TGIF: Social Cooperation Versus Violence

The chilling photo of a hooded man cold-bloodedly executing a health-insurance CEO on a busy New York City street should make any decent person pause and reflect. Anyone who even glimpses the role of social cooperation in making life better and longer felt sickened, or should have. Nothing can justify what the perpetrator did. That so many people see him as a vengeful hero acting in defense of the downtrodden is appalling. One can only hope they will soon come to their senses.

At the risk of taking our eye off the crime, it's worth pointing out that all departures from the market economy—laissez-faire capitalism—are steps toward social disintegration. That infamous, unsurpassingly ugly photo is the perfect image of anti-cooperation, anti-capitalism, and anti-human welfare.

The choice we face is between social cooperation and social disintegration. No person of goodwill harbors doubt about the right choice. The question is how to achieve social cooperation: the state, that is, aggressive force, or the market. The theoretical and historical evidence is unmistakable: the market economy is unequivocally the only way to achieve maximum social cooperation. The state destroys social cooperation.

The widely held belief that social cooperation through the market will not work with health care is balderdash for which no one has adduced evidence. Where markets are left significantly unmolested by politicians and bureaucrats, it achieves reasonable prices and supplies and—this is important—virtually universal coverage. Even those we call poor in this society have refrigerators, HVACs, automobiles, microwave ovens, mobile phones, flat-screen TVs, and so on. Why not affordable universal health services, including insurance?

The reason is that variously motivated politicians and bureaucrats—urged on by "Baptists and bootleggers"—have for over a hundred years tried to combine insurance and welfare in one system, despite their incompatibilities. When that happens, socially harmful results follow; perverse incentives proliferate. Government measures have suppressed supply and boosted demand, a volatile combination. Falsely proclaiming that health care is a right matter not a whit. That the resulting Rube Goldberg "system" of partly spontaneous disorder works as well as it does is a tribute to what's left of the entrepreneurial market and the profit motive. A little market goes a long way. (As they used to say about the Timex watch: 'It takes a licking and keeps on ticking.")

However, the distortions caused by interference with the practice of medicine and the provision of medical insurance have eroded social cooperation, imposed hardship, and created animosity. For that reason alone we need free markets for those services and products

Ludwig von Mises, the premier advocate of full classical liberalism in the 20th century, spent his life demonstrating the indispensability of private property and free trade—capitalism—to social cooperation. He almost titled his economics treatise, Human Action (1949), "Social Cooperation."

The social cooperation of the market economy is often used interchangeably with the term individualism. Isn't that a paradox? Mises resolved the paradox:

Individual man is born into a socially organized environment. In this sense alone we may accept the saying that society is--logically or historically--antecedent to the individual. In every other sense this dictum is either empty or nonsensical. The individual lives and acts within society. But society is nothing but the combination of individuals for cooperative effort. It exists nowhere else than in the actions of individual men. It is a delusion to search for it outside the actions of individuals. To speak of a society’s autonomous and independent existence, of its life, its soul, and its actions is a metaphor which can easily lead to crass errors.

The questions whether society or the individual is to be considered as the ultimate end, and whether the interests of society should be subordinated to those of the individuals or the interests of the individuals to those of society are fruitless. Action is always action of individual men....

The postliberals of "left" and "right"—the illiberals—who fret that in the market all relationships are reduced to cash get it wrong:

Within the frame of social cooperation there can emerge between members of society feelings of sympathy and friendship and a sense of belonging together. These feelings are the source of man’s most delightful and most sublime experiences. They are the most precious adornment of life; they lift the animal species man to the heights of a really human existence. However, they are not, as some have asserted, the agents that have brought about social relationships. They are fruits of social cooperation, they thrive only within its frame; they did not precede the establishment of social relations and are not the seed from which they spring.

Then what are the agents of social relationships?

The fundamental facts that brought about cooperation, society, and civilization and transformed the animal man into a human being are the facts that work performed under the division of labor is more productive than isolated work and that man’s reason is capable of recognizing this truth. But for these facts men would have forever remained deadly foes of one another, irreconcilable rivals in their endeavors to secure a portion of the scarce supply of means of sustenance provided by nature. Each man would have been forced to view all other men as his enemies; his craving for the satisfaction of his own appetites would have brought him into an implacable conflict with all his neighbors. No sympathy could possibly develop under such a state of affairs.

So we have the division of labor, increased productivity, and trade to thank for civilization. The postliberals are wrong. Very wrong. We should yearn for neither the Rousseauian state of nature nor the Hobbesian Leviathan. Mises:

Man appeared on the scene of earthly events as a social being. The isolated asocial man is a fictitious construction....

