Friday, November 28, 2008

Conceptions of Capitalism

In an excellent blogpost at NoodleFood entitled Absent a Moral Defense of Capitalism, fellow Objectivist Gina Liggett writes:

"As Dr. Brook states in his talks, obviously the fact about capitalism's success is simply not enough; the fact that government interference in the economy wrecks havoc is simply not enough. We must make the moral argument that laissez-faire capitalism is not only practical, it is morally right."

A good friend involved in the Ron Paul Campaign for Liberty responds:

[I acknowledge] the right to enjoy the fruits of our labor, the right to possess that which we produce, the right to trade our possessions, the right to freely and peacefully associate with others and the right to pursue our individual happiness without any restraint beyond the reciprocity found in recognizing and honoring all of these same rights in others.

Unfortunately, what the rest of the world calls "capitalism" has nothing to do with any of these individual rights. The modern world consists of nations practicing what, at best, could be called "mixed economy" or "state capitalism". Most variants of "capitalism" in the world today, first violated one or more of these rights. What we refer to as laissez faire, laissez fair capitalism, capitalism, a free market or a market economy do not exist in any modern state. A moral defense is the only way to defended the concept. I just wonder if we shouldn't find a better name for what we all agree is the natural way for freemen to organize their financial affairs.

Thanks for your comments.

I share the view of Rand and Mises: Capitalism cannot violate any rights. Only statism violates rights.

A "mixed economy" is, by definition, not capitalist -- just as a mixture of water and poison is not water. What America and most of the rest of the world practice is Interventionism. The rest are socialist or variants thereof.

I believe there needs to be a renewed understanding, embrace and promotion of total laissez-faire free market capitalism. I am working on this with Objectivists around the country (world, even). That is why I drafted the conceptual scheme that I shared with you earlier.

There is even an Objectivist Party that has been started; although, I'm not confident that this is the proper approach (see correspondence to the Objectivist Party below).

Frankly, the so-called cause of "liberty" is vague, undefined, and has too broad an appeal. It is a valid principle, but without a concrete political expression, it leads to nothing substantial or consistent.

Both Mises and Rand have a lot to say about capitalism -- they are its primary champions. They also have a lot to say about anti-capitalist sentiments and policies. I am reading "Liberalism: The Classical Tradition" by Ludwig von Mises right now. This is von Mises's prescription for a properly ordered society; one based on the ideology of Liberalism. ("Liberalism" is another term I believe should be restored to its proper meaning.)

I honestly believe that if we cannot agree on the fundamentals, any moderate successes are doomed to fail in the long run. As we have amply seen already. Better to get on the same page first, then act.

The country and the world are at a crossroads. Let's get on the right side and pack a compass.

You have a better understanding than most and I look forward to working with you "as we go marching."


Correspondence with The Objectivist Party

From Dr. Tom Stevens
Sent: Friday, November 21, 2008 11:34:25 AM
Subject: Objectivist Party Member Priorities

Here are the priorities for Objectivist Party members who would like to be of help to the cause. If you feel something should be added to the list, do not hesitate to suggest it.

Thanks for your thoughtful and thorough notes.

I threw together some thoughts in graphic form on a conceptual framework for a liberty-oriented political action club for consideration by a local libertarian group (this is a draft with implications). It was coolly received and I forward it to you for whatever it might be worth.

I think that an Objectivist political organization should have as its central theme the unapologetic promotion of laissez-faire free market capitalism. This is the political component Ayn Rand identified in her synopsis of Objectivism, given on one leg.

I am unsure about turning the entire name Objectivism over to only a political focus. The political component, according to Rand and Objectivism, is Capitalism. I have tried to frame that aspect in the graphic, hopefully with fuller definitions and extrapolations to come. At any rate, I think it provides a good starting point, with much to develop, where Capitalism is broadly defined as a political-economic social system of freedom (per Rand, Reisman, Bernstein, & Mises).

I have, however, encountered a wavering commitment from libertarians and Ron Paul supporters to recognize and champion capitalism, as such. Below is some correspondence from that conversation with local libertarians for background.

Correspondence with Asheville libertarians

From: ...........
Ref: Conceptual Framework
Might I suggest that the chart would be perhaps improved if "Capitalism" were to be replaced with "Liberty". Liberty seems like a more broad ideology on which to build than capitalism. Also, it is far more attractive in that the mere word "capitalism", which is often regarded as fearful or downright evil to the political left.

Let me clarify something about the conceptual structure conveyed in the chart.

