Why Our Current Brand of “Capitalism” is Inconsistent with Freedom
November 25, 2008 by Mike Wilson · Leave a Comment
“The system of corporate life is a new power for which our language contains no name. We have no word to express government by moneyed corporations.” -Charles Francis Adams
Equal opportunity is the bedrock of freedom. This nation was established to preserve, protect, and ensure that opportunity. The United States (and the world) will need to make a very important decision over the next 30 years: whether to choose democracy or capitalism. Democracy protects equal opportunity while capitalism (as practiced today) stifles it.
Let’s ask some questions to help us see in what ways capitalism and democracy are incongruent. Our first task will be to precisely describe our terms.
What is capitalism and how does it differ from free enterprise?
Capitalism suffers from misused and loose definitions. Capitalism is commonly defined as “an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market.”
Unfortunately, in our current state of capitalism, this free market doesn’t exist. What we experience is more closely associated with Karl Marx’s definition of a “capitalist.” It was Marx who first used the term to describe the oppressive and face-grinding economic environment of aristocratic Europe that was buoyed up by legal protection of the few at the expense of the many.
In place of a free market exists a complicated web of laws and regulations that, as one critic suggests, allows the corporate class to “use free-market rhetoric to justify imposing greater economic risk upon the lower classes, while being insulated from the rigors of the market by the political and economic and legal advantages that such wealth affords.”
Capitalism today is an economic system where the government favors those with capital over those with little or none. It’s a marriage between government and big business. You don’t see small businesses being “bailed out” right now, do you? There’s a reason for that.
Although capitalism suffers from these weaknesses, we should recognized that it is a much freer system, both economically and politically, than either communism or socialism.
Nevertheless, capitalism is the systems in which those with the capital make the rules. The rules are made to benefit themselves at the expense of new competition. This is accomplished through financially-privileged and unequal access to political influence and power.
For example, a small business owner would have a difficult road competing against a large “box” store, not only because of volume and pricing (which is part of market forces and free enterprise), but because of fewer obstacles (paperwork, fees, etc) the large “box store” would face because of laws and favors granted due to financial influence (which is what makes it capitalism).
This environment results in exclusionary practices and limits opportunity; and this is where our current state of capitalism breaks with democracy.
Free enterprise is the legal framework that allows all with the desire and the idea and the creativity to compete on a level playing field; free enterprise is therefore more democratic because it is based on equal opportunity before the law. In contrast, capitalism is the legal framework that leads to aristocratic structures by providing advantage to those who have capital via protection and perpetuation of wealth.
What is democracy and why is it currently tightly associated with capitalism?
Democracy is another term with many loose definitions. Historically it denotes that the common people (demos) rule (kratia) in that the population of the society controls the government, and that the government is for, of and by the people. There are many brands of democracy but they are all distinguished from other forms of government by general population-based input into the political process.
Aristocracy, the rule by “the best” (generally determined by birth or status that almost always rule for life) and plutocracy, rule by the wealthy, are enemies of democracy. Our current brand of capitalism tends to create and then maintain these other social forms.
Historically, free enterprise was tied to democracy by the American Revolution, as much of the reasoning for war was a push-back against British mercantilistic policies imposed upon colonists accustomed to operating within an essentially free market.
With the advent of communism and socialism in the mid 19th century and their rise at the turn of that century, capitalism stood out as the “more free” of the economic systems and the alliance with democracy was forged. This bond was fortified during WWI and WWII and the Cold War as the world battled between democracy and totalitarianism.
Why is “a government of the people, by the people, and for the people” inconsistent with mercantilistic capitalism?
1. The increasingly manipulated legal system of capitalism, set up in order to preserve and protect privileged access to the market (try to get a franchise license without incredible personal assets), causes the political process to concurrently become less and less democratic.
Although we are given the impression that the process is becoming more democratic (that we can vote about more things), reality is that those who we choose to represent us are increasingly influenced, and to that degree, controlled by those who fund their political ascendancy. This tends to aristocracy or oligarchy (rule by the few).
