Mises Daily Articles
Not Just Survival; Not Just of the Fittest
As Murray Rothbard described one of their favorite lines of attack,
The free-market economy, they charge, is "the rule of the jungle," where "survival of the fittest" is the law. Libertarians who advocate a free market are therefore called "Social Darwinists" who wish to exterminate the weak for the benefit of the strong.
While such assertions meet the low standards of proof used by those who wish to override market results with ones they will dictate, anything approaching close logical scrutiny reveals them as baseless. To view capitalism as "dog eat dog" social Darwinism, in which only the very fittest survive at everyone else's expense, is not only erroneous, but in several ways, the exact opposite of the truth.
Markets Make More People Fit
The most obvious error of the "survival of the fittest" view of capitalism is that markets — even ones as hindered by regulation, taxation, etc., as they are now — dramatically expand the number of people who are fit enough to survive. The wealth and technology that capitalism creates — e.g., the medical miracles that now routinely save previously "unfit" people — demonstrate that capitalism's benefits are not restricted to the fittest.
Capitalism, even when undermined and hampered by government intervention, has no peer when it comes to providing more abundant, and therefore cheaper, goods and services for all. And the less it is hampered, the better it achieves those results, without violating individual liberty. That means that virtually all survive better, making capitalism dramatically anti-Darwinian. Over the past two centuries, roughly six times as many people have been enabled to survive on the earth, with dramatically longer lifespans, as well. As Sheldon Richman summarized it, "If under capitalism only the fit survive, it seems to have a knack for making people fit."
In enriching most those who are most productive, capitalism allows the survival of billions of people who would not otherwise have survived. In fact, capitalism gives everyone — particularly the weakest, whom it is accused of harming — the best chance not just to survive but to thrive. One of many ways this is revealed is the vast increases in leisure that markets have made possible, while real incomes dramatically increased at the same time. This could not result from "dog eat dog" competition.
Private Property Prevents the Law of the Jungle
Private property, the basis of capitalism, prevents rather than enables the law of the jungle that capitalism's attackers accuse it of. Private property prevents the physical invasion of a person's life, their liberty, or their property without their consent. By preventing such invasions, private property is an irreplaceable defense against aggression by the strong against the weak. No one is allowed to be a predator by violating others' rights. Property rights negate the rule of "might makes right," which prevails in the absence of such rights. In Herbert Spencer's words, "far from being, as some have alleged, an advocacy of the claims of the strong against the weak, [it] is much more an insistence that the weak shall be guarded against the strong."
As Ludwig von Mises explained it, private property is the basis for "joint action and cooperation in which each participant sees the other partner's success as a means for the attainment of his own," in sharp contrast to a Darwininan struggle in which others are enemies. Even those who would be tyrants, if given the opportunity, must instead focus their efforts on offering what others value, to induce their voluntary cooperation. Free markets channel even the drive for power into service for others.
Unlike predatory animals that must race to beat others to scarce prey, market prices mean people need not race each other to stores to secure highly limited supplies of goods for fear that none will be available. Contrast this peaceful order to the case of price controls, which, by overriding market mechanisms, create just such shortages. In markets, we see order rather than violence.
The free market, in fact, is precisely the diametric opposite of the "jungle" society. The jungle is characterized by the war of all against all. One man gains only at the expense of another, by seizure of the latter's property. With all on a subsistence level, there is a true struggle for survival, with the stronger force crushing the weaker. In the free market, on the other hand, one man gains only through serving another…. It is precisely through the peaceful co-operation of the market that all men gain through the development of the division of labor and capital investment. To apply the principle of the "survival of the fittest" to both the jungle and the market is to ignore the basic question: Fitness for what? The "fit" in the jungle are those most adept at the exercise of brute force. The "fit" on the market are those most adept in the service of society. The jungle is a brutish place where some seize from others and all live at the starvation level; the market is a peaceful and productive place where all serve themselves and others at the same time and live at infinitely higher levels of consumption.
The free market, therefore, transmutes the jungle's destructive competition for meager subsistence into a peaceful co-operative competition in the service of one's self and others. In the jungle, some gain only at the expense of others. On the market, everyone gains. It is the market — the contractual society — that wrests order out of chaos, that subdues nature and eradicates the jungle, that permits the "weak" to live productively … in a regal style compared to the life of the "strong" in the jungle. Furthermore, the market, by raising living standards, permits man the leisure to cultivate the very qualities of civilization that distinguish him from the brutes.
Competition in Production
In the jungle, animals compete for a given quantity of available food. In contrast, in markets, people compete and prosper by increasing the value of goods and services produced by more than they receive in return, especially through new ideas and innovation, which are not part of animal competition. As William Graham Sumner expressed it, markets
turn the competition of man with man from violence and brute force into an industrial competition under which men vie with one another for the acquisition of material goods by industry, energy, skill, frugality, prudence, temperance, and other industrial virtues.
The more people serve others, the greater their income.
Given the fact of scarcity, individuals can seek to satisfy their desires in one of two ways — they can benefit themselves by harming others or by benefiting others. Unlike any other form of structuring society, markets restrict us to the latter. As Sheldon Richman put it, "the competition that goes on in the marketplace is not, for the most part, competition in consumption, but rather competition in production … we compete to consume by competing to produce."
