Great Libertarian & Minarchist Quotes

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# If you are not outraged you are not paying attention – Unknown

# Socialists like to tout their confiscation and redistribution schemes as noble and caring, but we should ask if theft is ever noble or caring. – Robert Hawes

# The greatest gift of freedom is that it allows us to govern ourselves, and the greatest burden of freedom is that it requires us to govern ourselves. – Robert Hawes

# A great danger that we face in our modern world is to get so caught up in the pursuit of the blessings that freedom has given us that we come to take freedom itself for granted, and thus fail to see to its maintenance. – Robert Hawes

# Everyone is entitled to his own opinion, but not his own facts. – Daniel Patrick Moynihan

# The Constitution was made to guard the people against the dangers of good intentions. – Daniel Webster

# Profit is a signal that valuable services are being rendered to people on a voluntary basis. – Lew Rockwell

# Subsidies create more of whatever is being subsidized. – Lew Rockwell

# 98% of Americans support the use of mass transit by others. – The Onion (satire newspaper)

# You don’t need a degree in political science to know what freedom is. – Andrew Wiegand

# Eternal vigilance is the price of liberty. – Thomas Jefferson

# As our rights fade out, we accept perpetual war for perpetual peace, the two parties fuse into one, and the government becomes more powerful than at any time in our history. – Kevin Maley

# Even the lion has to defend himself against flies. – Anonymous

# The fact is that the average man’s love of liberty is nine-tenths imaginary, exactly like his love of sense, justice and truth. Liberty is not a thing for the great masses of men. It is the exclusive possession of a small and disreputable minority, like knowledge, courage and honor. It takes a special sort of man to understand and enjoy liberty – and he is usually an outlaw in democratic societies. – H.L. Mencken, Baltimore Evening Sun, Feb. 12, 1923

# Expecting the government to fight the deficit is like expecting the Mafia to fight crime. – Anonymous

# Freedom is still the most radical idea of all. – Anonymous

# At the day of judgment we shall not be asked what we have read but what we have done. – Thomas A Kempis

# Have no fear. The next President will promise not to raise taxes. – Anonymous

# Old MacDonald had an agricultural real estate tax abatement. – Anonymous

# Space has no beginning or end and goes on to infinity with no limits! Like taxes, but on a much smaller scale. – Anonymous

# Syntax? Why not, they tax everything else. – Anonymous

# Taxes are not for the benefit of the taxed. – Anonymous

# Taxpayers don’t have to take a civil service exam to work for the government. – Anonymous

# The chief purpose of government it to perpetuate the government. – Anonymous

# The politicians’ three R’s: this is Ours, that is Ours, everything is Ours. – Anonymous

# Things happen the day you decide you’re going to make them happen. – Pam Lontos

# Under capitalism man exploits man; under socialism the reverse is true. – Anonymous

# Why does a slight tax increase cost you two hundred dollars and a substantial tax cut save you thirty cents? – Anonymous

# Publics schools are institutions of coercion. Students are coerced to attend them. Parents are coerced to pay for them. – Gary Reed

# A proliferation of new laws creates a proliferation of new loopholes.

# A thing is not necessarily true because a man dies for it. – Oscar Wilde

# Any system that takes responsibility away from people, dehumanizes them.

# Bad law is more likely to be supplemented than repealed.

# Being right is seldom enough. Even the best ideas must be packaged and sold.

# What the government is good at is collecting taxes, taking away your freedoms and killing people. It’s not good at much else. – Tom Clancy on Kudlow and Cramer 9/2/03

# The majority of Americans get their news and information about what is going on with their government from entities that are licensed by and subject to punishment at the hands of that very government. – Neal Boortz

# What the government gives, it must first take away. – John S. Coleman

# With respect to the words “general welfare,” I have always regarded them as qualified by the detail of powers connected with them. To take them in a literal and unlimited sense would be a metamorphosis of the Constitution into a character which there is a host of proofs was not contemplated by its creators. – James Madison

# You can no more win a war than you can win an earthquake. – Jeannette Rankin

# I don’t know the key to success, but the key to failure is trying to please everybody. – Bill Cosby

# Any intelligent fool can make things bigger, more complex, and more violent. It takes a touch of genius – and a lot of courage – to move in the opposite direction. – E. F. Schumacher

# We can’t all be heroes because somebody has to sit on the curb and clap as they go by. – Will Rogers

# The whole problem with the world is that fools and fanatics are always so certain of themselves, but wiser people so full of doubts. – Bertrand Russell

# Well, if crime fighters fight crime and fire fighters fight fire, what do freedom fighters fight? They never mention that part to us, do they? – George Carlin

# The problem with political jokes is they get elected. – Henry Cate VII

# Those who corrupt the public mind are just as evil as those who steal from the public purse. – Adlai E. Stevenson

# No snowflake in an avalanche ever feels responsible. – Stanislaw J. Lec

# A problem well stated is a problem half solved. – C.F. Kettering

# I don’t have any solution, but I certainly admire the problem. – Ashleigh Brilliant

# The issue today is the same as it has been throughout all history, whether man shall be allowed to govern himself or be ruled by a small elite.” – Thomas Jefferson

# The system of private property is the most important guaranty of freedom, not only for those who own property, but scarcely less for those who do not. – Friedrich A. Hayek, in “The Road to Serfdom”

# The fatal flaw in socialism is twofold: first, the conceit inherent in the desire to plan the lives of others; second, the force necessary to impose that plan on unwilling subjects. This is not a formula for freedom but for tyranny. – Jim Peron in The Ideals of Tyranny

# Remember that the key words in the sentence “I want to help you” is “I want”. – G James

# Liberty is born of self-interest. It effects goodwill to all through its practice, and it generates goodwill in everyone as a consequence. – Richard Rieben

# If voting made a difference, they would make it illegal. – Donal Scannell, at the Conference on World Affairs, Boulder CO, 4/6/04

# In almost all matters, the real question should be: why are we letting government handle this? – Harry Browne

# The root source of wealth is human ingenuity. This has no known bounds, so the amount of wealth in existence can always be increased. That’s why capitalism is called “making money”. – Marc Geddes

# I’d rather live free with some peril than be a protected slave of government. – Dave Duffy

# Democracy is not a system of liberty, but a form of tyranny: the tyranny of the majority. – Robert Garmong

# A hallmark of democracy is pressure-group warfare, as each group seeks to claim the status of a majority and exploit all the rest. – Robert Garmong

# It makes no difference, in principle, if this “collective will” is divined by the edicts of a dictator or by majority vote – so long as the rights of the individual may still be sacrificed. – Robert Garmong

# Individualists unite! – Treveor Sutherland, Hamilton County TN LP Chairman

# The government that we gave limited power to – to protect our rights – has grown into a hideous behemoth that continually increases its power and now enslaves the people, and causes strife throughout the world. – Tom Parker

# Those are my principles. If you don’t like them, I have others. – Groucho Marx

# Many say that since all the signers of the Constitution were Christian, this is a Christian country. However, they were all white males as well. Are we a White Male Country? – “bostnfound”, in a Free State Project forum, 7/04

# Nothing gives one person so much advantage over another as to remain always cool and unruffled under all circumstances. – Thomas Jefferson

# Most people … aren’t just ignorant or stupid: they genuinely prefer government control of their own and their neighbors’ lives. We can hand out flyers for the rest of our lives, publish as many books as we like, make speeches until we’re blue in the face, and most of them aren’t going to change their minds. While they disagree among themselves about the details, authoritarians of one sort or another constitute an overwhelming majority. – Max Orhai, Liberty Magazine, 6/04, page 23

# Benevolence comes from within as a reflection of our personal, individual sense of well-being. To force it, externally – through moral intimidation (altruism), social intimidation (duty), or at the point of a gun (legislation) – debilitates our personal sense of well-being and negates the source of benevolence. – Richard Rieben (4/7/04)

# It is our true policy to steer clear of entangling alliances with any portion of the foreign world. The great rule of conduct for us in regard to foreign nations is, in extending our commercial relations, to have with them as little political connection as possible. – George Washington

# I can now comprehend the fact that there is no possibility of freedom in this Country. It’s too late. Call me a bad American, but I am ashamed and hang my head low when I think of what America has become. … The experiment is over, freedom lost, tyranny won. – Mike Wasdin, 9/7/04