2. Thus, only those with legal and political influence are able to manipulate the system to their advantage. At some point (I think we’re getting close) the common man disengages from the political and civil conversation and the wealthy and powerful (whether conservative or liberal) are the only ones involved in the functioning of government, making decisions based on protecting their wealth and power.
3. Even if the political structures don’t change form, the economic and legal systems create a de facto wealth-based aristocracy. The ability of the common people (demos) to influence the political situation diminishes into insignificance and thus capitalism changes the political structure.
4. The laws currently in place give capitalism a decided advantage in the choice between capitalism and democracy. Money purchases political influence and will continue to bring into play laws that perpetuate the capitalist system at the expense of free enterprise and democracy.
5. Remember that we are not talking about overnight change. This is a trend that has progressed for decades. Only now are we able to distinguish the two, and we need to choose before we reach a point of no return.
How are democracy and capitalism perceived internationally?
The United States is currently the self-proclaimed “bastion” of both capitalism and democracy. However, in international opinion the U.S. government is associated (through sad experience) with rapacious capitalistic policies and oft-times hypocritical democratic interventions that have been claimed have the intention of “spreading democracy and prosperity,” only to have had the opposite effects in multiple countries throughout the world.
Much of U.S. foreign policy has supposedly been to “spread democracy”; however the means chosen seem to indicate that the purpose has been to make the world safe for mercantilistic capitalism at the expense of popular sovereignty and paced and sequenced movements, determined by each country, to improve the freedom in their markets and the prosperity of the people of these lands.
It’s not yet clear whether the incoming executive administration will continue to force on other countries the concepts of free government and free markets through the use of the military and international financial organizations. Regardless, we must choose, as soon as possible, whether as a people we will continue to align ourselves with mercantilistic capitalism, or if we will trust free government, free markets, and popular sovereignty.
Conclusion
Our rampant commercialism, consumerism, and materialism indicate which way we are leaning. Our ethics and our legal system to which we sacrifice our morals demonstrate that we value capital and wealth (and especially protecting it) more than we value liberty. We demonstrate that we would rather have an aristocratic plutocracy govern us than to govern ourselves (if it means we can maintain our current level of luxury).
Mercantilistic capitalism is winning in the U.S. and will continue to do so until appropriate corporate and tax reforms are undertaken and until financial influence of the political system is eliminated.
Will we wait until our own government implements “Intolerable Acts” that protect its mercantilistic desires at the expense of the free market, or until our foreign economic and political policies become so unfair that our security is even more seriously compromised? Or will we pro-actively choose democracy, free enterprise, and liberty at home and abroad?
We must call our current economic system what it is — mercantilistic capitalism — recognize how distant we are from liberty in our government and our economics, and move forward the overhaul that needs to occur.
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Is the Cause of Liberty a Christian Organization?
October 16, 2008 by Stephen Palmer · 4 Comments
Today I received the following comment and question from a new subscriber: “As a Christian American I believe in separation of church and state. I am interested in knowing if you are pursuing the cause of liberty for all in this country or if this is a Christian organization. Some of the manner in which it is written leads me to believe that it is…I have read several times your Declaration of Dependence with which I have significant difficulty for I come away with the subtle sense that you are in pursuit of a Christian United States. Is that true?”
This was my response:
The quick answer is no, we are not in pursuit of a Christian United States. We are, however, in pursuit of a nation that depends on and obeys the “laws of nature and of nature’s God” — just like the Founders.
Now here’s the long answer:
Jesus Christ is not even referenced in the Declaration of Dependence, so I don’t know how one would find Christianity in that document. Out of 113 articles currently posted on our site, only 10 of them reference Jesus Christ, and most of those are in a very general sense (such as one random quote from the Bible within the context of a long article about something entirely different than Christ). One of them is about a book that seeks a reconciliation between Islam and Christianity. The most recent article, entitled “Was Jesus Christ a Liberal Socialist,” is less about Christ and more about political philosophy and the proper role of government. It was written to answer a question from one of our subscribers, not to promote Jesus Christ as the son of God and the Savior of the world.
