Saturday, June 24, 2006

The news media

The news media, for the most part, has always been on the side of the socialists, from the second half of the nineteenth century till present day. Socialism is promulgated from the socialist camps within the universities across this Nation and Europe as well as in other parts of the World. It is a contagion that spreads itself through out the news media and comes to rest in the minds of many lawmakers and judges, and thus, a consensus is formed which shuns those who would think and act otherwise within the various organizations. This is why we have news writers and reporters who are biased to the left.

From the book Socialism: Epilologue in paragraph E.7

History will call our age the age of the dictators and tyrants. We have witnessed in the last years the fall of two of these inflated supermen. But the spirit which raised these knaves to autocratic power survives. It permeates textbooks and periodicals, it speaks through the mouths of teachers and politicians, it manifests itself in party programmes and in plays and novels. As long as this spirit prevails there cannot be any hope of durable peace, of democracy, of the preservation of freedom or of a steady improvement in the nation's economic well-being.

It must be remembered that the professors were the pacemakers of both World Wars, according to the book Socialism. It was their hatred of country and especially that of capitalism that they spread from border to border, which was only waiting for the socialist politicians to direct their hatred toward the bloodshed from within(1).

F. A. Hayek, in his book The Road to Serfdom published in 1944, reminds us that when the war ends, the war from within will have just begun. That the new rise of Nazism will appear different then that of Germany, but the principals will remain the same, that is, the hatred of country and that of capitalism. From the late nineteenth century on, the hatred of wealth and country gave birth to the new National Socialist Party, (The Nazi Party). It is false to point to the national pride and the war mongering of the Nazis and not examining the destruction of the wealth and country prior to this national pride. If you did so, you would be describing the end results of Nazism, not its evolution.

The only Germans who preserved the national pride of the country was the older generation as the younger generation was imbued by the educators towards becoming a world citizen, and unlike that of Germany.


By Dennis Lamb

Anti-capitalistic bias

Socialism Epilogue in paragraph E.1

The characteristic mark of this age of dictators, wars and revolutions is its anti-capitalistic bias. Most governments and political parties are eager to restrict the sphere of private initiative and free enterprise. It is an almost unchallenged dogma that capitalism is done for and that the coming of all-round regimentation of economic activities is both inescapable and highly desirable.

Friday, June 23, 2006

Immigration

Socialism Part I,Ch.1 in paragraph I.1.30
The liberal conception of social life has created the economic system based on the division of labour. The most obvious expression of the exchange economy is the urban settlement, which is only possible in such an economy. In the towns the liberal doctrine has been developed into a dosed system and it is here that it has found most supporters. But the more and the quicker wealth grew and the more numerous therefore were the immigrants from the country into the towns, the stronger became the attacks which Liberalism suffered from the principle of violence. Immigrants soon find their place in urban life, they soon adopt, externally, town manners and opinions, but for a long time they remain foreign to civic thought. One cannot make a social philosophy one's own as easily as a new costume. It must be earned—earned with the effort of thought. Thus we find, again and again in history, that epochs of strongly progressive growth of the liberal world of thought, when wealth increases with the development of the division of labour, alternate with epochs in which the principle of violence tries to gain supremacy—in which wealth decreases because the division of labour decays. The growth of the towns and of the town life was too rapid. It was more extensive than intensive. The new inhabitants of the towns had become citizens superficially, but not in ways of thought. And so with their ascendancy civic sentiment declined. On this rock all cultural epochs filled with the bourgeois spirit of Liberalism have gone to ruin; on this rock also our own bourgeois culture, the most wonderful in history, appears to be going to ruin. More menacing than barbarians storming the walls from without are the seeming citizens within—those who are citizens in gesture, but not in thought.

These migrations have the closest bearing upon the condition of the different nations. They cause citizens of one nation, the natural conditions of which are less favourable, to move into the territory of other nations more favourably endowed. If the conditions under which migration takes place are such that the immigrants are assimilated to their new surroundings then the nation from which they came is, to that extent, weakened in numbers. If they are such that the immigrants preserve their nationality in their new home—still more if they assimilate the original inhabitants—then the nation receiving them will find immigration a menace to its national position.

Tuesday, June 20, 2006

The impossibility of economic calculation under socialism

HUMAN ACTION BY LUDWIG VON MISES:
THE IMPOSSIBILITY OF ECONOMIC CALCULATION UNDER SOCIALISM
Part 5, Chapter XXVI. The impossibility of economic calculation under socialism in paragraph 5.
Today two methods are resorted to for providing a city with clean water. Either one brings the water over long distances in aqueducts, an ancient method long practiced, or one chemically purifies the water available in the city's neighborhood. Why does one not produce water synthetically in factories? Modern technology could easily solve the technological problems involved. The average man in his mental inertia is ready to ridicule such projects as sheer lunacy. However, the only reason why the synthetic production of drinking water today—perhaps not at a later day—is out of the question is that economic calculation in terms of money shows that it is a more expensive procedure than other methods. Eliminate economic calculation and you have no means of making a rational choice between the various alternatives.

Monday, June 19, 2006

Economic Democracy

Socialism: Preface2 in paragraph PG.15
Capitalist society is the realization of what we should call economic democracy, had not the term—according I believe, to the terminology of Lord Passfield and Mrs. Webb—come into use and been applied exclusively to a system in which the workers, as producers, and not the consumers themselves, would decide what was to be produced and how. This state of affairs would be as little democratic as, say, a political constitution under which the government officials and not the whole people decided how the state was to be governed—surely the opposite of what we are accustomed to call democracy. When we call a capitalist society a consumers' democracy we mean that the power to dispose of the means of production, which belongs to the entrepreneurs and capitalists, can only be acquired by means of the consumers' ballot, held daily in the market-place. Every child who prefers one toy to another puts its voting paper in the ballot-box, which eventually decides who shall be elected captain of industry. True, there is no equality of vote in this democracy; some have plural votes. But the greater voting power which the disposal of a greater income implies can only be acquired and maintained by the test of election. That the consumption of the rich weighs more heavily in the balance than the consumption of the poor—though there is a strong tendency to overestimate considerably the amount consumed by the well-to-do classes in proportion to the consumption of the masses—is in itself an 'election result', since in a capitalist society wealth can be acquired and maintained only by a response corresponding to the consumers' requirements. Thus the wealth of successful business men is always the result of a consumers' plebiscite, and, once acquired, this wealth can be retained only if it is employed in the way regarded by consumers as most beneficial to them. The average man is both better informed and less corruptible in the decisions he makes as a consumer than as a voter at political elections. There are said to be voters who, faced with a decision between Free Trade and Protection, the Gold Standard and Inflation, are unable to keep in view all that their decision implies. The buyer who has to choose between different sorts of beer or makes of chocolate has certainly an easier job of it.

Monday, June 12, 2006

Plato...

Socialism Part I,Ch.4 in paragraph I.4.41
Midway between Orient and Occident the unique culture of the Greeks grew up. But antiquity also failed to raise woman to the level on which it had placed man. Greek culture excluded the married woman. The wife remained in the woman's quarters, apart from the world, nothing more than the mother of the man's heirs and the steward of his house. His love was for the hetaera alone. Eventually he was not satisfied even here, and turned to homosexual love. Plato sees the love of boys transfigured by the spiritual union of the lovers and by joyful surrender to the beauty of soul and body. To him the love of woman was merely gross sensual satisfaction.

