Monday, May 24, 2010

The Secret of an Empowered People

Imagine, for a moment, that one wanted to create a nation of truly empowered people. How would one go about doing it?

The knee jerk reaction to solve any problem is to turn to the government.

As such, there is a long tradition of politicians associating the term "empowerment" with forms of government such as "Republic" or "Democracy"; however, these forms of government are about the decision making process of the collective. They do not directly empower the individual.

If one really wanted a society of empowered people, one should discuss the nature people before discussing the form of government.

The nature of people is that people come equipped with the ability to make decisions.

Empowering the people involves structuring things so that people get to make meaningful decisions in their lives.

To empower people, one wants things set up in a way where each person has a realm where their decisions mattered.

We need a term for this realm.

The classical liberal tradition used the term "property."

In this classical sense, the term "property" does not refer simply to a physical state, but about who has say so over an object.

For example, I own this blog post and I have property rights (say so) over this post.

All of the bad grammar and misspellings belong to me!

The preservation of property rights was as, if not more, important to the founders of this nation than the form of government.

The hope of the day was that a constitutionally limited government elected by the people would do a better job protecting property rights than a monarchy that assumed say-so over all things.

The American revolution was not about empowering a new set of rulers through Democracy, but an effort to empower all the people of the land by giving them greater say so in the form of property rights.

This concept of people having a realm in which they can act is very much a fundamental human right.

The idea of property rights fit in well with Adam Smith's observation that a free people set on optimizing and re-investing their personal property end up optimizing the wealth of the nation.

The Modern Era

In the Modern Era, Hegel (1770-1831) and Marx (1818-1883) developed the idea that history evolved through a system of thesis/anti-thesis conflicts. These conflicts resolved in a catharsis that sets up the next conflict.

The American and French revolutions saw the middle class rise against the tyranny of the monarchy.

Marx noted that, in 19th century Europe, the power of the ruling class was waning and the power of the middle class was rising. He also noticed that peasants who were dependent on the ruling class were in bad condition.

So, Marx predicted that the next conflict would involve the ruling class and peasant class rising up against the middle.

In Marxist Theory proper, the thesis/anti-thesis conflict involved the intelligentsia and avant-garde uniting with the proletariat in revolution against the bourgeoisie.

Translated into English, Marx believe the intellectuals and the workers would unite to overthrow the capitalists.

Marx wrote a really long book called "Das Kapital" which accentuated all of the things in a free market that concentrate wealth. He then wrote a pamphlet called "The Manifesto" that used to the ideas of Das Kapital to help raise people in revolution.

A really funny thing about Marx is that, although he spent a great deal of time mincing the faults of capitalism, he never defined communism beyond vague terms.

Enter Capitalism

The term "capitalism" appeared with its modern definition in the mid eighteenth century. The term was popularized by social critics who were specifically looking for a way to create a new world order.

Needless to say, the people who appreciated the idea of property rights as fundamental human rights were happy to argue the anti-thesis.

So, the great irony of history is that term "capitalism" was coined and popularized by the enemies of the free market.

Sadly, this historical development has been problematic for the defenders of liberty. By arguing the anti-thesis, the defenders of liberty appear to have abandoned the classical logic of classical liberalism in favor of the material dialectics of the modern era.

Modern scholars have a toned down definition of capitalism. Many define "capitalism" as a socio-economic system in which the means of production are privately owned.

This definition stands in contrast to the socio-economic system of socialism in which the means of production are owned by the collective … and err, uh, corporate ownership is not a form of collective ownership.

This toned down definition is a little more favorable to the free market; however, the definition is designed so that capitalism is seen in contrast to socialism.

The working definition of capitalism is aimed at preserving the Marxian thesis/anti-thesis conflict.

This would just be an interesting historical fact, except for the fact that current usage of the term seems to have preserved many of the negative images and ideas projected onto capitalism.

Even worse, that, in preserving the term "capitalism" as the primary description of our society, we appear to have preserved the messed up thinking of Hegel and Marx.

Our very language seems to have preserved the idea that capitalism is but an evolutionary step on the path toward a more enlightened state called socialism. The intelligentsia continues to label acts that lead to socialism as progressive and efforts to preserve liberty as regressive.

To preserve our freedoms, we have to break this paradigm.


As the term "capitalism" was defined by the enemies of the free market, I believe that the defenders of freedom would do well to reject this strawman definition and to return to defending property rights as was the practice in the days of our nation's founding.

All of the positive aspects of capitalism flow directly from classical liberal concept of property rights. The idea that the means of production should be privately owned flows directly from property rights.

Negative ideas associated with capitalism (such as monopolies, naked short selling, insider trading, big business colluding with big government, etc.) can be exposed as a violation of property rights.

For that matter, in most cases where one finds abject poverty, one finds that there are artificial structures hindering the ability of the people to own property.

The secret to empowering people is to create a limited government focussed primarily on defending human rights, including the right of a free people to own and have say so over property.


Scott Hinrichs said...

The term capitalist was indeed a pejorative term. It was applied to "monied interests" that used their immense power in ways that often harmed others' property rights. Many of the "capitalists" of the gilded age saw themselves as divinely called to exercise authority over the benighted masses, much as the omnipresent ruling elite class did and does.

Few even bother to notice that the capitalists of yore and of today could not exist in a truly free market. Despite the story line from the statists, capitalists could not survive without being in partnership with government. Perhaps a term more people would understand today is "corporatism," which is a partnership of Big Government and Big Business. While the partnership has its internal squabbles that play out in the press, it works from two directions to centralize power and property, while creating a bulwark to defend itself against competition.

I agree that classical liberals would be wise to reject the term capitalism. It has never meant anything good.

y-intercept said...

Thank you for the kind post.

I wish more conservatives were engaged in the fundamental thinking that you've done on Reach Upward.

When I bring up this topic, I usually get shouted down by people on both the left and right. The left, of course, knows the false dichotomy between capitalism and socialism is a ruse. The right is in a reactionary rut of assuming all criticism of the term is an argument for socialism.

To defend freedom, we have to find a way to counter the false dichotomy that it undermining freedom ... that means going back to the foundations and asking fundamental questions about liberty.

BTW, I would not sure about the definition you gave for "corporatism." It is not simply collusion with the government that leads corporations astray. A corporation is a creation of a group investment and can develop a group think process that undermines the freedom of people ... even if it is not direct collusion with the government.