# Do not separate text from historical background. If you do, you will have perverted and subverted the Constitution, which can only end in a distorted, bastardized form of illegitimate government. – James Madison

# Unlike the world of free-markets, in political government when some individuals win, other individuals lose. – Robert Klassen, 10/3/02

# When a majority rules, a minority is ruled. – Robert Klassen, 10/3/02

# The price of a “free” public education is freedom. – Capitalism.org

# All wars are fought over one premise; my god is better than yours. – Mike Wasdin

# Borrow, spend, tax and … promise, promise, promise is the formula for a long and successful political career. – Hal O’Boyle

# We get to go to the polls every couple of years and choose between two flavors of the same gruel. The inmates get to elect the guards. Then, having exercised our rights as free citizens of a great social democracy, we go back to obeying orders. – Hal O’Boyle

# The government says: You are free to do anything we want. – Anonymous

# The political ballot box stands for – willingness to be ruled by somebody other than yourself. – Alvin Lowi, Jr.

# If voting could change things, it would be illegal. – Unknown

# Intaxication: Euphoria at getting a refund from the IRS, which lasts until you realize it was your money to start with. – Unknown

# The next time some academics tell you how important “diversity” is, ask how many Republicans there are in their sociology department. – Thomas Sowell

# To protect us from terrorists our government treats us like terrorists. Hal O’Boyle

# Government failure is always used as an excuse for government expansion. Government thrives on crisis and incompetence. – Jim Babka of DownsizeDC.org

# Politics is a strife of interests masquerading as a contest of principles. – Ambrose Bierce

# If we all stop voting, will they just go away? – Bumper Sticker

# The price of empire is terrorism. – Greenbacks

# We have been living amidst one of the great revolutions of human history, and we hardly know it: the penetration of the State into every aspect of human life and society. Some people regard this as good and “progressive,” others regard it as tyrannical; but either way, it’s a fact, a transformation as great as, say, the Industrial Revolution. Absolutely nothing is now beyond the scope of State power. – Joseph Sobran

# A limited government is a contradiction in terms. – Robert LeFevre, The Fundamentals of Liberty

# The most destructive thing governments do is divide people against each other, all in competition over the reins of the state. – Anthony Gregory

# The war on “terror” will never be over, it will just change locations. Like the war on drugs, prostitution, pornography, and the many others that will follow, it is a war on humanity. These wars will never be won; the State will just keep creating new boogiemen to frighten us with. The sheep will anxiously anticipate the next fall guy the State offers up as a sacrifice for the war on whatever happens to be next. Be careful, the next pawn could be me or you. – Mike Wasdin

# Vows made in a storm are forgotten in calms. – Old English saying

# If the Tenth Amendment were still taken seriously, most of the federal government’s present activities would not exist. That’s why no one in Washington ever mentions it. – Thomas E. Woods, Jr. in The Policitally Incorrect Guide to American History

# A country that goes out of its way to imprison the innocent has no business preaching democracy to the world. – Paul Craig Roberts

# The problem is that democracy is not freedom. Democracy is simply majoritarianism, which is inherently incompatible with real freedom. Our founding fathers clearly understood this. – Rep. Ron Paul in Democracy Is Not Freedom

# Popular suffrage is in itself no guarantee of freedom. People can vote themselves into slavery. – Frank Chodorov

# There’s small choice in rotten apples. – William Shakespeare

# How to obtain freedom has been, and is, mankind’s most important quest. – John A Pugsley, intro to “None of the Above”.

# A democracy is rule by the majority; a republic is the rule of law. This is a very critical distinction. – Steven LaTulippe

# Voting is the opiate of the masses. – Steven LaTulippe

# As the state grows, one’s sense of self-ownership is destroyed, liberty is traded for “security,” the human spirit diminishes, and the citizenry increasingly thinks and behaves like dependent children. – Eric Englund in Income Taxes, Obesity, and Other Maladies of Nanny Statism

# To shackle future generations, with such monstrous debt and liabilities [$50 trillion+ of unfunded federal liabilities], is tantamount to selling them into tax slavery. – Eric Englund in Income Taxes, Obesity, and Other Maladies of Nanny Statism 2/28/05.

# We cannot restore traditional American freedom unless we limit the government’s power to tax. No tinkering with this, that, or the other law will stop the trend toward socialism. We must repeal the Sixteenth Amendment. – Frank Chodorov in The Income Tax: Root of all Evil

# Government is force, and politics is the process of deciding who gets to use it on whom. This is not the best way to solve problems. – Richard Grant, The Incredible Bread Machine, 1999

# The good governor should have a broken leg and keep at home. – Cervantes

# A man is none the less a slave because he is allowed to choose a new master once in a term of years. – Lysander Spooner

# People do not walk barefoot because there are no government shoe factories. – Anonymous

# What difference is it to me if a decision is forced upon me by a dictator or by half of my neighbors? Either way my right to free, peaceful action has been nullified. – Stephen H. Foerster

# An anarchist is anyone who believes in less government than you do. – Robert LeFevre

# You don’t need a treaty to have free trade. – Murray Rothbard

# Public schools are government-established, politician- and bureaucrat-controlled, fully politicized, taxpayer-supported, authoritarian socialist institutions. In fact, the public-school system is one of the purest examples of socialism existing in America. – Thomas L. Johnson

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Robert Owen: The Woolly-Minded Cotton Spinner

Robert Owen: The Woolly-Minded Cotton Spinner

_{Mr. Barger is a corporate public relations executive and writer in Toledo, Ohio.}

_{The nearby Wabash river must have seemed symbolically reassuring to Robert Owen on the day he arrived in Harmony, Indiana in late 1824 to launch the millennium.}

_{It had been on another river, the Clyde in Scotland, that Owen became rich and famous as the director of the New Lanark cotton spinning mills. Here at Harmony, on the Wabash, he was about to establish a community that would become a beacon for all mankind. For too long, in Owen’s view, the world had been in bondage to the sins of individualism and self-interest. He had a better way, a way of cooperation and sharing. New Harmony, the name he gave the village after purchasing it early in 1825, would direct the world to this new way by its successful example.}

_{But as students of American history know, Owen’s millennium never came. New Harmony was a colossal failure that consumed at least four-fifths of his fortune and destroyed his reputation as an astute businessman. Far from proving that individualism and self-interest could be eradicated, New Harmony revealed perverse and virulent forms of both traits. Hailed as a new beginning in cooperation, the community of 900 persons on the Wabash was characterized by bickering and dissension almost from the start. Established as a new social order that would bring economic security, the village quickly fell behind in crop production and ordinary maintenance tasks were neglected. Proclaimed as the model for a system that would usher in a new era, Owen’s village was copied only briefly by other communistic societies in America and was then abandoned. As a venture that was supposed to spark the millennium, New Harmony was a total failure.}

_{Oddly enough, however, the New Harmony debacle may have been the high point of Robert Owen’s life, because it won him a place in American history and created a heightened interest in "Owenism," the brand of socialism he espoused. Unfortunately, neither Robert Owen nor his followers learned the lessons that New Harmony could have taught them, and much of the "democratic socialism" that is now practiced in the Western world reflects the same fuzzy thinking that destroyed Owen’s model community. We are still paying for Owen’s folly and for the failure to understand the contradictions of Owenism.}

_{Why did the New Harmony venture fail? It certainly had everything going for it. The community was actually a going concern with good buildings, cultivated lands and orchards, and afair amount of livestock when Owen purchased it from a German religious sect called the Rappites. It could have had good leadership, because Owen was wealthy and had proved himself a capable manager. The New Harmony movement also had wide support in the new American nation, and Owen had even been given an audience with President-elect John Quincy Adams and the Secretary of the Treasury when he arrived in Washington. There was a kindly tolerance of new ideas, and if New Harmony had been a sound and workable system, the United States had both the political freedom and the available land for thousands of such communal enterprises. Then or now, nothing in the fundamental American idea was opposed to the socialistic communities of the early 19th century, since they were voluntary arrangements and used peaceful means. So why didn’t New Harmony become – as Owen hoped it would – the seed colony of a new social order for the country and the world?}

