The Shortcomings of Socialism and Altruism

Throughout the Obama administration’s tenure, conservative and Republican groups have been quick on the uptake in deeming the administration’s policies as no more than socialism.  From universal health care to huge bank and auto bailouts (which are extensions of the Bush legacy), this flag has been thrown numerous times & quite freely.  While I will not be taking up the examination of the merits or demerits of these claims, I do want to take a closer look at the philosophical and practical shortcomings of socialistic policy and a government based on altruism in general.  I contend that socialism in concordance with altruism does not unite a country, but sets it at each others throats, merely serving to create a deep psychological divide amongst its citizens.  Before I get into this, I want to define altruism and look at its implications.

Far too often, altruism is used as a synonym for benevolence or acts of kindness.  This couldn’t be further from the case.  Merriam-Webster defines altruism as such: “Behavior by an animal that is not beneficial to or may be harmful to itself but that benefits others of its species”.  Therefore, altruism is a lifestyle in which the promotion of one’s interests, the reasonable actions to develop, improve, and maintain one’s life are set on the backburner, taking consideration for only such actions that will benefit others, even when it is detrimental to oneself.  Altruism then is the complete antithesis of capitalism, of rational self-interest.  A free market would not, could not,  sustain itself under an altruistic state, therefore presenting the need for planned economies and essentially the “nanny state” that socialism offers.  If citizens act only in regard to others, who will take care of them?  Individuality is shunned in the name of the collective, but it cannot be assumed that someone else will always be there to provide help when they need it.  The natural answer to such a society? Socialism.

It must be noted that benevolence not only can thrive in a capitalistic society, but helps to progress it.  Altruism destroys capitalism, for capitalism depends upon rational self-interest.  This does not mean advancing one’s interests at the expense and detriment of others, but advancing one’s interests through voluntary trade and mutual benefit with others.  Thus, this is why capitalism is portrayed as such a greedy rat-race leaving the lesser endowed to rot in a ditch: it stems from the fundamental confusion regarding the definitions of “altruism” and “benevolence”.

Now that the correct state of altruism has been defined, I want to take a look at some of the philosophic difficulties presented by socialism.  Socialism, as its name implies, is founded upon the idea that the interests of society, the collective, take precedence over the individual.  The inherent problem with this that socialists tend to overlook is that the “collective” is a man-made social construct that could not even exist were it not for the individual.  Any collective, any society, is merely an amalgam of individuals.  Why an imaginary entity would and should take precedence over an objectively factual entity has yet to be defended.  

Next, I want to look at the concept of a socialistic society that presents possibly the largest problem: coercion.  Socialism thrives on the tenet that all citizens devote their energies and resources to the good of the collective, deeming it a just and moral action.  It is a value they hold dear. So dearly do they hold it, they feel the need to coerce those who don’t agree (and happen to live in that society) to comply. My contention is that as soon as coercion enters into the equation, the value one is promoting then becomes a non-value.  Forcing someone to comply with a “moral” value ends up obliterating that person’s judgment.  They don’t reach the conclusion that the value before them is moral by their own reasoning, they arrive as a goaded sheep.  Ayn Rand asserted that values could not exist within a vacuum.  She said, “values cannot exist (cannot be valued) outside the context of a man’s life, needs, goals, and knowledge”.  She also contends in the same paragraph that “an attempt to achieve the good by force is like an attempt to provide a man with a picture gallery at the price of cutting out his eyes”.  One cannot value what they cannot perceive and justify of their own logic.  

It is along these same lines regarding force in the sense of redistribution of wealth that Russian philosopher, Leonid Nikonov, states:

“A robber can steal from someone and then have more than the victim, resulting in greater inequality, or the same as the victim, resulting in greater equality.” [Emphasis added]

The reason I bring this quote up is to put the true nature of redistribution under the spotlight.  Any use of force in claiming and redistributing wealth in the name of social justice is theft. No more, no less.  The term “robber” is just substituted with the term “government”, “victim” with “citizen”.

