Mises Wire

Equity, Racial Equality, and Wealth Redistribution

Equity

Ludwig von Mises warned that socialists are constantly changing their terminology to disguise their schemes, all of which are designed to undermine individual liberty and private property. Regardless of the terminology they use, their ultimate goal is to vest as much property as possible in the hands of the state or—failing that—to grant the state increasing power to assign and control private property. One major way in which the state controls private property is through wealth redistribution. The Marxist “permanent revolution” is therefore mounted through various forms of wealth redistribution. The idea of the “permanent revolution” is that all revolutions that lead towards “the dictatorship of the proletariat” are connected, each building on the gains made by the previous revolution. In “The Permanent Revolution,” Trotsky wrote:

For an indefinitely long time and in constant internal struggle, all social relations undergo transformation. Society keeps on changing its skin. Each stage of transformation stems directly from the preceding. This process necessarily retains a political character, that is, it develops through collisions between various groups in the society which is in transformation. Outbreaks of civil war and foreign wars alternate with periods of ‘peaceful’ reform. Revolutions in economy, technique, science, the family, morals and everyday life develop in complex reciprocal action and do not allow society to achieve equilibrium. Therein lies the permanent character of the socialist revolution as such.

The notion of “equity,” which is familiar to many as a component of “diversity, equity and inclusiveness,” should be seen in that light—it is merely the latest terminology used to justify wealth redistribution and thereby advance the permanent revolution. Equity, as used in the context of DEI, expresses the idea of “substantive equality,” which states that formal equality or equality before the law does not suffice. The argument is that equality should be “real”—people should actually be equal in reality, not just equal in theory.

The “substantive equality” arguments used to justify DEI have provided the rationale for promoting equal outcomes, which, in turn, requires the redistribution of wealth. Wealth redistribution is a goal that appeals to egalitarians because it expresses ideals to which egalitarians are already committed. Even though they may not consider themselves “socialists,” because they consider property rights to be worth defending at least to some extent, they nevertheless support the idea that outcomes should be equalized as part of substantive equality. In this way, under various guises, the ideal of “equality” has played a central role in advancing the Marxist permanent revolution. A good example of how wealth redistribution undermines property rights by adopting the mantle of equality can be seen in the Radical Republican rhetoric of the post-bellum United States.

Confiscation of Confederate Property 

The confiscation of private property under the Confiscation Act of 1861 was not originally justified in the language of wealth redistribution. Rather, it was explicitly framed as part of Lincoln’s war effort. Its goal was stated as: “to allow the federal government to seize property, including slave property, being used to support the Confederate rebellion.” Further laws were later enacted during the war, granting power to “seize the property of rebels”:

SEC. 5. And be it further enacted, That, to insure the speedy termination of the present rebellion, it shall be the duty of the President of the United States to cause the seizure of all the estate and property, money, stocks, credits, and effects of the persons hereinafter named in this section, and to apply and use the same and the proceeds thereof for the support of the army of the United States…

The “persons hereinafter named” included Confederate officers as well as anyone who “shall hereafter assist and give aid and comfort to such rebellion.” Court proceedings were to be instituted for due process, to ensure that “said property, whether real or personal, shall be found to have belonged to a person engaged in rebellion, or who has given aid or comfort thereto.” If so, the property was to be “condemned as enemies’ property and become the property of the United States.” After the war, this power to seize the property of rebels gradually lost its connection to the war or to punishing the rebellion, and became increasingly redistributive in its aims and rhetoric.

In his article “Forty Acres and Mule,” Walter Fleming explains how the power to seize enemy property was at first understood as a form of “confiscation and division of property” to punish those who had participated in the rebellion. Thaddeus Stevens—the leading proponent of confiscating Confederate property—stated that the aim was “to pay the expenses of the war, to punish the Confederates, and to provide for ‘loyalists’ and for the blacks. The white people of the South, Steven said in 1863, were entitled to no rights of person or property.”

Over time, the idea that the confiscated property should be given to the freed slaves assumed increasing political importance. The Freedmen’s Bureau was established to hold property confiscated from the “rebels” and provide support for the freedmen, through such measures as parceling out land and providing them with regular food supplies. The political rhetoric became more blatantly redistributionist, emphasizing the desire to seize property from the vanquished foe and award it to the freed slaves. Fleming notes that:

[Thaddeus] Stevens, in a speech to his constituents at Lancaster, Pennsylvania, in the summer of 1865, declared that each negro family ought to receive forty acres of land, and that sufficient land should be secured by confiscating the estates of those Confederates who had owned over two hundred acres, and by seizing the lands belonging the Southern States.

The Radical Republicans appear to have lost all interest in whether the property owners “gave aid and comfort” to the rebels and were soon more concerned with how much property white Southerners owned. The goal was to split larger farms into smaller parcels to facilitate redistribution. Stevens reiterated this view in Congress, and as Fleming observes, “as time went on he was more and more strongly in favor of it.” After displacing Andrew Johnson, the Radical Republican faction became the most influential group in the Republican Party, all of whom were in favor of “confiscation from whites and provision for the blacks.” By this point, the policy was explicitly one of wealth redistribution—confiscating property from whites to give to blacks—disguised as justice for freed slaves. This was not expressed as a general desire to give federal property to freed slaves, but was specifically aimed at seizing private property owned by Confederate sympathizers for redistribution on the same pattern as the precedent set in 1865. Fleming notes that,

The barns, storehouses, offices, dwellings, public buildings, court-houses, hospitals, prisons, armories, arsenals, ironworks, boats, mills, factories, and all kinds of supplies used by or intended for the use of the Confederacy were seized and, for the most part, after June 2d, 1865, were given for the use of the blacks. Church and school buildings belonging to the whites were given to the missionaries for the negroes. Property in the hands of the Bureau was sold or rented, and the proceeds applied to the support of the blacks or given directly to them. Naturally, the negroes thought that they were in permanent possession, and the policy of the Bureau encouraged them in this belief.

The cautionary tale to derive from this history lies in the conflict over property rights that soon erupted. Fleming explains how disputes over property title soon descended into violence and racial strife, as the “rebels”—who were the vast majority of white Southerners—secured their titles and the blacks, to whom this property had been promised, felt that they had been cheated. The effects of this disastrous attempt to achieve justice through expropriation reverberate to this day.

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