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America's Counter-Revolution
The Constitution Revisited

From the back cover:

This book challenges the assumption that the Constitution was a landmark in the struggle for liberty. Instead, Sheldon Richman argues, it was the product of a counter-revolution, a setback for the radicalism represented by America’s break with the British empire. Drawing on careful, credible historical scholarship and contemporary political analysis, Richman suggests that this counter-revolution was the work of conservatives who sought a nation of “power, consequence, and grandeur.” America’s Counter-Revolution makes a persuasive case that the Constitution was a victory not for liberty but for the agendas and interests of a militaristic, aristocratic, privilege-seeking ruling class.

Thursday, January 21, 2010

The "Pro-Capitalist" Mentality

You have the courage to tell the masses what no politician told them: you are inferior and all the improvements in your conditions which you simply take for granted you owe to the effort of men who are better than you.
--Ludwig von Mises to Ayn Rand (pdf)
regarding Atlas Shrugged

These two people have been big influences on me, and both have made important contributions to the cause of freedom. Nevertheless, I believe that "capitalism" can engender the attitude shown here. Often it is implicit in writing about capitalism, but it is there and people we might win over to libertarianism are alienated by it.

39 comments:

Stephan Kinsella said...

Sheldon, can you articulate exactly what you see as the error or problem with the "attitude" you allude to? Is it unlibertarian? Is it inaccurate? Or just ambiguous? or just bad strategy?

Sheldon Richman said...

The problem with the quote seems obvious.

Stephan Kinsella said...

It's not obvious to me what you think is wrong with it. It's not unlibertarian, for example, in my view. It's not very rigorous, granted. But is that your problem wiht it? Or is it some kind of egalitarian opposition to ever having natural elites and hierarchies?

Sheldon Richman said...

I didn't say it is unlibertarian, although it's an attitude that would weaken the foundation of a free society. It says that most people are idiotic drones, carried along by Great Men, when we know this is not the case. In hierarchical organizations, the people at the top tend to be ignorant of what really goes on and the people below are the ones who bring intelligence and micro innovation to their tasks. Moreover the quote refers to a political economy (historical capitalism) in which hierarchy and concentration have been subsidized and otherwise encouraged by the State, and therefore have developed further than it would have in a true free market.

It is also bad strategically, partly because it is patently wrong and partly because it drips with disrespect for most human beings.

See Kevin Carson's book "Organization Theory: A Libertarian Perspective" for details.

Stephan Kinsella said...

Sheldon, I agree with you in part, but not sure the statement is as clear and rigorous as all that. There is truth in the statement too. And there are lots of attitudes that if prevalent could weaken a free society's foundations. I think there are more charitable interpretations of the comment that are not as damning. In my view there's nothing wrong with hierarchies per se, nor with recognizing there are unequal contributions to prosperity in an economy, nor with recognizing this fact and even praising those who have contributed in this way. This is not to gainsay most of your points. I think one can be more realistic about things than the more extreme versions of the Randian titans-of-industry worship without going all the way towards egalitarianism or anti-bossism, anti-hierarchism, etc. In fact in my view the anti-IP view contributes to this, by demolishing the myth that there are all these great inventors who did it all themselves in a vacuum-rather scientific and technical progress comes millions of smaller contributions each building upon those of others.

I certainly agree that the state has distorted and maybe even increased hierarchies and concentration and bossism etc., but I do not think this means the idea society is missing these features.

Sheldon Richman said...

A similar discussion is taking place here, where Bryan Caplan has critiqued Roderick Long's recent Cato article about Ayn Rand and the "pyramid of ability."

clay barham said...

To turn our country around, we must permit individual interests and not community interests to dominate. Obama, Democrats, socialists, liberals and everyone on the left wants to share the booty from America saying community is most important. Save Pebble Droppers & Prosperity on Amazon and claysamerica.com, tells how America did so well in the first place, and shows us how to repeat the process of regaining our prosperity. America has drifted into meaningless self-sacrifice to the point we cannot earn our way back and focusing on individual interests as described so well by Ayn Rand. Claysamerica.com

VangelV said...