Another shortcoming of socialistic thinking is that eventually, someone will have to necessarily be the “selfish” or “greedy” one.  To exemplify this, I want to paraphrase a scenario presented by Chinese economist, Mao Yushi, in one of his essays:

A and B receive an apple.  They cut the apple in half to split it.  Without hesitation, without a word, A grabs the larger half for himself.  Distressed, B looks at A and asks, “How could you be so selfish?”  A looks down at his portion of apple and then back at B asking, “If you had grabbed a piece first, which would you have taken?”  B looks frustrated at such a silly question: “The smaller half, of course.  I’m not selfish.”  A looks at B and responds, “Then my ‘selfish’ actions are in accordance with your wishes. I would have received the larger portion anyway.”

The point: total equality is impossible. There will always be a “selfish” party in a socialistic society, even if misnamed, for perfect equality is something that cannot be achieved, thus implying there will always be someone with a bit more or a bit less.  

Overall, what are the philosophical implications of socialism and altruism?  Why is a rational interest in the one’s own well being, not at the expense of others but through mutual benefit, immoral?  I believe this stems from a subconscious frustration with the irreconcilable problems of socialist systems.  Under socialism, personal gain, personal happiness, is wholly dependent upon the actions of others and the declarations of a government. There is a lack of personal responsibility under socialism that cannot be replaced by any “collective” or “government”, no matter how hard those advocates of socialism would try.  Why did man originally enter into “society”? Why was there the sense of need for companionship and community so as to create this social construct?  It assuredly wasn’t under the assumption that one would be taken care of by everyone else, setting down their personal responsibility.  It was based on the idea of mutual benefit through voluntary trade, through rational self-interest. The baker is more skilled than the carpenter at making bread and pies and other forms of sustenance. Likewise, the carpenter is better than the baker at building homes and buildings and repairing them.  They exchanged their goods and services for the other because they both, in their minds, ended up better off.  The other had skills they did not possess.  They thrived on individual action and responsibilities, exchanging them for those of others to better their lives.  This is why “society” was created.  Not to expect others to take care of oneself, but to improve one’s own life, and as a result (not an end in itself), the lives of others through mutual benefit and trade with one another.  

This is a very brief look at what I see as shortcomings of a socialist system operating under altruism. I’d like to end this essay with one sentence to be used as food for thought:

In a free society, voluntary socialism is possible, but in a socialist society, the opposite is impossible.  

Until next time, Take Care.

-Brad

A Case for Life, Liberty, & Property.

As I have delved deeper into various philosophies and ideologies, it has become apparent that there is a desperate need for a justification of the rights to Life, Liberty, & Property that is based upon sound logic and reason.  In his two treatises on government, philosopher John Locke asserts three inalienable rights of human beings, endowed with these rights by Natural Law and our Creator, God: Life, Liberty, & Property.  These three rights and their God-granted inalienability went on to shape our Founding documents.  For one who wholly believes in a Creator, to consider these rights as inalienable and granted by that Creator’s authority seems to be a logically and reasonably held assumption.  But what if one were confronted by a person who openly refutes the existence of a Creator, not even acknowledging the possibility of one?  How would one prove and defend that these three rights are not only moral, but indeed inalienable?  This is what prompted me to write on this topic: an argument for Life, Liberty, & Property, without God, for if you cannot defend these rights from any angle of attack, you are doomed to fail from the outset.  Not only will I prove these rights’ self evident nature, but their interdependency upon each other. If one of these rights is lost, the others will necessarily fall as well.