And capitalism obviates the need to get some economic planner's permission to produce. All it takes to acquire the resources to produce in capitalism is to convince sufficient investors that a project benefits others sufficiently, gauged by potential profits; consumers then choose among the offerings put forward.
Capitalism's competition in production was well summarized by George Reisman, in "Some Fundamental Insights into the Benevolent Nature of Capitalism":
Under capitalism, not only is one man's gain not another man's loss, insofar as it comes out of an increase in overall, total production … one man's gain is positively other men's gain.…
As von Mises has shown, the economic competition that takes place under capitalism is radically different than the biological competition that prevails in the animal kingdom. In fact, its character is diametrically opposite. The animal species are confronted with scarce, nature-given means of subsistence, whose supply they are unable to increase. Man, by virtue of his possession of reason, can increase the supply of everything on which his survival and well-being depend. Thus, instead of the biological competition of animals striving to grab off limited supplies of nature-given necessities, with the strong succeeding and the weak perishing, economic competition under capitalism is a competition in who can increase the supply of things the most, with the outcome being practically everyone surviving longer and better.…
[U]nder capitalism … they compete … by means of offering the best and most economical products their minds can devise. Since such competition is a competition in the positive creation of new and additional wealth, there are no genuine long-run losers as the result of it. There are only winners.…
[P]roductive geniuses are free to succeed in revolutionizing products and methods of production … [others] are able to enjoy … products whose very existence they could probably never have even dreamed of on their own.
Comparative versus Absolute Advantage
Survival-of-the-fittest rhetoric also ignores the essential difference between absolute advantage and comparative advantage. It puts forth the idea that only those who are absolutely the best survive, which is not the reality of market competition. As economists have long known, even when one party is absolutely better at everything than another, they can both gain by specialization in what each is relatively good at, then exchanging via markets. When wages and prices are not prevented from changing, they adjust to the point where each person is able to work where they are fittest (e.g., if I am half as good as you at everything, I still survive in the marketplace because at half of your wage, the cost of producing with me is the same as using you). Where wages and prices are prevented from changing to coordinate people's plans, dog-eat-dog behavior can result, but that is the result of overriding markets, not the result of allowing them to work.
In Sheldon Richman's words, "capitalism is based not on survival of the fittest but rather on advancement of the fittest. After all, in the market the less 'fit' don't perish. They just make less money. That is no small consideration when comparing capitalism with other social arrangements."
When a business venture fails, or a line of work becomes less attractive, owners and employees do not die. They are moved toward different work that consumers value more. At such times, the workers and owners may earn less than they wish, because their services have become less valuable to others. But absent coercion, there is no way to prevent such a possibility, unless all changes by which people think they can benefit cease, and all progress with it. Further, as George Reisman explains, even those who are now paid less are not hurt by capitalistic competition:
Even in those cases in which an isolated competition results in an individual having to spend the remainder of his life at a lower station than he enjoyed before … even he cannot reasonably claim that competition has harmed him. The most he can reasonably claim is merely that from this point on, the immense gains he derives from competition are less than the still more immense gains he derived from it previously…. For competition is what underlies the production and supply of everything he continues to be able to buy and is what is responsible for the purchasing power of every dollar of his…. And … it proceeds to raise his real income from the level to which it was set back. Indeed, under capitalism, competition proceeds to raise the standard of living of the average wage earner above that of even the very wealthiest people in the world a few generations earlier.
Misunderstanding the logic of comparative advantage seems to be a major reason why protectionist sentiment is so frequently expressed, even though it would decimate our well-being if applied generally. Those who promote protectionism in areas that benefit them (by taking away others' options, thus harming them) do not want similar restrictions imposed everywhere. The vast majority of people seem to favor restrictions on those who compete with them, but they do not want similar restrictions hindering market competition among those who sell to them or buy from them, because such restrictions will hurt them.
Unfortunately, in politics, people seldom give markets the credit in the uncountable instances when they "win" as a result, but are quick to blame markets (even when market prices are just conveying the adverse effects of government restrictions) whenever competition keeps them from earning as much as they feel they deserve. So protectionist voices tend to drown out others, leading to counterproductive restrictions on markets.
Competition to Improve Cooperation
Survival-of-the-fittest rhetoric also views competition and cooperation as incompatible alternatives. However, competition in markets is competition to discover whom one can most beneficially cooperate with — information that is unattainable without market competition to reveal it. Market competition, properly understood, is the process of improving social collaboration and the mutual gains it creates, not social warfare.
This confusion seems to arise from a too-narrow focus on competition in describing markets. The result is that the true central feature of markets — coordinating voluntary choices — is often overlooked, even though it is the antithesis of the law of jungle. Competition arises whenever people are free to make their own choices, because when there are multiple others with whom they may choose to deal, they can advance their well-being by having them compete for the privilege. And when property rights are enforced, that competition rules out force or fraud, which are rampant in the jungle competition that results where property rights are not enforced.
