Capitalism, Issues, Socialism

The Individual versus the State

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At the extreme edges (Freedom Caucus on the right, Bernie Sanders on the left), what the fractures in the Republican and Democratic Parties boil down to is free-market capitalism versus government control of our lives.

Image Credit: Mises Institute; Henry Hazlitt estate CC by 3.0

In the middle, however, clueless government-addicted pundits, politicians, and much of the general public are fond of saying that the government should only intervene “a little” when it comes to regulating business and helping people who do not have the means to fend for themselves.  But in real terms, what government’s helping “a little” equates to is a so-called mixed economy, which the late, great Henry Hazlitt meticulously explained, in Economics in One Lesson, does not work.

The truth be known, all Western countries have long had mixed economies — i.e., socialism mixed together with just enough capitalism to keep tax revenues flowing in to pay the welfare tab (both social and corporate welfare).  Among other things, the capitalism portion of a mixed economy also produces the wealth that provides a cushy lifestyle for politicians and millions of government employees, subsidizes countries who hate us, and fights a McCain/Graham-promoted war here or there whenever the political need for a manmade conflict arises.

The liberty/tyranny pendulum tends to swing back and forth in Western countries, though for the past fifty-plus years the overall move has been toward tyranny.  In the United States, in particular, the pendulum has been moving at an accelerating pace toward tyranny since Barack Obama’s attempt to fundamentally change the United States of America.

Now the question is, Is there any hope that the pendulum will swing back toward liberty any time soon?  Unfortunately, no one knows for certain, but what we do know from a study of history is that if the pendulum swings too far in the direction of tyranny, there’s a danger that it might get stuck there for fifty to a hundred years.  (Think Russia, Cuba, North Korea, and China, with Venezuela on the verge of a similar fate.)

That said, let’s get back to the basic question of “a little bit of government” versus a lassez-faire society.  This fundamental question goes back centuries — probably as far back as the Roman Empire, which closely resembled the United States of today with its seeming determination to destroy itself from within.

Many books have been written about why capitalism is the best economic system ever devised, not only for people in general, but specifically for those on the lowest rung of the income ladder.  In the short space I have available here, I’ll zero in on just a few of the most important reasons for this.

First and foremost, government, by its very nature, is inherently corrupt.  It’s a theft-driven gravy train for the most self-righteous, nefarious, unethical individuals among us (read, politicians).  Even those who come to Washington with good intentions soon realize they have only two choices:

  1. Do the bidding of those who contribute to the campaigns that keep them in power …

or

  1. Be voted out of office.

People who believe that in certain cases the government has to do something in order to help “the needy” and keep both large corporations and entrepreneurs from raping and pillaging the masses are either naïve, knowledge challenged, or suffering from a bad case self-righteousness.  As a result, their emotion-driven actions are forever on autopilot.

The facts all speak against government and for a free society — especially when it comes to helping the poor.  That’s because in a free society people are free to give their money to whomever they believe to be in need.  It’s a subjective decision that corrupt politicians in Washington are not in a moral position to make for anyone else.

But morality aside, there’s a practical aspect to capitalism, what Henry Hazlitt referred to as “the invisible aspect.”  By this phrase, he meant how much more consumers would benefit from a truly free market.

If, for example, you and I wanted to start a cable company and could raise the necessary money necessary to do so, the existence of our service in the marketplace would force cable company monopolies to lower their prices and improve the quality of their services.  The marketplace is a much more effective regulator and far better protector of consumers than government could ever hope to be.

Andrew Carnegie’s Carnegie Steel Company (which ultimately became part of U.S. Steel Corporation) and John D. Rockefeller’s Standard Oil Co., among other giants of their day, enjoyed near monopolies, but never total monopolies, because there was always competition lurking on the economic horizon.  The result was that they drastically lowered the price of steel and oil to fend off competitors, which made steel and oil products affordable for the common man.

The plain truth that low-information and self-righteous voters have trouble accepting is that these men reduced their prices for purely selfish reasons.  They were smart enough to understand that by lowering their prices, they could sell more of their products and make greater profits.  That, in turn, brought the invisible hand of the marketplace into play, which resulted in a better life for consumers and the creation of millions of jobs.

Taking all this into consideration, regardless of how bad things get in the U.S., if you care about yourself, your family, and those suffering financially as a result of our printing-press economy, you should be vigilant about thinking and acting as an individual.  The collective is a progressive fantasy that entices people who not only lack knowledge, but tend to think with their hearts instead of their heads.  That, in turn, leads to fewer jobs, lower wages, and a more difficult life for most everyone.

Also, never forget that groups do not have minds, so avoid the temptation to become drawn in by group-think.  Groups are composed of individuals with individual minds, individual likes and dislikes, individual morals, individual skills, individual wills, and individual views of the world.

Though I’ve never met you, I can say without hesitation that I trust you, as an individual, more than I trust a group of politicians and bureaucrats whose main focus is on keeping their jobs and leading the good life at the expense of millions of taxpayers.  It doesn’t take a village for a country to prosper.  What it takes is millions of individuals seeking their own happiness.

As to the centuries-old question of those who kneel at the altar of the omnipotent state, “But what would happen to the poor in a totally free society?” it is to our good fortune that human beings have the unique capacity to transcend themselves and feel empathy for others.

In a totally free and rational society, people would think of family first, friends second, and “the poor” third.  Those in the last group not only would be helped by others through a wide variety of charities, they would also gain two important assets that they lack in a government-controlled economy:  self-esteem and a path to upward mobility.

If you loved the American way of life before it was fundamentally transformed into a hodge-podge of government regulations and politically correct insanity, the most positive thing you can do is think and act as an individual and not allow yourself to be intimidated by those who lack the knowledge or intellect to understand the evils of big government and the efficacy of individualism.

This is a guest post by Robert Ringer an American icon whose unique insights into life have helped millions of readers worldwide. He is also the author of two New York Times #1 bestselling books, both of which have been listed by The New York Times among the 15 best-selling motivational books of all time.

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