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A Liberal and a Libertarian discuss Free Market Economics

Posted by CommunitarianKevin , in Free Market Discussion 28 August 2012 · 712 views

free market liberal libertarian capitalism
I have been getting really into politics lately and I have also been trying to get ready for my class History of Capitalism. I keep finding that people with degrees in the area or that study in the area believe in Free Market Economics (FME) or Free Market Capitalism (FMC.) Even some people that I admire and believe are very intelligent are Libertarians. This has made me question my stance. Is there something that I am missing or is it something they are missing? I have the perfect person to help me figure this out...

My buddy and former class mate, Anthony, is probably the smartest guy I have ever met. He was a Religious Studies major with a Political Science minor. Not only do I respect him but I know he is not ignorant. He agree to discuss the topic with me. I am going to post our covos on here because I think it might be beneficial to others. Hell maybe it will even make me a Libertarian. So here is the discussion so far...

We started by me asking him where he was coming from on different topics...

Up until recently I did not really understand what a Libertarian was. I knew a lot of smart people or people I like are Libertarians, such as you and Bill Maher. I started looking into it because of a guy I work with, who is a Libertarian. He is a political science major with a minor in economic philosophy at the University of Wisconsin River Falls. Last semester I took Geog 1301 and topics we covered were imperialism and capitalism. To me it has seemed that FM Capitalism is a failure or at the very least it takes advantage of people and does not help people as a whole, only the corporations. However, I do respect people with a degree in a certain area so I have considered perhaps I am wrong, maybe I am missing something. I went as far as to look up all of the required classes for a PolSci major at RF to see if I was missing something or they were missing something. The thing that stood out to me was that they require very little, if any, history. As you know I am an education major and this forces me to be well rounded. I need to know a little about everything. And from what I can see the problem with FMC is ignorance, whether that be in history, philosophy, or human nature. I will explain…

I guess I would like to hear where you are coming from on a few different fronts. First, the moral front, such as the treatment of people in the global south and poorer Americans.

I would also like to know who you think FME helps. Does it help the nation's wealth or the individuals in it (down to the lowest level.)

I would also like to know why you feel corporations (with a non-elected CEO) would be better than government control or regulation (which in American is elected) and why you might think business men have people's best interests in mind (which is obviously false.)

In a true free market economy what would stop monopolies and oligopolies from forming? It appears to me that we would end up with something more like guilds in medieval Europe as the BEST case scenario. I do not see any reason corporations would not greatly over-charge people like has been shown time and time again in history.

Who would be in charge of industries where there is not profit to be made?

Finally, what would keep corporations from treating workers worse than dogs, like they did in earlier American history?

What's your opinion on the Auto Bailouts.


First of all, you'll have to remember to ALWAYS consider the source. The people teaching at the University are being paid by the government (for the most part), owe most of their current lifestyle to the government, and have everything to gain and nothing to lose by letting the government continue to impede in the free market. The University is NOT the place to get an unbiased view of political truth. A critical mind becomes aware of this only too quickly. Then, you'll also have to remember that Universities are Liberal echo chambers (again, for the most part). Down with religion and capitalism is evil! These are the rallying cries of naive youth who do not understand how the world works, but spend countless hours studying books and hypothetical situations. Their naivety is brilliant and I'm almost jealous of it (for emotional reasons), but these children are not the bastions of reason they think they are. They are the Liberal hivemind, circle jerking each other until no one knows what reality is anymore.

You'll have to forgive my cynicism. The above touches on one of the many reasons I left the University. It prides itself on knowledge, but has little interest in truth. Everyone has their own agenda; Universities are no different.

Now, more to the point! Your first issue with Free Market Economics (if I understand you correctly) is that economists that believe in the free market have no understanding of history. Well, I suppose I'd point out the first contradiction to that point which is the person you are discussing with right now who has spent the last 6 years of his life studying history and almost certainly knows a great deal more about it than the majority of the world (few obvious exceptions not withstanding). But, even without tooting my own horn, I'd argue that Free Market Economists like Ludwig von Mises and Milton Friedman have a fantastic understanding of history and how humanity itself works in a society. This second point, how humanity works, is of more importance than history, however. True, without an understanding of history you are doomed to repeat it, and we certainly don't ignore it, but let's focus on human nature first and then we can return to history and how human nature plays itself out in it.

