A Libertarian View on Class Warfare

"Reject your sense of injury and the injury itself disappears."

"The object of life is not to be on the side of the majority, but to escape finding oneself in the ranks of the insane." 

"A man should be upright, not be kept upright."

"That which is not good for the swarm, neither is it good for the bee."

~ Marcus Aurelius, Meditations

Disclaimer: I am broke. 

Super broke. Believe me. 

To be absolutely clear, I do not mean the kind of broke that can only afford a cheap MP3 player from the Argos catalogue instead of a gleaming new iPod. It’s not the kind that’s forced to pick the grubby package holiday to Majorca instead of a private beach on Martinique waited by native girls in coconut bikinis. Nor even is it the kind of broke that possesses two bangers instead of five Ferraris. God forbid!

I mean utterly, dirt awful broke.

I say this in the hope of taking the fangs out of that tired old Leftist speech bubble, which pounces on anyone arguing for free markets and economic non-intervention as "hating the poor" or some such nonsense. I’m not perfect, sure, but I don’t hate myself. It’s certainly true that the class struggle rhetoric promulgated by the Labour Party in 50s/60s/70s Britain (a period which – totally unrelated – saw Britain’s greatest decline) had totally lost its appeal by the 80s, as Margaret Thatcher’s reign produced a dramatic increase in living standards. Try to deny it, I dare you. We all know that’s why Tony Blair could only win over the country by imitating her policies.

I will not address those who loudly proclaim the failure of capitalism with every market crash, since as anyone who is familiar with Nobel economist F.A. Hayek’s work on business cycles and monetary policy will know, recessions are engineered by the one sector of the economy that for nearly a century has been stubbornly socialized: monetary policy and central banking. As an Austrian-school free banker I depart on this point from Thatcher’s Friedman-school monetarism. It is quite possible that many of those who are against the worst excesses of the banking sector do not realize that most Libertarians are in fact on their side, if for slightly different reasons.

In an earlier article of mine, Purchasing power and the gap fallacy, I called these people "Gappers" for their eternal obsession with the gap between the rich and the poor: the gap fallacy. I explained that since all the incentives of capitalism point towards expanding and streamlining the economy to meet human needs and desires, if the process is allowed to work without undue political intrusions, you will get an increase in PURCHASING POWER. 

This means that, since the prices are all coming down (take a look at the price of continental airline tickets before and after Ryanair) you reach a point where it matters little beyond the surface varnish whether you are a millionaire or a 25Ker – roughly the average industrial wage in Britain. Both the millionaire and the 25Ker can afford a standard of living which would have been miraculous, virtually unthinkable, for even the wealthiest a century ago. If you are broke like me, consider the device on which you are reading this article for proof of that. Consistently it seems, the only sectors of the private economy where we see prices affordable "only to the rich", are precisely those with which government has interfered the most: education, healthcare, utilities – even law (though as a classic liberal I’m not brave enough to pick up that argument). 

Somehow, the prices always seem to go up when people start to regard a serviceable commodity as a fundamental human right. This kind of behaviour soon becomes a self-fulfilling prophesy: the more the government get involved, the more indeed "only the rich" can afford it, causing an endless vicious spiral into more and more nationalization, more socialism, more poverty.

In a plight such as mine, why would I choose to be a Libertarian? I should explain that, as a 22 year old Irelander without a degree in a foreign country, I have chosen to be as I am. As a writer and entrepreneur by halves, both activities, unlike working for wages, require a much longer apprenticeship of thankless plugging before the magic of market value is earned. I am not in the slightest bit angry at Elon Musk or Richard Branson for not paying for my existence. I understand that capitalism produces win-win situations: that the world, and beyond, is better off for the companies these men have built and profited from than without. I understand that while we must always be vigilant against fraud (which is the definition of win-lose capitalism), we Libertarians are in the business of growing the pie, not slicing it into smaller pieces.

