Socialism, Libertarianism, and Freedom
I'm not a fan of Paul Krugman, but every once in a while he says something intelligent, and recently it's something that I've been investigating.
The other claim, however, has been that free markets translate into personal freedom: that an unregulated market economy liberates ordinary people from the tyranny of bureaucracies. In a free market, the story goes, you don’t need to flatter your boss or the company selling you stuff, because they know you can always go to someone else.
What Robin points out is that the reality of a market economy is nothing like that. In fact, the daily experience of tens of millions of Americans – especially but not only those who don’t make a lot of money – is one of constant dependence on the good will of employers and other more powerful economic players... the idea that free markets remove power relations from the equation is just naïve.
Power and personal freedom are two ideas that are joined at the hip, a point I will return to.
After listening to many debates with libertarians, I've concluded that their idea of how the power relations in an economy works is based on both ignorance and deep denial.
Let's start with their denial with this example by the libertarian Mises Institute.
Corporate managers regularly lose workers to those who make them a better offer, and since the free market provides abundant opportunities for work and entrepreneurial activity, the power to withdraw one's labor from the service of an employer is a formidable power indeed. In fact, the commonly heard notion that employers have superior bargaining power in this employment transaction is a complete fallacy.
If this was a one-off example, it would be one thing. However, this is just one of a seemingly endless number of instances where libertarians expect you believe them over your own lying eyes.
You have to wonder about a person who could say something like this.
Have they ever been in a job interview? They've obviously never been laid-off, and it appears their target audience isn't the working class. The power dynamics of the average worker versus their employers are generally one-sided.
I can say for certain that libertarians want many of the same things as socialists, and virtually everyone else. The problem is their "solutions".
For example, I've heard the libertarian argument against taxation that the government shouldn't take their money to fight bullsh*t wars, and that it's immoral to throw someone in a cage who refuses to pay taxes to fund bullsh*t wars.
There is absolutely nothing wrong with that sentiment. Where they go off-track is their solution to this moral dilemma.
Since governments have a monopoly on violence, libertarians want to shrink the size of government, thus reducing its ability to commit violence.
All of those assumptions are correct.
Where they go off-track is their assumption that a violent entity won't fill the void left by the government. Anyone who has ever done the most modest of research of company towns in the industrial revolution will know that large and unaccountable private corporations will take their place.
Consider the fate of the Molly Maguires:
The Molly Maguire trials were a surrender of state sovereignty. A private corporation initiated the investigation through a private detective agency. A private police force arrested the alleged defenders, and private attorneys for the coal companies prosecuted them. The state provided only the courtroom and the gallows.
- Carbon County judge, John P. Lavelle
From Sheriff J.H. Blair to the Pinkertons, a wealthy private entity will always fill the vacuum left when a government recedes. Most libertarians are OK with that.
In 2001, Hoppe published his DEMOCRACY: The God that Failed, which was considered a libertarian masterpiece. Hoppe unapologetically argued there that libertarianism and conservatism are one and the same — and that he wanted it, passionately: he hated democracy. Unlike many libertarians, who falsely allege that democracy is impossible without there first being libertarianism (a free market), Hoppe acknowledged and argued for the mutual inconsistency between libertarianism and democracy....
Of course, some libertarians don’t agree with Hoppe’s view; but, on 30 August 2011, Michael Lind at salon.com headlined “Why Libertarians Apologize for Autocracy: The experience of every democratic nation-state proves that libertarianism is incompatible with democracy,” and he empirically found that Hoppe was correct about this incompatibility.
Pretty much all hard-core libertarians oppose democracy. Their worship of capitalism inevitably means a preference for rule by wealth. Which makes their pro-freedom rhetoric ring very hollow.
The key difference in ideology between libertarians and socialists, as I understand it, is private power. Both socialists and libertarians have some distrust of the power of the state. Socialists balance that distrust with the power of worker-based democracy. There's a reason why the term libertarianism was invented by socialists, and remains a socialist idea everywhere but in the U.S.
Socialists have more distrust of private power. Libertarians simply ignore the dangers of private, unaccountable power. They deny monopolies can exist in a free market, despite all evidence to the contrary.
Interestingly, the objectives of both groups is freedom.
Under capitalism, we’re forced to submit to the boss. Terrified of getting on his bad side, we bow and scrape, flatter and flirt, or worse — just to get that raise or make sure we don’t get fired.
The socialist argument against capitalism isn’t that it makes us poor. It’s that it makes us unfree. When my well-being depends upon your whim, when the basic needs of life compel submission to the market and subjugation at work, we live not in freedom but in domination. Socialists want to end that domination: to establish freedom from rule by the boss, from the need to smile for the sake of a sale, from the obligation to sell for the sake of survival.
If capitalism and the free market led to freedom, then why is the dictator Pinochet so loved by capitalists? Why does the markets prefer right-wing dictators over liberal democracies?
Why did capitalism support slavery?
Banks capitalized the slave trade and insurance companies underwrote it. Covering slave voyages helped start Rhode Island’s insurance industry, while in Connecticut, some of the first policies written by Aetna were on slave lives.
Let's not forget that the slave trade was by definition a capitalist exchange of a commodity with the aim of mutual profit. The abolition of slavery was an anti-free market action, and it was only accomplished by force.
As sure as night follows day, the libertarian philosophy, if followed to its logical conclusion, will replace government oppression with private tyranny.
If there are no restraints put on the power elite, what countervailing power is there to stop them from becoming the government? And when they become the government, then all of a sudden, the superwealthy shed their Libertarian principles and become the great advocates of big government because government no longer restrains them; the government is them.
The superwealthy already own the government. The trick is maintaining the illusion that libertarians haven't already achieved their objectives. Libertarians are in such denial that they don't recognize that they've won, and that their victory is nothing like what they envisioned because they never understood the rules of the game.