_{How Allocate Resources?}

_{The seed colony didn’t reproduce because the problems that undermined New Harmony are essentially the same problems that bedevil every social democratic country in the world, including the present-day United States. Using strictly voluntary, peaceful means, how do you obtain human cooperation and allocate resources in a socialistic society ? How do you convince the most productive workers that they should keep on producing when everybody, including the idler and the incompetent, is rewarded equally? How do you decide what is to be produced? Or who is to have what job? Who should do the saving to provide investment funds? How can you exchange goods and services in a fair and equitable manner? These are tough, common-sense questions, and they weren’t answered satisfactorily at New Harmony. So far, the democratic socialists haven’t really answered them either. Socialists are either forced to yield to the requirements of the marketplace, because of their love of freedom, or to move towards the totalitarianism of the Marxist-Leninist camp, because of their blind love of socialism. Both actions are a tacit admission that democratic socialism doesn’t work.}

_{In Owen’s case, he made no compromises with reality, since he was basically rigid in his outlook and was not capable of altering most of his views. Early in his adult life, he had developed a distaste for individualism and competition, although he was in many ways a gifted individual who could easily compete with others. He wasalso a man of deep humanitarian instincts, and he would have abhorred the brutal socialism of modern Russia and China. Beyond that, however, he was dogmatic and single-minded. Macaulay regarded him as a "gentle bore" and he was said not to have thought differently of a book for having read it. In other words, Owen was in- some ways insensitive to the realities of human nature and did not learn a great deal either from study or from experience. Yet he was an outstanding person of great ability, a high achiever in what would later be the Horatio Alger, Jr. tradition.}

_{A Successful Businessman}

_{Owen was born in Newton, Wales on May 14, 1771, and grew up under circumstances that seem severe by modern standards but were important in shaping his philosophy and life’s goals. Unlike some advocates of social change -Karl Marx, for example – Owen was a happy and successful man who had no personal reasons to resent the economic system of his day. Although he began his working career as an apprentice at age 10 without pay for the first year, his abilities were such that he had become a manager of a cotton mill at age 18 and within two years was able to demand and obtain a responsible position at the then handsome salary of 300 pounds yearly. He soon became well known in the British cotton spinning industry, and in 1799 he purchased an interest in a group of mills at New Lanark, Scotland. He became world famous as a result of the success of his enlightened policies in running the New Lanark mills.}

_{Owen was born at the right time and landed in the right place for the kind of business success he was to enjoy. The mechanization of the cotton spinning arts was in full swing in the late 18th century, and was presenting excellent commercial opportunities for large profits and rapid growth. It was also an ideal opportunity for a person such as Owen who had considerable management skills but, at the outset, little capital.}

_{Owen’s adult life can be divided into several periods of interest and activity. During his first 13 years at New Lanark, he was occupied with the problems of running the mills and bringing about improvements in the educational system and working conditions for the people employed in the mill. As he became wealthier and acquired national prominence, he began to speak out on social conditions and was soon producing the first of many essays outlining the program that eventually became known as Owenism. He was associated with the New Lanark mills until 1828, but long before that the promulgation of his social program had become his chief interest.}

_{With the closing of the long Napoleonic wars in 1815 and a sudden dropoff in demand, England went through a depression. Alarmed because of widespread unemployment, a committee of nobles and other leaders sought advice from manufacturers on ways of dealing with the problem. Owen proposed the development of Villages of Cooperation – the self-sustaining community idea that became the blueprint for New Harmony.}

_{New Harmony}

_{Owen thought that an ideal community such as a Village of Cooperation would bring out the best in people and put an end to competitiveness and other traits which he saw as social evils. He decided to prove this when he purchased the Harmonie (Harmony) settlement in 1825 from the Rappites. He renamed the community New Harmony and issued an open invitation to persons who might choose to affiliate with the settlement. But the venture was characterized by friction and indecision from the start, and by 1828 Owen withdrew most of his support, though retaining title to the property. His financial losses were so great that Mrs. Owen, who had not accompanied her husband to America, was forced to move out of their large mansion into smaller quarters.}

_{Owen unsuccessfully attempted to persuade the Mexican government to sponsor a community similar to New Harmony. He then returned to England and spent the rest of his life advocating social reforms. He was associated with another community venture in England, but like New Harmony, it was also shortlived. He experimented with a Labour Exchange, a sort of tradesmen’s cooperative to which individuals would bring articles in exchange for notes in lieu of currency. The exchange soon failed. Owen also led a massive union movement in England in the 1830s, but this collapsed within a few months. For the remainder of his life, Owen continued to publicize his social theories. But he had lost most of his influence by 1834. He spent his last five remaining years as a devotee of spiritualism, and believed himself to be in contact with famous persons who had passed on. At age 86, he wrote his autobiography, a book that is surprisingly lucid and carries important sections outlining the basic tenets of Owenism. He died at 87.}

_{Robert Heilbroner described Owen as "a strange mixture of practicality and naiveté, achievement and fiasco, common sense and madness." We are not accustomed to such "strange mixtures" most of the time. Actually, however, Owen’s behavior was contradictory only to those who lacked his view of matters, which he was to call "a new view of society." He always knew what he was doing and had supreme confidence in himself. He perceived a certain kind of role for himself and lived up to it.}

_{Guiding Principles}

_{Throughout his adult life, Owen was guided by three obsessive beliefs about himself and mankind which were to influence almost everything he did. Many of Ow-en’s actions will appear stupid and contradictory to the person who does not understand Owen’s motivations and attitudes. In fact, however, Owen was an unusually consistent person. He almost always behaved in accordance with his fundamental beliefs. It was his consistency, in fact, that may have led to his downfall on some occasions.}

_{What were the three guiding elements in Owen’s life? First of all, he was committed to a form of humanitarianism, and was certainly humane in his desire to seek a better life for all and to put an end to wretched social conditions and human suffering. He loved people, although in a way that some persons may have felt demeaning and patronizing. He was kindly and gentle, and it is virtually impossible to find an instance in which Owen exhibited spite, vindictiveness, jealousy, or greed. He had a friendly manner that others found attractive. His writing also had a warm, friendly tone, and his criticisms were usually carefully phrased when they involved specific persons.}

_{The second guiding force in Owen’s life was messianism and a belief in the eventuality of an earthly millennium. Yet he was openly anti-religious. He saw himself in a messianic role with a personal responsibility for causing the millennium (i.e., a New Moral Order) to come to pass. Had Owen been merely a humanitarian without a messianic mission, he probably would have ended his days as the genial director of the New Lanark mills. But he was not content with relative progress. He was able to prove at New Lanark that considerate treatment of employees and a general interest in improving employees’ well-being is also compatible with good business. But such improvements were too slow for the transformation that he believed was needed. He wanted to take dramatic and effective action that would quickly transform the world and bring about the glorious millennium. It was this messianic mission – and belief in millennialism – that took him from New Lanark to New Harmony.’}

_{Determined by Environment}

_{The third guiding belief in Owen’s life was determinism. He was unqualifiedly deterministic, and seems to have been almost completely committed to the belief that individuals are shaped by their conditions and their environment. He gave some weight to heredity, but devoted most of his attention to conditions. He was openly critical of individualism and seemed to be unwilling to admit that certain persons were capable of rising above the conditions imposed on them by society (even though he had !). Owen was dogmatic in stating his belief in the proposition that individuals are shaped by their environment.}

_{In the first essay in A New View of Society, Owen stated a fundamental principle which expressed his determinism and also became the rationale for many of his plans. This principle was restated frequently in Owen’s writings and has been considered typically Owen by his biographers. The principle is:}

_{Any general character, from the best to the worst, from the most ignorant to the most enlightened, may be given to any community, even to the world at large, by the application of proper means; which means are to a great extent at the command and under the control of those who have influence in the affairs of men.²}

_{Owen’s determinism, like his messianism, also helped take him out of New Lanark and into a wider world of social action. Had he not been basically determinist in his outlook, he might have been able to see some of the pitfalls in his plans for Villages of Cooperation. As a practical businessman, Owen knew that successful ventures require certain character traits and skills in management personnel and workers. If he had applied this same understanding to his proposals for ideal communities, he would have admitted more freely that the communal ventures would require similar individual traits in order to succeed. Although Owen steadily lost power and influence in the socialist movement after 1834, he continued to travel and to lecture whenever he could find an audience. New stars were appearing in the socialist constellation, among them Karl Marx and Friedrich Engels. Both paid homage to Owen as a man and a pioneer socialist, but neither thought much of his utopian socialism and they thoroughly refuted his major tenets. The struggling labor movement also honored Owen in the breach. Owen approved of general strikes, but wanted them carried out in a spirit of universal charity and philanthropy – an idea that never has caught on with any major labor union.}