While it is clearly not politically correct I see nothing that would be considered inaccurate in the statement being cited.

Most of the advancements that are responsible for our high standard of living have come from the efforts of great men and women in pursuit of their own interests. Mises was responding to the progressive movement that tried to restrict such advancements by pushing the ideas of egalitarian collectivism.

And Mises' statement is not very different from those of Bernard of Chartres, Newton, Nietzsche, and many other thinkers who had no problem admitting that even the great men of their time were like dwarves standing on the shoulders of giants. Would Newton really disagree with Mises? I doubt it. The fact that Mises is blunt and not politically correct does not make him wrong.

Stephan Kinsella said...

Vange, yes, this is partly what I meant by saying there could be more charitable interpretations of what Mises was saying, especially taking into account the times he wrote, and what he was fighting against. That said, I do think that the "great men" view of history is flawed for a couple of reasons. First, because most improvements are incremental and build on those of others, and they are all done in a social context where the support and cooperation of others is crucial. Second, because far too many of the "great men" were in bed with the state and far from lily white.

Sheldon Richman said...

The Great Man Theory doesn't hold up. Progress is made primarily not through big dramatic leaps, but through countless improvements at the margin. See Don Boudreaux's article "Drops and Splashes."

Sheldon Richman said...

I wrote my last comment before I saw Stephan's. Sorry for the duplication.

VangelV said...

It says that most people are idiotic drones, carried along by Great Men, when we know this is not the case.

I don't see it that way. The statement does not say that any particular individual does not have the potential to be a Great Man. It simply recognizes that most of the great advances that make our lives so much better came from a small group of Great Men. Nowhere does Mises claim that there should be an elite that governs society because the masses are ignorant. In fact, Mises' respect for the individual is much greater than the progressives that he opposes.

In hierarchical organizations, the people at the top tend to be ignorant of what really goes on and the people below are the ones who bring intelligence and micro innovation to their tasks.

That may be true to some extent but Mises was never promoting large hierarchical organizations as a solution for anything. He was perfectly comfortable with the idea that the market would punish ineffective organizations that did not meet consumer needs while it rewarded those individuals and organizations that were effective.

Moreover the quote refers to a political economy (historical capitalism) in which hierarchy and concentration have been subsidized and otherwise encouraged by the State, and therefore have developed further than it would have in a true free market.

You may be misreading the quote here. I think that Mises was aware that Rand knew of his ideas and preferred the unhampered markets. As such, it is not likely that Mises believed that his preferences and his life's work would be misunderstand.

It is also bad strategically, partly because it is patently wrong and partly because it drips with disrespect for most human beings.

I could see how someone who does not understand Mises' work would think that. But you know better. You have read his books and know that Mises has much more regard for ordinary individual than the progressives and socialists. That means that you have taken the very politically incorrect statement out of context and are far more unhappy about Mises' politically tin ear than for his true sentiments.

Sheldon Richman said...

Why would you say free-market capitalism if you can say free market? For many people, it will be like saying free-market cronyism. Think of the opportunity cost of arguing over whether what we have is "really" capitalism or not. Why do you refuse to let go of the word. It was not "ours" when it was coined. It was coined or first used widely, pre-Marx, by (liberal) opponents (of corporatism). Let it go already.

Stephan Kinsella said...

Sheldon, I agree with you on the Great Man thing--and as I've noted elsewhere, it's exemplified in the field of innovation and invention as well; see Jeff Tucker’s Speech on IP; Simultaneous Invention and Carbon Paper; and Rand on IP, Owning "Values", and "Rearrangement Rights".

Stephan Kinsella said...

Sheldon, as for "capitalism"--are you in agreement that this is *only* a semantic dispute? I agree that the word is problematic for a number of reasons: first, even aside from connotational problems, it's too narrow. BUt would you agree that the libertarian favors a system of private ownership of the means of production (whatever word you want to use to desribe this -- "pure capitalism" or wahtever)? And not only favors it, but thinks it's an inextricable part of any advanced, free society. Right?

