Freedom and Economic Order

by Linda C Raeder

  Locke’s defense of private property carried forward a longstanding tradition of Christian reflection on the institution of private property. Among his predecessors was the celebrated Christian philosopher Thomas Aquinas (1224-1274), who, like Locke, provided a common-sense defense of the institution. Aquinas defends the necessity of private property on three grounds. First, human nature is self-interested: it is such that “every man is more careful to procure what is for himself alone than that which is common to many or to all, since each one would shirk the labor and leave to another that which concerns the community.” Second, private property enables a more “orderly” conduct of human affairs because it allows each person to “take care of some particular things himself; whereas there would be confusion if everyone had to look after any one thing indeterminately.” Third, private property minimizes conflict within society, that is, “a more peaceful state is ensured to man if each one is content with his own. Hence it is to be observed that quarrels arise more frequently where there is no division of the things possessed.”[84] Aquinas shares Locke’s concern with the “quarrelsome and contentious.”

  The institution of private property has existed in some form or another in every developed or civilized society known to man. Communal or collective property, on the other hand, is characteristic of relatively primitive societies in early stages of cultural development.[85] Advanced civilization is inconceivable in the absence of private property. As has been discussed, a property right, in effect, is a decision right. The complexity of any developed society in a spatially extensive territory requires that individuals have both the right to make decisions regarding the direction of resources and the incentive to do so. Such a conclusion follows from the epistemological facts discussed in previous chapters. Only individuals possess the requisite knowledge—tacit and fleeting knowledge of time, place, and circumstance—to ensure an efficient utilization of scarce resources directed to the production of goods and services that people actually need and want. The right to direct such resources is guaranteed by the right to private property. The incentive to act on that knowledge is provided by the possibility of profit, secured to risk-takers by the enforcement of individual rights to property. We have also seen that the formation of an accurate structure of relative prices is similarly dependent on the institution of private property. Marx was correct: private property is indeed the linchpin of a capitalist economic order. The success or failure of a market economy, more precisely, the success or failure of the individuals who order their activities through market exchange, hinges on the scrupulous protection of the individual’s right to decide, that is, his right to private property.

  Justice and Socialism: Social or Distributive Justice

  We have seen that the overarching moral goal of Marxism and its variants is greater equalization of material wealth among members of society. Toward that end, collectivist ideology not only proposes fundamental institutional change but also a redefinition of morality. Morality, as discussed, is implicitly redefined in material terms and along consequentialist lines congruent with the central collectivist end: good or right is identified with greater equality of material outcome and bad or wrong with inequality of material outcome. We have further seen that the equalization of material outcome valorized by collectivist ideology intrinsically conflicts with traditional justice, particularly its principle of equality under law and protection of universal, individual, negative rights to property. Economic centralization or collectivization of any kind is irreconcilable with traditional justice. Accordingly, advocates of economic socialization reject traditional justice in favor of a competing conception of justice, variously termed “social,” “distributive,” or “economic” justice or, more recently, “global,” “racial,” or “environmental” justice. All such terms are more or less synonymous. They all represent the demand for greater equality of economic or material outcome, to be achieved by the political distribution and/or redistribution of wealth.[86]

  The attempt to achieve “social” or distributive justice—greater equalization of wealth—can be approached in various ways, just as the attempt to achieve governmental control of resources can be approached in various ways. Classic communism, as we have seen, demanded outright governmental confiscation and exclusive ownership of the means of production and subsequent distribution of wealth according to the dictates of political elites. As we recall, however, various fellow travelers and sympathizers quickly realized that the Marxist vision can be brought to fruition by means far less drastic than those envisioned by Marx himself. They realized, in particular, that democratic legislative action—the careful crafting of tax and regulatory policy—can also bring resources under control and direction of government and effectuate redistribution of wealth, with the great advantage of simultaneously permitting nominal preservation of private property. Similarly, the realization of social or distributive justice can be attempted in one of two ways. It can of course proceed along the lines of classic communism—outright governmental ownership of resources and industry (and subsequent material distribution by government). It can also be attempted by maintaining nominal private property but taxing and spending taxpayers’ resources in such a manner as to achieve greater equalization of wealth across society (governmental redistribution of wealth). The collectivist moral ideal can be pursued through either political distribution or redistribution of resources.