_{Religion Rejected}

_{Owen also made a colossal mistake when he turned his back on organized religion and even attacked the church in an 1817 speech. This position cost him valuable allies, of course, but it also blinded him to the important role of religion in shaping society. It was indeed ironic that a religious sect, the Rappites, had established Harmony and operated it as a successful and prosperous community ; but things quickly fell apart under Owen. Owen wanted the kind of sharing and serving that groups such as the Rappites practiced, but he rejected the religious beliefs that held them together. As C. A. Burt, a resident of the famous Oneida Community, said with reference to New Harmony’s failure: "There are only two ways of governing such an institution as a Community; it must be done either by law or by grace. Owen got a company together and abolished law, but did not establish grace; and so, necessarily, failed." To this day, socialistic communities survive only when they are held together by religious or nationalistic feelings or are ruthlessly totalitarian.}

_{Misreading the Market}

_{Perhaps Owen’s greatest blunder, however, was in failing to understand the marketplace in which he had first accumulated his wealth and acquired prestige. Despite his success as a businessman, there is no evidence that Owen ever attributed his good fortune to the relative freedom of the marketplace in Britain or saw much social good in the mechanization of the cotton spinning industry. He did not seem to be interested in the kind of progress that occurs by increasing the productivity of the individual worker through the use of labor-saving machines. During Owen’s lifetime, for example,his own cotton spinning industry had made low-priced clothing and fabrics available to the masses. The impact of the cotton-spinning industry was so extensive that J. A. Schumpeter asserted that English industrial history can (1787-1842) "be almost resolved into the history of a single industry."}³

^{The rapidly improving productivity of the cotton spinning industry exemplified Adam Smith’s argument that "the great multiplication of the productions of all the different arts, in consequence of the division of labour, . . . occasions, in a well-governed society, that universal opulence which extends itself to the lowest ranks of the people."4 It did not seem to occur to Owen that he and his fellow manufacturers, albeit for profit-seeking purposes, had performed a great social service in building an industry that gave the majority of the people access to better clothing at lower prices. To Owen, cotton spinning machines had enslaved the worker and left him poorer than before. Adam Smith, studying the same industry, would have concluded that the steady improvements in machinery would tend to benefit almost everybody and that the British standard of living could be expected to rise with every increase in industrialization. Owen was unduly pessimistic about the future of mechanized industry, despite the fact that he had a major role in early stages of the industrial revolution.}

^{Utopian Socialism Replaced by Bolshevism}

By the time Robert Owen died in 1858, his utopian socialism had been largely displaced by the fiery doctrines that eventually became modern Bolshevism. But democratic socialists still claim him as their true ancestor. Clement Atlee, the British Labour Party leader who engineered a great upset victory at the polls in 1945, was quick to point out that "socialist theory was developed by Robert Owen in Britain long before Karl Marx." Perhaps this comment reflects the hope that Owen’s humanitarianism will triumph over the harshness of Marx and the totalitarianism of Lenin and Stalin.

^{The unfortunate verdict of unfolding events does not sustain this hope. The Owenism that failedat New Harmony did not die there; it has become the underlying philosophy of today’s British and American governments. If there are redeeming qualities in all this, it’s that many democratic socialists share Owen’s decency and humanitarianism. But they also share the woolly-mindedness and impracticality that sank his New Harmony enterprise and led to weakness and failure in Owen’s other ventures. If it’s the spirit of Robert Owen that pervades modern society, some of us might want to echo the words of an editorialist of Owen’s time:}

^{Robert Owen, a benevolent cotton-spinner . . . conceives that all human beings are so many plants which have been out of the earth for a few thousand years, and require to be reset. He accordingly determines to dibble them in squares after a new fashion.}

^{Everybody, I believe, is convinced of Mr. Owen’s benevolence and that he proposes to do us much good. I ask him to let us alone, lest he do us much mischief.}

^{Robert Owen – humanitarian, messiah, and determinist – didn’t want to let anybody alone. Today, we live with the mischief of his faulty philosophy. VV}

_{1 Frank Podmore, an Owen biographer, wrote, "When (Owen) published his New View of Society, he looked for the regeneration of the world to begin on the morrow: throughout his long life that high vision, ever receding as he advanced, was still before his eyes; and he died at the age of eighty-seven happy in the belief that the millennium was even then knocking at the door." Podmore, Frank, Robert Owen, Augustus M. Kelley, Publishers, New York, 1968 (a reprint of the 1906 hook), page 124.}

_{2 Robert Owen, A New View of Society, first published 1813/14, Penguin Books, Baltimore, 1969, page 101}

^{3 J. A. Schumpeter, Business Cycles, vol. 1 (1939), page 271 (referred to in Phyllis Deane’s The First Industrial Revolution, Cambridge University Press, England, 1965, page 84.)}

^{4 Adam Smith, The Wealth of Nations, Gateway Edition, Henry Regnery Company, Chicago, printed in 1953, page 19.}

 

Melvin D. Barger

Melvin D. Barger is a retired corporate public relations representative and writer who lives in Toledo, Ohio. He has been a contributor to The Freeman since 1961.

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The Nature of the State by Clarence Darrow 1903

THE NATURE OF THE STATE By Clarence Darrow 1903

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In this heroic age, given to war and conquest and violence, the precepts of peace and good will seem to have been almost submerged. The pulpit, the press, and the school unite in teaching patriotism and in proclaiming the glory and beneficence of war; and one may search literature almost in vain for one note of that "Peace on earth, and good will toward men" in which the world still professes to believe; and yet these benign precepts are supposed to be the basis of all the civilization of the western world.

The doctrine of non-resistance if ever referred to is treated with derision and scorn. At its best the doctrine can only be held by dreamers and theorists, and can have no place in daily life. Every government on earth furnishes proof that there is nothing practical or vital in its teachings. Every government on earth is the personification of violence and force, and yet the doctrine of non-resistance is as old as human thought—even more than this, the instinct is as old as life upon the earth.

The doctrine of non-resistance to evil does not rest upon the words of Christ alone. Buddha, Confucius, Plato, Socrates, show the evil and destruction of war, of conquest, of violence, and of hatred, and have taught the beneficence of peace, of forgiveness, of non-resistance to evil. But modern thought is not content to rest the conduct of life upon the theories of moralists. The rules of life that govern men and states must to-day be in keeping with science and conform to the highest reason and judgment of man. It is here that non-resistance seems to have failed to make any practical progress in the world. That men should "turn the other cheek," should "love their enemies," should "resist not evil," has ever seemed fine to teach to children, to preach on Sundays, to round a period in a senseless oratorical flight; but it has been taken for granted that these sentiments cannot furnish the real foundation for strong characters or great states.

It is idle to discuss "non-resistance" in its effect upon life and the world without adopting some standard of excellence by which to judge results. Here, as elsewhere in human conduct, after all is said and done, men must come back to the fundamental principle that the conduct which makes for life is wise and right. Nature in her tireless labor has ever been developing a higher order and a completer life. Sometimes for long periods it seems as if the world were on the backward course, but even this would prove that life really is the highest end to be attained. Whatever tends to happiness tends to life,—joy is life and misery is death.

In his long and toilsome pilgrimage, man has come to his present estate through endless struggle, through brutal violence administered and received. And the question of the correctness of nonresistance as a theory, like any other theory, does not depend upon whether it can be enforced and lived now or to-morrow, but whether it is the highest ideal of life that is given us to conceive. In one sense nothing is practical excepting what is; everything must have been developed out of all the conditions of life that now exist or have existed on the earth. But to state this means little in the settlement of ethical questions, for man's future condition depends quite as much upon his mental attitude as upon any other fact that shapes his course.

Everywhere it seems to have been taken for granted that force and violence are necessary to man's welfare upon the earth. Endless volumes have been written, and countless lives been sacrificed in an effort to prove that one form of government is better than another; but few seem seriously to have considered the proposition that all government rests on violence and force, is sustained by soldiers, policemen and courts, and is contrary to the ideal peace and order which make for the happiness and progress of the human race. Now and then it is. even admitted that in the far distant ages yet to come men may so far develop toward the angelic that political governments will have no need to be. This admission, like the common concept, presumes that governments are good; that their duties undertaken and performed consist in repressing the evil and the lawless, and protecting and caring for the helpless and the weak.