Sunday, June 11, 2006

The fall of the Roman Empire

Human Action:
Knowledge of the effects of government interference with market prices makes us comprehend the economic causes of a momentous historical event, the decline of ancient civilization.
6.XXX.32
It may be left undecided whether or not it is correct to call the economic organization of the Roman Empire capitalism. At any rate it is certain that the Roman Empire in the second century, the age of the Antonines, the "good" emperors, had reached a high stage of the social division of labor and of interregional commerce. Several metropolitan centers, a considerable number of middle-sized towns, and many small towns were the seats of a refined civilization. The inhabitants of these urban agglomerations were supplied with food and raw materials not only from the neighboring rural districts, but also from distant provinces. A part of these provisions flowed into the cities as revenue of their wealthy residents who owned landed property. But a considerable part was bought in exchange for the rural population's purchases of the products of the city-dwellers' processing activities. There was an extensive trade between the various regions of the vast empire. Not only in the processing industries, but also in agriculture there was a tendency toward further specialization. The various parts of the empire were no longer economically self-sufficient. They were interdependent.
6.XXX.33
What brought about the decline of the empire and the decay of its civilization was the disintegration of this economic interconnectedness, not the barbarian invasions. The alien aggressors merely took advantage of an opportunity which the internal weakness of the empire offered to them. From a military point of view the tribes which invaded the empire in the fourth and fifth centuries were not more formidable than the armies which the legions had easily defeated in earlier times. But the empire had changed. Its economic and social structure was already medieval.
6.XXX.34
The freedom that Rome granted to commerce and trade had always been restricted. With regard to the marketing of cereals and other vital necessities it was even more restricted than with regard to other commodities. It was deemed unfair and immoral to ask for grain, oil, and wine, the staples of these ages, more than the customary prices, and the municipal authorities were quick to check what they considered profiteering. Thus the evolution of an efficient wholesale trade in these commodities was prevented. The policy of the annona, which was tantamount to a nationalization or municipalization of the grain trade, aimed at filling the gaps. But its effects were rather unsatisfactory. Grain was scarce in the urban agglomerations, and the agriculturists complained about the unremunerativeness of grain growing.*37 The interference of the authorities upset the adjustment of supply to the rising demand.
6.XXX.35
The showdown came when in the political troubles of the third and fourth centuries the emperors resorted to currency debasement. With the system of maximum prices the practice of debasement completely paralyzed both the production and the marketing of the vital food-stuffs and disintegrated society's economic organization. The more eagerness the authorities displayed in enforcing the maximum prices, the more desperate became the conditions of the urban masses dependent on the purchase of food. Commerce in grain and other necessities vanished altogether. To avoid starving, people deserted the cities, settled on the countryside, and tried to grow grain, oil, wine, and other necessities for themselves. On the other hand, the owners of the big estates restricted their excess production of cereals and began to produce in their farmhouses—the villae—the products of handicraft which they needed. For their big-scale farming, which was already seriously jeopardized because of the inefficiency of slave labor, lost its rationality completely when the opportunity to sell at remunerative prices disappeared. As the owner of the estate could no longer sell in the cities, he could no longer patronize the urban artisans either. He was forced to look for a substitute to meet his needs by employing handicraftsmen on his own account in his villa. He discontinued big-scale farming and became a landlord receiving rents from tenants or sharecroppers. These coloni were either freed slaves or urban proletarians who settled in the villages and turned to tilling the soil. A tendency toward the establishment of autarky of each landlord's estate emerged. The economic function of the cities, of commerce, trade, and urban handicrafts, shrank. Italy and the provinces of the empire returned to a less advanced state of the social division of labor. The highly developed economic structure of ancient civilization retrograded to what is now known as the manorial organization of the Middle Ages.
6.XXX.36
The emperors were alarmed with that outcome which undermined the financial and military power of their government. But their counteraction was futile as it did not affect the root of the evil. The compulsion and coercion to which they resorted could not reverse the trend toward social disintegration which, on the contrary, was caused precisely by too much compulsion and coercion. No Roman was aware of the fact that the process was induced by the government's interference with prices and by currency debasement. It was vain for the emperors to promulgate laws against the city-dweller who "relicta civitate rus habitare maluerit."*38 The system of the leiturgia, the public services to be rendered by the wealthy citizens, only accelerated the retrogression of the division of labor. The laws concerning the special obligations of the shipowners, the navicularii, were no more successful in checking the decline of navigation than the laws concerning grain dealing in checking the shrinkage in the cities' supply of agricultural products.
6.XXX.37
The marvelous civilization of antiquity perished because it did not adjust its moral code and its legal system to the requirements of the market economy. A social order is doomed if the actions which its normal functioning requires are rejected by the standards of morality, are declared illegal by the laws of the country, and are prosecuted as criminal by the courts and the police. The Roman Empire crumbled to dust because it lacked the spirit of liberalism and free enterprise. The policy of interventionism and its political corollary, the Führer principle, decomposed the mighty empire as they will by necessity always disintegrate and destroy any social entity.
6.XXX.38

The gap between the rich and poor

As the gap between the rich and poor closes, the more the masses cry that things are worst today then ever before.

From the book Socialism: Part III,Ch.25 in paragraph III.25.24
The fact is, that the doctrine of increasing relative social poverty is nothing more than an attempt to give an economic justification to policies based on the resentment of the masses. Growing social poverty means merely growing envy.*25 Mandeville and Hume, two of the greatest observers of human nature, have remarked that the intensity of envy depends on the distance between the envier and the envied. If the distance is great one does not compare oneself with the envied, and, in fact, no envy is felt. The smaller the distance, however, the greater the envy.*26 Thus one can deduce from the growth of resentment in the masses that inequalities of income are diminishing. The increasing "covetousness" is not, as Kautsky thinks, a proof of the relative growth of poverty; on the contrary, it shows that the economic distance between the classes is becoming less and less.


From the book: Plea for Liberty Introduction, From Freedom to Bondage, by Herbert Spencer in paragraph S.3
Introduction, From Freedom to Bondage, by Herbert Spencer in paragraph S.3

And so it is, too with the general state of the population in respect of food, clothing, shelter, and the appliances of life. Leaving out of the comparison only barbaric states, there has been a conspicuous progress from the time when most rustics lived on barley bread, rye bread, and oatmeal, down to our own time when the consumption of white wheaten bread is universal—from the days when coarse jackets reaching to the knees left the legs bare, down to the present day when labouring people, like their employers, have the whole body covered, by two or more layers of clothing—from the old era of single-roomed huts without chimneys, or from the 15th century when even an ordinary gentleman's house was commonly without wainscot or plaster on its walls, down to the present century when every cottage has more rooms than one and the houses of artisans usually have several, while all have fireplaces, chimneys, and glazed windows, accompanied mostly by paper-hangings and painted doors; there has been, I say, a conspicuous progress in the condition of the peopIe. And this progress has been still more marked within our own time. Any one who can look back sixty years, when the amount of pauperism was far greater than now and beggars abundant, is struck by the comparative size and finish of the new houses occupied by operatives—by the better dress of workmen, who wear broadcloth on Sundays, and that of servant girls, who vie with their mistresses—by the higher standard of living which leads to a great demand for the best qualities of food by working people: all results of the double change to higher wages and cheaper commodities, and a distribution of taxes which has relieved the lower classes at the expense of the upper classes. He is struck, too, by the contrast between the small space which popular welfare then occupied in public attention, and the large space it now occupies, with the result that outside and inside Parliament, plans to benefit the millions form the leading topics, and everyone having means is expected to join in some philanthropic effort. Yet while elevation, mental and physical, of the masses is going on far more rapidly than ever before—while the lowering of the death-rate proves that the average life is less trying, there swells louder and louder the cry that the evils are so great that nothing short of a social revolution can cure them. In presence of obvious improvements, joined with that increase of longevity which even alone yields conclusive proof of general amelioration, it is proclaimed, with increasing vehemence, that things are so bad that society must be pulled to pieces and re-organised on another plan, In this case, then, as in the previous cases instanced, in proportion as the evil decreases the denunciation of it increases; and as fast as natural causes are shown to be powerful there grows up the belief that they are powerless.

LIFE IN THE 1800'S The next time you are washing your hands and complain because the water temperature isn't just how you like it, think about how things used to be. Here are some facts about the1500s:
These are interesting... Most people got married in June because they took their yearly bath in May, and still smelled pretty good by June. However, they were starting to smell, so brides carried a bouquet of flowers to hide the body odor. Hence the custom today of carrying a bouquet when getting married.
Baths consisted of a big tub filled with hot water. The man of the house had the privilege of the nice clean water, then all the other sons and men, then the women and finally the children. Last of all the babies. By then the water was so dirty you could actually lose someone in it. Hence the saying, Don't throw the baby out with the Bath water..
Houses had thatched roofs-thick straw-piled high, with no wood underneath. It was the only place for animals to get warm, so all the cats and other small animals (mice, bugs) lived in the roof When it rained it became slippery and sometimes the animals would slip and fall off the roof. Hence the saying . It's raining cats and dogs.
There was nothing to stop things from falling into the house.. This posed a real problem in the bedroom where bugs and other droppings could mess up your nice clean bed. Hence, a bed with big posts and a sheet hung over the top afforded some protection. That's how canopy beds came into existence.
The floor was dirt. Only the wealthy had something other than dirt. Hence the saying, Dirt poor. The wealthy had slate floors that would get slippery in the winter when wet, so they spread thresh (straw) on floor to help keep their footing. As the winter wore on, they added more thresh until, when you opened the door, it would all start slipping outside. A piece of wood was placed in the entranceway. Hence the saying a thresh hold. (Getting quite an education, aren't you?)
In those old days, they cooked in the kitchen with a big kettle that always hung over the fire. Every day they lit the fire and added things to the pot. They ate mostly vegetables and did not get much meat. They would eat the stew for dinner, leaving leftovers in the pot to get cold overnight and then start over the next day. Sometimes stew had food in it that had been there for quite a while. Hence the rhyme, Peas porridge hot, peas porridge cold, peas porridge in the pot nine days old..
Sometimes they could obtain pork, which made them feel quite special. When visitors came over, they would hang up their bacon to show off. It was a sign of wealth that a man could, bring home the bacon. They would cut off a little to share with guests and would all sit around and chew the fat..
Those with money had plates made of pewter. Food with high acid content caused some of the lead to leach onto the food, causing lead poisoning death. This happened most often with tomatoes, so for the next 400 years or so, tomatoes were considered poisonous.
Bread was divided according to status. Workers got the burnt bottom of the loaf, the family got the middle, and guests got the top, or the upper crust.
Lead cups were used to drink ale or whisky. The combination would sometimes knock the imbibers out for a couple of days. Someone walking along the road would take them for dead and prepare them for burial. They were laid out on the kitchen table for a couple of days and the family would gather around and eat and drink and wait and see if they would wake up. Hence the custom of holding a wake.
England is old and small and the local folks started running out of places to bury people. So they would dig up coffins and would take the bones to a bone-house, and reuse the grave. When reopening these coffins, 1 out of 25 coffins were found to have scratch marks on the inside and they realized they had been burying people alive. So they would tie a string on the wrist of the corpse, lead it through the coffin and up through the ground and tie it to a bell. Someone would have to sit out in the graveyard all night (the graveyard shift.) to listen for the bell; thus, someone could be, saved by the bell or was considered a ...dead ringer..
And that's the truth...
Now, whoever said History was boring ! ! !