Sheldon Richman said...

Is it just semantics? Well, I favor free markets and we are discussing whether we should call a libertarian free-market society "capitalist." That sounds semantic. But that also seems to trivialize the discussion. So it also seems more than semantic. Does it matter what "the matter" is labeled, semantics or not? I'm for freedom and I believe that we can't teach people about freedom if we don't communicate clearly. That's what this is about.

And yet we are also talking about the nature of historical capitalism, the one on the ground, and how "free market" it really was. That is not semantics.

Stephan Kinsella said...

"Is it just semantics?"

Hey, I asked you first. :)

"Well, I favor free markets and we are discussing whether we should call a libertarian free-market society "capitalist." That sounds semantic."

Bingo.

"But that also seems to trivialize the discussion."

Why? Maybe it deserves being trivialized.

"So it also seems more than semantic. Does it matter what "the matter" is labeled, semantics or not? I'm for freedom and I believe that we can't teach people about freedom if we don't communicate clearly. That's what this is about."

Okay, fine, I agree.

"And yet we are also talking about the nature of historical capitalism, the one on the ground, and how "free market" it really was. That is not semantics."

Well when we advocate laissez-faire capitalism, we are not advocating the unlibertarian aspects of the mixed systems that some people wrongly call "capitalist." So it seems like almost purely semantics to me. And to the extent there is a strategic aspect to this, that also is not about substance and truth, but about ... strategy.

Sheldon Richman said...

It's rhetoric: "The art or study of using language effectively and persuasively."

VangelV said...

The Great Man Theory doesn't hold up.

My error. When I say Great Man, I define the greatness by the person who implemented the breakthrough, not all of the contributors who made it possible. I do not believe that Mises thought any differently when he talked about great men. To make breakthroughs one does not always need to be more intelligent than many others. Instead it is a combination of judgement, courage, perseverance, hard work, and sometimes luck.

Henry Ford was great because he was the person who implemented the assembly line, which made it possible to produce consumer goods cheaply, not because he is the person who was entirely responsible for the idea. Had the market rejected his cars the person who did manage to make them better and cheaper using the same method would have been the great man.

We have to keep in mind that in the real world recognition and compensation are not scaleable. Many good writers work hard and publish but the market chooses J.K. Rowling to be rewarded far more than any of her contemporaries. Consumers do not care about what elitist critics say; they vote with their wallets in the marketplace and by doing so determine who gets rich and famous and who doesn't.

I apologize for not being clear enough on this topic and understand that my position is still far from being clear. I simply do not have the time at this point to write much on the subject but find it interesting and may get back to it when the kids are in school and I have more free time to clarify the argument.

The bottom line is a simple one. Those who believe in the free markets are not under any illusion that the markets will be 'fair' and will reward equally all those that have similar ideas and have made similar contributions. It is a mechanism that distributes wealth unequally and it is this inequality that is the great driver that makes our prosperity possible. In a free market men work their butts off to try to be one of the very few that get the disproportionate rewards that accrue to the winners and most will fail. The few who manage to get the bulk of the rewards, which I define as the Great Men, get rich by making the lives of the rest of their fellow men much better.

VangelV said...

Why would you say free-market capitalism if you can say free market? For many people, it will be like saying free-market cronyism.

Because I want to defend the idea of capitalism. People who think of it as 'free-market cronyism' are already under the misconception that one can have free markets without the private ownership of capital and I have no interest in perpetuating that myth.

Stephan Kinsella said...

Sheldon: "It's rhetoric: "The art or study of using language effectively and persuasively.""

Agreed. Sure. It has its place, and uses. But I think clear thinking requires keeping this conceptually distinct from substantive truth. And naturally, I don't give a damn whether you believe me or not on this -- wait, maybe you have a point ... :)

Sheldon Richman said...