If the history of the state proved that governing bodies were ever formed for this purpose or filled this function, there might be some basis for the assumption that government is necessary to preserve order and to defend the weak. But the origin and evolution of the political state show quite another thing—it shows that the state was born in aggression, and that in all the various stages through which it has passed its essential characteristics have been preserved.

The beginnings of the state can be traced back to the early history of the human race when the strongest savage seized the largest club and with this weapon enforced his rule upon the other members of the tribe. By means of strength and cunning he became the chief and exercised this power, not to protect the weak but to take the good things of the earth for himself and his. One man by his unaided strength could not long keep the tribe in subjection to his will, so he chose lieutenants and aids, and these too were taken for their strength and prowess, and were given a goodly portion of the fruits of power for the loyalty and help they lent their chief. No plans for the general good ever formed a portion of the scheme of government evolved by these barbarous chiefs. The great mass were slaves, and their lives and liberty held at the absolute disposal of the strong.

Ages of evolution have only modified the rigors of the first rude states. The divine right to rule, the absolute character of official power, is practically the same to-day in most of the nations of the world as with the early chiefs who executed their mandates with a club. The ancient knight who, with battle-ax and coat of mail, enforced his rule upon the weak, was only the forerunner of the tax-gatherer and tax-devourer of to-day. Even in democratic countries, where the people are supposed to choose their rulers, the nature of government is the same. Growing from the old ideas of absolute power, these democracies have assumed that some sort of government was indispensable to the mass, and no sooner had they thrown off one form of bondage than another yoke was placed upon their necks, only to prove in time that this new burden was no less galling than the old. Neither do the people govern in democracies more than in any other lands. They do not even choose their rulers. These rulers choose themselves and by force and cunning and intrigue arrive at the same results that their primitive ancestor reached with the aid of a club.

And who are these rulers without whose aid the evil and corrupt would destroy and subvert the defenceless and the weak? From the earliest time these self-appointed rulers have been conspicuous for all those vices that they so persistently charge to the common people whose rapacity, cruelty and lawlessness they so bravely curb. The history of the past and the present alike proves beyond a doubt that if there is, or ever was any large class, from whom society needed to be saved, it is those same rulers who have been placed in absolute charge of the lives and destinies of their fellow men. From the early kings who, with blood-red hands, forbade their subjects to kill their fellow men, to the modern legislator, who, with the bribe money in his pocket, still makes bribery a crime, these rulers have ever made laws not to govern themselves but to enforce obedience on their serfs.

The purpose of this autocratic power has ever been the same. In the early tribe the chief took the land and the fruits of the earth, and parceled them amongst his retainers who helped preserve his strength. Every government since then has used its power to divide the earth amongst the favored few and by force and violence to keep the toiling, patient, suffering millions from any portion of the common bounties of the world.

In many of the nations of the earth the real governing power has stood behind the throne, has suffered their creatures and their puppets to be the nominal rulers of nations and states, but in every case the real rulers are the strong, and the state is used by them to perpetuate their power and serve their avarice and greed.

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Five Differences Between the Alt-Right and Libertarianism by Jeffrey Tucker

Five Differences Between the Alt-Right and Libertarianism

Well, Hillary Clinton has gone and done it.

To the cheers of alt-righters everywhere, those angry lords of the green frog meme who hurl edgy un-PC insults at everyone to their left, the Democratic nominee has put them on the map at long last. Specifically, she accused Donald Trump of encouraging and giving voice to their dark and dangerous worldview.

Let’s leave aside the question of whether we are talking about an emergent brown-shirted takeover of American political culture, or perhaps merely a few thousand sock-puppet social media accounts adept at mischievous trolling on Twitter. The key issue is that more than a few alt-rightists claim some relationship to libertarianism, at least at their intellectual dawning until they begin to shed their libertarianism later on.

What are the differences in outlook between alt-right ideology and libertarianism?

1. The Driving Force of History

Every ideology has a theory of history, some sense of a driving theme that causes episodic movements from one stage to another. Such a theory helps us make sense of the past, present, and future. The libertarian theme of history is beautifully articulated by Murray Rothbard:

My own basic perspective on the history of man...is to place central importance on the great conflict which is eternally waged between Liberty and Power... I see the liberty of the individual not only as a great moral good in itself (or, with Lord Acton, as the highest political good), but also as the necessary condition for the flowering of all the other goods that mankind cherishes: moral virtue, civilization, the arts and sciences, economic prosperity. Out of liberty, then, stem the glories of civilized life.

There it is: liberty vs. power. Liberty unleashes human energy and builds civilization. Anything that interferes with the progress of liberty impedes the progress of humanity. One crowds out the other. The political (or anti-political) goal is clear: diminish power (which means reducing unjust violence) and enhance liberty.

Frédéric Bastiat described the free society as characterized by a “harmony of interests.” What is the alt-right theory of history? The movement inherits a long and dreary tradition of thought from Friedrich Hegel to Thomas Carlyle to Oswald Spengler to Madison Grant to Othmar Spann to Giovanni Gentile to Trump’s speeches. This tradition sees something else going on in history: not liberty vs. power, but something like a more meta struggle that concerns impersonal collectives of tribe, race, community, great men, and so on.

Whereas libertarianism speaks of individual choice, alt-right theory draws attention to collectives on the move. It imagines that despite appearances, we all default in our thinking back to some more fundamental instinct about our identity as a people, which is either being shored up by a more intense consciousness or eroded by a deracination and dispossession from what defines us. To criticize this as racist is often true but superficial. What’s really going on here is the depersonalization of history itself: the principle that we are all being buffeted about by Olympian historical forces beyond our control as mere individuals. It takes something mighty and ominous like a great leader, an embodiment of one of these great forces, to make a dent in history’s narrative.

2. Harmony vs. Conflict

A related issue concerns our capacity to get along with each other. Frédéric Bastiat described the free society as characterized by a “harmony of interests.” In order to overcome the state of nature, we gradually discover the capacity to find value in each other. The division of labor is the great fact of human community: the labor of each of us becomes more productive in cooperation with others, and this is even, or rather especially, true given the unequal distribution of talents, intelligence, and skills, and differences over religion, belief systems, race, language, and so on.

And truly, this is a beautiful thing to discover. The libertarian marvels at the cooperation we see in a construction project, an office building, a restaurant, a factory, a shopping mall, to say nothing of a city, a country, or a planet. The harmony of interests doesn’t mean that everyone gets along perfectly, but rather than we inhabit institutions that incentivize progress through ever more cooperative behavior. As the liberals of old say, we believe that the “brotherhood of man” is possible.
The libertarian believes that the best and most wonderful social outcomes are not those planned, structured, and anticipated, but rather the opposite.To the alt-right mind, this all seems ridiculous. Sure, shopping is fine. But what actually characterizes human association is deep-rooted conflict. The races are secretly at war, intellectually and genetically. There is an ongoing and perpetual conflict between the sexes. People of different religions must fight and always will, until one wins. Nations fight for a reason: the struggle is real.

Some argue that war is what defines us and even gives life meaning, and, in that sense, is glorious and celebratory. For this reason, all nations must aspire toward homogeneity in stock, religion, and so on, and, as for the sexes, there must be dominance, because cooperation is an illusion.
Maybe you notice a certain commonality with the left here. In the 19th century, the Marxists whipped themselves up in a frenzy about the allegedly inherent conflict between labor and capital. Their successors fret incessantly about race, ethnicity, ability, gender, and so on, pushing Marxian conflict theory into ever more exotic realms. Ludwig von Mises captured this parallel brilliantly when he wrote, “Nationalist ideology divides society vertically; the socialist ideology divides society horizontally.” Here, as with many other areas, the far right and far left are strangely aligned.

3. Designed vs. Spontaneous Order

The libertarian believes that the best and most wonderful social outcomes are not those planned, structured, and anticipated, but rather the opposite. Society is the result of millions and billions of small acts of rational self interest that are channelled into an undesigned, unplanned, and unanticipated order that cannot be conceived by a single mind. The knowledge that is required to put together a functioning social order is conveyed through institutions: prices, manners, mores, habits, and traditions that no one can consciously will into existence. There must be a process in place, and stable rules governing that process, that permit such institutions to evolve, always in deference to the immutable laws of economics.