Saturday, June 10, 2006

Freedom

FROM THE BOOK PLEA FOR LIBERTY: The Impracticability of Socialism, by Edward Stanley Robertson in paragraph I.46
Freedom is the most valuable of all human possessions, next after life itself. It is more valuable, in a manner, than even health. No human agency can secure health; but good laws, justly administered, can and do secure freedom. Freedom, indeed, is almost the only thing that law can secure. Law cannot secure equality, nor can it secure prosperity. In the direction of equality, all that law can do is to secure fair play, which is equality of rights but is not equality of conditions. In the direction of prosperity, all that law can do is to keep the road open. That is the Quintessence of Individualism, and it may fairly challenge comparison with that Quintessence of Socialism we have been discussing. Socialism, disguise it how we may, is the negation of Freedom. That it is so, and that it is also a scheme not capable of producing even material comfort in exchange for the abnegations of Freedom, I think the foregoing considerations amply prove.

The mind set of those like Senator Ted Kennedy

Anti-Capitalistic mentality: http://www.mises.org/etexts/mises/anticap/section1.asp

On the market not hampered by the interference of external forces, the process which tends to convey control of the factors of production into the hands of the most efficient people never stops. As soon as a man or a firm begins to slacken in endeavors to meet, in the best possible way, the most urgent of the not yet properly satisfied needs of the consumers, dissipation of the wealth accumulated by previous success in such endeavors sets in. Often this dispersion of the fortune starts already in the life­time of the businessman when his buoyancy, energy and re­sourcefulness become weakened by the impact of old age, fa­tigue, sickness, and his ability to adjust the conduct of his af­fairs to the unceasingly changing structure of the market fades away. More frequently it is the sluggishness of his heirs that fritters away the heritage. If the dull and stolid progeny do not sink back into insignificance and in spite of their incompetence remain moneyed people, they owe their prosperity to institutions and political measures which were dictated by anticapitalistic tendencies. They withdraw from the market where there is no means of preserving acquired wealth other than acquiring it anew each day in tough competition with everybody, with the already existing firms as well as with newcomers “operating on a shoestring.” In buying government bonds they hide under the wings of the government which promises to safeguard them against the dangers of the market in which losses are the penalty of inefficiency.*
However, there are families in which the eminent capaci­ties required for entrepreneurial success are propagated through sev­eral generations. One or two of the sons or grandsons or even great-grandsons equal or excel their forebear. The ancestor’s wealth is not dissipated, but grows more and more.
These cases are, of course, not frequent. They attract atten­tion not only on account of their rarity, but also on account of the fact that men who know how to enlarge an inherited business enjoy a double prestige, the esteem shown to their fathers and that shown to themselves. Such “patricians,” as they are some­times called by people who ignore the difference between a sta­tus society and the capitalistic society, for the most part combine in their persons breeding, fineness of taste and gracious manners with the skill and industriousness of a hard-working business­man. And some of them belong to the country’s or even the world’s richest entrepreneurs.
It is the conditions of these few richest among these so-called “patrician” families which we must scrutinize in order to explain a phenomenon that plays an important role in modern anticapitalistic propaganda and machinations.
Even in these lucky families, the qualities required for the successful conduct of big business are not inherited by all sons and grandsons. As a rule only one, or at best two, of each gen­eration are endowed with them. Then it is essential for the sur­vival of the family’s wealth and business that the conduct of af­fairs be entrusted to this one or to these two and that the other members be relegated to the position of mere recipients of a quota of the proceeds. The methods chosen for such arrange­ments vary from country to country, according to the special provisions of the national and local laws. Their effect, however, is always the same. They divide the family into two cate­gories—those who direct the conduct of affairs and those who do not.
The second category consists as a rule of people closely re­lated to those of the first category whom we propose to call the bosses. They are brothers, cousins, nephews of the bosses, more often their sisters, widowed sisters-in-law, female cousins, nieces and so on. We propose to call the mem­bers of this second cate­gory the cousins.
The cousins derive their revenues from the firm or corpo­ration. But they are foreign to business life and know nothing about the problems an entrepreneur has to face. They have been brought up in fashionable boarding schools and colleges, whose atmosphere was filled by a haughty contempt for banausic money-making. Some of them pass their time in night clubs and other places of amusement, bet and gamble, feast and revel, and indulge in expensive debauchery. Others amateurishly busy themselves with painting, writing, or other arts. Thus, most of them are idle and useless people.
It is true that there have been and are exceptions, and that the achievements of these exceptional members of the group of cousins by far outweigh the scandals raised by the provoking be­havior of the playboys and spendthrifts. Many of the most emi­nent authors, scholars and statesmen were such “gentlemen of no occupation.” Free from the necessity of earning a livelihood by a gainful occupation and independent of the favor of those ad­dicted to bigotry, they became pioneers of new ideas. Others, themselves lacking the inspiration, became the Maecenas of artists who, without the financial aid and the applause received, would not have been in a position to accomplish their creative work. The role that moneyed men played in Great Britain’s in­tellectual and political evolution has been stressed by many his­torians. The milieu in which the authors and artists of nine­teenth-century France lived and found encouragement was le monde, “society”.
However, we deal here neither with the sins of the playboys nor with the excellence of other groups of wealthy people. Our theme is the part which a special group of cousins took in the dissemination of doctrines aiming at the destruction of the mar­ket economy.
Many cousins believe that they have been wronged by the ar­rangements regulating their financial relation to the bosses and the family’s firm. Whether these arrangements were made by the will of their father or grandfather, or by an agreement which they themselves have signed, they think that they are receiving too little and the bosses too much. Unfamiliar with the nature of business and the market, they are—with Marx—convinced that capital automatically “begets profits.” They do not see any rea­son why those members of the family who are in charge of the conduct of affairs should earn more than they. Too dull to ap­praise correctly the meaning of balance sheets and profit and loss accounts, they suspect in every act of the bosses a sinister at­tempt to cheat them and to deprive them of their birthright. They quarrel with them continually.
It is not astonishing that the bosses lose their temper. They are proud of their success in overcoming all the obstacles which governments and labor unions place in the way of big business. They are fully aware of the fact that, but for their efficiency and zeal, the firm would either have long since gone astray or the family would have been forced to sell out. They believe that the cousins should do justice to their merits, and they find their complaints simply impudent and outrageous.
The family feud between the bosses and the cousins concerns only the members of the clan. But it attains general importance when the cousins, in order to annoy the bosses, join the anticapi­talistic camp and provide the funds for all kinds of “progressive” ventures. The cousins are enthusiastic in supporting strikes, even strikes in the factories from which their own revenues originate.* It is a well-known fact that most of the “progressive” magazines and many “progressive” newspapers entirely depend on the sub­sidies lavishly granted by them. These cousins endow progres­sive universities and colleges and institutes for “social research” and sponsor all sorts of communist party activities. As “parlor socialists” and “penthouse Bolsheviks,” they play an im­portant role in the “proletarian army” fighting against the “dismal system of capitalism.”

THE RESENTMENT OF THE INTELLECTUALS

Anto-Capitalistic Mentality: http://www.mises.org/etexts/mises/anticap/section1.asp