The idea that anybody would have fared better under an asocial state of mankind and is wronged by the very existence of society is absurd. Thanks to the higher productivity of social cooperation the human species has multiplied far beyond the margin of subsistence offered by the conditions prevailing in ages with a rudimentary degree of the division of labor. Each man enjoys a standard of living much higher than that of his savage ancestors. The natural condition of man is extreme poverty and insecurity. It is romantic nonsense to lament the passing of the happy days of primitive barbarism.

Mises laid out more clearly than anyone how the market process creates general prosperity. He wrote:

The market economy is the social system of the division of labor under private ownership of the means of production. Everybody acts on his own behalf; but everybody’s actions aim at the satisfaction of other people’s needs as well as at the satisfaction of his own. Everybody in acting serves his fellow citizens. Everybody, on the other hand, is served by his fellow citizens. Everybody is both a means and an end in himself, an ultimate end for himself and a means to other people in their endeavors to attain their own ends.

This system is steered by the market. The market directs the individual’s activities into those channels in which he best serves the wants of his fellow men. There is in the operation of the market no compulsion and coercion....

The market process is the adjustment of the individual actions of the various members of the market society to the requirements of mutual cooperation.

The dislocations and distortions we rightly criticize in the medical sector are produced by government interference with this market process rooted in social cooperation. But people widely attribute those distortions to the market itself. How could they make such a fundamental mistake? Part of the reason is that private property in the profit-and-loss environment has not been completely eradicated. Rather, it has been denatured; the shell has been maintained, but its essence has been changed almost beyond recognition. The politicians' and bureaucrats' fingerprints are over it.

Mises noted:

In searching for remedies against poverty, inequality, and insecurity, [the present-day welfare propagandists] come step by step to endorse all the fallacies of the older schools of socialism and interventionism. They become more and more entangled in contradictions and absurdities. Finally they cannot help catching at the straw at which all earlier “unorthodox” reformers tried to grasp—the superior wisdom of perfect rulers. Their last word is always state, government, society, or other cleverly designed synonyms for the superhuman dictator.

The welfare school ... [has] published many thousands of volumes stuffed with punctiliously documented information about unsatisfactory conditions. In their opinion the collected materials clearly illustrate the shortcomings of capitalism. In truth they merely illustrate the fact that human wants are practically unlimited and that there is an immense field open for further improvements. They certainly do not prove any of the statements of the welfare doctrine.

In Mises's day the socialialists and interventionists promised that their alternatives to the market would outperform a social system based on private property. However, that promise changed when the anti-market forces could no longer evade statism's obvious inferiority in delivering the goods. Undeterred, they discovered the "age of limits" and criticized "consumerism." Now statism's superiority lies in its lack of productivity. But as I say, Mises had to contend with the opposite claims.

There is no need to tell us that an ampler supply of various commodities would be welcome to all people. The question is whether there is any means of achieving a greater supply other than by increasing the productivity of human effort by the investment of additional capital. All the babble of the welfare propagandists aims only at one end, namely, obscuring this point, the point that alone matters.,,, Thus they are the harbingers of economic retrogression, preaching a philosophy of decay and social disintegration. A society arranged according to their precepts may appear to some people as fair from the point of view of an arbitrary standard of social justice. But it will certainly be a society of progressing poverty for all its members....

The truth is that capitalism has not only multiplied population figures but at the same time improved the people’s standard of living in an unprecedented way. Neither economic thinking nor historical experience suggest that any other social system could be as beneficial to the masses as capitalism. The results speak for themselves. The market economy needs no apologists and propagandists. It can apply to itself the words of Sir Christopher Wren’s epitaph in St. Paul’s: Si monumentum requiris, circumspice. [If you seek his monument, look around.]

Our very lives depend on reviving the public's understanding of what the free market has bestowed in so short a time.

Appearance on "Don't Tread on Anyone"

 Keith Knight interviewed me for his video/podcast "Don't Treat Anyone." Enjoy!

TGIF: Is Self-reliance a Libertarian Ideal?

An Associated Press article published a few days ago reported on disagreements among libertarians over what, if anything, the government may properly do about the coronavirus pandemic. My purpose here is not to comment on the quotes from the various libertarians. I prefer to focus on just one sentence by the author, Hillel Italie.

It's this one: "Libertarian principles of self-reliance and minimal government have been around for centuries."

Only the part I emphasized -- the reference to self-reliance -- interests me today.
At first, that term may seen unexceptional -- even to many libertarians -- in an article about libertarianism. A term like self-reliance (along with rugged individualism) is often associated with the libertarian philosophy, again, even by many libertarians. But is that term really pertinent? Or is it misleading and subversive of public understanding? I say the latter.
It's certainly true that libertarians believe that people should not rely on the government because government is force (to recall the quote erroneously attributed to George Washington). But by what reasoning does one equate eschewing reliance on the state with self-reliance? Is there nothing else but the self to rely on? Society perhaps? It's hardly a novel idea. It's especially not novel among libertarians.