In this chart, an activist organization would consist of three main components: Organization, Ideology, and Activism. All of which enable the organization to fulfill its mission.

As part of the group's ideological development, certain foundational principles would be identified; such as the libertarian principles of Self-Ownership and Self-Determination. Those principles would naturally generate a set of values; for example: Privacy, Independence, and Justice. Taken together they lend themselves to the formation of key concepts. Those concepts, once fully broken down (as shown in the chart), can then help indicate which concrete and specific issues are the most appropriate targets of political activism as well as the ideological position to take on them.

The concept must support the principles and values that constitute an ideology.

Capitalism 'per se' is, as we know, the only political-economic social system that recognizes, respects, and preserves individual liberty. Therefore, at least for us, it is the principle of liberty that is hierarchically prior to the concept of politics and its subsequent concrete manifestations. A proper political system that derives from libertarian principles will be one that incorporates the key attributes of Rights, Governments and Markets. In this conceptual structure, the inclusive concept is Capitalism.

I hope that helps to explain the parts of the chart that I was able to expand on so far. Also, bear in mind that this chart is an internal document, it is a rough draft, and is intended for our consideration only.

On the further linguistic question, I have long considered shuttering away explosive terms like "capitalism" in my normal conversations in favor of terms that could better gain me entrée into diverse political conversations. However, capitalism, I now believe, cannot simply be called something else merely to sooth the nervous minds and sensibilities of its duplicitous opponents, the anti-capitalists. It is they who attempt to obfuscate their intentions through the disingenuous manipulations of language and ideas. We could at least set ourselves apart on precisely this point: by saying what we mean and meaning what we say.

I think it is long past time to be squeamish about important ideas. It is imperative that we precisely set the terms of the debate and clearly distinguish ideas that favor liberty -- in the social, economic and political arenas -- from those that do not. What better litmus test than to have clear and consistent libertarian ideas forthrightly upheld with substance and conviction.

If some terminology is from time to time shown to be wrong or wrongly used, the error should be corrected and clarifications made. If it is right, it should be embraced and promoted for what it is. We cannot 'synonym' our way around a foundational idea. If the term "capitalism" suffers disrepute, then surely it falls upon us to restore it.


The flowering of human society depends on two factors: the intellectual power of outstanding men to conceive sound social and economic theories, and the ability of these or other men to make these ideologies palatable to the majority. -Ludwig von Mises, Human Action


Capitalism and the Moral High Ground
Craig Biddle | Objective Standard | Winter 2008
We who wish to advocate capitalism must take the moral high ground—which is ours by logical right—and we must never cede an inch to those who claim that self-sacrifice is a virtue.

Capitalism Without Guilt: The Moral Case for Freedom [video]
by Yaron Brook | National Press Club | October 22, 2008
In this lecture in Washington, D.C., Executive Director Yaron Brook demonstrates how Ayn Rand’s revolutionary ethics of rational self-interest supplied the moral foundation that previous proponents of capitalism lacked.

Capitalism: The Unknown Ideal
by Ayn Rand | 1966
Ayn Rand explains the social system that she held has “never been properly understood and defended—and whose very existence has been denied.” That system is laissez-faire capitalism: a social system in which the government is exclusively devoted to the protection of individual rights, including property rights, and therefore in which there exists absolutely no government intervention in the economy.

The Capitalist Manifesto: The Great Disconnect
by Andrew Bernstein | August 28, 2005
The capitalist revolution began in Great Britain in the late-18th century. Since that time, the capitalist nations have been the freest countries of history.

Ayn Rand: Radical for Capitalism [video]
Yaron Brook | October 11 2007
Capitalism is usually conceived as an evil idea, the mere fact of practicing self-interest has been thought as wrong and the traditional ethics teaches us that we don't have to combine with the idea of entrepreneurship. In her book Atlas Shrugged, Ayn Rand explains us how these two ideas are compatible: When we seek our benefit, we benefit the others.

The Ludwig von Mises Legacy [video]
Mises Institute | December 13, 2005
A man who never stopped fighting for freedom: not when the Nazis burned his books, not when the Left blackballed him at universities, not when it seemed as if statism had won. With courage and genius, he fought big government until the day he died... in 25 books, hundreds of articles, and more than sixty years of teaching.

Radicals for Capitalism
by Brian Doherty | February 12, 2007

The Free Market and Its Enemies
by Ludwig von Mises | 2006 (1951)

Capitalism, topic search, Ayn Rand Center for Individual Rights