Again, the alt-right mind finds all of this uninspired and uninspiring. Society in their conception is built by the will of great thinkers and great leaders with unconstrained visions of what can be. What we see out there operating in society is a result of someone’s intentional and conscious planning from the top down.

If we cannot find the source, or if the source is somehow hiding, we imagine that it must be some shadowy group out there that is manipulating outcomes – and hence the alt-right’s obsession with conspiracy theory. The course of history is designed by someone, so “we” might as well engage in the great struggle to seize the controls – and hence the alt-right obsession with politics as a contact sport.
Oh, and, by the way, economics is a dismal science.

4. Trade and Migration

The libertarian celebrates the profound changes in the world from the late Middle Ages to the age of laissez faire, because we observed how commercial society broke down the barriers of class, race, and social isolation, bringing rights and dignity to ever more people.Of course the classical liberals fought for free trade and free migration of peoples, seeing national borders as arbitrary lines on a map that mercifully restrain the power of the state but otherwise inhibit the progress of prosperity and civilization. To think globally is not a bad thing, but a sign of enlightenment. Protectionism is nothing but a tax on consumers that inhibits industrial productivity and sets nations at odds with each other. The market process is a worldwide phenomenon that indicates an expansion of the division of labor, which means a progressive capacity of people to enhance their standard of living and ennoble their lives.

The alt-right is universally opposed to free trade and free migration. You can always tell a writer is dabbling in alt-right thought (or neoreactionary or Dark Enlightenment or outright fascism) if he or she has an intense focus on international trade as inherently bad or fraudulent or regrettable in some sense. To them, a nation must be strong enough to thrive as an independent unit, an economic sovereignty unto itself.

Today, the alt-right has a particular beef with trade deals, not because they are unnecessarily complex or bureaucratic (which are good reasons to doubt their merit) but because of their meritorious capacity to facilitate international cooperation. And it is the same with immigration. Beginning at some point in the late 19th century, migration came to be seen as a profound threat to national identity, which invariably means racial identity.

5. Emancipation and Progress

The libertarian celebrates the profound changes in the world from the late Middle Ages to the age of laissez faire, because we observed how commercial society broke down the barriers of class, race, and social isolation, bringing rights and dignity to ever more people. Slavery was ended. Women were emancipated, as marriage evolved from conquest and dominance into a free relationship of partnership and consent. This is all a wonderful thing, because rights are universal, which is to say, they rightly belong to everyone equally. Anything that interferes with people’s choices holds them back and hobbles the progress of prosperity, peace, and human flourishing. This perspective necessarily makes the libertarian optimistic about humanity’s potential.

The alt-right mind can’t bear this point of view, and regards it all as naive. What appears to be progress is actually loss: loss of culture, identity, and mission. They look back to what they imagine to be a golden age when elites ruled and peons obeyed. And thus we see the source of their romantic attachment to authority as the source of order, and the longing for authoritarian political rule. As for universal rights, forget it. Rights are granted by political communities and are completely contingent on culture. The ancients universally believed that some were born to serve and some to rule, and the alt-right embraces this perspective. Here again, identity is everything and the loss of identity is the greatest crime against self anyone can imagine.

Conclusion

The alt-right knows exactly who its enemies are, and the libertarians are among them.To be sure, as many commentators have pointed out, both libertarians and alt-rightist are deeply suspicious of democracy. This was not always the case. In the 19th century, the classical liberals generally had a favorable view of democracy, believing it to be the political analogy to choice in the marketplace. But here they imagined states that were local, rules that were fixed and clear, and democracy as a check on power. As states became huge, as power became total, and as rules became subject to pressure-group politics, the libertarianism’s attitude toward democracy shifted.

In contrast, the alt-right’s opposition to democracy traces to its loathing of the masses generally and its overarching suspicion of anything that smacks of equality. In other words, they tend to hate democracy for all the wrong reasons. This similarity is historically contingent and largely superficial given the vast differences that separate the two worldviews. Does society contain within itself the capacity for self management or not? That is the question. 

None of this will stop the mainstream media from lumping us all together, given that we share a dread of what has become of the left in politics today.

But make no mistake: the alt-right knows exactly who its enemies are, and the libertarians are among them. 

Jeffrey Tucker

Jeffrey Tucker is Director of Content for the Foundation for Economic Education and CLO of the startup Liberty.me. Author of five books, and many thousands of articles, he speaks at FEE summer seminars and other events. His latest book is Bit by Bit: How P2P Is Freeing the World.  Follow on Twitter and Like on Facebook. Email. Tweets by @jeffreyatucker

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When Destruction Can Be Creative by Sandy Ikeda

When Destruction Can Be Creative

Those of us who write for TheFreemanOnline never tire of pointing out instances in the news of the “broken-window fallacy” (BWF), which is good because people never seem to tire of committing it.  In recent times, for example, following natural disasters in Haiti, Japan, and now Alabama, you can always depend on some pundit trying to argue that all the spending on repair and replacement will have the net effect of stimulating the local economy.

My first Wabi-sabi column in fact dealt with this fallacy in the case of the terrible earthquake in Haiti.  To quote from something I wrote in the comments section of that piece:

It is the belief that if Paul breaks Peter’s window, the community will become richer when Peter has to shell out $100 to replace it because “now” the glazier will have $100 more to spend, and so on. The fallacy is that a similar spending cycle can occur (e.g., before his window got broken Peter was going to pay Mary $100 for her painting) without Peter’s window needing to be broken at all — and Peter will not have lost the value of his original window.

But why does this fallacy persist?  Can destruction ever promote economic development in a way that would be better than if the situation had remained status quo ante?  Let me try to explain how in a certain sense it might, but in a way completely different from the BWF.

Joseph Schumpeter and Mancur Olson

Joseph Schumpeter was a great Viennese economist (part neoclassical economist, part Austrian economist, although in my opinion more the former than the latter) who famously described the forces of capitalism, the entrepreneurial dynamics of change, as “gales of creative destruction.” In his view entrepreneurial innovations unleash powerful waves of change throughout the economy that overturn established markets and ways of doing things.

However, the social-choice theorist Mancur Olson has argued that over time in stable societies where organizations and understandings have long formed and operated, coalitions of businesses and other political interests are able to gain privileges that protect their members from precisely the kinds of entrepreneurial change that Schumpeter placed at the heart of capitalism.  With the help of political power, various forms of collusion emerge throughout society, presumably on both the demand side and supply side of markets, with the effect that “on balance special-interest organizations and collusions reduce efficiency and aggregate income in the societies in which they operate and make political life more divisive.”  Moreover they “slow down a society’s capacity to adopt new technologies and to reallocate resources in response to changing conditions, and thereby reduce the rate of economic growth.”

In the language of social networks that I often invoke in this column, the ties that connect a given individual to a host of networks become thicker and thicker while at the same time the rate at which she can move out of one network and into another becomes slower and slower.  These might take the form of guilds, unions, and cartels on the supply side, and renters’ rights and consumer-protection groups (and the accompanying regulations) on the demand side.  All of these have the object of insulating special interests from dynamic competitive forces.

Under these circumstances it’s hard to expect ordinary economic processes to dislodge strongly tied special-interest groups from their privileged positions — not impossible but very hard.

The Role of Upheaval

Olson argues that disrupting these cozy connections can open space for the kinds of creative innovation Schumpeter described.  While Olson says war and revolution may sometimes serve as such initiating forces, he adds that no one in her right mind would recommend those as an economic policy.  (Would that that were true!)  Instead he makes the more sensible case that free trade is disruptive enough to do the trick:  “[T]here should be freer trade and fewer impediments to the free movement of factors of production and of firms.”  I can hardly disagree with this recommendation.
But his analysis of the conditions for radical change would seem to apply not only to wars, invasions, and free trade, but perhaps also to violent natural events. They could possibly serve a similar function, at least at the local level.

An earthquake, hurricane, or tornado not only damages and destroys the physical infrastructure of a community, it can also damage and destroy its social infrastructure.  In a relatively free society like ours, the harm done to social networks is overwhelmingly bad.  Obviously the lives lost and families, businesses, and communities torn asunder are an unmitigated tragedy.

