as little reliance on the policies that brought it all about, namely, government meddling in the economy. Let the referees of the game learn to do their proper job, then let the athletes resume play free of bureaucratic interference, instead of making things worse by inserting themselves even more into something they know nothing about.

Greenspan versus Rand on Self-Interest

Tibor R. Machan

Nearly every time Alan Greenspan is written about in the media, his early association with Ayn Rand is remarked upon. The impression is often left that Greenspan holds the same views as Rand did, especially about the ethics of egoism or selfishness.

Some will no doubt remember that Ayn Rand wrote a little book, The Virtue of Selfishness, A New Concept of Egoism, in which she defended the idea that everyone has a moral responsibility to strive to live successfully, to achieve happiness in life. This does include one’s economic flourishing but is by no means confined to it. Indeed, one interpretation of Randian egoism is that everyone must first discover what would make him or her happy and then seek to attain that goal.

When economists talk of self-interest—the way Alan Greenspan spoke of it in his testimony on October 23rd to the House Committee on Oversight and Government Reform—they have something very different in mind. What they tend to mean by self-interest is a supposed inner drive we all have to seek to further what we like, what pleases us, including, of course, our prosperity. From this view they derive many of their conclusions regarding the way people conduct themselves in the market place. So, for example, Greenspan said that “Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief.” To Representative Henry Waxman’s question of whether his ideology pushed him to flawed thinking that has contributed to the current financial fiasco, Greenspan replied “Yes, I’ve found a flaw. I don’t know how significant or permanent it is. But I’ve been very distressed by that fact.”

What exactly is the ideology that Waxman had in mind that supposedly “pushed [Greenspan] to make decisions that you wish you hadn’t made”? It was not made clear either by Waxman, Greenspan, or those who reported the exchange in The New York Times. But it is fairly evident from the context that they had in mind the standard neo-classical economic notion that everyone always, automatically, pursues his or her self-interest which has a substantial economic component to it. And this is supposed to be especially so with Wall Street firms, including “lending institutions.”

In a less unnatural language the idea Greenspan gave voice to means roughly that those who work in the lending industry would be motivated by their professional responsibility to serve their clients properly, not unlike it is expected that doctors, attorneys, psychiatrists or other professionals do. But it is not part of this language that professionals are driven to serve their clients competently, conscientiously. No, outside of the social science of economics it is pretty much understood that professionals can carry on properly, ethically, or fail to do so. Indeed, their self-interest as professionals may well be neglected and they may yield to act to promote other objectives, some of them at times induced by various political pressures and contingencies.

For example, if politicians establish regulations that violate the laws of sound economics, this can promote irresponsible conduct on the part of professionals in lending institutions and throughout the widely integrated market place. And this possibility was not at all touched upon by Greenspan and others at the hearings although it was raised at an earlier time.

It is true that the professional interests or objectives of lenders would tend, in the main, to coincide with the best interest of their clients, as this is true in other professional-client relationships, except when various bureaucratic and political objectives interfere. But when President Clinton and many others in Washington, D.C., insisted that lenders ignore the standards of proper lending because adherence to them would leave out a pretty sizable segment of the voting population from among those who would receive loans to purchase homes, this changed the economic dynamics considerably. It created incentives for both lenders and buyers to act imprudently, rashly, wildly even, and the overall effect of it all came to be the current fiasco just as had been forecast at the time (and reported by, you guessed it, The New York Times—see Stephen A. Holmes’ report on September 30, 1999, for example).

The ideology that Greenspan seems to have embraced is not what Ayn Rand taught. Rand advised that we be prudent, strive for success, including in our economic lives. She didn’t believe, as Greenspan and others seem to have, that people, including “lending institutions,” will necessarily pursue their self-interest. Had market agents followed Rand’s advice, this fiasco would have been avoided. Greenspan himself should have studied Rand more carefully.