The right to Life is necessarily placed foremost, for the rest are direct derivatives of this right.  Without the right to Life, no other right can exist.  When looking at the definition of the word “life”, common dictionaries state: “The animate existence or period of animate existence of an individual.”  I would like to place particular emphasis on the words “animate”, “existence”, and “individual”.  The mere fact of existence implies a right to Life.  As Ayn Rand puts it when describing her axioms of knowledge, “existence exists”.  The fact that existence “exists” is the defense here, existence in tandem with a rational consciousness of a superior level.  Existence is irreducible in the sense that the only way to disprove existence is to utilize the concept of existence. It is impossible; a paradox.  Human beings are fascinating creatures in that upon the mind developing to a point where humans have the ability to make rational decisions of their own, Life becomes a choice.  Any time before this development of rationality, a child is wholly dependent upon a human with a rational consciousness.  If they do not have this rational mind taking the steps to take care of them, they will perish.  Once this rationality does develop, thousands upon thousands of choices present themselves to the human.  We are beings of volitional existence, our survival, our existence, our Life, only continuing so long as we make choices to prolong it.  When our bodies need energy, we are alerted through pangs of hunger.  These pangs are not volitional, but involuntary, natural reactions produced by our bodies.  Volitionality enters the equation when one decides whether or not to sate that desire by consuming food.  The body is dependent upon the rational being’s consciousness to choose to eat the food to continue living, otherwise the person will die.  It is in this volitionality, in this concept of choosing to prolong one’s life through rational actions that the right to Life is justified.  I’d like to bring the term “individual” from the definition of Life back to mind.  Each individual rational consciousness must make these decisions for themselves, therefore creating an inherent responsibility to prolong one’s own Life.  The instinct of survival is inherently buried within the mind to be carried out by the body. It is the rational mind, the rational thought process, that must be facilitated in order to meet the standards required to bring this instinct into fruition and, indeed, survive.  It is wholly of and from the individual.  Some may ask, what of children or the mentally handicapped?  They are innately unable to make this volitional choice on their own. They lack the rational consciousness, and in the case on the handicapped, even the ability to reach this state of rationality.  This in absolutely no way voids them of their right to Life.  It is the parents’ responsibility to raise their children until they reach this stage of consciousness.  As for the handicapped, it must be taken upon their direct relatives, whether family or some other relation, to sustain this person due to their lack of a rational state.  Just because Fate has dealt someone an “out of the ordinary” hand does not deny them their fundamental right to exist.   To make the decision of Life for another rationally aware being would be immoral, depriving the person of an inherently embedded concept.  To make the decision of Life for one who is rationally incapable is just as immoral.  In both cases, it would be violating the individual physically and mentally.  Each person must choose to maintain existence, therefore establishing Life as a fundamental right. As for children, due to the fact that they will reach this stage of rational consciousness, the right is still maintained.  No one has the authority to hinder another from prolonging their Life, even if that person will never be able to enter a rational state.  Life is inherently instilled within each individual upon coming into existence, each “life” wholly belonging to each individual, existing completely separately from one another.  Therefore, the right to Life is reliant upon individuality and its acknowledgement, and is a right due to the concepts of volitional existence and rational consciousness.

The right to Liberty is directly derived from the right to Life.  Liberty can be said to be the freedom to choose how to live one’s own Life.  Since we have established that humans are beings of volitional existence, it can be said that choosing whether or not to prolong one’s existence is the base and foundational Liberty from which all others flow.  Choosing to survive is an exertion of Liberty, in and of itself.  Without the right to Life, the right to continue to choose whether to continue living or not, no other Liberty can exist.  Once humans reach that higher state of consciousness, doors open that they’ve never had access to before, or rather had, but did not have the capability to comprehend these doors’ existence.  They start making their own decisions, searching for their true purpose and true happiness, even if these acts are being carried out subconsciously.  The presence of a rationally capable conscious does not guarantee rationally based decisions, though.  People may knowingly make choices that are in fact detrimental to their purpose or happiness based on no foundation of reason or logic.  Regardless, it is their decision to make.  If that is what they deem to be the superior decision for their Life, may I repeat, their Life, who is anyone else to stop them?  To whom is each individual beholden to on this Earth? From where or whom do those who would control others derive their authority?  From what logical, empirical source?  There is none. There is no one.  It is certainly not a government’s job, nor any man’s for that matter.  As Jeremy Bentham contends, utility is achieved when the government leaves people alone to do as they please, or to exercise the liberties they have had since coming into existence.  Liberty is implied by Life and existence itself, and each person shall have authority over their decision and solely their decisions.  As far as to what extent one may exercise one’s Liberty, John Stuart Mill’s “Harm Principle” seems to be the best standard.

“The only purpose for which power can be rightfully exercised over any member of a civilized community, against his will, is to prevent harm to others.  His own good, either physical or moral, is not a sufficient warrant.”  

Race, color, sex, or creed makes no difference in the equation.  Chemically, biologically speaking, we all have the same functioning organs and organ systems (gender defining organs aside).  There is absolutely no foundational argument as to why one human being can determine how another lives their life, or from where they gain the authority to do so.  Liberty is an irreducible concept it that, even in a complete totalitarian state where the individual has no liberties, and to disobey the state is to be punishable by death, the individual still has the Liberty to disobey, even if upon disobeying, they are denied their right to Life.  If one were to disagree with my argument for Liberty, they are in fact exerting their Liberty to disagree.  Liberty is inescapable as a concept, thus proving it as a fundamental right.  It is inalienable, inherent within each human being.  Just as death is an inescapable fact, so it is with Liberty, no matter how hard nor to what lengths oppressors would try to restrain it.