This is where I imagine you'll have your first major issue: What is human nature? Free Market Economists believe that human nature is brazen self-interest. i.e. Everyone is strategizing their surroundings and circumstances so as to assure (as much as possible) the best outcome for THEMSELVES. It is a selfish outlook on life, but only if you look at it in the short term. Long term self-interest often plays itself into fantastic things; we might well call society itself a strategy of long-term self-interest. In the short term, living in a society is a small loss (one is forced to share and compromise resources instead of hold them all to one's self), but in the long term it makes life for the individual easier on the whole. So we see that all human activity, no matter how seemingly benevolent, always leads back eventually to benefiting the individual. For now I'll heed your potential objections on this point, because without accepting this as true, we cannot continue.

I will respond to your remarks as I read them…
I understand what professors and teachers are all about, I want to be one, but the key to being a good teacher is showing the views objectively. My strength in this topic may be that the majority of my knowledge is from outside sources or indirect sources. World history classes and U.S. history classes are not all conspiring together but I can use critical thinking and evaluation of sources to put things together. As far as I believe, religion is not evil, but actually the opposite. Also I can see capitalism as important in every aspect. I feel the best balance is to have a good mix of free market (FM) and government regulation. Capitalism is not bad but a perfect free market capitalistic system is.

I understand what you are saying about the ignorant youth but I am not worried about them. I am concerned about my own person knowledge. As defined by the majors, I am a Religious studies major in Christianity, Religion in America, Ancient Near Eastern Religions, Judaism; History major in Ancient history, European History, and American History; Education major, basically a course in everything; and Jewish studies minor. I am the opposite of a naive youth but very well rounded and have a very solid grasp on world history.

I do understand that you left the U and that many scholars have issues. But in the scientific world, those that hold weight win out. That is why I believe you will one day be a respected scholar. You will be like Darwin, who was ignored but changed opinions and changed science. The key is to pick out the good and the bad and play the game if you have to.
I first want to say that I figured you were well knowledged in this area which is why I reshaped our convo. I figured the one thing you were not ignorant in is history which is why I am asking you. I am trying to figure out if it is something I am missing. I am not an expert in this area and I certainly could be missing something but the answers I have been given to this point are laughable.

Well we can agree on a major point and that is that humans are self-interested. That is exactly the issue I have. Capitalists are only concerned about themselves and no one else. I can see your point that this may be the best long term solution, judging by our current status, but does that mean it is right or that we cannot improve on it? Like you said, humans are individualistic, including myself, but to a different extent. I care about the well-being of my children and grandchildren. I am also (by the definition in my PolSci book) a Communitarian. That means I value the success and wellbeing of my local community even if that means I give up some things. I am individualistic, but more so in a community sense. I want what is best for those around me. The issue I have with your proposal is that it does not help people in the near future, if ever. We have other influences that are making an impact on countries. Liberal Democracies are turning countries that used to be in the global south are gaining strength. China, India, Argentina, and Brazil are a few examples. Not only is the FM benefiting some of those countries, but it is doing it at the expense of our citizens and our future. We are reducing jobs and out-sourcing them to other countries, which pumps wealth into them instead of us. The major issue I have is the effect on the global south. We are raping their countries and raping their people for our own interests and I believe that is the wrong way to go about things. How will they ever recover? Or does it even matter? I do not think individualism is the answer for the U.S. or the world on a whole. Many people are hurt and killed by this ideal.

On a final note…we have not established a perfect system. Every empire has fallen. A true FME has never existed, and probably for very good reasons. Why should we assume it should work now?

Your other concerns will be discussed later on. Let's stay focused on self-interest for now. You ask, “does that mean it is right or that we cannot improve on it?” To which I would ask, “Is it right that you have two arms? Can we not improve on the system of two arms?” I suspect you see my point. Our nature is born into us; we have no control over it. We may well be able to imagine a better system than having two arms, but our being able to imagine it does not mean that we can suddenly change our DNA into another creature. We are human, but more than that we are biological life, and life itself would not exist on this planet (or anywhere else) without self-interest at its core. Can we be depressed that such possibilities are beyond our grasp, sure if you'd like. But I prefer to think that no human venture in history is without self-interest, so in that way even the beauty of the Mona Lisa, the majesty of the Giza Pyramids, and the glory of the American Revolution has “selfishness” at its core. You can focus on the tragedies of self-interest if you wish, but don't forget the light because it casts a shadow, brother.