The common man as a rule does not have the opportunity of consorting with people who have succeeded better than he has. He moves in the circle of other common men. He never meets his boss socially. He never learns from personal experience how different an entrepreneur or an executive is with regard to all those abilities and faculties which are required for successfully serving the consumers. His envy and the resentment it engenders are not directed against a living being of flesh and blood, but against pale abstractions like “management,” “capital”, and “Wall Street.” It is impossible to abominate such a faint shadow with the same bitterness of feeling that one may bear against a fellow creature whom one encounters daily.
It is different with people whom special conditions of their occupation or their family affiliation bring into personal contact with the winners of the prizes which—as they believe—by rights should have been given to themselves. With them the feelings of frustrated ambition become especially poignant because they en­gender hatred of concrete living beings. They loathe capitalism because it has assigned to this other man the position they them­selves would like to have.
Such is the case with those people who are commonly called the intellectuals. Take for instance the physicians. Daily routine and experience make every doctor cognizant of the fact that there exists a hierarchy in which all medical men are graded according to their merits and achievements. Those more eminent than he himself is, those whose methods and innovations he must learn and practice in order to be up-to-date were his classmates in the medical school, they served with him as internes, they attend with him the meetings of medical associations. He meets them at the bedside of patients as well as in social gatherings. Some of them are his personal friends or related to him, and they all behave toward him with the utmost civility and address him as their dear colleague. But they tower far above him in the appre­ciation of the public and often also in height of income. They have outstripped him and now belong to another class of men. When he compares himself with them, he feels humiliated. But he must watch himself carefully lest anybody notice his resent­ment and envy. Even the slightest indication of such feelings would be looked upon as very bad manners and would depreciate him in the eyes of everybody. He must swallow his mor­tification and divert his wrath toward a vicarious target. He in­dicts society’s economic organization, the nefarious system of capitalism. But for this unfair regime his abilities and talents, his zeal and his achievements would have brought him the rich re­ward they deserve.
It is the same with many lawyers and teachers, artists and actors, writers and journalists, architects and scientific research workers, engineers and chemists. They, too, feel frustrated be­cause they are vexed by the ascendancy of their more successful colleagues, their former schoolfellows and cronies. Their re­sentment is deepened by precisely those codes of professional conduct and ethics that throw a veil of comradeship and col­leagueship over the reality of competition.
To understand the intellectual’s abhorrence of capitalism one must realize that in his mind this system is incarnated in a defi­nite number of compeers whose success he resents and whom he makes responsible for the frustration of his own far-flung ambi­tions. His passionate dislike of capitalism is a mere blind for his hatred of some successful “colleagues.”
THE ANTICAPITALISTIC BIAS OF AMERICAN INTELLECTUALS
The anticapitalistic bias of the intellectuals is a phenomenon not limited to one or a few countries only. But it is more general and more bitter in the United States than it is in the European countries. To explain this rather surprising fact one must deal with what one calls “society” or, in French, also le monde.
In Europe “society” includes all those eminent in any sphere of activity. Statesmen and parliamentary leaders, the heads of the various departments of the civil service, publishers and edi­tors of the main newspapers and magazines, prominent writers, scientists, artists, actors, musicians, en­gineers, lawyers and physicians form together with outstanding businessmen and scions of aristocratic and patrician families what is considered the good society. They come into contact with one another at dinner and tea parties, charity balls and bazaars, at first nights, and varnishing days; they frequent the same restaurants, hotels and resorts. When they meet, they take their pleasure in conver­sation about intellectual matters, a mode of social intercourse first developed in Italy of the Renaissance, perfected in the Parisian salons and later imitated by the “society” of all impor­tant cities of Western and Central Europe. New ideas and ide­ologies find their response in these social gatherings before they begin to influence broader circles. One cannot deal with the history of the fine arts and literature in the nineteenth century without analyzing the role “society” played in encouraging or discouraging their protagonists.
Access to European society is open to everybody who has distinguished himself in any field. It may be easier to people of noble ancestry and great wealth than to commoners with modest incomes. But neither riches nor titles can give to a member of this set the rank and prestige that is the reward of great personal distinction. The stars of the Parisian salons are not the million­aires, but the members of the Académie Française. The intellec­tuals prevail and the others feign at least a lively interest in intel­lectual concerns.
Society in this sense is foreign to the American scene. What is called “society” in the United States almost exclusively con­sists of the richest families. There is little social intercourse between the successful businessmen and the nation’s eminent authors, artists and scientists. Those listed in the Social Register do not meet socially the molders of public opinion and the harbingers of the ideas that will determine the future of the na­tion. Most of the “socialites” are not interested in books and ideas. When they meet and do not play cards, they gossip about persons and talk more about sports than about cultural matters. But even those who are not averse to reading consider writers, scientists and artists as people with whom they do not want to consort. An almost insurmountable gulf separates “society” from the intellectuals.
It is possible to explain the emergence of this situation his­torically. But such an explanation does not alter the facts. Nei­ther can it remove or alleviate the resentment with which the in­tellectuals react to the contempt in which they are held by the members of “society.” American authors or scientists are prone to consider the wealthy businessman as a barbarian, as a man exclusively intent upon making money. The professor despises the alumni who are more interested in the university’s football team than in its scholastic achievements. He feels insulted if he learns that the coach gets a higher salary than an eminent profes­sor of philosophy. The men whose research has given rise to new methods of production hate the businessmen who are merely interested in the cash value of their research work. It is very significant that such a large number of American research physicists sympathize with socialism or communism. As they are ignorant of economics and realize that the university teachers of economics are also opposed to what they disparagingly call the profit system, no other attitude can be expected from them.
If a group of people secludes itself from the rest of the na­tion, especially also from its intellectual leaders, in the way American “socialites” do, they unavoidably become the target of rather hostile criticisms on the part of those whom they keep out of their own circles. The exclusivism practiced by the American rich has made them in a certain sense outcasts. They may take a vain pride in their own distinction. What they fail to see is that their self-chosen segregation isolates them and kindles animosi­ties which make the intellectuals inclined to favor anticapitalistic policies.

Sanitarians

A Plea For Liberty:
By the side of the claims made in the name of the great mass of labourers, in the name of the industrial proletariat and of the poor, there has arisen during the last fifteen or twenty years a new danger. It has its origin in a false conception of the attributes and powers of the State. We refer to the claims made on behalf of a system of official and governmental hygiene, which pretends to abolish insanitary conditions of life, to make healthy dwellings and workshops, in a word, to take under control the private lives of the citizens. In the opinion of many people at the present day, the modern State should be called on to determine the rate of wages, the length of the working-day, the price of provisions and other necessaries of life; to divide profits among the different branches of native industry, by the aid of innumerable laws, by a protective tariff, and by means of an army of inspectors. The Sanitarians ('Hygienistes' in the French term), in their turn, set out a programme of requirements and dictate the conditions under which houses are to be built and inhabited, the nature of the materials to be used, and the number of the tenants.
mckyPL: The Housing of the Working-Classes and of the Poor, by Arthur Raffalovich in paragraph VIII.5
Whether these pretensions are well founded or not, they have rendered sanitation popular. It has also created a group of Sanitarians who wish State protection to be introduced everywhere. M. Leon Say suggests a doubt whether people will be happier when the Sanitarians become master and succeed in regulating our lives to the minutest detail. In his opinion those who look at this matter from the scientific point of view should spare no effort to check this new protectionist movement. M. Leon Say has declared himself before all things a strong advocate of private initiative, all the more so because the limits of the rights of the State in the matter of hygiene cannot be determined.*89
mckyPL: Footnote: n89
89. [89] Hygiene has, in fact, become an official career. Those who fill the posts given by the State, seek to make themselves indispensable. One of the most distinguished of French doctors wrote to me recently that it will be necessary to make a new '89' against the tyranny of hygiene, and to risk a revolution in order to gain our liberty of eating and drinking, and to limit the busybodydom of Sanitarians in the concerns of our private life.

Friday, June 09, 2006

Hollywood

Anti-Capitalistic mentally:
http://www.mises.org/etexts/mises/anticap/section1.asp
THE COMMUNISM OF BROADWAY AND HOLLY­WOOD
The many to whom capitalism gave a comfortable income and leisure are yearning for entertainment. Crowds throng to the theatres. There is money in show business. Popular actors and playwrights enjoy a six-figure income. They live in palatial houses with butlers and swimming pools. They certainly are not prisoners of starvation. Yet Hollywood and Broadway, the world-famous centers of the entertain­ment industry, are hotbeds of communism. Authors and performers are to be found among the most bigoted supporters of Sovietism.
Various attempts have been made to explain this phe­nomenon. There is in most of these interpretations a grain of truth. However, they all fail to take account of the main motive that drives champions of the stage and the screen into the ranks of revolutionaries.
Under capitalism, material success depends on the apprecia­tion of a mans achievements on the part of the sovereign con­sumers. In this regard there is no difference between the services rendered by a manufacturer and those rendered by a producer, an actor or a playwright. Yet the awareness of this dependence makes those in show business much more uneasy than those supplying the customers with tangible amenities. The manufac­turers of tangible goods know that their products are purchased because of certain physical properties. They may reasonably ex­pect that the public will continue to ask for these commodities as long as nothing better or cheaper is offered to them, for it is un­likely that the needs which these goods satisfy will change in the near future. he state of the market for these goods can, to some extent, be anticipated by intelligent entrepreneurs. They can, with a degree of confidence, look into the future.
It is another thing with entertainment. People long for amusement because they are bored. And nothing makes them so weary as amusements with which they are already familiar. The essence of the entertainment industry is variety. The patrons applaud most what is new and therefore unexpected and surpris­ing. They are capricious and unaccountable. They disdain what they cherished yesterday. A tycoon of the stage or the screen must always fear the waywardness of the public. He awakes rich and famous one morning and may be forgotten the next day. He knows very well that he depends entirely on the whims and fan­cies of a crowd hankering after merriment. He is always agitated by anxiety. Like the master-builder in Ibsens play, he fears the unknown newcomers, the vigorous youths who will supplant him in the favor of the public.
It is obvious that there is no relief from what makes these stage people uneasy. Thus they catch at a straw. Communism, some of them think, will bring their deliverance. Is it not a sys­tem that makes all people happy? Do not very eminent men de­clare that all the evils of mankind are caused by capitalism and will be wiped out by communism? Are not they themselves hard-working people, comrades of all other working men?
It may be fairly assumed that none of the Hollywood and Broadway communists has ever studied the writings of any so­cialist author and still less any serious analysis of the market economy. But it is this very fact that, to these glamour girls, dancers and singers, to these authors and producers of comedies, moving pictures and songs, gives the strange illusion that their particular grievances will disappear as soon as the expropriators will be expropriated. There are people who blame capitalism for the stupidity and crudeness of many products of the entertainment industry.
There is no need to argue this point. But it is noteworthy to remember that no other American milieu was more enthusiastic in the endorsement of communism than that of people cooperat­ing in the production of these silly plays and films. When a fu­ture historian searches for those little significant facts which Taine appreciated highly as source material, he should not ne­glect to mention the role which the worlds most famous strip-tease artist played in the American radical movement.*

Fascism: Mussolini was a left wing fanatic

Socialism: Epilogue in paragraph E.176
Nobody could surpass Mussolini in Marxian zeal. He was the intransigent champion of the pure creed, the unyielding defender of the rights of the exploited proletarians, the eloquent prophet of the socialist bliss to come. He was an adamant adversary of patriotism, nationalism, imperialism, monarchical rule and all religious creeds. When Italy in 1911 opened the great series of wars by an insidious assault upon Turkey, Mussolini organized violent demonstrations against the departure of troops for Libya. Now, in 1914, he branded the war against Germany and Austria as an imperialist war. He was then still under the dominating influence of Angelica Balabanoff, the daughter of a wealthy Russian landowner. Miss Balabanoff had initiated him into the subtleties of Marxism. In her eyes the defeat of the Romanovs counted more than the defeat of the Habsburgs. She had no sympathy for the ideals of the Risorgimento.