"But I think clear thinking requires keeping this [rhetoric, I presume --SR] conceptually distinct from substantive truth."

But we can't even think or talk about substantive truth except with language. It's all bound up together. Read your Wittgenstein.

Sheldon Richman said...

"Because I want to defend the idea of capitalism."

We are now going in circles.

Stephan Kinsella said...

Sheldonator: "we can't even think or talk about substantive truth except with language. It's all bound up together. Read your Wittgenstein."

Hmm. I will, if you concede the validity of Hoppe'sargumentation ethics. NOW what you gonna say, eh, eh EHH? :)

Sheldon Richman said...

I don't buy the argumentation ethics argument for reasons given by Roderick Long. It's a short cut to rights, bypassing justice, that doesn't work.

Stephan Kinsella said...

Fine, then I don't buy your Wittgenstein!

Sheldon Richman said...

But I know Hoppe's argument.

Stephan Kinsella said...

I don't know much about Wittgenstein. Therefore I must be silent.

Sheldon, to step out of the levity--what is your view of the is-ought gap? Do you think you can derive any norms or oughts from mere facts? Me, I don't think so. I think norms always come from other norms or values. Thus, at the bottom you must finally come to norms that are simply adopted --by a certain community of people.

Sheldon Richman said...

"Do you think you can derive any norms or oughts from mere facts?"

Of course I do.

Stephan Kinsella said...

Sheldon, ahh, okay. I tend to think Hume was right.

Which libertarian philosopher or work do you believe makes the best case for libertarian rights?

Sheldon Richman said...

Hume's view goes against our everyday activity. We routinely use reason to mediate among values (ends) and not just means. We shouldn't blindly accept common sense, but we shouldn't ignore it either.

Roderick Long is the man. He's putting all the pieces together. His book, which is online, is a gem.

Stephan Kinsella said...

Sheldon, yes, I'm a huge fan of Long's. But which book do you mean?

Sheldon Richman said...

Wittgenstein, Austrian Economics, and the Logic of Action. Chapter X gets into ethics and reason. It's here.

Sheldon Richman said...

Bet ya didn't know Socrates was a praxeologist. Neither did I.

Stephan Kinsella said...

By the way, some of your left-lib comrades advocate the word "socialism." If we talk about historical connotations, semantics, and strategy--surely this is at least as bad an idea as associating freedom with "capitalism," no? Surely you would condemn the use of the word "socialism" to describe our movement too, n'est-ce pas?

What are we about, really? We are people who are opposed to unjustified violence. We favor peace in personal interactions--cooperation. Civilized values. So I think we are in favor of the Civil Society, or the Free Society, or the Peaceful Society, something like that.

Sheldon Richman said...

I know of only one today, Brad Spangler, who uses the word socialist to mean free-market anarchism. Kevin Carson calls himself a mutualist and his blog is Free-Market Anticapitalism. I wouldn't call myself a socialist because people wouldn't understand it as "free market" and there typically would not be time to elaborate. Libertarian or voluntarist or individualist anarchist is better.

Years ago Jim Davidson, founder of the American Taxpayers Union, (no lefty), wrote a book called The Squeeze in which he called for "a socialization of rules," by which he meant that government should leave rule making to free social processes. That's what got me started thinking this way. That was the early 1980s.

Hey, if we favor civil society, we can call ourselves civilians!

Stephan Kinsella said...

Actually "civilian" already has a dual meaning--the less common one means a civil law lawyer, someone from a civil-law state like Louisiana or France. So, I refer to myself sometimes as a civilian. Why not a third meaning?

Sheldon Richman said...

The best reason I can think of is that people will think you're telling them you're not in the military.

Stephan Kinsella said...

Sheldon, I just read this transcript of the newly-discovered 1962 Mises audio recording and thought of your comments here, when I came across this line by Mises: "In the market economy the only way left to the more gifted individuals to take advantage of their superior abilities is to serve the masses of their fellowman."

Heh. http://blog.mises.org/archives/011592.asp