Are libertarians against insurance for their lives, homes, automobiles, and medical needs? I don't think so. What's insurance? It's a large number of people, mostly strangers, pooling their resources in case of a long-shot catastrophic event that would bankrupt any one of the individuals. Insurance is the opposite of self-reliance, but it's perfectly libertarian.

Are libertarians against voluntary associations for fellowship and other nonmaterial values? I don't think so.

Is the symbol of libertarianism the hermit, Randy Weaver, or Ted Kaczynski sans letter bombs? Again, I don't think so.

Can advocates of a political philosophy who spend so much time, ink, and electrons praising free markets, global free trade, specialization, and the division of labor hold self-reliance as a core aspiration? Can the people often described by their opponents as "Adam Smith fundamentalists" be regarded as worshipers of self-reliance. No way! The Wealth of Nations is a paean to social cooperation. Libertarian hero Ludwig von Mises, author of Human Action, nearly called his magnum opus Social Cooperation. That's the second-most-used phrase in the very long book. What's the most-used phrase? Division of labor, another way to say "social cooperation."

I suspect that the term self-reliance actually works as a subtle smear of libertarians. It's a way to portray them as churlish, "selfish," antisocial. But as we can see, no grounds exist for that portrayal. When Simon and Garfunkel sang, "I am a rock; I am an island," they were singing no libertarian anthem -- not by a long shot. (Sorry, Neil Diamond, neither was "Solitary Man.")
Libertarians are in no way advocates of -- gotta love this one -- atomistic individualism. Rather, they are, as I suggested long ago, better described as champions of molecular individualism. They form associations for all kinds of reasons. (Alexis Tocqueville noticed this feature of early America's rather libertarian masses.)  Even the non-Aristotelians among libertarians agree that human beings are social animals, which means that the individual's best shot at flourishing is in a society -- as a long as it's a free society, of course.

When libertarians themselves are confused about this matter, they undercut their own case. I have often heard libertarians condemn the welfare state because it discourages self-reliance. I've even heard libertarians demonize people who accept food stamps and Medicaid or Social Security benefits.
But that's not the problem with the welfare state, or the social safety net. The problem is with the armed tax collector, not the recipients.

There's nothing wrong with wanting a social safety net. It's telling that when people are free to do so, they set up their own voluntary safety nets.

Before the growth of the national welfare state in the United States, working-class and middle-class Americans hedged against the risky, uncertain future by joining mutual-aid societies, also know as fraternal societies, lodges, and in England, friendly societies. These were not only sources of fellowship; they were also voluntary welfare organizations built on the insurance principle. (They were mostly member-owned societies, rather than for-profit companies.)

In the 19th century and the first few decades of the 20th century, working men and women joined these societies, among other reasons, to obtain various insurance benefits. They paid in when they were healthy and working, and drew benefits when they were not. Societies also paid funeral benefits so that families were not left with large debts when the breadwinner died. Some organizations even kept doctors under contract to provide affordable primary care to their members and families. (The state-linked medical societies did not like this "unfair" competition that lowered their incomes.)
Importantly, the societies were competitive and often part of nationwide networks: they boasted of their superior benefits in order to attract and retain members. Moreover, blacks and other minorities responded to racial and ethnic discrimination by forming their own -- successful -- societies. (See David Beito's history, From Mutual Aid to Welfare State: Fraternal Societies and Social Services, 1890-1967. Also see my video.)

The libertarian case against the welfare state, then, is not that it undermines self-reliance. It's that the state is 1) coercive and 2) bound to provide an inferior product because it's a monopoly with captive customers (taxpayers).

Quite possibly, a libertarian may say he has something else in mind by the term self-reliance. He might mean that he thinks for himself. Fair enough. People ought to think for themselves, though even here we must issue a caveat. F. A. Hayek taught us that even someone who thinks for himself benefits by relying on knowledge that other people possess. Society -- the market specifically -- extends our intellects by enabling us to act on knowledge of which we would otherwise be ignorant. (Prices are carriers of such knowledge.) Yes, we each must sift through what we learn from others, but we could not flourish without that input.

Going back further than Hayek, Aristotle noted that much of what we can reasonably be said to know includes second-hand "reputable beliefs" picked up from society. I'm comfortable in saying I know the earth is spherical, but I could not confirm that personally. To be sure, which of these beliefs are accepted as reasonable is up to each individual; the proof of the pudding will be in the acting. (See Roderick T. Long's liberating Reason and Value: Aristotle versus Rand.)