The programme of the Fascists, as drafted in 1919, was vehemently anti-capitalistic. The most radical New Dealers and even communists could agree with it. When the Fascists came to power, they had forgotten those points of their programme which referred to the liberty of thought and the press and the right of assembly. In this respect they were conscientious disciples of Bukharin and Lenin. Moreover they did not suppress, as they had promised, the industrial and financial corporations. Italy badly needed foreign credits for the development of its industries. The main problem for Fascism, in the first years of its rule, was to win the confidence of the foreign bankers. It would have been suicidal to destroy the Italian corporations.

Fascist economic policy did not—at the beginning—essentially differ from those of all other Western nations. It was a policy of interventionism. As the years went on, it more and more approached the Nazi pattern of socialism. When Italy, after the defeat of France, entered the second World War, its economy was by and large already shaped according to the Nazi pattern. The main difference was that the Fascists were less efficient and even more corrupt than the Nazis.

But Mussolini could not long remain without an economic philosophy of his own invention. Fascism posed as a new philosophy, unheard of before and unknown to all other nations. It claimed to be the gospel which the resurrected spirit of ancient Rome brought to the decaying democratic peoples whose barbarian ancestors had once destroyed the Roman empire. It was the consummation both of the Rinascimento and the Risorgimento in every respect, the final liberation of the Latin genius from the yoke of foreign ideologies. Its shining leader, the peerless Duce, was called to find the ultimate solution for the burning problems of society's economic organization and of social justice.

From the dust-heap of discarded socialist utopias, the Fascist scholars salvaged the scheme of guild socialism. Guild socialism was very popular with British socialists in the last years of the first World War and in the first years following the Armistice. It was so impracticable that it disappeared very soon from socialist literature. No serious statesman ever paid any attention to contradictory and confused plans of guild socialism. It was almost forgotten when the Fascists attached it to a new label, and flamboyantly proclaimed corporativism as the new social panacea. The public inside and outside of Italy was captivated. Innumerable books, pamphlets and articles were written in praise of the stato corporativo. The governments of Austria and Portugal very soon declared that they were committed to the noble principles of corporativism. The papal encyclical Quadragesimo Anno (1931) contained some paragraphs which could be interpreted—but need not be—as an approval of corporativism. In France its ideas found many eloquent supporters.
It was mere idle talk. Never did the Fascists make any attempt to realize the corporativist programme, industrial self-government. They changed the name of the chambers of commerce into corporative councils. They called corporazione the compulsory organizations of the various branches of industry which were the administrative units for the execution of the German pattern of socialism they had adopted. But there was no question of the corporazione's self-government. The Fascist cabinet did not tolerate anybody's interference with its absolute authoritarian control of production. All the plans for the establishment of the corporative system remained a dead letter.

Thursday, June 08, 2006

The mind set of most professors

The Anti-Capitalistic Mentality:http://www.mises.org/etexts/mises/anticap/section1.asp
Again there are grumblers who blame capitalism for what they call its mean materialism. They cannot help admitting that capitalism has the tendency to improve the material con­ditions of mankind. But, they say, it has diverted men from the higher and nobler pursuits. It feeds the bodies, but it starves the souls and the minds. It has brought about a decay of the arts. Gone are the days of the great poets, painters, sculptors and architects. Our age produces merely trash.

The judgment about the merits of a work of art is entirely subjective. Some people praise what others disdain. There is no yardstick to measure the aesthetic worth of a poem or of a building. Those who are delighted by the cathedral of Chartres and the Meninas of Velasquez may think that those who remain unaffected by these marvels are boors. Many students are bored to death when the school forces them to read Hamlet. Only people who are endowed with a spark of the artistic mentality are fit to appreciate and to enjoy the work of an artist.

Among those who make pretense to the appellation of edu­cated men there is much hypocrisy. They put on an air of con­noisseurship and feign enthusiasm for the art of the past and artists passed away long ago. They show no similar sympathy for the contemporary artist who still fights for recognition. Dis­sembled adoration for the Old Masters is with them a means to disparage and ridicule the new ones who deviate from traditional canons and create their own.

John Ruskin will be remembered—together with Carlyle, the Webbs, Bernard Shaw and some others—as one of the gravedig­gers of British freedom, civilization and prosperity. A wretched character in his private no less than in his public life, he glorified war and bloodshed and fanatically slan­dered the teachings of political economy which he did not understand. He was a big­oted detractor of the market econ­omy and a romantic eulogist of the guilds. He paid homage to the arts of earlier centuries. But when he faced the work of a great living artist, Whistler, he dis­praised it in such foul and objurgatory language that he was sued for libel and found guilty by the jury. It was the writings of Ruskin that popularized the prejudice that capitalism, apart from being a bad economic system, has substituted ugliness for beauty, pettiness for grandeur, trash for art.

As people widely disagree in the appreciation of artistic achievements, it is not possible to explode the talk about the artistic inferiority of the age of capitalism in the same apo­dictic way in which one may refute errors in logical reason­ing or in the establishment of facts of experience. Yet no sane man would be insolent enough as to belittle the gran­deur of the artistic ex­ploits of the age of capitalism.

The preeminent art of this age of “mean materialism and money‑making” was music. Wagner and Verdi, Berlioz and Bizet, Brahms and Bruckner, Hugo Wolf and Mahler, Puc­cini and Richard Strauss, what an illustrious cavalcade! What an era in which such masters as Schumann and Donizetti were over­shadowed by still superior genius!

Then there were the great novels of Balzac, Flaubert, Mau­passant, Jens Jacobsen, Proust, and the poems of Victor Hugo, Walt Whitman, Rilke, Yeats. How poor our lives would be if we had to miss the work of these giants and of many other no less sublime authors.

Let us not forget the French painters and sculptors who taught us new ways of looking at the world and enjoying light and color.

Nobody ever contested that this age has encouraged all branches of scientific activities. But, say the grumblers, this was mainly the work of specialists while “synthesis” was lacking. One can hardly misconstrue in a more absurd way the teachings of modern mathematics, physics and biology. And what about the books of philosophers like Croce, Berg­son, Husserl and Whitehead?

Each epoch has its own character in its artistic exploits. Imitation of masterworks of the past is not art; it is routine. What gives value to a work is those features in which it differs from other works. This is what is called the style of a period.

In one respect the eulogists of the past seem to be justified. The last generations did not bequeath to the future such monu­ments as the pyramids, the Greek temples, the Gothic cathedrals and the churches and palaces of the Renaissance and the Baroque. In the last hundred years many churches and even cathe­drals were built and many more government palaces, schools and libraries. But they do not show any original conception; they re­flect old styles or hybridize divers old styles. Only in apartment houses, office buildings and private homes have we seen some­thing develop that may be qualified as an architectural style of our age. Although it would be mere pedantry not to appreciate the peculiar gran­deur of such sights as the New York skyline, it can be ad­mitted that modern architecture has not attained the distinction of that of past centuries.

The reasons are various. As far as religious buildings are concerned, the accentuated conservatism of the churches shuns any innovation. With the passing of dynasties and aristocracies, the impulse to construct new palaces disap­peared. The wealth of entrepreneurs and capitalists is, what­ever the anticapitalistic demagogues may fable, so much inferior to that of kings and princes that they cannot indulge in such luxurious construction. No one is today rich enough to plan such palaces as that of Ver­sailles or the Escorial. The orders for the construction of gov­ernment buildings do no longer emanate from despots who were free, in defiance of public opinion, to choose a master whom they themselves held in esteem and to sponsor a project that scandalized the dull majority. Committees and councils are not likely to adopt the ideas of bold pioneers. They prefer to range them­selves on the safe side.

There has never been an era in which the many were pre­pared to do justice to contemporary art. Reverence to the great authors and artists has always been limited to small groups. What characterizes capitalism is not the bad taste of the crowds, but the fact that these crowds, made prosper­ous by capitalism, became “consumers” of literature—of course, of trashy litera­ture. The book market is flooded by a downpour of trivial fic­tion for the semibarbarians. But this does not prevent great au­thors from creating imperishable works.

The critics shed tears on the alleged decay of the indus­trial arts. They contrast, e.g., old furniture as preserved in the castles of European aristocratic families and in the collections of the museums with the cheap things turned out by big‑scale produc­tion. They fail to see that these collectors’ items were made ex­clusively for the well-to-do. The carved chests and the intarsia tables could not be found in the mis­erable huts of the poorer strata. Those caviling about the inexpensive furniture of the American wage earner should cross the Rio Grande del Norte and inspect the abodes of the Mexican peons which are devoid of any furniture. When modern industry began to provide the masses with the para­phernalia of a better life, their main con­cern was to produce as cheaply as possible without any regard to aesthetic values. Later, when the progress of capitalism had raised the masses’ standard of living, they turned step by step to the fabrication of things which do not lack refinement and beauty. Only romantic prepossession can induce an observer to ignore the fact that more and more citizens of the capitalistic countries live in an environment which cannot be simply dis­missed as ugly.