Socialism and the Rich
 
Tibor R. Machan
 
There has been some silly outrage on the part of his supporters at the claim that Senator Barack Obama may be a socialist.  The idea arose after in his exchange with "Joe the Plumber"--and I haven't investigated whether Joe is a plumber--the Democratic presidential hopeful remarked that he supports "spreading the wealth."  Socialism is committed, in part, to the idea that all wealth apart from some purely personal stuff (like one's toothbrush) is in fact collective, public property.  In the Communist Manifesto Marx and Engels wrote that the first order of business for socialists is the abolition of private property.  
 
This notion, by the way, stems from something more basic.  That's that there are no human individuals, only social wholes or bodies of which those we take to be individual human beings are, in fact, mere cells. 
And then, of course, there is no room for private property either, nor to any right to it.  Which is why the wealth needs to be spread.  It belongs to us all.  (Only this  poses the problem of which individuals will decide what use will be made of this wealth!)
 
A colleague of mine disputed the view that Senator Obama is advocating socialist measures by observing that Warren Buffet is one of his economic ad visors.  This objection assumes that the rich are enemies of socialism, which, of course, is flatly wrong.  But it does again reflect a Marxist idea, namely, that of economic determinism: because the rich are surrounded by wealth, they will hold views that are favorable to wealth creation.  Only this is flatly contradicted by the plain historical fact that socialism has been supported by many wealthy people.  A most notable example is Armand Hammer, an American industrialist who was an avid fan of the Soviet Socialist Republic during Lenin's reign and even Stalin's, if I recall right.  And Buffet himself is a great fan of wealth redistribution, which is one reason he supports the death tax that deprives the relatives of wealthy people from making use of this wealth once the original owners dies.  (This would make continuing a productive enterprise impossible since the government would take possession of the wealth required for that)
 
Quite a few people who are personally savvy when it comes to running, let alone building, a vast business enterprise haven't much of a clue about what are the soundest principles of political economy.  We may say they are micro economically but not macro economically prudent. They are often sentimentalists, apart from running their own firms, and give their wealth to various utopian communities an projects.  Sometimes they feel guilty for having wealth in the first place, given how bad the reputation of riches has been from time immemorial.  Both in secular philosophers, such as Aristotle's, and a many theological systems, the idea of profit has been denounced as evil, even while poverty is decried as well.  One thing though is clear--just because someone is wealthy, it doesn't follow that one will support the system of economic and political principles that most effectively promote wealth creation.
 
Nor is it the case that someone who promotes socialist notions, like Senator Obama is, must do so in every instance, consistently.  One can be predominantly socialist but not go all the way, like a Hugo Chavez who will try to silence all of his opponents. Nonetheless, the socialist elements of such a person's outlook can undermine such goals as creating wealth in a society, lifting a poor from their poverty in something close to an ongoing, continuous fashion.
 
When someone sees that Senator Obama has very strong socialist tendencies it doesn't even mean that his opponent, Senator McCain is necessarily a better candidate for president.  After all, the continuation of the costly war in the Middle East could just as easily damage the American economy as the adoption of various socialist public policies can.
 
Most people haven't a fully worked out, consistent system of political economic ideas, even when they aspire to be president of the United States of America.  It is important, however, for American citizens to learn whether some of their more basic beliefs are likely to lead the country in the direction of a whole impractical and, ultimately, misanthropic political economic era. 
 
 
 

Why Not Socialism?

Tibor R. Machan

It is no scare tactic to raise the specter of a socialist America these days. First, it was Senator Hillary Rodham Clinton whose candidacy promised to take socialism front and center as America’s official ideology. Clinton’s book, It Takes A Village (Simon & Schuster, 1996), unabashedly affirms the socialist ideal, arguing that individualism must be rejected in favor of collectivism, wherein all of us are part of one social whole, exactly as Karl Marx had argued in several of his works. (See, most accessibly, Marx’s posthumously published Grundrisse for a very clear example.)