Much like the right to Liberty, the right to Property is wholly dependent upon the right preceding it.  Without the right to Liberty, there is no right to Property.  Property stems from the rational being’s acceptance of volitional existence and is a direct product of the steps taken to ensure survival.  As you can see, it starts with Life, Liberty being utilized to survive, thus bring us to Property.  It cascades down logically in a natural fashion and progression.  When a person decides to progress in growth of Life and Mind, they voluntarily exercise labor.  The yield of this labor is effectively their creation.  Whether they consume or utilize this yield directly, or whether they trade this yield voluntarily with another for their yield for mutual benefit, it is still the direct essence and product or their labor, thus making it essentially a part of their being.  The efforts one pours into the their own survival and what is created from that is effectively their own to do with what they please.  To seize one’s property, for whatever “justifiable” reason, is to deny any right to Property, and by consequence, any right to Liberty.  If one does not strongly grasp the Liberty to maintain and use the fruits of their own labor as they deem fit so as to secure their right to Life, a very slippery slope is molded down which all liberties could slide forever, at least as many as is possible for a government or other person to control and limit.  Property allows for the progression and improvement of one’s Life by facilitating the necessary steps and actions required for survival.  It also creates a system of value through which trades and compromises can be made, voluntary contracts mutually benefitting each party.  This trade helps to usher in more innovation through the gain of a wider breadth of knowledge, thus improving the overall quality of Life for all humans.  It is no coincidence that the explosion of technological advancements ushered in by the Industrial Revolution occurred after the founding of America, bringing with it the first free market system to be truly utilized within the world.   So not only is it beneficial and moral to preserve the right of Property for the individual, but it ends up benefitting all in society.  It is truly remarkable what can be achieved via voluntary interactions.  Therefore, Property is the direct product of one’s choice of accepting our volitional existence and to deprive someone of their property would essentially be depriving a person a portion of, not only their Life, but their Liberty as well.

In closing, the right to Life, Liberty, & Property are naturally inherent upon existence.  To deny any of them is to deny all, for they are all mutually dependent.  They derive their properties from one another, all these properties being intricately woven into a tapestry of the rights of Existence.  It is morally reprehensible for one to exert their faux-authority to dictate these rights for anyone but themselves.  While human beings do thrive through cooperation, it is the congregation of individual persons and their individual achievements that coalesce into the overall progress of mankind.  The only way to facilitate this progress in undoubtedly via the inalienable rights to Life, Liberty, & Property.

Until next time,

-Brad

The Nature of RIghts

For as long as I’ve been politically aware, I’ve heard the term “right” thrown about in every context imaginable.  Whether used in the standard context regarding Life, Liberty, or the Pursuit of Happiness, or in regards to a “right” to affordable healthcare, affordable housing, free medicine, a job, free birth control, rights of the unborn, the right to bear arms. I could list such examples long into the night.  But what is the true nature of a right? How can we objectively determine what are rights and what are merely privileges of living in a free society?  That is the goal of this essay: to define the nature of a right, what should be considered a right, and what should not. I’d be terribly mistaken to assume my following contentions would be impervious to debate, but I at least plan to provide my line of logic and reasoning on the matter.  

First, we must look at what exactly a right is and what facilitates it.  Rights can be described as the fundamental principles and/or standards necessary to the proper maintenance of existence that cannot be justifiably denied of a law abiding person.  As to what facilitates a right’s ability to indeed be a right, this is the key portion:  A right can only be deemed such insofar as it is not dependent upon any other individual or group of individuals.  Rights are of the individual and yielded from the individual, their very existence.  There can be no other derivation of a right.  Anything that helps to better the life of oneself we will deem, not a right, but a privilege, for the many comforts of Life are ensured to no man and overall, are not integral in securing the continuance of one’s Life; they simply make it more convenient to do so.  Also, any benefit being derived from someone other than the sole individual concerned we shall call a privilege as well, for demanding a right that is dependent upon the production or skill of another enters into the field of coercion.  Thus, for a right to be able to stand firm, it must be something that can be achieved in man’s natural state: solitariness.  Society itself is man-made, facilitated through voluntary interactions, thus making the individual the sole concern of rights and from where they come.  There is no such real, objective thing as a collective, a race, an advocacy group, a society, for these are all man-made societal constructs and are conditional upon one thing: the individual.  All of these concepts are merely groups of individuals.  This, and only this, is the reason why rights can only be derived from the individual.  We will delve further into this when we look at what cannot be considered a right, but first, let’s look at what we can properly call “rights”.