Any religious overtones on the site are intended in a very general sense to promote a universally accepted conception of God and the importance of adhering to Natural Law. Consider the following quotes from some of our nation’s Founders:
“We have staked the whole future of American civilization, not upon the power of government, far from it. We have staked the future of all our political institutions upon the capacity of mankind for self-government, upon the capacity of each and all of us to govern ourselves, to control ourselves, to sustain ourselves according to the Ten Commandments of God.” -James Madison
“Only a virtuous people are capable of freedom. As nations become corrupt and vicious, they have more need of masters.” -Benjamin Franklin
“Religion and virtue are are the only foundations, not of republicanism and of all free government, but of social felicity under all government and in all the combinations of human society.” -John Adams
“Statesmen…may plan and speculate for liberty, but it is religion and morality alone, which can establish the principles upon which freedom can securely stand. The only foundation of a free constitution is pure virtue; and if this cannot be inspired into our people in a greater measure than they have it now, they may change their rulers and the forms of government, but they will not obtain a lasting liberty. They will only exchange tyrants and tyrannies. You cannot, therefore, be more pleasantly or usefully employed than in the way of your profession, pulling down the strong-holds of Satan. This is not cant, but the real sentiment of my heart.” -John Adams
“We ought to be no less persuaded that the propitious smiles of heaven can never be expected on a nation that disregards the eternal rules of order and right which heaven itself has ordained.” -George Washington
“Of all the dispositions and habits which lead to political prosperity, religion and morality are indispensable supports.” -George Washington
“Whatever may be conceded to the influence of refined education on minds of peculiar structure…reason and experience both forbid us to expect that national morality can prevail in exclusion of religious principle.” -George Washington
Many more quotes could be provided but the point is that the Founders had a very clear understanding that believing in and obeying God is a prerequisite to a free nation. It’s an indispensable aspect of republican government. Regardless of one’s conception of God, without a belief in a “just God who presides over the destiny of nations” no nation can maintain its freedom.
Whether a person is Christian, Muslim, Buddhist, Jewish, or any other religion under the sun, we can all agree that there is a God, a Creator, who is intimately aware of our lives and who cares about our happiness. Furthermore, I believe that all religions would agree that happiness is found by adhering to natural laws, as created by God. This is what we reference as “virtue.”
The Real Concern
Having said all of this, I don’t think I’ve addressed your real concern. The obvious concern, which is what Jefferson referred to in the letter that that statement is taken from, is a government that endorses or supports or has a formal relationship with one particular religion over another to the detriment of liberty.
The First Amendment is a better source of constitutional authority regarding this concern than is Jefferson’s letter, which states, “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”
By our very nature as a private institution, The Cause of Liberty does nothing to encroach upon the liberties of others, even if we were a Christian organization (which we are not). In other words, the issue isn’t about simply promoting one religion over another; it’s about using the force of government to promote — or demote — religion. If we were a government-sponsored organization then people would have need to fear if we were blatantly Christian.
The government relies upon force to carry out its goals, policies, and laws. Private institutions, such as The Cause of Liberty, rely upon persuasion and voluntary association. All of this is to say that even if we were a Christian organization there is no need for concern, since we will do nothing to encroach upon the concept of “separation of church and state.” The separation of church and state is implicit in our private institutional status. Furthermore, we do not believe that the government should promote Christianity, although we do believe that good forms of government are based in universal natural laws.
We’re not a church, and we’re not the state. We’re an educational institution that seeks to identify and promote the universal principles that secure and maintain as much freedom for as many individuals in the world. Black or white, Christian or Muslim, Jewish or Buddhist, male or female, we promote freedom, equality, and justice for all.
Move the Cause of Liberty by (1) subscribing to the Sentinel, a free weekly newsletter boldly illuminating the principles of freedom in a darkening nation, and (2) pledging your Life, Liberty, and Sacred Honor to the Cause by signing the Declaration of Dependence.