Senator Barack Obama, too, clearly shows a preference for the socialist system, as in his exchange with Joe the Plumber where he made it crystal clear that he wants to spread the wealth no matter whose wealth it is (certainly not his own) and in his life long association with socialist groups and projects.

Senator Joe Biden, too, has his socialist credentials. During the hearings of the Senate Judiciary Committee concerning the nomination to the U. S. Supreme Court of Clarence Thomas, Senator Biden openly ridiculed the ideas of those who champion the right to private property. He held up Professor Richard Epstein’s book, Takings: Private Property and the Power of Eminent Domain (Harvard University Press, 1985), which affirms that principle, in order to openly reject its ideas. (It was Marx and Engels, in their Communist Manifesto, who made it abundantly clear that to advance toward socialism and, in time, communism, the principle of the right to private property must be abolished!)

Variations of socialism have, of course, managed to get established in different societies without any violent revolution--just consider how National Socialism triumphed in Germany’s Weimar Republic, ushering in Hitler’s regime, and how Hugo Chavez got elected in Venezuela and promptly installed his version of fascistic socialism. Marx himself pointed this out in a speech he gave in Holland in 1983, arguing that in more or less democratic countries the revolution can be achieved via the ballot box.

The notion that it cannot happen here is completely silly. Yes, America has a pretty good constitution and its Bill of Rights would seem to be a good defense against establishing a socialist or fascist regime. In fact, however, no written constitution alone can fend off such a development, not without the beliefs of the bulk of the citizenry backing up the ideas and ideals of that anti-socialist constitution. Given how powerful the temptation is to seek the help of an all powerful government to promote one’s economic agenda of taking from Peter to provide for Paul--the central element of Senator Clinton’s and now Obama’s health care proposal and, of course, of the idea of "spreading the wealth" and given how weak is the conviction in America of the basic principles of the Declaration of Independence--all that stuff about everyone having unalienable rights to one’s life, liberty, and pursuit of happiness--the prospect of real socialism in the U. S. A. is no longer a version of McCarthyism.

Of course many Americans would be shocked to learn that they are being complicit in ushering in socialism in their country. They only want moderate wealth redistribution--they want to spread the wealth but within limits; they want their children to be socialized, along lines spelled out in Senator Clinton’s book, but only to a point. In short, most Americans believe in what political theorists now call market socialism--a kind of impossible combination of socialism and the free market. They want a robust welfare state.

Trouble is there is no coherent idea of market socialism or even the welfare state that provides solid limits to the power of government and secures an individual's rights to life and liberty, let alone property. The pursuit of the public interest, the common good, the welfare of society as a whole, necessarily amounts to pursuing the good of just some members of society as understood by a few of those members. The only valid public interest is what the American Founders identified, namely, securing everyone’s basic, individual rights to their lives, liberty and pursuit of happiness. Every other idea of the welfare of society or the public or some such notion amounts to handing power to some few members who will then wield it without a clue as to what else to aim for but their own agenda. There is, in other words, no valid socialist idea, no valid welfare of the state, nada! It all comes down to the dictatorship of a few, just as it did in Soviet Russia and Nazi Germany, Cuba, North Korea, China, and now Venezuela. The rest is all some feeble attempt to square the circle.

On Being Dismissed

Tibor R. Machan

Those who occupy seats of power, whether intellectual or political, can deal with challengers in a variety of ways. Ignoring them is popular—it saves one the trouble of having to deal with the question of whether one’s favored position is morally justified, well founded, intellectually defensible. Just don’t bother and hope the annoying pests will vanish. Dismissing them as inconsequential is nearly the same ploy but here it is evident that those in power are a bit worried because they want to give the impression that their views while being given some voice do not really matter and aren’t worth investigating. Then there is a more decent approach of actually taking up the challengers’ ideas and arguing against them. But this runs the risk of making those ideas seem worthy of discussion, maybe even palatable.