Since we have established that rights are wholly of and from the individual, I’d like to take a look at some examples of what we can assert as rights.  There are four I would like to point out specifically, all being intricately interwoven, dependent upon each other.  These are the rights to Life, Liberty, Property, & Self-Defense.  The essay I’ll be posting next Monday will deal specifically with the first three and their inalienability, so here, I would like to focus on how these three stem from each individual.  Life and the right of one to possess it is inherently instilled within each person upon coming into existence.  The axiom that “existence exists” solidifies this concept.  Liberty is the ability of each person to choose how to live their life as they see fit, beholden to no man so long as they do not harm another.  Property is a direct derivative of exerting the combined rights of Life and Liberty, each individual producing the necessaries of existence, turning those yields into that person’s property. To deprive a person of any of these would be to deprive them of all three.  As I already stated, this is an extremely brief overview, a more detailed look already being prepared for next week, so let’s move on to self-defense.

Self-defense establishes itself as an individual right within its own name, “self” denoting this fact.  The whole purpose of self-defense is to fend off those that would physically harm one’s Life, Liberty, or Property.  Therefore, self-defense is only viable as a right conditional upon the existence of the previous three rights.  If one did not have a right to Life, Liberty, or Property, there would be nothing for one to defend, thus further establishing the interdependency of the four rights I have asserted as being absolutely necessary, proper, and inalienable.

Now I would like to turn to principles that should not, cannot, be considered rights.  The first I want to examine is the “right to health care” or “affordable health care”.  The main and most important reason that this is by no means a right is that it is wholly dependent on more than the individual receiving the health care.  This receiving presupposes that someone is providing it.  But who? Even leaving the matter of taxpayer dollars being poured into socialized health care out of the equation, it leaves the biggest problem here: the doctor-patient relationship.  Making affordable health care a right completely obliterates any notion of such a relationship.  It makes the services, the efforts, the experience, the knowledge of the doctors subject to the whims of what the government deems to be “affordable” health care.  The government at this point becomes an insurmountable middleman, dashing voluntary trade, dashing the very essence of Liberty from the situation.  To coerce doctors to comply with “collectively” erected standards in regards to health care is essentially holding a gun to their heads, saying “Comply or face the consequences”.  And thus, the years of research, study, and effort poured into their profession are wiped clean, for these doctors no longer provide health care of their own free will, but because a government, a people, have deemed, have demanded, healthcare as a right.

The same exact argument, no matter the “arena”, I would argue on principle alone.  Whether it be the right to affordable housing, the right to a job, the right to birth control, etc.  These are all dependent upon the producers of the world to provide it under government coercion.  There is honestly no more I can say to defend it, for if one were to actually approve of the use of government coercion to make a producer, a doctor, a businessman, a builder, no matter the case, to provide their services for a pre-determined price, eliminating free will, the battle has already been lost, and Reason will not appeal to that person’s line of thinking.  

Sadly, these are the times we live in.  These horrors are becoming realities, as seen with the Affordable Care Act.  I do not want to be misunderstood. I want progress. I want the citizens of every country to thrive, live, to be the Masters of their own Fates.  But for this state to exist, a system of governmental coercion can not be, can never be, the answer when speaking of voluntary trade.  I will sign off this week with the words of a Frenchman come to America, observing the opportunities here, observing the Liberties we so often take for granted:

“I should have loved freedom, I believe, at all times, but in the time in which we live I am ready to worship it.”

-A. de Tocqueville

Until next week, friends.

Take Care.

-Brad

Morality Precedes Wealth.