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Palmer Says Bush Feeding Market Instability
October 10, 2008 by Stephen Palmer · 2 Comments
I just read an article on Yahoo! News entitled “Bush Says Anxiety Feeding Market Instability.” It prompted me to write my own version of the article. My version will make more sense after you’ve read the original.
(Note: Apparently Yahoo! News updates their stories, so the article I link to above is not the exact article that this was based on. But you’ll still get the point.)
Palmer Says Bush Feeding Market Instability
By STEPHEN PALMER, COL Correspondent
October 10, 2008
ROUND ROCK, TX — Stephen Palmer said Friday that the government’s financial rescue plan was aggressive enough and big enough to plunge America into a depression and rob citizens of their hard-earned savings, but it may take time to fully kick in as the government props up unstable policies and institutions. “We can solve this crisis and we will — by getting rid of the Federal Reserve,” he said in brief remarks from his home.
Palmer spoke as leaders of the world’s top economies gathered in Washington to figure out how they could leverage the panic to confiscate more illegitimate power.
Mr. Palmer noted that major Western countries were working together in an attempt to undermine every positive step we’ve taken toward creating just and equitable society since 1776, including ignoring their respective Constitutions.
“Through these efforts, the world is sending an unmistakable signal. We’re in this together and we’ll be oppressed by our governments together,” Palmer said.
Palmer said how he understood how Americans could be concerned about their economic future. “That anxiety can feed anxiety and that can make it hard to see all that’s being done to worsen the problem and strip us of more freedom,” he said.
But despite a relentless sell-off that has seen the Dow Jones industrials plunge 20 percent in the past seven trading days, Palmer said, “We are a prosperous nation with immense resources and a wide range of tools at our disposal — all of which can be employed when we get President Bush, Henry Paulson, Ben Bernanke and the Federal Reserve out of the way.”
Mr. Palmer said the new $700 billion tyranny plan that President Bush signed into law a week ago authorizes the Treasury Department to socialize financial institutions at the whims of one man.
It wasn’t the first time Mr. Palmer has declared that the government stop distorting the market by controlling interest rates and the money supply, although it has also been mentioned by several other prominent economists and experts.
Since the bailout package was signed into law, the conversation about how it will be used has shifted from how taxpayers are lining the pockets of corporate executives to how they are supporting an overblown government.
Nationalization of the U.S. banking industry was once unthinkable, but in a stagnant pond of public apathy, anything is possible.
The government is authorized under the law to “screw taxpayers.”
These include the couple in South Dakota making $45,000 a year and trying desperately to put their two sons through college, but not Wall Street executives making $5 million per year and struggling with the overwhelming decision of how they should spend their money.
It is Mr. Palmer’s position that the Bush administration’s authority extends to whatever it feel like doing, since Congress doesn’t have the guts, nor the knowledge, to check it on any front.
“The plan they are executing is aggressive. It is the wrong plan. It will take time to have its full impact. It is flexible enough to get even more tyrannical as the executive branch amasses more power. And it is big enough to work, the definition of ‘work’ being to collapse the economy,” Palmer said.
He also noted that the Federal Reserve has injected hundreds of billions of green pieces of paper into the system — with little to no oversight and with nothing backing it. Other central banks have cooperated to help speed up the rate of inflation and erode the savings of every American.
“The federal government has a comprehensive strategy to lull the people into temporary security at the cost of freedom,” Palmer said.
While he sought to reassure Americans that the situation is not hopeless and that we should continue doing all we can, Palmer also acknowledged that this was one of the most egregious acts of tyranny in our nation’s history.
Palmer said his online community, The Cause of Liberty, has launched initiatives that are “helping common Americans to reclaim their responsibilities as citizens and to restore the American Republic.”
He also noted “rigorous discipline” must be enacted by the People to make sure that the government doesn’t “take advantage of the crisis to illegitimately erode our freedoms.”
“Over the past few days,” Palmer continued, “we have witnessed a totally predictable drop in the stock market, much of it driven by the stupidity and power-mongering of the government and the Federal Reserve. This has been a deeply unsettling period for the American people.”