  We have previously touched upon the ideal of social or distributive justice as conceived by classic Marxism. Marx, as we have seen, condemned capitalism as profoundly unjust. Capitalists, he claimed, appropriate or steal what rightfully belongs to the workers—the entire value of the goods and services produced by their labor, staking their claim to exclusive possession of profits on the ground of individual rights to property. The Communist Manifesto aims straight at the heart of such injustice—the chronic and massive legal theft enabled by the institution of private property. It straightforwardly demands “the abolition of private property . . . [especially] bourgeois private property.”[87] The Marxist vision, as discussed, involves direct governmental ownership and control of all resources in a manner that aims, in principle, to benefit every member of society, not merely the privileged capitalist class. Government planners devise and implement production plans and distribute their fruits equitably across society. Each individual worker contributes to fulfillment of the central plans in accord with his unique abilities. Political authority assesses the relative needs of members of society and meet such needs by distribution from the common pool—the fruits of production jointly generated by all individual workers: “From each according to his ability, to each according to his need.”

  The end and purpose of all such procedures is justice—social or distributive justice, a more equal distribution of the material goods of this world. Workers, the source of all value, will finally receive their due, their fair share of the value they produce. Society will no longer be plagued by the obscene spectacle of extravagant luxury juxtaposed to grinding poverty, as under capitalism. Every member of society will be provided with decent food, housing, medical care, educational and cultural opportunities, and so on. Every member of society will be provided with the material means necessary to fulfill their lives and realize their potential. The class conflict that has plagued mankind throughout all previous stages of history will disappear. The “haves” and “have-nots” will be supplanted by the universal class of “Socialist Man,” each member of which is equipped with the necessities of life and selflessly motivated to promote the common good. Justice will be realized at long last—social justice, an equitable distribution of material goods across all members of society.

  Indeed, socialized economic relations will achieve not only justice but also freedom, not the sham “freedom” of capitalist society but rather true freedom—freedom from necessity. No longer will human beings be forced to work against their will, on pain of death. Instead government, the state, will “regulate the general productio
n” and administer its distribution to ensure the material wellbeing of all persons. Human beings will finally achieve the freedom requisite to fulfillment of their nature, the spontaneous creative activity their species being demands. Indeed, the communist horizon beckons with the promise of untold joys, including release from the dreary tedium and monotony putatively intrinsic to capitalist relations of production. The specialization and division of labor demanded by capitalism will disappear under socialist relations of production, permitting the individual simultaneously to pursue his myriad inclinations and develop his myriad abilities. As Marx depicts the dream:

  In communist society, where nobody has one exclusive sphere of activity but each can become accomplished in any branch he wishes, society regulates the general production and thus makes it possible for me to do one thing today and another tomorrow, to hunt in the morning, fish in the afternoon, rear cattle in the evening, criticise [sic] after dinner, just as I have a mind, without ever becoming hunter, fisherman, herdsman or critic.[88]

  Human beings will never again have to suffer the deadening pain of boredom in their working hours or sacrifice development of their various abilities for exclusive development of one. Socialism, unlike capitalism, will require no such painful trade-off.

  Such is the essence of the ideal that drives the socialist aspiration in its myriad forms. It should again be emphasized that the collectivist ideal, cast in economic terms, is fundamentally a moral ideal. Equality of material distribution is portrayed as the highest moral good; inequality of material distribution as the epitome of injustice, immorality, and selfishness. Socialism thus asserts itself, as previously observed, as a decided moral advance over capitalism, which is said to be concerned not with the good of the whole of society but merely the rights and interests of the individual or a privileged group of individuals, the capitalists. On the Marxist view, the individual property rights that sustain capitalist exploitation have value only to this privileged group; they have no value to those who own no property but their labor, the workers. As Marx says in the Communist Manifesto,

  You are horrified at our intending to do away with private property. But in your existing society private property is already done away with for nine-tenths of the population; its existence for the few is solely due to its non-existence in the hands of those nine-tenths. You reproach us, therefore, with intending to do away with a form of property, the necessary condition for whose existence is the non-existence of any property for the immense majority of society.

  In one word, you reproach us with intending to do away with your property. Precisely so: that is just what we intend.[89]

  Capitalism only benefits the select few, the bourgeoisie, and this at the expense of the many, the proletariat. The superior morality of socialism, by contrast, is concerned not with the mere individual or one class of individuals but the good of all. The word “socialism” itself points to the elevation of the collective whole over the individual or the minority. As Adolph Hitler, leader of the German National Socialists, pointedly remarked, “. . . the state must act as the guardian of a . . . future in the face of which the wishes and the selfishness of the individual must appear as nothing and submit."[90] Such sentiments underlie not only Nazi socialism but all the various forms of modern collectivist ideology.

