Over at Salon, I came across a post titled Libertarians Very Confused About Capitalism which I thought I’d give a read. I was curious how the author came to the conclusion that libertarians should support redistribution. The article is pretty typical of the type of class warfare writing you find in the liberal media today. So, let’s take a closer look:
If one defines capitalism as a system designed by and for the interests of those who hold capital (what it is), capitalism is what the United States has today.
Not exactly. Mr. Davis wants us to believe that capitalism equals libertarianism. But the primary goal of libertarians is to eliminate coercion. That is, libertarians wish to allow people to engage in voluntary behavior including trade. If you asked Ron Paul what he would do if given a choice between a world without “capitalism” and a world without coercion, clearly Paul would choose the latter. Additionally, the above statement is nonsense from the outset. For example, I could make the same statement about North Korea. After all, the only difference is the capital is held by the state rather than the evil “private” individuals.
It is a system based not on principles of freedom and liberty and justice for all, but the accumulation of wealth for people called “capitalists.” It entails structuring an economy in such a way that natural resources are exploited for private gain and land is parceled off into mortgage-backed securities. It means rich people using their money to buy power and shape economic relations to their advantage, which makes them more money
Now that I’ve dismissed libertarianism from this discussion, let’s get to the authors real beef: capitalism. The primary problem with these type of statements is that they ignore the fact that free market capitalism has raised the world out of poverty. However, the author here makes it difficult to respond because he provides no details whatsoever and paints with such broad brush strokes. Is the concern of poverty within capitalist countries or is the concern over world poverty? If it’s within capitalist countries, has the author taken a look at what poverty looked like, say in Europe, prior to the industrial revolution? If it is a concern over world poverty, has the author considered that poverty in third world countries exists precisely because they do not have a form of free market capitalism? Very few serious economists today argue that capitalism is a bad thing. True, the author claims his main point is that we should have more redistribution. But, in reading this piece, it’s seems he is more interested in ranting against the rich than helping the poor or determining what the proper reforms are of our current model of Capitalism. I think that is clear in the following statement:
I am told this does not exist today, “the free market,” and I agree, but I suspect it doesn’t exist now – a capitalism based on rigid notions of private property but not systemic violence that manifests itself in a massive transfer of wealth to an already wealthy elite – for the same reason human babies aren’t born to alligators: because it’s impossible and goes against everything we know about our world.
I grew up poor and among both conservative and liberal family members. I had the same disdain for the rich, mistrust of management and “the boss” that many young people do. I did not come to understand and accept libertarianism easily. It took quite a lot of reading and thought. And, even today, I refuse to allow myself to become close minded about it. In other words, you won’t find me writing much about human babies being born to alligators.
The author has this one backward, and I believe history proves it. It is socialism that is an impossibility. Ludwig von Mises an Austrian economist, wrote of the calculation problem in 1920 that is inherent in all socialist economies. And since then, Mises has been proven correct. You can see the results of this clearly in countries like North Korea and China. China is an especially interesting example since liberalization in the country has improved their economy situation in the last few decades. In fact, you can find many failed experiments of socialism thru out history, including early colonial settlements in America.
We know that money buys power, for instance. And we know that rich people are not typically concerned with sainthood when it comes to their pursuit of money. When enormous wealth is allowed to accumulate in the hands of a small fraction of the population, then, that minority can use that wealth to manipulate economic outcomes – and they don’t care if they violate every principle known to the Paul family. That is why some oppose this concentration of wealth no matter whether it comes from “good” or “bad” capitalism.
Rich people are not typically concerned with sainthood? It appears to me that the authors real agenda is showing here. Again and again he makes the same mistake: to lump people into broad categories. This should come as no surprise as progressives, and really politicians and other coercers in general, must do this to accomplish their goals. If you recognize the individual and wide variations you have in humanity, you lose the power to easily pass coercive legislation against these made up categories of people. It’s also pretty clear the author has a real problem with “the rich”. But “the rich” that I know started small businesses without the help of lobbyists. They are nothing like the kind of “evil” people this author imagines them to be.
But lets focus on the last sentence in the above quotation. It appears to me that the author is saying that, since some rich people are extremely rich and most likely unsaintly, that we must oppose concentrations of wealth in general. This is a non-sequitor. But it is a pretty common line of reasoning for socialists. Maybe it stems from those days in school when the teacher would punish the whole class until the perpetrator revealed himself. But in the grown up world, it makes little sense to paint with such broad strokes. The author seems to be saying “some rich people are bad, therefore I oppose all wealth”. Using this line of reasoning, I could oppose literally anything because bad people are everywhere. In addition, who would decide what concentrations or too much? And can we trust someone with this kind of power?
Libertarians need not agree that the accumulation of enormous sums of wealth is immoral and unhelpful when it comes to the preservation of freedom, even though it is.
I have to admit, I’m a bit lost with this statement. What is the connection between accumulation of wealth and the loss of freedom? Freedom is the lack of coercion. However, I suspect the authors definition is different. Most progressives definition of freedom includes positive rights which are essentially another way of saying they support redistribution. As a libertarian, I’m frankly not concerned with accumulation of wealth, per se. This misses the problem completely. The real problem runs a bit deeper than this shallow salon post. Instead we should have an open mind and ask important questions and seek answers;
- Why is the wealth gap growing?
- Is poverty really getting worse and if so, why?
- Have current income redistribution schemes improved things or made them worse?
- Is there really difference between the power wielded by an elected official and power wielded by an elite rich? Can we really put more trust in one over the other?
As of 2012, the average CEO at a top American firm now makes 273 times as much as the average employee, up from a ratio of 20-1 in 1965. Few libertarians would say the market today is freer than the market then. So why don’t we hear anything about any grand, liberty-minded plans for the radical redistribution of wealth? When you change a system but keep the results of systemic injustice in place, you are not really changing anything. Who cares about “freedom” when the only difference between that and oppressive Big Government is that an absentee landlord now relies on a private security firm to kick you out of your home instead of the cops?
I believe one should look at this objectively and with a clear head. This is something that is difficult to do when your getting your “hate the rich” on like this Salon post. First, why has this occurred? Is it due to the free market, or is it crony capitalism? The author seems unconcerned and, in fact, I don’t think he cares a twit. This is class warfare pure and simple. To the author, there’s no need for economic analysis. It’s simple. The ratio was 20-1 and now it’s 273-1 so lets pass laws to make it 20-1 again. This is extremely naive and childish. The last sentence from the above is bordering on ridiculous. There is so much to unwind in that one statement, I don’t know where to begin. It’s pretty clear this author has no interest in the truth, since the answer is already predetermined: more redistribution! First of all, it was this progressives big government, along with the federal reserve and crony Wall Street firms that was primarily responsible for the bubble in 2007 that resulted in much of the housing problems over the last 5 years. The author does not say why this person was kicked out of his house. He does not say why he is concerned that this was performed by a private security firm. However, I do think the author’s real agenda has peeked in again, as apparently he, given a choice between a society of freedom with private security firms and a society with tyranny and public police would choose the latter.
At this point, this post has gone on long enough. I see no point in commenting on the rest of this nonsense. If the author of this post would like to have a serious debate on this, I’d be happy to do that. I can be found on debate.org under the handle ax123man.