In less-free societies the human tragedy is just as great of course, but where social networks serve more insidious purposes, such as to monitor and control the private lives of individuals, a natural disaster could undermine old politically connected networks and cronyism. What dynamic free markets require, in addition to economic liberty, are dense, weakly tied social networks that can serve as both sources of information about entrepreneurial opportunities and the means of diffusing discoveries throughout the community.  At least for a time, then, a natural disaster could open a space for new, informal relationships to arise – relationships with people outside one’s immediate circle of family, work, and closed community which can serve as bridges that may be useful when normal times return.

Policy Implications?

Does this always happen?  I think it does sometimes.  In the case of wars, one of the examples Olson gives is how World War II broke up the old Zaibatsu cartels in Japan, which may have contributed to that country’s postwar resurgence.  This is not the broken-window fallacy – Japan certainly would have been better off without the war – but rather a possible explanation for its explosive growth.
The historian Peter Hall posits that cities achieve their “golden ages” often as a result of great upheaval.  The Athens of Socrates, Plato, and Aristotle emerged from plague and wars that decimated the majority of its population.

I had hoped something like this would happen in Haiti after the earthquake.  The government disappeared, and new communities, in the form of tent cities, sometimes operated with an efficiency and order superior to the pre-earthquake neighborhoods.  Unfortunately, it appears that the status quo ante is reemerging there. Perhaps it’s too soon to tell.

Uncertainty over whether destruction will actually release creative energies, as well as abhorrence of destructive aggression per se, would, I hope, keep sane people from advocating a policy of destruction.  Unfortunately, we are not all sane.

Sandy Ikeda

Sandy Ikeda is a professor of economics at Purchase College, SUNY, and the author of The Dynamics of the Mixed Economy: Toward a Theory of Interventionism. He is a member of the FEE Faculty Network.

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The Politically Incorrect Guide to Socialism

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For a New Liberty: The Libertarian Manifesto by Murray N. Rothbard

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The Man in the High Castle by Philip K Dick

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Moon Is a Harsh Mistress by Robert A Heinlein

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Ayn Rand - The Virtue of Selfishness

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Why Businessmen Need Philosophy by Ayn Rand

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Fahrenheit 451 by Ray Bradbury

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Brave New World by Aldous Huxley

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1984 by George Orwell

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Our Enemy, the State by Albert Jay Nock

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Anatomy of the State by Murray N. Rothbard

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Human Action by Ludwig von Mises

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Road to Serfdom by F.A. Hayek

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The Legacy of Karl Marx by Henry Hazlitt

The Legacy of Karl Marx

Henry Hazlitt has had a long and distinguished career as economist, journalist, and author. Best known of his numerous books is Economics in One Lesson.

How the Communist Manifesto fails as an economic guidebook.

A number of women (and men) have recently been contending that women who are just as productive as men are being employed on the average for only about 70 per cent as much pay, and that the statistics prove it. I am not going to quarrel with the comparisons of men’s and women’s actual wages, but with the contention about productivity. In a market in which competition is permitted between employers and between workers, the situation ascribed could not long exist. What would prevent it, what does prevent it, is the selfishness of employers. 

Let us suppose that there was an industry in which both male and female workers were producing enough to bring the employer an ascertainable added profit of just over $10 an hour, but in which the men workers were receiving $10 an hour, and the equally productive women workers only $7 an hour. 

It would soon occur to an unscrupulously selfish employer that he should henceforth employ only women workers from which he could make a net $3 more an hour than from his male workers. He would let his men workers go. Other employers would follow his example, and for the same reason. But this would mean that the female workers would start demanding higher individual wages until their pay was on an equality with that previously received by males.
In other words, selfish employers would prefer to make only $2 an hour net by employing female labor at $8 an hour rather than see competing employers make $3 net out of them. They would even choose to make only $1 an hour net by paying them $9 an hour rather than stand by and watch other employers making $2 net out of them. This would continue until prevailing female wages in that industry were very close to female labor productivity in dollar terms. (In the long run, of course, there would be no drop in the prevailing men’s pay, because their productivity would still make it profitable to employ them at that rate.) 

To state this more briefly and bluntly, any employer would be a fool to hire male workers for $10 an hour when he could hire equally productive women workers for $7 an hour. 

There are, it is true, special conditions, temporary and localized, in which labor productivity might not be the dominant factor in determining wage levels. In a small mill town, for example, in which there was only one mill, not large enough to employ the entire working population, the wages paid by that mill might fall below the worker-productivity level. But this would tend to prove only a temporary situation. Two developments would be likely to change it. The unemployed surplus workers would start to leave for other towns. And the mill owners would be tempted to reinvest their profits and expand their operations. 

So far, I have been writing about the factors that tend to eliminate wage discrimination on sexual grounds where it exists. But the same considerations would also tend to eliminate wage discrimination on grounds of color, race, nationality, or other reasons. Where such wage differences persist, they tend to reflect real differences in productivity.
Let me now carry my contention a giant step further. The selfishness of individual employers is the force that, under competitive capitalism, brings the level of wages up close to the full value of the productivity of the workers.
Of course, there are never conditions of perfect competition; of full knowledge on both sides, employer and employed, of their respective opportunities. There are individual accidents, immobilities, prejudices, and other factors that prevent everybody’s wage or salary from corresponding with the approximate value of his or her contribution or output. But this correspondence is the dominant long-run tendency. 

There is nothing original in this explanation. I have simply been stating, in fact, in an unusual form, what is known as the marginal productivity theory of wages. This is the theory held by the overwhelming majority of serious economists today. 

The Marginal Productivity Theory of Value 

This theory was astonishingly late in its development. It did not make its appearance until the very end of the 19th century, in the principal works of the Austrian economists, Carl Menger (1871), Friedrich von Wieser (1884) and Eugen von Böhm-Bawerk (1884), and of the American economist John Bates Clark (1899). 

Why did its development take so long? It took so long partly because the field was already occupied by other theories—wrong theories. And how did they in turn get started? They got started partly through the errors of writers that were in some respects acute and even profound thinkers. The first of these was the economist David Ricardo (17721823), who, by abstract reasoning, developed a labor theory of value in which the contributions of capital investment, initiative, invention, and management somehow got buried. 

Then, along came Karl Marx. Ostensibly taking off from Ricardo, he presented a pure “exploitation” theory of wages, and declared out right that as long as the “capitalist system” continued in existence there could be no real improvement in the condition of workers. 

This assertion was made in the face of some very noticeable improvement in the economic condition of the “masses” before 1848, when the Communist Manifesto was published, and certainly in the remaining 35 years of Marx’s life.
Doubtless there was some excuse for Marx’s failure to notice this improvement, in the early years of his life some relics of the medieval system were still around. Great tracts of land were still held by princes, dukes, and barons, and the men who tilled the soil were often forced to pay excessive rents. Production was by our present standards incredibly low. Capital goods—tools, implements, machinery, vehicles, and other equipment—were still rare, crude and primitive. There was a scarcity of donkeys, horses, and other farm animals. On the farms, human beings were forced to carry great burdens on their own backs, as they still do in China today. Only very slowly were more capital goods produced. The great bulk of labor went into producing tomorrow’s food and other necessities. 

But let us now turn to the actual text of the Communist Manifesto. That document, of approximately 40 pages, was written by Karl Marx and Friedrich Engels partly as a call for civil war—“Working men of all countries, unite!”—partly as propaganda, and partly to explain the economic theories of Communism to the workers. But the reader will look in vain to find those theories spelled out in any reasoned form. 

We are told that there are two main classes in society—the “proletariat,” which consists of the “workers,” employed and unemployed, and forms allegedly about nine-tenths of the population, and the “bourgeoisie,” which consists of the employers and a few other groups who are comfortably well off. The bourgeoisie rule. They hire the proletariat; and because they do, they necessarily “exploit” them. The only way this dreadful situation can be changed is by revolution, in which the proletariat must seize all the property of the bourgeoisie, and, if they object, kill them. 

The Marxist Exploitation Dogma 

No explanation is offered in the Manifesto of how this “exploitation” is possible, or what is its exact extent. The word implies that the employers pay their workers only a fraction of what they are worth—of what they add to production or profits. The fraction is not mentioned. Let us say it is only 50 per cent. As individual employers would be making such a big profit at that rate, and would obviously want to hire workers away from other employers, what stops them? The exploitation theory implies that the employers must all be in some secret agreement to keep wages down to this existing near-starvation level, and maintain it through the most drastic penalties against humane employers, if any, who attempt to offer more. “The average price of wage-labor is the minimum wage, i.e., that quantum of the means of subsistence which is absolutely requisite to keep the laborer in bare existence as a laborer.” 