Tuesday, June 06, 2006

Modern wars are caused by...

Socialism: epilogue 1947

The intellectual leaders of the peoples have produced and propagated the fallacies which are on the point of destroying liberty and Western civilization. The intellectuals alone are responsible for the mass slaughters which are the characteristic mark of our century. They alone can reverse the trend and pave the way for a resurrection of freedom.


For more than seventy years the German professors of political science, history, law, geography and philosophy eagerly imbued their disciples with a hysterical hatred of capitalism, and preached the war of "liberation" against the capitalistic West. The German "socialists of the chair," much admired in all foreign countries, were the pacemakers of the two World Wars. At the turn of the century the immense majority of the Germans were already radical supporters of socialism and aggressive nationalism. They were then already firmly committed to the principles of Nazism. What was lacking and was added later was only a new term to signify their doctrine.

If we look closer we find that the ideal of the higher phase of communist society, ripening only in remote distances of the future, is, as the Marxists view it, thoroughly undemocratic.*63 Here, too, the socialist intends that eternal peace shall reign—the goal of all democratic institutions. But the means by which this peace is to be gained are very different from those employed by the democrats. It will not rest on the power to change peacefully rulers and ruling policy, but on the fact that the regime is made permanent, and that rulers and policy are unchangeable. This, too, is peace; not the peace of progress which Liberalism strives to attain but the peace of the graveyard. It is not the peace of pacifists but of pacifiers, of men of violence who seek to create peace by subjection. Every absolutist makes such peace by setting up an absolute domination, and it lasts just as long as his domination can be maintained. Liberalism sees the vanity of all this. It sets itself, therefore, to make a peace which will be proof against the perils which threaten it on account of man's inextinguishable yearning for change.

Why the republicans don't fight back

Socialism: Epilogue in paragraph E.230
The socialist propaganda never encountered any decided opposition. The devastating critique by which the economists exploded the futility and impracticability of the socialist schemes and doctrines did not reach the moulders of public opinion. The universities were mostly dominated by socialist or interventionist pedants not only in continental Europe, where they were owned and operated by the governments, but even in the Anglo-Saxon countries. The politicians and the statesmen, anxious not to lose popularity, were lukewarm in their defence of freedom. The policy of appeasement, so much criticized when applied in the case of the Nazis and the Fascists, was practised universally for many decades with regard to all other brands of socialism. It was this defeatism that made the rising generation believe that the victory of socialism is inevitable.


The defeat of the liberal ideology could not long be postponed. Liberalism has anxiously avoided all political artifice. It has relied entirely upon the inner vitality of its ideas and their power to convince, and has disdained all other means of political conflict. It has never pursued political tactics, never stooped to demagogy. The old Liberalism was honest through and through and faithful to its principles. Its opponents called this being "doctrinaire."

The misconception to which the principle of equality

Socialism: Part I,Ch.4 in paragraph I.4.43
The misconception to which the principle of equality before the law is exposed in the field of general social relationships is to be found in the special field of the relations between those sexes. Just as the pseudo-democratic movement endeavours by decrees to efface natural and socially conditioned inequalities, just as it wants to make the strong equal to the weak, the talented to the untalented, and the healthy to the sick, so the radical wing of the women's movement seeks to make women the equal of men.*78 Though they cannot go so far as to shift half the burden of motherhood on to men, still they would like to abolish marriage and family life so that women may have at least all that liberty which seems compatible with childbearing. Unencumbered by husband and children, woman is to move freely, act freely, and live for herself and the development of her personality.

Free love

Socialism: Part I,Ch.4 in paragraph I.4.36
Proposals to transform the relations between the sexes have long gone hand in hand with plans for the socialization of the means of production. Marriage is to disappear along with private property, giving place to an arrangement more in harmony with the fundamental facts of sex. When man is liberated from the yoke of economic labour, love is to be liberated from all the economic trammels which have profaned it. Socialism promises not only welfare—wealth for all—but universal happiness in love as well. This part of its programme has been the source of much of its popularity. It is significant that no other German socialist book was more widely read or more effective as propaganda than Bebel's Woman and Socialism, which is dedicated above all to the message of free love.Utopianism presents all its ideals for the future as the reconstruction of a Golden Age which humanity has lost through its own fault. In the same way it pretends that it is demanding for sexual life only a return to an original felicity. The poets of antiquity are no less eloquent in their praises of marvellous, bygone times of free love than when they speak of the saturnian ages when property did not exist.*65 Marxism echoes the older Utopians.Free love is the socialist's radical solution for sexual problems. The socialistic society abolishes the economic dependence of woman which results from the fact that woman is dependent on the income of her husband. Man and woman have the same economic rights and the same duties, as far as motherhood does not demand special consideration for the woman. Public funds provide for the maintenance and education of the children, which are no longer the affairs of the parents but of society. Thus the relations between the sexes are no longer influenced by social and economic conditions. Mating ceases to found the simplest form of social union, marriage and the family. The family disappears and society is confronted with separate individuals only. Choice in love becomes completely free. Men and women unite and separate just as their desires urge. Socialism desires to create nothing that is new in all this, but "would only recreate on a higher level of culture and under new social forms what was universally valid on a more primitive cultural level and before private ownership dominated society.Without coercive regulation of the growth of population, a socialist community is inconceivable. A socialist community must be in a position to prevent the size of the population from mounting above or falling below certain definite limits. It must attempt to maintain the population always at that optimal number which allows the maximum production per head. Equally with any other order of society it must regard both under- and over-population as an evil. And since in it those motives, which in a society based on private ownership of the means of production harmonize the number of births with the limitations of the means of subsistence, would not exist, it will be obliged to regulate the matter itself. How it will accomplish this need not be here discussed. Nor is it relevant to our purpose to inquire whether its measures will serve eugenic or ethnological ideas. But it is certain that even if a socialist community may bring "free love," it can in no way bring free birth. The right to existence of every person born can be said to exist only when undesirable births can be prevented. In the socialist community as in any other, there will be those for whom "at the great banquet of Nature no place has been laid" and to whom the order must be given to withdraw themselves as soon as may be. No indignation that these words of Malthus may arouse can alter this fact.

Carl Marx really cared for the poor?

socialism: Part III,Ch.25 in paragraph III.25.19
The theory of increasing poverty among the masses stands at the centre of Marxist thought as well as of older socialist doctrines. The accumulation of poverty parallels the accumulation of capital. It is the "antagonistic character of capitalist production" that "the accumulation of wealth at one pole" is simultaneously "accumulation of misery, work torture, slavery, ignorance, brutalization, and moral degeneracy at the other."*18 This is the theory of the progressive increase in the absolute poverty of the masses. Based on nothing but the tortuous processes of an abstruse system of thought, it need occupy us all the less in that it is gradually receding into the background, even in the writings of orthodox Marxian disciples and the official programmes of the Social-Democratic parties. Even Kautsky, during the revisionism quarrel, was reduced to conceding that, according to all the facts, it was precisely in the most advanced capitalist countries that physical misery was on the decline, and that the working classes had a higher standard of life than fifty years ago.*19 The Marxians still cling to the theory of increasing poverty purely on account of its propaganda value, and exploit it today just as much as during the youth of the now aged Party.

Price controls

Socialism: Epilogue in paragraph E 30
If the government wants to make it possible for poor parents to give more milk to their children, it must buy milk at the market price and sell it to those poor people with a loss at a cheaper rate; the loss may be covered from the means collected by taxation. But if the government simply fixes the price of milk at a lower rate than the market, the results obtained will be contrary to the aims of the government. The marginal producers will, in order to avoid losses, go out of the business of producing and selling milk. There will be less milk available for the consumers, not more. This outcome is contrary to the government's intentions. The government interfered because it considered milk as a vital necessity. It did not want to restrict its supply.

Now the government has to face the alternative: either to refrain from any endeavours to control prices, or to add to its first measure a second one, i.e., to fix the prices of the factors of production necessary for the production of milk. Then the same story repeats itself on a remoter plane: the government has again to fix the prices of the factors of production necessary for the production of those factors of production which are needed for the production of milk. Thus the government has to go further and further, fixing the prices of all the factors of production—both human (labour) and material—and forcing every entrepreneur and every worker to continue work at these prices and wages. No branch of production can be omitted from this all-round fixing of prices and wages and this general order to continue production. If some branches of production were left free, the result would be a shifting of capital and labour to them and a corresponding fall of the supply of the goods whose prices the government had fixed. However, it is precisely these goods which the government considers as especially important for the satisfaction of the needs of the masses.

But when this state of all-round control of business is achieved, the market economy has been replaced by a system of planned economy, by socialism. Of course, this is not the socialism of immediate state management of every plant by the government as in Russia, but the socialism of the German or Nazi pattern.

Many people were fascinated by the alleged success of German price control. They said: You have only to be as brutal and ruthless as the Nazis and you will succeed in controlling prices. What these people, eager to fight Nazism by adopting its methods, did not see was that the Nazis did not enforce price control within a market society, but they established a full socialist system, a totalitarian commonwealth.

Price control is contrary to purpose if it is limited to some commodities only. It cannot work satisfactorily within a market economy. If the government does not draw from this failure the conclusion that it must abandon all attempts to control prices, it must go further and further until it substitutes socialist all-round planning for the market economy.

Minimum wage

Socialism: Epilogue in paragraph E.19
Minimum wage rates, whether enforced by government decree or by labour union pressure and compulsion, are useless if they fix wage rates at the market level. But if they try to raise wage rates above the level which the unhampered labour market would have determined, they result in permanent unemployment of a great part of the potential labour force.