Over the years that I have championed the fully free society—no exceptions, no compromises within the legal framework of the system—I have experienced all these treatments both personally and as a member of the small group of defenders of classical liberalism or libertarianism. For the first part of the several decades involved most intellectuals at the colleges and universities with which I was connected tended to ridicule my views and those of my fellow travelers. I recall how at my undergraduate institution, where I began to go on record with these ideas (in the student and the local newspaper), I was mostly ridiculed by both classmates and some professors, although there are a few who did show some interest and even respect. Then at the graduate schools I attended the fierceness of the rebuke got more intense even though my skill in defending my ideas also improved, which sometimes showed up in my winning over a few adversaries.

Once I managed to go through all the hoops to obtain my degree and even found decent jobs in my discipline, the situation changed once again—many critics began to use the one-upmanship method, while some actually engaged in proper debate. But I found that most of my adversaries preferred star gazing, paying attention only to prominent advocates at the prestigious institutions. Still, I kept holding up my side of the discussion and got published in decent, sometimes even outstanding, journals and that opened some doors to publish books, get included in various readers on ethics and political philosophy. Because in the meanwhile a few professors at very prominent institutions came out with views somewhat similar to mine, defending libertarianism in their own ways, it became a bit more difficult for detractors to simply ridicule or even dismiss my libertarian ideas.

In the general culture, though—outside the academy—libertarianism made some but not very many inroads. By now the view is pretty well known and at times even treated as a legitimate contending alternative answer to how society ought to be organized. Yet there are quite a few among the big players, folks who contribute to major publications, who deploy the more unsavory methods I mentioned above.

For example, in a recent article for the journal World Affairs, Max Boot, who is the Jeane J. Kirkpatrick Senior Fellow for National Security Studies at the Council of Foreign Relations and a policy adviser to the John McCain presidential campaign, proclaims without seeing any need for argument, that “Aside...from a few extreme libertarians, few conservatives would contend that the kind of limited protections envisioned by Teddy Roosevelt—and ultimately brought into being by his cousin, Franklin—were incompatible with free enterprise or personal liberty.”

So, the New Deal is supposed to be acceptable to other than such extremists as libertarians, argues an advisor to Senator John McCain Those who would challenge this view need not be answered! They don’t even deserve a few points countering their skepticism, their conviction, for instance, that the New Deal gave rise to just the sort of irresponsible statism that the country is paying for right now, with financial meltdowns and the saddling of today’s and tomorrow’s taxpayers with inordinate debts. These so called “ultimate safeguards of the capitalist system,” as Boot calls New Deal policies, were just fine, never mind how they did violence of individual liberty and to political prudence.

Ah, but scoring points with such verbal acrobatics seems to be the way to promote a failed policy of welfare statism. One can only wish that in time the ruse will be fully detected and sounder policies, more in line with the American Founders’ ideas of limited government, reasserted. In the meanwhile libertarians must simply push on, not allow such disrespectful, highhanded treatment to deter them.

Sarkozy Is Wrong

Tibor R. Machan

The French president, with a Hungarian father and born in the mid 1950s, recently made headlines by announcing that "Le laisser-faire, c'est fini." This means that free market capitalism is finished.

What is interesting about Sarkozy having said this is that the term “laisser-faire” refers to how the French king was responded to when he asked French farmers “So what do you want?” He was told: “Leave us alone.” Accordingly, laisser-faire came to refer to a system of economics, also defended by Adam Smith and the classical liberal and libertarian political economy tradition, in which the government plays the sole role the American Founders assigned to it, namely, “to secure [our] rights.” Just as referees do at games, government has the important role of making sure the rules are followed and violators are punished. In the case of a society, including its economic system, the rules are that the rights to private property and freedom of contract are strictly respected and protected.