I chose to be a Libertarian because I understand that there is a fundamental difference between being poor and temporarily broke. This sentiment was best expressed by the novelist John Steinbeck, who said that socialism never took root in America because the poor see themselves not as an exploited proletariat, but as temporarily embarrassed millionaires.

The quality of "being rich" or "being poor," to use mathematical terminology, is more like a vector rather than a fixed state. A more correct term for this is social mobility. The static chart of a rich-poor divide cannot account for individual choosers moving up and down this scale each and every day. In this sense, the gap could be described not as a kind of hierarchical order of authority, but simply an expansive playing field. Those at the top are expanding the reach of possibility. The truth is, no one is ever just "rich" or "poor". You are always either moving in one direction or another.  That is why many people who are born into enormous wealth end up squandering it all, while many who are born into the most abject poverty end up contributing the most to mankind.

But let’s avoid talking only in terms of extremes. Life is not polarized between a shanty in Calcutta and the entrance hall of Buckingham Palace. There are also the many to be considered who, through hard work and perseverance, make it into the middle class. Good for them.

What then, does it mean to be truly poor, as opposed to temporarily broke? By definition, those who use the language of class warfare are on the poor vector. You will find certain beliefs like "money is the root of all evil" underlie it. "Making a profit is immoral." It may or may not even be conscious – in fact more often than not it is entirely unconscious. It might even be religiously motivated in some cases, but it certainly doesn’t help. Compare that to someone on the rich vector, who would say the lack of money is the root of all evil. And that’s not just a catchphrase. If you look at the crime statistics of murder, rape, theft and drug abuse, this is pretty much true. 

The poor vector also encompasses things like the inability to delay gratification. Making decisions based on emotion or passion instead of reasoned evaluation. The financial equivalent of eating ice cream instead of salad is spending your wages on beer every Friday night instead of saving or buying stocks. Both succumb to minor pleasures in the short term instead of holding off for more satisfying long term pleasures. Gappers who argue from a position of emotional blackmail, jealousy and rue of success are on the poor vector. You’d be shocked at how vicious and personal some people can get over a disagreement in politics.

Those on the other hand who save, are open to new opportunities, educate themselves, work on their character defects, welcome the success of others, build networks, stay healthy, and so on, are on the rich vector. It doesn't mean it will come tomorrow or the next day. Maybe not even next year. But those who consistently stay in this frame of mind will certainly get there, sooner or later.

On the rich vector, wherever you happen to be on it, your destiny depends not on the hands of a distant politician or the state of the economy, but only on the limits of your imagination and willingness to work for it. That’s not to say that these external factors do not influence – significantly in many cases – but which kind of attitude do you think is ultimately more helpful in overcoming them? The quality of an internal versus an external locus of control lies at the root of the Libertarian emphasis on the individual over the collective. Entrepreneurs tend to have an internal locus of control: which is to say that they have a high sense of self-responsibility both for the initiation of their goals and the outcome of their efforts. Those on the other hand with an external locus of control tend to look to others not only for validation, but as the source of their success and the fault of the lack thereof, as the case may be. It’s not hard to see which attitude is more helpful in the long term.

Many people bandy about the term "individualist" as being something synonymous with "sociopath" or "selfish." But if we look at the Quakers we find another kind of individualism at work. I doubt anyone would accuse these cheerful servants of virtue as being sociopaths. But attend a meeting and you will find a deep emphasis on introspection, on a personal, heartfelt connection with whatever one senses as the Divine (dogma is discouraged) rather than the practice of communal autosuggestion you will find in the regular religious services of other faiths. The individualism of the Quakers emphasises a deep respect of each individual based on nothing but their humanity: an equality of soul, rather than circumstance. This equality of soul that seeps through us regardless of the contents of our wallet is also rooted at the heart of the Libertarian view of equality: that we all have the equal right to our liberty and our property; that the natural rights of man must be strictly respected without fear or favour. Equality in that sense does not need to be brought about: it exists in nature. On the other hand, the socialist egalitarianism of forced equality treats fellow human beings as lab rats: as barely civilized animals who are likely to go off kilter at any minute – and need to be kept in check. The tragedy is that, more often than not, this becomes a self-fulfilling prophesy.