Move the Cause of Liberty by (1) subscribing to the Sentinel, a free weekly newsletter boldly illuminating the principles of freedom in a darkening nation, and (2) pledging your Life, Liberty, and Sacred Honor to the Cause by signing the Declaration of Dependence.
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Fear, Expediency, and the Economy
September 25, 2008 by Mike Wilson · Leave a Comment
So leave everything you know and carry only what you fear.
Daily we face the onslaught from the media. A murder here, a rape there. Illegal immigrants taking your jobs here; globalism outsourcing your job to over there. It is called news. Fundamentally, however, it is fear-mongering — and if succumbed to, it is fatal to our soul.
Both political parties attempt to play on fear, portraying the opposition candidate in the most negative light possible to the point where this campaign has become more immature than a kindergarten shout-down (”My dad can beat up your dad!”). In order to achieve support for means that we know are questionable, those in office instill fear of the unknown or the different. Fundamentalism Muslims are referred to as “Islamo-fascists” (a convenient compounding of any word to denigrate the former term).
Our current economic situation is a result of fear…fear of work, fear of hard times, fear of the housing
market plunging more deeply. This fear will cause us to operate from a position of expediency. Expediency resulting from fear pushes us towards means that seem to be fixes to the fearful problem, but are really methods that will, like termites, slowly eat away at our structural foundation.
In the years of the Roaring 20’s, economists (mainly following the theories of Irving Fisher) were convinced that slowly increasing the money supply would allow for continued expansion of the economy without increasing prices too much or causing any damage to the financial and industrial structures. However, an economist in Austria (Ludwig von Mises) was writing a contrary view, contending that increasing the money supply, thus lowering interest rates and making borrowing cheaper and more attractive than savings, might just pull the rug out from under the glass table on which the economy sat. He felt that “if monetary policy pushed ‘market’ interest rates below the ‘natural’ rate, the central bank could create an unstable business cycle that could lead to financial disaster” (’natural’ rate of interest defined to be “the rate that equalizes the supply and demand for saving based on the social rate of time preference”) [Skousen--The Big Three in Economics].
Mises predictions were ignored and the Federal Reserve in the U.S. continued to increase the money supply and lowered interest rates below the natural rate such that structural imbalances were introduced into the economy, contributing to the Great Depression.
Fast-forward to the 1990’s, a time of great economic growth and increases to the money supply as demonstrated by the decreasing interest rates imposed by the Federal Reserve over the last 18 years. What are we facing again? An economy that isn’t saving because the cost of borrowing was cheaper than it should have been is loading the investment market with mortgage-backed that are described as “radioactive toxic waste.” Fear of the economy slowing down during the 90’s and the early 2000’s gave impetus to regulators to adjust the money supply to such a degree that it is likely to have dropped the market rate of interest below the natural rate of interest, leading to the instabilities we’ve seen over the last few months, coming to a head these last ten days.
We know that in order to prosper we need to save. However, we buy into the information spoon-fed to us by a media that is inherently a business and operates on a 24-hour news cycle, thus it is not only subject to fear-mongering, but media is also an objective participant in the generation of economic fear. Politicians also aren’t hesitant to promote fear since our fear gives them greater power as we feel a deeper need for security and every politician will tell us that “changing horses midstream” is a dubious and dangerous proposition.
I started this post with a line from Bruce Springsteen’s ironic warning entitled Magic. We need to listen to the warning voice by holding onto “everything [we] know and [letting go of] what [we] fear”. We must recognize that fear, as described in the following lyrics, is a dangerous thing and if allowed, will turn our heart black and take our God-filled soul and “fill it with devils and dust.”
Now every woman and every man
They want to take a righteous stand
Find the love that God wills
And the faith that He commands
Well I’ve got God on my side
And I’m just trying to survive.
What if what you do to survive
Kills the things you love?
Fear’s a dangerous thing.
It can turn your heart black, you can trust;
It’ll take your God filled soul, fill it with devils and dust.