This idea has never, ever been fully implemented but here and there, especially in America, it has gained some inroad in public affairs. Certain compared to the rest of human history and the rest of the globe, America’s economy has often been relatively free. But as with most democracies which may not ban the input of even undemocratic ideas, the best that has been achieved is a mixed economy, one with socialist, capitalist, fascist, theocratic and even communist features, a fully free market never existed in America.

Still, whenever some upheaval with economic implications does occur in America and other mixed economies, defenders of some variation of the ancient regime of mercantilism—which include champions of all kinds of statist economic systems such as socialism, fascism, etc.—quickly announce what Sarkozy said, namely, that free enterprise is now dead, proven to have failed. In the current financial fiasco this is all too evident. Day after day one can read this bunk, in The New York Times, The New Republic, letters to various magazines and newspapers, you name it.
A regular feature of this glee, exhibited by folks who have never shown the slightest sympathy for free enterprise, is to mention that people in the business world are often complicit in promoting statism. But that’s no news at all, of course. Adam Smith already observed it back in the 18th century. As he warned:

“The proposal of any new law or regulation which comes from [businessmen], ought always to be listened to with great precaution, and ought never to be adopted till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention. It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it.” The Wealth of Nations, vol. 1, pt. xi, p.10 (at the conclusion of the chapter) (1776).

The bottom line is that in mixed economies it is somewhat difficult to detect the source of economic problems. The chattering classes—many of whose members would love to rule the world since they tend to believe (following the lead of a certain reading of Plato) that only they are qualified to do so—jump at the chance to blame freedom, including free enterprise, since that is the main obstacle to their being in charge.

My simple plea is, do not fall for this ruse. The current—as all human produce—economic fiasco is the fault of statists who routinely distort the natural ways of an economy. (In this case it had to do with massive amounts of easy money doled out in the name of helping the poor, minorities, and so forth.) As usual, such interference results in disaster.

And those who are responsible have no intention to confessing their guilt in making it happen and one effective way to hide that fact is to point the finger at the innocent party, human liberty.

Whistling in the Dark

Tibor R. Machan

It is hardly ever disputed among honest political economists that most Western countries, including the United States, are welfare states or mixed economies. Unlike, say, a fascist or socialist country, in a relatively free society if a substantial number of voting citizens champion a system that undermines the very liberty that makes it possible to have an influence in how the country is governed, the country is going to reflect this fact in its public policies. Under socialism, which is a planned society--especially when it comes to its economic features--or fascism, which is run by some charismatic leader, opponents tend to be officially silenced. The more the system is socialist, the more such silencing takes place. The same with fascism. Unity is crucial for both of these political organizations and when such unity is believed by the leadership to be threatened, dissent is squelched.

But in countries where political participation is deemed to be a basic right, it isn't customary to silence opponents. At most a kind of compromise is achieved among the various political factions. It is very rare that some given political idea succeeds at dominating public policy. Accordingly, a mixed economy is exactly that, a mixture of various conceptions of how the economic affairs of the country ought to be governed. Some parts of the economy will be substantially, maybe even totally free of government regimentation or regulation. Consider the market wherein pottery is being produced, sold, exported, imported, etc. It isn't subject to much government meddling. Or posters or hats. And this could be the case for many other goods and services, although in an integrated economic system regimenting or regulating one sector of the market will tend to have an impact on the rest. What is pretty much guaranteed, especially where no strict constitutional protection of free trade exists, is that there will be no system-wide socialism or capitalism or fascism in play but, instead, all these and some others will somehow coexists and champions of every one will advance and retreat in their respective influence on the country's economy as a whole.

It is, therefore, a foregone conclusion that those who assert that a mixed economy has become fully socialized or is completely laissez-faire are engaging in hyperbole. When a columnist for The New York Time, the author of some book on public policy, or a letter to the editor writer says that the philosophy of free market capitalism has become the ruling ideology of the country and is responsible for our ills, they cannot be telling the truth and they must know that they aren't since no genuine free market system exists. Furthermore, it is inherent in the mixed economy that it is, well, mixed. Perhaps in one or another era one or another part of the mixture can be more pronounced. And, certainly, one or another part of the mixture of a mixed economy could find more vocal champions supporting it. But unless these champions manage to change the basic law of the land that give legal backing to its mixed character, their position will not dominate.

