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It was the United States of America, with its system of limited, constitutional government, that implemented the principle of capitalism-a free trade on a free market-to the greatest extent. In America, during the nineteenth century people’s productive activities were for the most part left free of governmental regulations, controls, and restrictions; most thinkers considered themselves thoroughly emancipated from the discredited economic policies of medievalism, mercantil-ism, and pre-capitalist statism. In the brief period of a century and a half, the United States created a level of freedom, of progress, of achievement, of wealth, of physical comfort-a standard of living-unmatched and unequaled by the total sum of humankind’s development up to that time.
With the Enlightenment, the Industrial Revolution, and the rise of capitalism, an extraordinary transformation took place in men’s and women’s thinking about the possibilities of life on earth, a revolution so radical that it is still far from fully understood.
With the collapse of the absolute state and the development of the free market society, people saw the sudden release of productive energy that had previously had no out-let. They saw life made possible for countless millions who could have had no chance at survival in precapitalist econo-mies. They saw mortality rates fall and population growth rates explode upward. They saw machines (the machines that many of them had cursed, opposed, and tried to destroy) cut their workday in half while multiplying incalculably the value and reward of their effort. They saw themselves lifted to a standard of living no feudal baron could have conceived. With the rapid development of science, technology, and in-dustry, they saw, for the first time in history, the individual’s liberated mind taking control of material existence.
To the extent that various countries adopted capitalism, the rule of brute force vanished from people’s lives. Capitalism abolished slavery and serfdom in all of the civilized nations. Trade, not violence, became the ruling principle of human relationships. Intellectual freedom and economic freedom rose and flourished together. Political thinkers had discovered the concept of individual rights. Individualism was the creative power revolutionizing the world.
A system in which wealth and position were inherited or acquired by physical conquest or political favor was replaced by one in which values had to be earned by productive work. In closing the doors to force, capitalism threw them open to achievement. Rewards were tied to production, not to extor-tion; to ability, not to brutality; to the capacity for furthering life, not to that for inflicting death.
Much has been written about the harsh conditions of life during the early years of capitalism. Yet when one considers the level of material existence from which capitalism raised men and women and the comparatively meager amount of wealth in the world when the Industrial Revolution began, what is startling is not the slowness with which capitalism liberated people from poverty, but the speed with which it did so. Once the individual was free to act, ingenuity and inventiveness proceeded to raise the standard of living to heights that a century earlier would have been judged fantas-tic. It would be difficult to name an event of history more impressive than this-or less appreciated.
Capitalism was achieving miracles before human beings’ eyes. Yet, from its beginning, the majority of nineteenth–century intellectuals were vehemently antagonistic to it. Their writings were filled with denunciations of the free market economy. Broadly speaking, the antagonism came from two camps: the medievalists and the socialists.
The medievalists found the disintegration of feudal aristoc-racy, the sudden appearance of fortune makers from backgrounds of poverty and obscurity, the emphasis on merit and productive ability, the concern with science and material progress, and, above all, the pursuit of profit spiritually re-pugnant. Many of them-such as Richard Oastler, William Wordsworth, Samuel Taylor Coleridge, Thomas Carlyle, Rob-ert Southey, William Cobbett, Thomas Hood, and Thomas Love Peacock-unleashed scathing attacks on the factory sys-tem. They were avowed enemies of the Age of Reason. They declared individualism vulgar. They longed for a return to a status society. “Commerce or business of any kind,” wrote John Ruskin, “may be the invention of the Devil.”
The medievalists dreamed of abolishing the Industrial Rev-olution. The socialists wished to take it over. Both camps dismissed or gave only grudging acknowledgment to the achievements of capitalism. They preferred to eulogize the living conditions of previous ages. Friedrich Engels, along with Carlyle, regarded the domestic industry’s system of the preindustrial era as the golden age of the working classes. The criticisms leveled against capitalism by both camps were remarkably similar: the “dehumanizing” effect of the factory system upon the worker, the “alienation” of man and woman from nature, the “cold impersonality” of the market, the “cruelty” of the law of supply and demand-and the evil of the pursuit of profit.
In the writings of both medievalists and socialists, one can observe the unmistakable longing for a society in which the individual’s existence will be automatically guaranteed-that is, in which no one will have to be responsible for his or her own survival. Both camps project their ideal society as one characterized by what they call “harmony,” by freedom from rapid change or challenge or the exacting demands of compe-tition; a society in which each must do his or her prescribed part to contribute to the well-being of the whole, but in which no one will face the necessity of making choices and decisions that will crucially affect his or her life and future; in which the question of what one has or has not earned, and does or does not deserve, will not arise, in which rewards will not be tied to achievements and in which someone’s benevo-lence will guarantee that one need never bear the conse-quences of one’s errors.
It is historically, philosophically, and psychologically signif-icant that not one of the defenders of capitalism chose to attack the position of its opponents at the root, on the level of basic premises; not one of them challenged the altruist–collectivist frame of reference in which all discussions con-cerning the value of capitalism were held. Economically, the case for capitalism has never been refuted. Capitalism has lost more and more ground because we have lacked a moral philosophy to sustain and support it.