All this is pure fiction. The exploitation theory implies that the wage-level cannot rise. In trying to maintain this, the Manifesto quickly falls into inconsistencies and self-contradictions. We are told that: “The bourgeoisie, by the rapid improvement of all instruments of production . . . draws even the most barbarian nations into civilization. The cheap prices of its commodities are the heavy artillery with which it batters down all Chinese walls . . . The bourgeoisie, during its rule of scarce one-hundred years, has created more massive and more colossal productive forces than have all preceding generations together,” with “whole populations conjured out of the ground.” 

But this enormously increased production could not have been possible without equally increased consumption. The increased population that the increased production made possible must have consisted mainly of the proletarians, and the increased production itself could only have taken place in response to an increased demand. This demand must have been made possible by increased purchasing power, and that in turn either by increased wages or lower prices. But nowhere in the Manifesto is this necessary chain of causation acknowledged. The exploitation dogma blinded Marx to the obvious. 

The Manifesto keeps compounding its economic errors. Obviously capital—which is most usefully thought of as capital goods—is used because it increases production. And because it increases production, it must increase the income of the owner or user. The carpenter would get nowhere without the use of hammers, saws, chisels, and even more elaborate machinery. And so for all other artisans. These tools and machines must at least promise to “pay for themselves” before they are acquired. 

Yet we find the authors of the Manifesto writing: “In proportion as the use of machinery and division of labor increases, in the same proportion the burden of toil increases, whether by prolongation of the working hours, by increase in the work exacted in a given time, or by increased speed of the machinery, etc.” [My italics.] Even if the reduction in weekly working hours recorded through the years did not show this Manifesto statement to be false, it was nonsense on its face. Yet Marx and Engels go on: “Machinery obliterates all distinctions of labor, and reduces wages to the same level!” [My italics.] 

The Historical Record 

From the 1830s on, however, the historic record shows a reduction of hours and an increase of wages from the introduction of machinery. Prof. W. H. Hutt, in his essay on The Factory System of the Early Nineteenth Century, writes: “That the apparent benefits wrought by the early Factory Acts are largely illusory is suggested by the steady improvement which was undoubtedly taking place before 1833, partly as a result of the development of the factory system itself.” (Capitalism and the Historians, edited by F.A. Hayek, p. 181.) 

Tooke and Newmarch, in their book A History of Prices From 1792 to 1856, publish extracts from a report issued by the City Chamberlain of Glasgow in 1856. This records that in 1856 wages of skilled labor in the building trades (masons, carpenters, and joiners) increased 20 per cent from the level of 1850-1, and wages of unskilled labor 48 per cent in the same period. He attributes this principally to “increased production in consequence of improvements in machinery.”
“It must also be borne in mind,” he adds, “that weavers and spinners worked 69 hours per week in 1841 and only 60 hours in 1851-6, and hence received in 1851-6 more money for less labor.” He also notes at another point that in 1850: “The number of hours per week worked by masons, carpenters and other artisans employed in the building trades was 60 hours, or six days of 10 hours each, with a deduction of 1½ hours for meals. Since 1853, the weekly time has been reduced to 57 hours.” 

For the United States (which seems to have lagged greatly behind England), the official publication, Historical Statistics of the U.S.: Colonial Times to 1957, reports (p. 90) that in 1860, the weighted average of working hours in all industries was 11 hours a day (Monday through Saturday inclusive), and that by 1891 this had fallen to 10 hours. In 1890, the working week was 60 hours (6 times 10 daily) and by 1926 had fallen to 50.3. 

Recent issues of government publications, the annual Statistical Abstract and the current monthly Economic Indicators, show that the average of manufacturing hours fell from 51 a week in 1909 to 39.8 in 1957 and to 35 in 1985. Thus average working hours per week under capitalism, in other words, show a steady fall for nearly a century and a half.
In the Manifesto, our two authors mention frequently how “the competition between the workers” undermines solidarity and reduces wages. But they never once acknowledge the existence of competition among employers for workers. It is precisely this that brings wages up to the value of the workers’ specific contribution to output. And this is not because the employers have or need to have any altruistic motives, but simply the motive of maximizing their own individual profits. 

The Ominous Appeal of Hatred 

Karl Marx must himself later have felt a great deal of misgiving about the lack of any real explanation of the male-ficent workings of the existing economic system that he had portrayed in the Manifesto. For in 1867 he published (in Germany) a volume entitled Das Kapital. This was apparently intended to be the first of further volumes, but though Marx lived to 1883, nothing more appeared. Some commentators have surmised that Marx had reached an impasse, and could not decide how to continue. After Marx died, Engels undertook to “complete” the work in three volumes by supplementing his friend’s unfinished manuscripts. The Austrian economist Eugen von Böhm-Bawerk thoroughly demolished the argument of the finished work in his Karl Marx and the Close of His System (1896), a masterful refutation that does not have to be done again. 

Let me remind the reader once more that the thesis with which I began this piece—that the assumption of pure selfish competition on the part of the employers would be enough to explain how workers on the average receive practically the full value of their productive contribution—is only a novel way of presenting the marginal productivity theory of wages, now accepted by the overwhelming majority of present-day economists. 

The factual substantiation of that theory is particularly impressive in the United States. The annual report of nonfinancial corporation earnings, going back for more than thirty years, show that the employees today receive an average of about 90 per cent of corporate gross earnings in their wages and the stockholders only about 10 per cent in their profits. In fact, a man’s personal income often seems to have little to do with whether he is technically an employee or an employer. A baseball, football, basketball, or prize-fighting star may receive an income in the million-dollar range, far above that of the promoter who technically employs him. It is a result of the star’s “productivity”—his box-office appeal. It is the competition among promoters, employers, that brings this about. 

Selfish Capitalists vs. the Communist Manifesto 

From the standpoint of common sense, the appeal of the Manifesto to violence and class war seems entirely needless. If the proletariat (supposedly some nine-tenths of the population) would be better off under a Communist economy, all that was necessary was to make this clear to them, and they could be trusted to vote themselves into power and such an economy into being. (Democracy was emerging in Britain in 1848, and, for whites, already functioning in America.)
But such an appeal gave little promise of starting a “movement” or leading to early political action. Marx and Engels were agitators, activists—and shrewd psychologists. They knew that most people who find themselves at the bottom of the economic ladder are tempted to put the blame, not on themselves, but mainly on somebody else. The exploitation theory, however weak as an economic doctrine, was tremendously persuasive psychologically and as a call for action. It was an essential part of their propaganda. 

So, though the Communist Manifesto, even in its own time, failed completely as an economic guidebook, it did succeed thoroughly in instilling class hatred. This hatred, unfortunately, has been its most permanent contribution. It was originally directed ostensibly against a special class, the bourgeoisie—the employers, and all those comparatively well off—in revenge for “exploiting” the workers. 

But, with the passing years, the target of this hatred has been quietly changed. As the employing class in Russia was liquidated by various means, a still existing group had to be substituted. To stay in command, a dictatorship must continue to point to a powerful enemy to be feared and destroyed. Fortunately, such an enemy can still be pointed to. It is the “capitalist” nations as a whole, especially the United States. Sixty-eight years after the Bolshevik Revolution, most of the American population is notably better off than the population in the Soviet Union. Though Russian school children are taught that we are an “imperialist” nation, the American “proletariat” are now tacitly included, as the Russian “bourgeoisie” once explicitly were, among the people to be envied and somehow blamed for the plight of the Communist-ruled countries.


This newly directed fear and hatred are ominous. They have led to an enormous armament buildup in Russia, and to the development and storage of multiple nuclear weapons which are forcing the West to try to keep uneasy pace. None of us can foresee the ultimate outcome.

Henry Hazlitt

Henry Hazlitt (1894-1993) was the great economic journalist of the 20th century. He is the author of Economics in One Lesson among 20 other books. See his complete bibliography. He was chief editorial writer for the New York Times, and wrote weekly for Newsweek. He served in an editorial capacity at The Freeman and was a board member of the Foundation for Economic Education. 

This article was originally published on FEE.org. Read the original article.

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