Affirmed: Human Nature is self-interest

Next point: Ethics

We must now discuss what Libertarians, Minarchists, and Anarcho-Capitalists call the Non-Aggression Principle (the NAP from here on). Wikipedia defines it pretty well. I'll quote it here, “[The NAP] is a moral stance which asserts that aggression is inherently illegitimate. Aggression, for the purposes of the NAP, is defined as the initiation or threatening of violence against a person or legitimately owned property of another. Specifically, any unsolicited actions of others that physically affect an individual’s property or person (which may also be considered that person's property), no matter if the result of those actions is damaging, beneficial, or neutral to the owner, are considered violent or aggressive when they are against the owner’s free will and interfere with his right to self-determination or the principle of self-ownership. Supporters of NAP often use it to demonstrate the immorality of theft, vandalism, assault, and fraud. In contrast to pacifism, the non-aggression principle does not preclude violence used in self-defense or defense of others.” In order to progress, we must now discuss whether or not you believe it is EVER justified to use aggression. Your instinct might first be no (which proves you're still human), but consider what we consider aggression/coercion: Nearly all forms of taxation, as a prime example, are considered coercive and threaten aggression. If this seems farfetched to you, consider what happens should you refuse to pay your taxes; they threaten to take away your liberty. Refuse to go to jail? They take away your life. This is aggression and is inherently illegitimate.

So, to progress: Is there any example of aggression which is justified, from any person or political/religious body? If yes, please explain. If no, we may continue.

I understand what you are saying about nature and that is probably the one point I won’t argue because that is the point I always make. But just because we are self-interested does not mean it has to be glorified (as you seem to be making it.) As you know, evolution has no path. The fact that we are self-interested does not mean that it is a positive thing but rather that we “just are.” I guess what pisses me off is the whole deception and hypocrisy. I would love to hear republicans or libertarians say “we are selfish, so what?” But they don’t. I still would not agree with them but at least I can respect them for being honest. Your argument is the first time I have heard an admission of selfishness. I fully understand why a rich business man would be for the republican ideals and a FME. That fits my framework perfectly. My question is why poor people, or even middle class people, would support this idea? What is in it for them? Is there something in it for them that I am missing or are they just stupid? Just because we are something does not mean we cannot try and control it. People are self-interested…they are also rapists, and murderers. Well maybe not the majority but the majority are violent creatures and we try to curb that so we can have a safe society. Have we eliminated violence, no…And we won’t eliminate self-interest but does that mean we should just give into it? Since it is in our nature to be violent, should we just let people be? Let rape and murder run rampant? This idea could be “evolved out” of us over time. They have done experiments where they bred aggressive rats with aggressive rats and less aggressive rats with less aggressive ones and found that in each generation they get more aggressive and less aggressive respectively. I do not have to explain to you that we breed for specific traits in many things. I mean obviously this would bring in the issues of eugenics but I think it is incorrect to say it is impossible to change.

As far as NAP goes, I feel like taxation is a little farfetched but not because it does not fit the definition but because it makes the definition too broad. Let me use rape as an example (because we just had our training on sexual assault prevention in the guard.) Rape (or sexual assault as they call it) is defined as any unwanted touch (in the victim’s eyes,) or any type of non consensual sexual acts. By definition, a person that has had only a single drink of alcohol cannot consent. By this definition I raped why wife every time I grabbed a boob in front of her family. By this definition my wife and I rape each other every time we have sex after having a few drinks. I have raped dozens of times and been raped dozens of times by this definition. Basically dirty thoughts are the only thing that is not considered rape…yet…
NAP suffers from this same problem. If taxation is aggression than any punishment for any crime is. You said this argument is used against the immorality of theft, vandalism, assault, and fraud but this argument would make any punishment for those crimes aggression. Basically for this philosophy it appears you would need a lawless society, or anarchy. In anarchy there would be much crime, violence, and murder because of self-interests. This would lead to people banding together and forming groups or gangs or tribes for protection. To regulate and hold them together these groups they would inevitably form rules or laws and would have to have enough might behind them to deter people from breaking them. At this point we have come out of anarchy but fall back into it because as I established, laws are Aggression. A society would not exist without laws.

In addition to that, people need protection from those types of aggression (theft, vandalism, assault, and fraud) and in our situation this protection comes from the police and the military, both of which are paid by the government, which gets its income from taxation. Without an ability to tax or generate income (we are assume government has no roll is the economy,) How are we to offer protection from self-interested individuals?

So do I feel like it is ever okay to use aggression? By the NAP definition...it is necessary...It is necessary to protect people and to provide for people in need and to deter people’s self-interests from running rampant. It seems to me like this idea would only be realistic in a society that is not full of self-interested humans.

Before we continue on I do want to thank you again for the discussion and even if we do not come to the same conclusions I still respect you for being honest with me.

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