Decisions based on fear using expediency instead of principles will most often destroy those fundamental principles. Let us be aware of what is seen and unseen and make decisions based on principles and re-establish liberty.
Move the Cause of Liberty by (1) subscribing to the Sentinel, a free weekly newsletter boldly illuminating the principles of freedom in a darkening nation, and (2) pledging your Life, Liberty, and Sacred Honor to the Cause by signing the Declaration of Dependence.
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Copyright © 2008 by The Cause of Liberty. All rights reserved.
The Constitution: A Rallying Point
August 31, 2008 by Aspen Eggimann · Leave a Comment
“Where are we going from here?”
I’ve been wondering this a lot lately, in regards to America. I hear and read theories about the Information Age and what it will bring, I learn about historical cycles predicting what to expect in the future, and observe the numerous political agendas proposed for the nation, yet still this question remains in a large part unanswered.
It may be difficult or nearly impossible to answer with clarity exactly where we are going, or to make a prediction that would quiet the concerns for the future. While pondering the question I read the following quote from Thomas Jefferson:
“Though written constitutions may be violated in moments of passion or delusion, yet they furnish a text to which those who are watchful may again rally and recall the people.” –Thomas Jefferson to Joseph Priestley, 1802
A written document that immortalizes principles and provides ongoing direction for generations is essential to maintain a strong and free nation.
“The Constitution is a written instrument. As such, its meaning does not alter. That which it meant when it was adopted, it means now.”
– South Carolina v. United States, 199 U.S. 437, 448 (1905)
The principles remain fast in the document, though the actions of men may not follow those principles. The violation of a constitution was foreseen by the Founders as inevitable; men would lose their perspective and deviate from the Constitution in moments of passion — no matter how much the “chains of the Constitution” bound them down. Having a written constitution does more than bind men for a time, however; its real strength is that it provides a rallying point for the People to turn to when the nation flounders and when guidance is needed.
It’s clear that we have deviated from the Constitution in many ways throughout our history, and recent years have been no different. From the repeal of habeas corpus for specified “enemy combatants” to the Patriot Act, we can see the distance we have come from the founding.
The governments’ disregard of our founding document was brought home to me when I read the following story from Ron Paul:
“In 2002, as war with Iraq loomed, I proposed that congress officially declare war against Iraq, making clear that I intended to oppose my own measure. The point was to underscore our constitutional responsibility to declare war before commencing major military operations, rather than leaving the decision to the president or passing resolutions that delegate to the president the decision-making power over war. The chairman of the International Relations Committee responded by saying, ‘There are things in the Constitution that have been overtaken by events, by time. Declaration of war is one of them. There are things no longer relevant to a modern society. We are saying to the president, use your judgment. [What you have proposed is] inappropriate, anachronistic; it isn’t done any more.’
What a relief that we have people in our government who will keep us posted on which constitution provisions they have decided are no longer ‘relevant!’” [Ron Paul; The Revolution: A Manifesto, pg 53]
As a nation that has disregarded its constitution and now strongly questions its stability and future freedom the question, “Where are we going from here?” demands our attention. We have, through fear and passion, given up much of our freedoms. But it need not continue. For we will decide what is next. By using the Constitution as a rallying point to recall a people we will regain the freedom and prosperity that the Founders fought for.
In the end our freedom and our future lie with those that are watchful, those that will take initiative in restoring the Constitution. As Thomas Edison said, “The strength of the Constitution, lies in the will of the people to defend it.”
If the question remains, “Where are we going from here?”, the answer is “Exactly where we take ourselves.” If Jefferson is right, if moments of passion will pass and those who are watching can rally the people, then let it be back to the Constitution.
Have YOU read and do you understand the Constitution? Will you become a constitutional scholar and help restore the American Republic?
Move the Cause of Liberty by (1) subscribing to the Sentinel, a free weekly newsletter boldly illuminating the principles of freedom in a darkening nation, and (2) pledging your Life, Liberty, and Sacred Honor to the Cause by signing the Declaration of Dependence.
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