If it is true that we become what we obsess about, then it’s hardly a surprise that socialism always seem to cause poverty. Probably the most damaging pieces of left-wing rhetoric is the conflation of wealth with being "strong" or "weak". Without the state, they say, "the strong will prey on the weak". You will have the "law of the jungle" or "Darwinism". To these confused individuals, I simply remind them that Darwinism is hardly evil – it made us! And before we get into a Reductio Ad Hitlerum on this subject, I’d like to pop the old cliché that the Nazis are in any way an example of Darwinism at work. Darwinism speaks of Natural Selection – which is where nature unconsciously perpetrates the strongest traits and qualities for the next generation – as opposed to Artificial Selection – which is the conscious choosing of traits by some outside force based on nothing but personal taste or prejudice. Any reasonable examination of nature beyond the clichés will find that creatures of a similar species are highly cooperative; that Natural Selection, if it can be sensed at all, is not like some callous gardener weeding out the weak bits, but more like a gentle nudge in the right direction over a long period of time. Economic Darwinism is therefore highly desirable. It is based on objective factors of supply and demand rather than prejudice. It does not mean anyone is going to die or get injured. Most entrepreneurs have experienced a business failure, but since they had an internal locus of control, they probably went right back to work instead of wasting time complaining about it. Economic Darwinism simply means the economy will be "economized" to the maximum degree possible to fulfil our needs and desires – a process which brings down prices and therefore benefits those on lower income via an increase in purchasing power. Strong/weak rhetoric is destructive because it precludes any possibility of growth or change. A temporarily embarrassed millionaire, regardless of their present circumstances, has a much greater chance of lifting themselves out of present difficulties than does someone who sees themselves as a Weak, Deprived Member of the Underclass.

I would not be fair if I did not mention the situations where a few individuals – the 1% – have genuinely fleeced the rest of us. These are the crony-capitalists, the government contractors, the inflationists. The fundamental flaw of our economy is that it is based on the fraud of fractional reserve banking and centralized, fiat currencies. Fraud does not become morally right because a government law says so, in much the same way that murder and theft do not suddenly become moral when renamed war and taxation. Let that be understood. One singular, strict as hell regulation is all that needs to be applied to the domain of money and banking to solve the problem: that is the consistent banning of fraud, in all its forms. Forget Glass-Steagall. You fudge the numbers, you go to jail. That said, two wrongs don’t make a right. To paraphrase the French economist Frederic Bastiat, you cannot howl at the rich for using the force of monetary policy to plunder the poor while advocating that the poor should be allowed to use the force of the state to plunder the rich. Both are immoral. In a free and just society, no one should be allowed to plunder anybody.

The full meaning of Liberty is to be seen in that Quaker spirit of sociably-inclined individualism and pacifism. It should be pointed out that while many of my arguments have drifted towards criticizing the left, I am just as vocal in my criticism of the right’s views that violence is justified in the pursuit of global hegemony and the control of private habits. Libertarians often refer to the non-aggression principle. Pacifism, a philosophy widely maligned during the great wars of the 20thcentury now appears to have become something of a norm in recent decades. Yet many who still speak out against the wars in the Middle East seem unable to lay down their arms in the perceived war of class. As standards of living have risen over the past century, it has become all too easy to lose perspective. Those who are fully clothed, own a cheap MP3 player, get to go on yearly package holidays to Majorca with a banger in the driveway are not poor by any objective standard. If they are dissatisfied with their lot, it may be that they have, so to speak, jumped onto the wrong vector. And as many a lonely millionaire will tell you, no amount government redistribution can overcome the ultimate poverty of spirit. It’s time to fly the white flag on class warfare.

This post orifinally appeared on LewRockwell.com