Government spending cannot create additional jobs. If the government provides the funds required by taxing the citizens or by borrowing from the public, it abolishes on the one hand as many jobs as it creates on the other. If government spending is financed by borrowing from the commercial banks, it means credit expansion and inflation. If in the course of such an inflation the rise in commodity prices exceeds the rise in nominal wage rates, unemployment will drop. But what makes unemployment shrink is precisely the fact that real wage rates are falling.


The inherent tendency of capitalist evolution is to raise real wage rates steadily. This is the effect of the progressive accumulation of capital by means of which technological methods of production are improved. There is no means by which the height of wage rates can be raised for all those eager to earn wages other than through the increase of the per capita quota of capital invested. Whenever the accumulation of additional capital stops, the tendency towards a further increase in real wage rates comes to a standstill. If capital consumption is substituted for an increase in capital available, real wage rates must drop temporarily until the checks on a further increase in capital are removed. Government measures which retard capital accumulation or lead to capital consumption—such as confiscatory taxation—are therefore detrimental to the vital interests of the workers.

Credit expansion can bring about a temporary boom. But such a fictitious prosperity must end in a general depression of trade, a slump.

It can hardly be asserted that the economic history of the last decades has run counter to the pessimistic predictions of the economists. Our age has to face great economic troubles. But this is not a crisis of capitalism. It is the crisis of interventionism, of policies designed to improve capitalism and to substitute a better system for it.

No economist ever dared to assert that interventionism could result in anything else than in disaster and chaos. The advocates of interventionism--foremost among them the Prussian Historical School and the American Institutionalists—were not economists. On the contrary. In order to promote their plans they flatly denied that there is any such thing as economic law. In their opinion governments are free to achieve all they aim at without being restrained by an inexorable regularity in the sequence of economicphenomena Like the German socialist Ferdinand Lassalle, they maintain that the State is God.

The interventionists do not approach the study of economic matters with scientific disinterestedness. Most of them are driven by an envious resentment against those whose incomes are larger than their own. This bias makes it impossible for them to see things as they really are. For them the main thing is not to improve the conditions of the masses, but to harm the entrepreneurs and capitalists even if this policy victimizes the immense majority of the people.

In the eyes of the interventionists the mere existence of profits is objectionable. They speak of profit without dealing with its corollary, loss. They do not comprehend that profit and loss are the instruments by means of which the consumers keep a tight rein on all entrepreneurial activities. It is profit and loss that make the consumers supreme in the direction of business.It is absurd to contrast production for profit and production for use. On the unhampered market a man can earn profits only by supplying the consumers in the best and cheapest way with the goods they want to use. Profit and loss withdraw the material factors of production from the hands of the inefficient and place them in the hands of the more efficient. It is their social function to make a man the more influential in the conduct of business the better he succeeds in producing commodities for which people scramble. The consumers suffer when the laws of the country prevent the most efficient entrepreneurs from expanding the sphere of their activities. What made some enterprises develop into "big business" was precisely their success in filling best the demand of the masses.

Anti-capitalistic policies sabotage the operation of the capitalist system of the market economy. The failure of interventionism does not demonstrate the necessity of adopting socialism. It merely exposes the futility of interventionism. All those evils which the self-styled "progressives" interpret as evidence of the failure of capitalism are the outcome of their allegedly beneficial interference with the market. Only the ignorant, wrongly identifying interventionism and capitalism, believe that the remedy for these evils is socialism.

What these people fail to realize is that the various measures they suggest are not capable of bringing about the beneficial results aimed at. On the contrary they produce a state of affairs which from the point of view of their advocates is worse than the previous state which they were designed to alter. If the government, faced with this failure of its first intervention, is not prepared to undo its interference with the market and to return to a free economy, it must add to its first measure more and more regulations and restrictions. Proceeding step by step on this way it finally reaches a point in which all economic freedom of individuals has disappeared. Then socialism of the German pattern, the Zwangswirtschaft of the Nazis, emerges.
For more information: Part 4, Chapter XIV. The scope and method of catallactics

Bob McEwen former US Congressman from Ohio:
Part 1
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Bob McEwen: Part 2
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"Capitalistic Production" are political catchwords

Socialism: Part II,Ch.5 in paragraph II.5.34
The terms "Capitalism" and "Capitalistic Production" are political catchwords. They were invented by socialists, not to extend knowledge, but to carp, to criticize, to condemn. Today, they have only to be uttered to conjure up a picture of the relentless exploitation of wage-slaves by the pitiless rich. They are scarcely ever used save to imply a disease in the body-politic. From a scientific point of view, they are so obscure and ambiguous that they have no value whatever. Their users agree only in this, that they indicate the characteristics of the modern economic system. But wherein these characteristics consist is always a matter of dispute. Their use, therefore, is entirely pernicious, and the proposal to extrude them altogether from economic terminology, and to leave them to the matadors of popular agitation, deserves serious consideration.

Labour legislation

Socialism: Part V,Ch.34 in paragraph V.34.10
Marx and Engels, the fathers of German Socialism, well understood how fundamentally important to the spread of destructionist ideas was the fight for labour legislation. The "Inaugural Address of the International Association of Workers" says that the English ten-hour day was "not only a great practical success; it was the victory of a principle. For the first time the political economy of the bourgeoisie was openly vanquished by the political economy of the working class."*10 Over twenty years before, Engels had made an even more candid admission of the destructionist nature of the Ten Hour Day Bill. He could not help admitting that the counter-arguments of the entrepreneurs were half true. The Bill would, he thought, depress wages and make English industry unable to compete. But this did not alarm him. "Naturally," he added, "were the Ten Hour Day Bill a final measure, England would be ruined, but because it necessarily involves the passing of subsequent measures, which must lead England into a path quite different from that she has travelled up till now, it will mean progress. If English industry were to succumb to foreign competition the revolution would be unavoidable. In a later essay he said of the Ten Hour Day Bill: "It is no longer an isolated attempt to lame industrial development. It is one link in a long chain of measures which will transform the whole present form of society and gradually destroy the former class conflicts. It is not a reactionary but a revolutionary measure.

The truth about the Industrial Revolution and the Unions

Human Action: Part 4, Chapter XXI. Work and wages in paragraph 4.XXI.111

Remarks About the Popular Interpretation of the "Industrial Revolution"

It is generally asserted that the history of modern industrialism and especially the history of the British "Industrial Revolution" provide an empirical verification of the "realistic" or "institutional" doctrine and utterly explode the "abstract" dogmatism of the economists.

The economists flatly deny that labor unions and government pro labor legislation can and did lastingly benefit the whole class of wage earners and raise their standard of living. But the facts, say the anti economists, have refuted these fallacies. The statesmen and legislators who enacted the factory acts displayed a better insight into reality than the economists. While laissez-faire philosophy, without pity and compassion, taught that the sufferings of the toiling masses are unavoidable, the common sense of laymen succeeded in quelling the worst excesses of profit-seeking business. The improvement in the conditions of the workers is entirely an achievement of governments and labor unions.

Such are the ideas permeating most of the historical studies dealing with the evolution of modern industrialism. The authors begin by sketching an idyllic image of conditions as they prevailed on the eve of the "Industrial Revolution." At that time, they tell us, things were, by and large, satisfactory. The peasants were happy. So also were the industrial workers under the domestic system. They worked in their own cottages and enjoyed a certain economic independence since they owned a garden plot and their tools. But then "the Industrial Revolution fell like a war or a plague" on these people. The factory system reduced the free worker to virtual slavery; it lowered his standard of living to the level of bare subsistence; in cramming women and children into the mills it destroyed family life and sapped the very foundations of society, morality, and public health. A small minority of ruthless exploiters had cleverly succeeded in imposing their yoke upon the immense majority.

The truth is that economic conditions were highly unsatisfactory on the eve of the Industrial Revolution. The traditional social system was not elastic enough to provide for the needs of a rapidly increasing population. Neither farming nor the guilds had any use for the additional hands. Business was imbued with the inherited spirit of privilege and exclusive monopoly; its institutional foundations were licenses and the grant of a patent of monopoly; its philosophy was restriction and the prohibition of competition both domestic and foreign. The number of people for whom there was no room left in the rigid system of paternalism and government tutelage of business grew rapidly. They were virtually outcasts. The apathetic majority of these wretched people lived from the crumbs that fell from the tables of the established castes. In the harvest season they earned a trifle by occasional help on farms; for the rest they depended upon private charity and communal poor relief. Thousands of the most vigorous youths of these strata were pressed into the service of the Royal Army and Navy; many of them were killed or maimed in action; many more perished ingloriously from the hardships of the barbarous discipline, from tropical diseases, or from syphilis. Other thousands, the boldest and most ruthless of their class, infested the country as vagabonds, beggars, tramps, robbers, and prostitutes. The authorities did not know of any means to cope with these individuals other than the poorhouse and the workhouse. The support the government gave to the popular resentment against the introduction of new inventions and labor-saving devices made things quite hopeless.

The factory system developed in a continuous struggle against innumerable obstacles. It had to fight popular prejudice, old established customs, legally binding rules and regulations, the animosity of the authorities, the vested interests of privileged groups, the envy of the guilds. The capital equipment of the individual firms was insufficient, the provision of credit extremely difficult and costly. Technological and commercial experience was lacking. Most factory owners failed; comparatively few succeeded. Profits were sometimes considerable, but so were losses. It took many decades until the common practice of reinvesting the greater part of profits earned accumulated adequate capital for the conduct of affairs on a broader scale.