Adam Smith is revered as the champion of free markets.  His paramount work, Wealth of Nations, published in 1776, played an enormous role in the shaping of economic theory, changing the way the game is played forever.  People most often reference his metaphor of an “Invisible Hand” that he used to describe the manner in which the free market self regulates itself, constantly moving towards a state of equilibrium and progress.  Little known though, is that Smith actually had a book on ethics published in 1759, years before his milestone of economic theory.  This work was called The Theory of Moral Sentiments.  I write this essay because I don’t think that it was a coincidence that Smith wrote a volume on ethics before his work regarding wealth.  I have two goals for this post.  First, I want to provide a brief synopsis on Moral Sentiments.  Second, I want to defend the following claim I have formulated: In order for a society to thrive and reach the pinnacle of its potential, a certain level of morality must be achieved and maintained before wealth creation takes place.  But before I can delve into my claim, I must lay the groundwork of Smith’s tome on morality.  I believe in going straight to the words of those we are researching to gather the true nature of their arguments, so be warned, ample quotations lie ahead.

Moral Sentiments is divided into a few large sections, each dealing with various topics of ethics.  The first section Smith chips away at is entitled “The Propriety of Actions”.  Smith starts off by talking about sympathy; its causes and its effects.  He contends there are two main sources of sympathy: sympathy in relation to that which excites it and sympathy in relation to the end it produces.  In talking about how connections between people are created to facilitate sympathy, Smith says:

“I judge of your sight by my sight, of your ear by my ear, of your reason by my reason, of

your resentment by my resentment, of your love by my love.”

He contends there is no other way.

Smith then warns of the danger of ambition, claiming it to be a trap that can ensnare any unwatchful person.  He boldly states that if you love liberty over servitude and prefer to live:

“...free, fearless, and independent...Never enter the place from whence so few have been

able to return; never come within the circle of ambition; nor bring yourself into comparison

with those masters of the earth who have already engrossed the attention of half mankind

before you.”

After writing at length about sympathy, the next section is presented regarding “Merit and Demerit”.  In regards to the merit of self defense, Smith implores that:

“Among equals each individual is naturally, antecedent to the institution of civil

government, regarded as having a right both to defend himself from injuries, and to exact

a certain degree of punishment for those which have been done to him.” [Emphasis added]

I want it to be noted that Smith advocates the inherent right of self defense, a right not granted by civil governments, but by the inherent nature of existence.  On the opposite side of this coin though, lies the initiation of force and its demerit.  Smith decries:

“To disturb his [our neighbor’s] happiness merely because it stands in the way of our

own, to take from him what is of real use to him because it may be of equal or more use

to us...is what no impartial spectator can go along with.”

Smith then declares that justice is more important than beneficence within a society.  You cannot gain a benefit without a firm foundation of justice to right the wrongs of those who would distort the natural order of society.

In the following section, “Foundations of Judgments”, lies probably my favorite portion from the entire Theory of Moral Sentiments.  Smith talks about being in adversity and prosperity and provides some of the best advice I think myself to have read in a very long time.  He asks the reader: “Are you in adversity?”  He then urges the readers to surround themselves with people who do not know them, who are not informed of their ills, who do not have the knowledge necessary to sympathize with their plight.  This will sooner aid in drawing the persons out of their particular case of adversity than any other remedy, removing them from a downtrodden state of mind.  Smith then goes on to ask: “Are you in prosperity?”  In this case, Smith urges the reader to surround himself with those that are independent of him.  This way, the reader will be judged according strictly to his or her character and conduct, not by their fortune.  Smith then declares in a tone that is eerily applicable to today that the danger of factions is worse than that of hostile nations, a fact we come more to terms with each passing day.

This is an extremely brief overview of an exhaustive work, so as always, I urge you to check it out for yourself.  I did not intend for this to be a novel-length post, so naturally I could not include all of the intricacies of the work. But now that we have a basic understanding of Smith’s Theory of Moral Sentiments, we can move on to my claim.

As I wrote earlier, I do not believe it to be a coincidence that Moral Sentiments was published before Wealth of Nations.  I believe this to have been an intentional succession of ideas by Smith, culminating into a combined social theory, thus leading me to my own conclusion:

In order for a capitalistic, free market economy to thrive, to reach its full potential,

there must be an established justice system, but more importantly, a certain standard

of morality, something that cannot be enforced by law.