In the world of the present, most people regard the right of a government to initiate force against its citizens as an absolute not to be debated or challenged. They stipulate only that the force must be used “for a good cause.” Precisely because capitalism in its ideal (that is, consistent) form forbids the use of force to gain social ends, or any other kinds of ends, intellectuals dismiss the laissez-faire concept as “antisocial’ and “unprogressive.” Whatever the differences in their spe-cific programs, all the enemies of the free market economy-communists, socialists, fascists, welfare statists-are unanimous in their belief that they have a right to dispose of the lives, property, and future of others, that private ownership of the means of production is a selfish evil, that the more a person has achieved, the greater is his or her debt to those who have not achieved it, that men and women can be compelled to go on producing under any terms or conditions their rulers decree, that freedom is a luxury that may have been permis-sible in a primitive economy, but for the running of giant industries, electronic factories, and complex sciences, noth-ing less than slave labor will do.
Whether they propose to take over the economy outright, in the manner of communists and socialists, or to maintain the pretense of private property while dictating prices, wages, production, and distribution, in the manner of fascists and welfare statists, it is the gun, it is the rule of physical force that they consider “kind,” they who consider the free market “cruel.”
Since the moral justification offered for the rule of force is humankind’s need of the things that persons of ability pro-duce, it follows (in the collectivist’s system of thought) that the greater an individual’s productive ability, the greater are the penalties he or she must endure, in the form of controls, regulations, expropriations. Consider, for example, the prin-ciple of the progressive income tax: those who produce the most are penalized accordingly; those who produce nothing receive a subsidy, in the form of relief payments. Or consider the enthusiastic advocacy of socialized medicine. What is the justification offered for placing the practice of medicine under government control? The importance of the services that physicians perform-the urgency of their patients’ need. Phy-sicians are to be penalized precisely because they have so great a contribution to make to human welfare; thus is virtue turned into a liability.
In denying human beings freedom of thought and action, statists and collectivist systems are anti-self-esteem by their very nature. Self-confident, self-respecting men and women are unlikely to accept the premise that they exist for the sake of others.
A free society cannot be maintained without an ethics of rational self-interest. Neither can it be maintained except by men and women who have achieved a healthy level of self-esteem. And a healthy level of self-esteem cannot be main-tained without a willingness to assert-and, if necessary, fight for-our right to exist. It is on this point that issues of psychology, ethics, and politics converge.
If I may allow myself a brief aside, one might imagine that psychologists, social scientists, and philosophers who speak enthusiastically and reverently about freedom, self-respon-sibility, autonomy, the beauty of self-regulating systems, and the power of synergy (the behavior of whole systems unpre-dicted by the behavior of the parts taken separately) would naturally be champions of noncoercion. More often than not, as I have already indicated, just the opposite is true. They tend to be among the most vociferous in crying for the coercive apparatus of government to further their particular ideals. To quote Waterman once again:
It should be recognized that a defining feature of a synergistic society is that participation in it is voluntary. If people do not choose to engage in a given cooperative activity, the implication is that they do not perceive that activity to be helpful, either for themselves or for others. Efforts to promote social cooperation within a synergistic society may appropriately include such techniques as education, persuasion, and negotiation. However, the use of political force to compel cooperation represents the abandonment of the synergistic ideal.
A free society cannot automatically guarantee the mental or emotional well-being of all its members. Freedom from exter-nal coercion is not a sufficient condition of our optimal fulfill-ment, but it is a necessary one. The great virtue of capitalism-laissez-faire capitalism, as contrasted not only with the more extreme forms of statism but also with the mixed economy we have today-is that it is the one system whose defining principle is precisely this barring of physical coercion from human relationships. No other political system pays even lip service to this principle.
If we pause to look back at the road we have traveled since the beginning of this book, we can appreciate, perhaps, that the whole course of human development and evolution is in the direction of increasing freedom, higher and higher actual-izations of personal choice.
Every concept we have entailing the idea of progress, higher levels of development, evolution, and the like contains the same core intention: a wider possible range of action, an increasing absence of constraints on our choices. On the evolutionary scale, when we speak of one species as being higher than another, an essential part of what we mean is that the more advanced species has a greater range of options, a wider repertoire of possible responses, in any given situation. When we speak of a person being more psychologically evolved, less encumbered by blocks, repressions, institutionalized areas of unconsciousness, again we think of this greater freedom. And if we speak of scientific or technological progress, once again we are referring to this wider range. Political freedom is the triumph of this same process in the external world of human relationships.
Part 1 | Part 2
This is Part II (Part I appeared in the November 1994 issue of Freedom Daily ) of an edited version of Chapter 14 in Dr. Branden’s book “Honoring the Self: The Psychology of Confidence and Respect”. Copyright 1983 by Nathaniel Branden. Reprinted by permission of the author.