That the factories could thrive in spite of all these hindrances was due to two reasons. First there were the teachings of the new social philosophy expounded by the economists. They demolished the prestige of Mercantilism, paternalism, and restrictionism. They exploded the superstitious belief that labor-saving devices and processes cause unemployment and reduce all people to poverty and decay. The laissez-faire economists were the pioneers of the unprecedented technological achievements of the last two hundred years.

Then there was another factor that weakened the opposition to innovations. The factories freed the authorities and the ruling landed aristocracy from an embarrassing problem that had grown too large for them. They provided sustenance for the masses of paupers. They emptied the poor houses, the workhouses, and the prisons. They converted starving beggars into self-supporting breadwinners.

The factory owners did not have the power to compel anybody to take a factory job. They could only hire people who were ready to work for the wages offered to them. Low as these wage rates were, they were nonetheless much more than these paupers could earn in any other field open to them. It is a distortion of facts to say that the factories carried off the housewives from the nurseries and the kitchens and the children from their play. These women had nothing to cook with and to feed their children. These children were destitute and starving. Their only refuge was the factory. It saved them, in the strict sense of the term, from death by starvation.

It is deplorable that such conditions existed. But if one wants to blame those responsible, one must not blame the factory owners who—driven by selfishness, of course, and not by "altruism"—did all they could to eradicate the evils. What had caused these evils was the economic order of the pre capitalistic era, the order of the "good old days."

In the first decades of the Industrial Revolution the standard of living of the factory workers was shockingly bad when compared with the contemporary conditions of the upper classes and with the present conditions of the industrial masses. Hours of work were long, the sanitary conditions in the workshops deplorable. The individual's capacity to work was used up rapidly. But the fact remains that for the surplus population which the enclosure movement had reduced to dire wretchedness and for which there was literally no room left in the frame of the prevailing system of production, work in the factories was salvation. These people thronged into the plants for no reason other than the urge to improve their standard of living.

The laissez-faire ideology and its offshoot, the "Industrial Revolution," blasted the ideological and institutional barriers to progress and welfare. They demolished the social order in which a constantly increasing number of people were doomed to abject need and destitution. The processing trades of earlier ages had almost exclusively catered to the wants of the well-to-do. Their expansion was limited by the amount of luxuries the wealthier strata of the population could afford. Those not engaged in the production of primary commodities could earn a living only as far as the upper classes were disposed to utilize their skill and services. But now a different principle came into operation. The factory system inaugurated a new mode of marketing as well as of production. Its characteristic feature was that the manufactures were not designed for the consumption of a few well-to-do only, but for the consumption of those who had hitherto played but a negligible role as consumers. Cheap things for the many, was the objective of the factory system. The classical factory of the early days of the Industrial Revolution was the cotton mill. Now, the cotton goods it turned out were not something the rich were asking for. These wealthy people clung to silk, linen, and cambric. Whenever the factory with its methods of mass production by means of power-driven machines invaded a new branch of production, it started with the production of cheap goods for the broad masses. The factories turned to the production of more refined and therefore more expensive goods only at a later stage, when the unprecedented improvement in the masses' standard of living which they caused made it profitable to apply the methods of mass production also to these better articles. Thus, for instance, the factory-made shoe was for many years bought only by the "proletarians" while the wealthier consumers continued to patronize the custom shoemakers. The much talked about sweatshops did not produce clothes for the rich, but for people in modest circumstances. The fashionable ladies and gentlemen preferred and still do prefer custom-made frocks and suits.

The outstanding fact about the Industrial Revolution is that it opened an age of mass production for the needs of the masses. The wage earners are no longer people toiling merely for other people's well-being. They themselves are the main consumers of the products the factories turn out. Big business depends upon mass consumption. There is, in present-day America, not a single branch of big business that would not cater to the needs of the masses. The very principle of capitalist entrepreneurship is to provide for the common man. In his capacity as consumer the common man is the sovereign whose buying or abstention from buying decides the fate of entrepreneurial activities. There is in the market economy no other means of acquiring and preserving wealth than by supplying the masses in the best and cheapest way with all the goods they ask for.

Blinded by their prejudices, many historians and writers have entirely failed to recognize this fundamental fact. As they see it, wage earners toil for the benefit of other people. They never raise the question who these "other" people are.

Mr. and Mrs. Hammond tell us that the workers were happier in 1760 than they were in 1830.*61 This is an arbitrary value judgment. There is no means of comparing and measuring the happiness of different people and of the same people at different times. We may agree for the sake of argument that an individual who was born in 1740 was happier in 1760 than in 1830. But let us not forget that in 1770 (according to the estimate of Arthur Young) England had 8.5 million inhabitants, while in 1831 (according to the census) the figure was 16 million. This conspicuous increase was mainly conditioned by the Industrial Revolution. With regard to these additional Englishmen the assertion of the eminent historians can only be approved by those who endorse the melancholy verses of Sophocles: "Not to be born is, beyond all question, the best; but when a man has once seen the light of day, this is next best, that speedily he should return to that place whence he came."

The early industrialists were for the most part men who had their origin in the same social strata from which their workers came. They lived very modestly, spent only a fraction of their earnings for their households and put the rest back into the business. But as the entrepreneurs grew richer, the sons of successful businessmen began to intrude into the circles of the ruling class. The highborn gentlemen envied the wealth of the parvenus and resented their sympathies with the reform movement. They hit back by investigating the material and moral conditions of the factory hands and enacting factory legislation.

The history of capitalism in Great Britain as well as in all other capitalist countries is a record of an unceasing tendency toward the improvement in the wage earners' standard of living. This evolution coincided with the development of pro labor legislation and the spread of labor unionism on the one hand and with the increase in the marginal productivity of labor on the other hand. The economists assert that the improvement in the workers' material conditions is due to the increase in the per capita quota of capital invested and the technological achievements which the employment of this additional capital brought about. As far as labor legislation and union pressure did not exceed the limits of what the workers would have got without them, as a necessary consequence of the acceleration of capital accumulation as compared with population, they were superfluous. As far as they exceeded these limits, they were harmful to the interests of the masses. They delayed the accumulation of capital thus slowing down the tendency toward a rise in the marginal productivity of labor and in wage rates. They conferred privileges on some groups of wage earners at the expense of other groups. They created mass unemployment and decreased the amount of products available for the workers in their capacity as consumers.

The apologists of government interference with business and of labor unionism ascribe all the improvements in the conditions of the workers to the actions of governments and unions. Except for them, they contend, the workers' standard of living would be no higher today than it was in the early years of the factory system.

It is obvious that this controversy cannot be settled by appeal to historical experience. With regard to the establishment of the facts there is no disagreement between the two groups. Their antagonism concerns the interpretation of events, and this interpretation must be guided by the theory chosen. The epistemological and logical considerations which determine the correctness or incorrectness of a theory are logically and temporally antecedent to the elucidation of the historical problem involved. The historical facts as such neither prove nor disprove any theory. They need to be interpreted in the light of theoretical insight.

Most of the authors who wrote the history of the conditions of labor under capitalism were ignorant of economics and boasted of this ignorance. However, this contempt for sound economic reasoning did not mean that they approached the topic of their studies without prepossession and without bias in favor of any theory. They were guided by the popular fallacies concerning governmental omnipotence and the alleged blessings of labor unionism. It is beyond question that the Webbs as well as Lujo Brentano and a host of minor authors were at the very start of their studies imbued with a fanatical dislike of the market economy and an enthusiastic endorsement of the doctrines of socialism and interventionism. They were certainly honest and sincere in their convictions and tried to do their best. Their candor and probity may exonerate them as individuals; it does not exonerate them as historians. However pure the intentions of a historian may be, there is no excuse for his recourse to fallacious doctrines. The first duty of a historian is to examine with the utmost care all the doctrines to which he resorts in dealing with the subject matter of his work. If he neglects to do this and naïvely espouses the garbled and confused ideas of popular opinion, he is not a historian but an apologist and propagandist.

The antagonism between the two opposite points of view is not merely a historical problem. It refers no less to the most burning problems of the present day. It is the matter of controversy in what is called in present-day America the problem of industrial relations.

Let us stress one aspect of the matter only. Vast areas—Eastern Asia, the East Indies, Southern and Southeastern Europe, Latin America—are only superficially affected by modern capitalism. Conditions in these countries by and large do not differ from those of England on the eve of the "Industrial Revolution." There are millions of people for whom there is no secure place left in the traditional economic setting. The fate of these wretched masses can be improved only by industrialization. What they need most is entrepreneurs and capitalists. As their own foolish policies have deprived these nations of the further enjoyment of the assistance imported foreign capital hitherto gave them, they must embark upon domestic capital accumulation. They must go through all the stages through which the evolution of Western industrialism had to pass. They must start with comparatively low wage rates and long hours of work. But, deluded by the doctrines prevailing in present-day Western Europe and North America, their statesmen think that they can proceed in a different way. They encourage labor-union pressure and alleged prolabor legislation. Their interventionist radicalism nips in the bud all attempts to create domestic industries. Their stubborn dogmatism spells the doom of the Indian and Chinese coolies, the Mexican peons, and millions of other peoples, desperately struggling on the verge of starvation.