  Marx and fellow travelers are correct to identify capitalism with individualism. As we have seen, the market order, along with the moral, legal, and political framework that sustains it, presupposes the value of the individual human person. The purpose of law in a free society, as well as the limited government established to declare, enforce, and adjudicate the law, is precisely to protect individual rights to life, liberty, and property. The elevation of the collective or the “social” over the individual is alien to the American political tradition, as is the corresponding conception of “group,” “collective,” or “social” rights.

  The American commitment to individual rights developed upon the foundation of the Western tradition more broadly conceived. One of the distinctive characteristics of that tradition is the profound value it places upon the individual person. Such a value, as we shall see, largely derives from the particular religious influences that shaped the development of Western civilization, in particular, Christianity, the religion of the individual par excellence. The relation between Christianity and individualism was well understood by enemies of liberal-capitalist society. Thus it is not surprising that carriers of the modern ideological impulse would condemn Christianity as fervently as capitalism, and on similar grounds. Capitalism, as we have seen, was denounced by collectivist ideologues as fostering selfishness and other moral vices. Nineteenth-century critics of capitalism had no difficulty relating that propensity to the religious milieu that fostered its rise: Christianity, proclaimed John Stuart Mill, is the Religion of the Selfish.[91] In the eyes of its adherents, socialism and the social ethics it advances are morally superior to both capitalism and Christianity, both of which are said to elevate selfish individualism over selfless concern for all members of society.

  Consciousness as “Epiphenomenon”

  The free society, as previously mentioned, is an integrated whole whose flourishing depends upon the existence of harmonious and complementary moral, legal, political, and economic institutions. Its economic dimension, capitalism, cannot be isolated from the more comprehensive social or cultural environment requisite to its operation. Marx well understood this fact, and his condemnation of Western liberal capitalism thus extended to a thoroughgoing condemnation of the moral, legal, and political institutions with which it is inextricably linked. Constitutional government is a case in point. Champions of limited government, he suggests, invariably portray its virtues in the most high-minded and noble light, as the quintessence of freedom, justice, and morality. According to Marx, however, such a depiction is false and contrived, a veil of illusion that obscures the truth of liberal constitutionalism, namely, the role it plays in safeguarding the selfish interests of the ruling class, the capitalists. As he says in the Communist Manifesto, “The executive of the modern state is but a committee for managing the common affairs of the whole bourgeoisie. In other words: the State is the executive committee of the ruling bourgeois class. . . .”[92]

  Marx castigates not only liberal constitutionalism but every moral, political, and religious ideal characteristic of the Western tradition. He scorns and ridicules traditional notions of freedom, justice, law, morality, religion, rights, and familial bonds. Such alleged “ideals,” he suggests, are little more than propaganda, manipulative rationalizations or lies whose purpose is to camouflage the reality of capitalist exploitation, to confuse the workers by masking the brutal fact of class struggle. Liberal ideals are mere inventions of the ruling bourgeoisie, beautiful words that signify nothing, and their purpose is to preserve the power of that class. As Marx says,

  The ideas of the ruling class are in every epoch the ruling ideas, i.e. the class which is the ruling material force of society, is at the same time its ruling intellectual force. The class which has the means of material production at its disposal, has control at the same time over the means of mental production, so that thereby, generally speaking, the ideas of those who lack the means of mental production are subject to it. The ruling ideas are nothing more than the ideal expression of the dominant material relationships, the dominant material relationships grasped as ideas.[93]

  Marx’s critique of traditional moral and political ideas and ideals is related to his general theory of consciousness, which must therefore be briefly considered. The question at issue concerns the status of ideas and values in history. The philosophical response to such a question is conventionally divided into two chief categories, so-called philosophical idealism and philosophical materialism. “Idealist” philosophers such G. W. F. Hegel (1770-1831) and others regard abstract ideas and the values they represent as the driving force of human history. Society, to paraphrase the idealist Plato, is man writ large. The charac
ter of any society derives from the character of its members, which itself is shaped by the ideas they hold and the values they pursue. Human existence is inescapably oriented toward fulfillment of value. The abstract values held by individual members of any society inform the ideas, beliefs, customs, institutions, and other cultural expressions characteristic of that society. A people who value individual freedom, for instance, will seek to devise institutions that protect and preserve that value; a people who value justice will seek to devise rules and laws that serve that value, and so on. The essence of such philosophical idealism may be summarized by Hayek’s observation, previously mentioned in another context, that “values generate facts.”