So when it is asserted that the American economy is based on market fundamentalism--or, indeed, on any other pure idea of economic organization--this cannot be right and is very likely done for a purpose other than to say what is in fact the case. As the English linguistic philosophers J. L. Austin argued, there are goals apart from stating the truth that we pursue when we offer various utterances. In his wonderful little book, How to Do Things With Words? Austin identified, among other such goals, the influencing of people's beliefs and even actions. Thus, for example, there are what he called perlocutionary utterances whereby those making the utterance want to make others do certain things they deem to be important. But they want to achieve this influence in a roundabout fashion, not directly, mostly by pretending something that is false, namely, that the welfare state is a well functioning system of political economy.

I am convinced that when opponents of free market capitalism charge that America has been in the grips of market fundamentalism, they don't mean to say anything that's true. Rather they want to influence others to act in certain ways that such utterances are likely to encourage. They want to belittle free market capitalism by associating it with various disagreeable aspects of the American economy, one that is anything but fully capitalist but rather highly regulated, highly interfered with by the various levels of government.

Please do not fall for this trick. A great deal depends on repelling it, especially when perpetrated by prestigious people and prestigious institutions.

Not everyone should vote!

Tibor R. Machan

Back in 1992 I wrote a column for The Chicago Tribune that is even more pertinent now, with the recent publication of George Mason University economist Professor Bryan Caplan's book, The Myth of the Rational Voter (Princeton University Press, 2007). Here is the gist of it, only slightly edited.

From various celebrities to the radio announcer at the station to which I listen, everyone urged me to vote this coming November. But, in fact, it isn't always such a good idea to vote.

I did, actually, fill out my absentee ballot but decided not to vote in a bunch of the races I had a chance to make a choice. I did record my choices on most of the ballot measures. When it came, however, to the folks who wanted to be judges and members of city council and such, I decided I had no idea what they stood for and voting for them would just be irresponsible.

And I bet that is so with nearly all of us--many of the people we have a chance to vote for or against are unknown to us. This is especially so when it comes to their ideas on the various issues they will have to address once in office. That is very troubling, since these days politicians address nearly every issue under the sun. Government isn't limited to keeping the peace so one could keep abreast of its activities fairly simply. No, in Congress the men and women serving must decide about everything from how many tanks should go to NATO forces to what percentage of alcohol must be in imported beer. Municipal, county, state and federal authorities have their noses into millions of issues and very few citizens they serve have even a clue as to how they will decide on them. It would take innumerable full time jobs to keep tabs on today's issues facing Congress, the state assembly, the county supervisors, and the city council.

So those who urge us all to vote need to temper their enthusiasm with a little dosage of reality. Most of us are ignorant about the issues and, moreover, this is unavoidable. We cannot possible keep up and still have a life of our own. As a result, if we were to listen to the counsel of all those celebrities, it would guarantee that our representatives would get elected by a bunch of ignoramuses. Come to think of it, isn't that just what we witness in the various centers of power? Isn't that one of the reasons political discourse is so inept, sinks so low, is so full of character assassination and void of substance in most regions?

It is plainly impossible these days to educate the public about all of what politicians and their appointed bureaucrats need to know to do the right thing. When folks must make decisions for so many people, on so many issues, there is no way to do the right thing--one will necessarily wrong many of the people affected. Even having a general political vision is insufficient, mainly because those who hold office vote not so much in line with some political philosophy but as they believe the various vested interests in their districts would like them to.