My main line of logic that leads to this claim is that, essentially, morality translates into trust.  When you have a society, the vast majority of which adhering to a standard moral and legal code, those who become so immoral as to lower themselves to the bottom most level of crime e.g. theft, murder, etc, are dealt with by the law.  Other immoralities such as falsehoods, manipulation, and the like, are things that cannot be punished by the law, generally not being sufficient circumstances to be considered crimes.  If one lies about how large their house is, or about their wealth in general, in order to try and impress someone, they are causing no harm to that individual they are trying to impress, therefore a falsehood of this nature is not punishable by law.  Quite the contrary, a lie of this sort ends up damaging the reputation and amiableness of the liar himself, merely repulsing the intended victim of their lie away from them.  The point of establishing these seemingly common sense concepts is to highlight the fact that general morality is not something that can be coerced into existence.  It must flow naturally from a society.  Also, my goal is to establish that without a strong sense of morality (morality here denoting general concepts of right and wrong, not different, subjective matters as dictated by certain religions or creeds), a free market cannot thrive.

Individuals participating in a free market presuppose a level of trust with those that they enter into business with and thrive on this trust.  This presupposition flows both from consumer to producer, producer to consumer.  A consumer trusts that the product that he or she is buying from the producer is of a certain expected quality.  A producer trusts that the consumer will make good on his or her promise to pay for the goods they intend to purchase.  For producers in this case, the profit motive essentially becomes the “trust motive”.  They are out to gain the consumers’ trust by providing an excellent, dependable product.  If they do not, they will not sell their goods or services, thus not making a profit.  It is in their best interests to provide the best possible service to their consumers so as to establish a meaningful, real mode of exchange.  This is essentially what advocates of free markets have always argued.  Government regulations are not necessary when it comes to enforcing strict dietary, sanitary, safety, etc standards.  Companies will do this naturally.  Why?  As I stated, trust turns into profit.

Now, suppose that a society was not moral on the whole.  Suppose almost every person lied about almost everything in their lives to almost everyone they encountered.  This kind of widespread immorality would make everyone wary of everyone else, reluctant to deal with others in any way. If people were overtly dishonest, manipulative, unafraid to trample those in their path for their gain, there would be no meaningful exchange.  A free market would suffocate in the lack of morality-rich air.  Individuals would be afraid to start a partnership or trade with anyone else due to one sole fact: they could not trust them.  

Let’s look at the perfect, real world example: Bernie Madoff.  Madoff’s wealth management business ended up being revealed to be a giant Ponzi scheme, essentially stealing billions and billions of dollars from his investors.  He took advantage of these investors (the consumers of his service) and their trust in him, totally abdicating morality from the equation.  The result?  The ruination of hundreds, perhaps thousands, of people’s lives.  All because one man threw morality out of the window.  This is an extreme case that, of course, was and is punishable by law.  But imagine a society with Madoff’s mindset.  It doesn’t even have to be a mindset of theft, merely one of accepting dishonesty as fair game.  Would that society thrive? Would that society benefit from all of the opportunities that the free market has to offer?  Of course not.  Smith says it best himself in Moral Sentiments:

“For one man to deprive another unjustly of any thing, or unjustly promote his own

advantage by the loss or disadvantage of another, is more contrary to nature, than

death, than poverty, than pain, than all the misfortunes that can affect him, either in his

body, or in his external circumstances.”

Ultimately, the point I have been trying to present is that without basic concepts of morality, i.e. honesty, integrity, pride in one’s work, etc, a society will not reach its utmost potential.  The lack of these virtues destroys any possibility of meaningful exchange, thus stifling growth and consequently innovation in the long run.  These concepts, though, cannot be legislated into being.  To force someone to be honest at the point of a gun does not bring about a genuine change of heart.  It brings about compliance that is not founded upon a logical line of cognition.  Critics of free market capitalism complain that within free markets, business owners ravage and plunder those they provide their services to.  What these critics fail to accept is the fact that people of this nature are not operating within the mentality of a capitalistic, free market society.  Those business owners will reap the contempt they’ve sown, whether it be through legal recourse, boycott by consumers, or some other method.  The most important thing critics of capitalism fail to accept, though, is the true nature of capitalism itself: peaceful, voluntary exchange; mutual trade to mutual benefit.  Until this concept is widely realized and accepted, we will be stuck with the ticking time bomb we operate under today: the mixed economy.

-Brad