Thus for a variety of reasons, self-reliance is no part of the libertarian vision. It's time we corrected the record.

Tyranny and Cooperation

Social phenomena -- both good and bad -- cannot happen without cooperation -- that is, without people doing things uncoerced. This is especially clear with bad phenomena. How much havoc could a Stalin, a Hitler, a Mao Zedong, or a Pol Pot wreak alone or with just a few trusted deputies? Obviously, a ruler needs many others to cooperate with him. Importantly, cooperation does not require understanding. Most people will not grasp the tyrant’s project, much less endorse it. But one way or another they will go along actively and passively (abstaining from resistance). Why? Because they have learned -- from parents, teachers, youth-group leaders, peers -- that that is just what one does: one respects the “law of the land,” which is seen as the will of the legitimate ruler(s) or of the people, depending on the reigning ideology, but is in fact merely a series of decrees (statutes, executive orders, etc.) widely believed to be authoritative. So coercion is unnecessary. But even when it is required, the tyrant still needs the cooperation of those called on to enforce the decrees. Should they defy their orders, the cooperation of others will be relied on to have those orders carried out. Etc. The ruled always outnumber the rulers. If no one cooperates, the tyrant must abandon his project or do his own dirty work. But that means the damage he could inflict would necessarily be small-scale. Moreover, acting alone, the tyrant would be exposed as a fraud, a mere freelance thug. In the end, evil systems can exist only because enough unthoughtful people cooperate with authority, unthoughtful in Hannah Arendt's sense, that is, in the sense that they never ask themselves if they have a better reason to respect the authority's decrees than “it’s the law.” I think this is what Arendt meant by “the banality of evil.”

(For more, see my "Come and See the Anarchy Inherent in the System!" and the chapter "The Constitution of Anarchy" in my book America's Counter-Revolution: The Constitution Revisited.)

Competition, Cooperation, and Conformity

The opposite of competition is not cooperation (which is a complement of competition) but conformity.

TGIF: A Freed Society Would Not Be Problem-Free

Modified April 28, 2015

In 1970 country singer Lynn Anderson had a hit recording of a Joe South song that opened with the line:

I beg your pardon. I never promised you a rose garden.

I often think of that song in connection with the libertarian philosophy. You may be asking: for heaven’s sake, why?

TGIF: Tackling Straw Men Is Easier than Critiquing Libertarianism

Maybe I’m being unreasonable, but I think it behooves a critic to understand what he’s criticizing. I realize that tackling straw men is much easier than dealing with challenging arguments, but that’s no excuse for the shoddy work we find in John Edward Terrell’s New York Times post, “Evolution and the American Myth of the Individual.”

In his confused attempt to criticize libertarians (and Tea Party folks, whom I’ll ignore here), Terrell gets one thing right when he says, “The thought that it is both rational and natural for each of us to care only for ourselves, our own preservation, and our own achievements is a treacherous fabrication” (emphasis added).

Indeed it is. Unfortunately for Terrell’s case, it’s his treacherous fabrication.

Read it here.

TGIF: Does the Market Exhibit Cooperation

Last week's TGIF rebutted a challenge to the view that the market does not embody literal social cooperation. I think it does. Read it here.

Recent Scribblings

TGIF: "Economy or Catallaxy?
Op-ed: "The Ominous U.S. Presence in Northwest Africa"
Op-ed: "Mali: Here We Go Again"
TGIF: "Government Undermines Social Cooperation"
"World War II Spending Did Not End the Great Depression"
"No More Corporate Welfare"
"Against Government Debt"

TGIF: Social Cooperation, Part 3

Twelve years after publishing his pioneering Principles of Economics, in 1883 [Carl] Menger issued his Investigations into the Method of the Social Sciences with Special Reference to Economics. In this book Menger sought to establish the study of society, especially economy, as a legitimate intellectual discipline in contrast to the German Historical School, which denied the existence of social or economic “laws” applicable to all human beings at all times and places. Late in the book, and consciously following Plato and Aristotle, Menger draws “the analogy between social phenomena and natural organisms.”

Read the full TGIF: Social Cooperation, Part 3.

TGIF: Social Cooperation, Part 2

Only individuals value, choose, and act, of course, but in an important sense the resulting social whole is greater than the sum of its individual parts. Thus the defense of personal liberty is the defense of society. Let’s hear our opponents criticize that.

Read the full TGIF: "Social Cooperation, Part 2."

TGIF: Social Cooperation

At FEE’s Advanced Austrian Economics Seminar last week, more than one speaker mentioned that Ludwig von Mises considered a different title for the book we know as Human Action. The other title? Social Cooperation.

Read all of TGIF: Social Cooperation here.