One reason the American Founders wanted a limited government is that they were aware of how much of a war of all against all the politics of a democracy could become unless democracy is severely checked. Government was supposed to secure our rights to life, liberty and the pursuit of happiness and elections were to decide only who we hire to do this job. By now, however, the job has gotten way out of hand -- politicians and bureaucrats have taken over supervision of nearly all parts of our lives. And the people are completely divided as to what they want from them. It all depends where their vested interest lies and what kind of coalitions they can arrange.

Yet, there is no way they can actually learn which proposal their politicians can vote for or against will do them the most good. So what is left? To vote ignorantly, based on vague impressions, style, feel, sex appeal, etc. Or to refrain from voting.

In such a climate it is no wonder that people begin to yearn for a simplified process, one whereby perhaps a great leader provides us with political guidance. In some areas the only virtue left to democracy is how it slows down political power. Even that is unappreciated by many people (consider how when a bunch of "world leaders" come together to sign some treaty they need to face the agony of selling the deal to their people; and then they are badgered about it by the less democratic of the parties).
I say, vote only if you have a clue. Otherwise do not vote and then, perhaps, the selection process will gain from the fact that the few who vote do have a clue. But, of course, the real answer is to reduce the scope of what politicians can vote on and keep them worried about just a few matters, mostly how best to defend our individual rights

Another Lesson in Freedom

Tibor R. Machan

When I became seriously interested in the free market I began, also, to encounter a good deal of criticism of that system, mainly because the critics mindlessly blamed the great depression on it. But looking at it more carefully I learned that by the time of the Great Depression there was nearly nothing left of laissez-faire capitalism in America. Sure, compared to some other countries there was more capitalism here than elsewhere but compared to a dead drunk someone who only staggers around a bit from booze seems nearly sober. Sadly, America was never "sober," never a completely free market economy and after the populist political economic influences of the early 1900s only the momentum of the remnants of a free economy was in evidence. Contrary to widespread myth, FDR did not rescue the country from the government induced Great Depression--it was the Second World War that exerted the greatest remedial influence.

One thing critics of capitalism kept repeating since the New Deal is that nothing like the Great Depression and the economic mess surrounding it can happen now since government stepped in with all its regulations and safety measures. Now, the mantra went, it just cannot happen here any more.

When the current economic slide began to be undeniable, defenders of the welfare state, of extensive government intervention in the market place, started to blame it all on market fundamentalism, on the "ridiculous confidence" shown in the free market system. Of course, this was a ruse and continues to be, as put out by the politicians who keep this way adding fuel to the fire they set in the first place. They keep repeating the lie that deregulation caused the current fiasco when, in fact, the main culprit is the easy credit policy demanded of banks and other lending institutions so as to "level the playing field" for everyone. (Of course, if by "deregulation" is meant taking off the legal protection of contracts and property rights, then, yes, "deregulation" is reponsible!) Instead of enabling minorities and groups whose members had experienced injustices and economic setbacks in the past, by means of freeing up the economy as fully as possible, the political class tended, in the main, to embrace the idea that handouts, special breaks and privileges, including easy credit, would be the proper way to "help." It never is, of course, but it can postpone the chicken coming home to roost. For a while by stealing from Peter so as to support Paul, which can appear to be effective but, in time, Peter will not take it anymore.

These elementary lessons of the vitality of freedom--in this case vis-à-vis economic health--keep being rejected and even outright distorted by statists around America and the world. Because it isn’t simple to trace out the chain of causation when disaster finally hits, many people keep repeating and get some mileage out of their anti-market message. (A perfect example is Naomi Klein’s The Shock Doctrine: The Rise of Disaster Capitalism [Metropolitan Books], which is a vicious, irresponsible attack on the late Milton Friedman and his defense of the free market and which gained equally devastating reviews in both the libertarian Reason and center left The New Republic.)

What is really sad is that nearly all those who have been most instrumental in precipitating the current economic fiasco are walking around telling lies with virtual total immunity. It is very much like all those Soviet communists who got off scot-free after the fall of the USSR and are continuing to mess things up for Russia and the former Soviet colonies with their influence on how history is understood there and how public policy is forged.