Sheldon Richman puts competition and cooperation in proper perspective:
For human beings competition is not the negation of cooperation but a form of it. We know this because when competition is forcibly suppressed, cooperation breaks down and something like the real law of the jungle takes its place. Competition is what arises when people are free to choose with whom to cooperate…. Thus freedom plus cooperation equals competition. Those who would banish competition would also have to banish free cooperation. All that would be left would be forced cooperation, with the state dictating the terms … compulsion.
Survival of the Fittest Goods and Organizational Forms
Survival-of-the-fittest rhetoric involves the implication that it is unfit individuals who do not survive. That is a mistake. The market requirement to earn positive profits in order to survive weeds out the least fit goods and services (those that consumers value less than alternative goods and services that could be produced with the same resources) and the least fit organizational forms (e.g., if organizing production via corporations is more efficient than through partnerships, corporations would capture increasing market shares at the expense of partnerships, and if large scale factories are more efficient than handcrafts, more would be produced at a large scale).
This form of survival of the fittest is highly beneficial to consumers, greatly improving their well-being, as better and better options are offered to them as a result. In George Reisman's words, "the only sense in which only the 'fittest' survive is that it is the fittest products and fittest methods of production that survive, until replaced by still fitter products and methods of production."
Thus, the survival of the fittest that actually takes place in markets results in the survival of more and more people, many of whom would have been unfit otherwise. This is why the Darwinian imagery of the survival of the fittest people was emphasized not by capitalism's proponents, who saw its dramatically un-Darwinian results, but by capitalism's opponents, who wanted to demonize it, in order to open the door for various versions of state control.
Political Survival of the Fittest
If competition is always to be termed as survival of the fittest, then the fact of political competition should be analyzed the same way. But critics of voluntary market arrangements fail to apply those same standards to their "solutions," because to do so would destroy their arguments.
Government's only comparative advantage is in the use of coercion, yet coercion is seldom necessary to be more survivable. As Rose Wilder Lane put it, "The need for Government is the need for force; where force is unnecessary, there is no need for government."
In this regard, one must only ask who is most fit to survive in the environment of arbitrary government power. Those willing to make the most use of coercive power to reward friends and punish enemies tend to rise to the top, as they can plunder more resources, allowing them to bribe or extort their desired results — always at someone else's expense — while those who are the fittest in markets are those most willing and able to serve others. As Sheldon Richman notes, "The 'fittest' are those who best meet the requirements of the system. When society is controlled by the state, those who are skilled at deceit, treachery, and brutality rise, as Friedrich A. Hayek put it, to the top. In a market society, the skills rewarded are creative attentiveness to consumers — entrepreneurship. In each case, the fittest advance and, at least in relative terms, prosper."
The contrast between market and political competition is made clear by Murray Rothbard: "It is precisely statism that is bringing back the rule of the jungle — bringing back conflict, disharmony, caste struggle, conquest and the war of all against all, and general poverty. In place of the peaceful 'struggle' of competition in mutual service, statism substitutes … the death-struggle of Social Darwinist competition for political privilege and for limited subsistence."
Ken Ewert has elaborated on the same point:
In contrast with economic power, political power is truly something to be feared because of its coercive aspect. The power-seeking individual in government … can actually abuse one group of people but still succeed by gaining the favor of other groups of people…. In fact, virtually every state intervention into the economy is for the purpose of benefiting one party at the expense of another … some are exploited by others via the medium of the state. Therefore, if we are concerned about the powerful oppressing the weak, we should focus our attention on the abuse of political power. It, and not the so-called "economic power" of individuals acting within the free market, is the true source of tyranny and oppression. Our concern for the downtrodden should not lead us to denigrate economic freedom but rather to restrain the sphere of civil authority.
Markets reward morality in the form of honesty, keeping commitments, entrepreneurship and hard work, turned to others' advantage, unlike government, which routinely rewards misrepresentation and abuse to attain and maintain office.
Markets also generate the wealth that allows charity to flourish, as what is not produced cannot be redistributed. That contrasts with government-mandated "charity." The first improves our character, while the second, based in violations of others' rights, debases it. A system that expands and makes more survivable good character is preferable to one that erodes good character.
Rhetoric that paints market arrangements as a Darwinian "survival of the fittest" has long been used to advantage by those who wish to impose their coercive "improvements" in their place. That misdirection and misrepresentation has only worked because most people have failed to think carefully (perhaps because their position in some part of the government gravy train has undermined their incentive to do so). However, closer inspection reveals just how false such language is.
Markets make more people fit rather than triggering a "dog eat dog" fight for survival. Private property prevents the law of the jungle rather than enabling it. In markets, individuals compete to consume by expanding production and wealth for others rather than by consuming at others' expense. Price adjustments in markets allow even those who are less capable in an absolute sense to survive rather than being weeded out. Market competition improves cooperation rather than supplanting it.
The real survival of the fittest in markets — the fittest goods and services, the fittest productive and organizational forms — greatly benefits consumers rather than harming them. And the alternative — survival of the fittest in the political arena, backed by the power of coercion — creates rather than eliminates the law of the jungle, where the fight for control of government erodes cooperation, morality, and charity.