Instead of going after the political criminals, a great many pundits and academicians are slandering freedom and keep asking for more of the same, namely, government meddling. The famous bailouts, for example, were perpetrated by those folks but despite their total failure, the perpetrators are still running around trying to manage the economy. The chorus of those who understand how ineffectual the government measures are and how much they make tings worse is too small and hardly gain a hearing in the mainstream forums where the problems are being talked about.

I know what I must do in the light of all this. I must continue to try to educate folks to the superior value of human liberty and how it is the only hope for bringing about recovery. Maybe you can help me.

Academic Conundrums

Tibor R. Machan

After I entered college, somewhat late in my life, I searched for a discipline I would be able to be devoted to. Took me a couple of years but my very first inclination had proved to be right--I became smitten by philosophy. One reason was that I didn't detect any orthodoxy in the field, not at least as taught where I first took courses in it. Not that I liked the idea that no philosophy could be correct, not by a long shot. But I liked that none was officially embraced, like Marxism was in my native country at the time. I have never regretted entering this discipline despite the many frustrations that I have encountered there.

My eventual choice was to defend something fairly ordinary, namely, that the world exists independently of how we feel about, perceive it, wish for it to be, etc. Even in ethics and politics I concluded there are right answers, though this is not as simple an idea as it may appear at first. To this day I enjoy taking part in various Socratic discussions--nearly free-for-all exchanges--inside or outside the halls of Ivy. But I admit that sometimes it is frustrating to take seriously what fellow academicians defend, or give voice to. Yet that is just what those who sign up for an academic career must accept, a lot of frustrating, even bizarre ideas being aired by one's colleagues.

At a couple of recent gatherings, for example, there were several notions circulated that just didn't seem to me to make any sense. For example, some of my colleagues from the natural sciences argued that time is unreal or, perhaps more accurately, that times is something different for those belonging to different cultures. (No wonder, I suppose, that many participants came "late" to the event and we started about 20 minutes "later" than scheduled!) In the course of the discussion it was even proposed that "everyone is right," meaning, I take it, that no right and wrong can be found about anything at all--which I take to imply that this idea, too, is neither right nor wrong. And that is quite difficult to make sense of for me.

Another notion that got aired, quite seriously, is that what counts as bona fide, genuine art is entirely flexible and certainly changes from one era to another. So standards of art would, for some of my colleagues, amount to something very temporary. (Does this invalidate the idea of timelessly worthy works? Or works that are artistically excellent in any period of human history, like the classics?) The only problem with this idea, as some even admitted, is that there would be no way to distinguish genuine art from trash. Ah, but I guess this is philosophically appealing to some, even while in matters of politics diversity is mostly frowned upon. (Many academics love diversity on the surface but when it comes to substantive diversity they disapprove--is liberalism a sound political idea, socialism, capitalism, or affirmative action or the minimum wage law?) Yet if everyone is right, then surely nothing can be politically correct, either.

When I teach undergraduate courses I sometimes imagine what my frosh students must go through as they try to explain to their relatives what is happening in college while visiting home on their Thanksgiving holiday. Of course, teachers don't often wholly convey their own ideas in their class rooms, especially if these ideas can only be fully appreciated by those who have a good sense of the history of a discipline. But students do not encounter their professors only in the classroom and if they come to some of faculty seminars and report back home what they hear there, this could land them in some emotional difficulties. Unless their relatives understand that university education is a kind of smorgasbord where many ideas are explored and none is required to be believed, only mastered.

Yet this idea, what is probably the meaning of a liberal education, is not all that widely understood by parents and relatives who have been away from college and university classrooms for decades. One can only hope that however perplexing the ideas of some professors may be, students have enough confidence in their own minds that they will think things over before they accept the more incredible ones. Yes, there are some serious issues to be explored about time but, yes, time is real--so show up for class when it begins!