Power & Market
Today would have been the ninety-first birthday of Burt Blumert, one of the greatest personalities of the modern libertarian movement. Burt was the indispensable man behind the scenes and was a key figure in the Mises Institute, the Center for Libertarian Studies, and LewRockwell.com. He was one of Murray Rothbard’s closest friends, and when you met him, it was easy to see why Murray liked him. He was a genial and kind person, and a source of wise counsel to all those fortunate to know him. Burt was the founder of Camino Coins and a principal figure in the hard money community. If you want to get a sense of what Burt was like, you have only to read his collection of humorous essays Bagels, Barry Bonds, and Rotten Politicians (2008). It was a source of great pride and comfort to Burt in his final illness that he was able to see this book in print. Burt helped me with good advice when I most needed it, and I will always be grateful to him for his counsel and friendship
While much of Friedrich Hayek’s The Road to Serfdom focused on correcting erroneous ideas and sloppy thinking that misled (and still mislead) many to support socialistic expansions of government power, that is not all it did. It also reiterated the case for individualism and its economic manifestation—free markets. Since convincing careful thinkers requires such an affirmative case as well as defensive debunking, the book’s diamond 75th anniversary is a propitious time for Americans to remember what only individualism provides, so that we will not continue to follow a path of “replacing what works with what sounds good,” as Thomas Sowell described it.
- The essential features of…individualism…are the respect for the individual man qua man…the recognition of his own views and tastes as supreme in his own sphere…and the belief that it is desirable that men should develop their own individual gifts and bents.
- The attitude of the liberal toward society is like that of the gardener who tends a plant and, in order to create the conditions most favorable to its growth, must know as much as possible about its structure and the way it functions.
- The holder of coercive power should confine himself in general to creating conditions under which the knowledge and initiative of individuals are given the best scope so that they can plan most successfully.
- The successful use of competition as the principle of social organization precludes certain types of coercive interference with economic life.
- Planning and competition can be combined only by planning for competition but not…planning which is to be substituted for competition.
- It is the very complexity of the division of labor under modern conditions which makes competition the only method by which such coordination can be adequately brought about.
- Nobody can consciously balance all the considerations bearing on the decisions of so many individuals…coordination can clearly be effective only by… arrangements which convey to each agent the information he must possess in order effectively to adjust his decisions to those of others…This is precisely what the price system does under competition and what no other system even promises to accomplish.
- The economist…His plea is for a method which effects such co-ordination without the need for an omniscient dictator.
- The various kinds of collectivism…[refuse] to recognize autonomous spheres in which the ends of the individuals are supreme.
- Recognition of the individual as the ultimate judge of his ends…that as far as possible his own views ought to govern his actions…forms the essence of the individualist position.
- What are called “social ends” are…merely identical ends of many individuals…to the achievement of which individuals are willing to contribute…Common action is thus limited to the fields where people agree on common ends.
- The clash between planning and democracy arises simply from the fact that the latter is an obstacle to the suppression of freedom which the direction of economic activity requires.
- The more the state “plans,” the more difficult planning becomes for the individual.
- The important question is whether the individual can foresee the action of the state…that the individual knows precisely how far he will be protected against interference from others, or whether the state is in a position to frustrate individual efforts.
- In a planned society the Rule of Law cannot hold…the use of the government’s coercive powers will no longer be limited and determined by pre-established rules.
- Economic control is not merely control of a sector of human life…it is the control of the means for all our ends.
- To believe that the power which is thus conferred on the state is merely transferred to it from others is erroneous. It is a power which is newly created and which in a competitive society nobody possesses. So long as property is divided among many owners, none of them acting independently has exclusive power to determine the income and position of particular people.
- The power which a multiple millionaire…has over me is very much less than that which the smallest fonctionnaire possesses who wields the coercive power of the state on…whether and how I am to be allowed to live or to work.
- Contrast…two types of security: the limited one, which can be achieved for all, and which is therefore no privilege but a legitimate object of desire; and absolute security, which…if it is provided for some, it becomes a privilege at the expense of others.
- Individualism is thus an attitude of humility…the exact opposite of that intellectual hubris which is at the root of the demand for comprehensive direction of the social process.
- It was men’s submission to the impersonal forces of the market that…has made possible the growth of a civilization without which this could not have developed; it is by thus submitting that we are every day helping to build something that is greater than any one of us can fully comprehend.
- If the democracies themselves abandon the supreme ideal of the freedom and the happiness of the individual…they implicitly admit that their civilization is not worth preserving.
- It is more important to clear away the obstacles with which human folly has encumbered our path and to release the creative energy of individuals than to devise further machinery for “guiding” and “directing” them—to create conditions favorable to progress rather than to “plan progress.”
Friedrich Hayek’s The Road to Serfdom defended the individual—the only ultimate locus of choice, responsibility and morality—as the appropriate focus of efforts toward human improvement, at a time when failing to keep that focus threatened the entire world. That is a lesson we need to remember now as well, when many do not remember the horrors that can lead to, and so support constantly expanding government powers over its citizens, which is in precisely the opposite direction of what once created America as a unique beacon of hope for the world.
In addition to providing crucial insights into the cleavages between social organization based on freedom and social organization based on coercion, Friedrich Hayek’s The Road to Serfdom provided many other insights. Many of them dealt with the morality of collectivism. In honor of the books 75th anniversary this year, please consider Part 2 of our considerations— Collectivism and Morality. (See Part I here.)
- Is there a greater tragedy imaginable than that, in our endeavor consciously to shape our future in accordance with high ideals, we should in fact unwillingly produce the very opposite of what we have been striving for?
- It seems almost as if we did not want to understand the development which has produced totalitarianism because such an understanding might destroy some of the dearest illusions to which we are determined to cling.
- Democratic socialism…is not only unachievable, but…produces something so utterly different that few of those who now wish it would be prepared to accept the consequences.
- [Beyond] the power to make general rules…delegation means that some authority is given power to make…arbitrary decisions.
- Any policy aiming directly at a substantive ideal of distributive justice must lead to the destruction of the Rule of Law.
- The question raised by economic planning is…whether it shall be we who decide what is more, and what is less, important, or whether this is to be decided by the planner.
- The kind of state action which really would increase opportunity is almost precisely the opposite of the “planning” which is now generally advocated and practiced.
- Although the professed aim of planning would be that man should cease to be a mere means, in fact—since it would be impossible to take account in the plan of individual likes and dislikes—the individual would more than ever become a mere means, to be used by the authority in the service of such abstractions as the “social welfare” or the “good of the community.”
- Planning…consists essentially in depriving us of choice, in order to give us whatever fits best into the plan.
- It soon becomes the one burning question which of the different sets of ideals shall be imposed upon all by making the whole resources of the country serve it.
- The more we try to provide full security by interfering with the market system, the greater the insecurity becomes; and…the greater becomes the contrast between the security of those to whom it is granted as a privilege and the ever increasing insecurity of the under-privileged.
- The democratic statesman who sets out to plan economic life will soon be confronted with the alternative of either assuming dictatorial powers or abandoning his plans.
- The ethics produced by collectivism will be altogether different from the moral ideals that lead to the demand for collectivism.
- Socialism can be put into practice only by methods of which most socialists disapprove.
- The practice of socialism is everywhere totalitarian.
- The principle that the end justifies the means in individualist ethics is regarded as the denial of all morals. In collectivist ethics it becomes necessarily the supreme rule.
- Once you admit that the individual is merely a means to serve the ends of the higher entity called society or the nation…the pursuit of the common end of society can know no limits in any rights or values of any individual.
- Since it is the supreme leader who alone determines the ends, his instruments must have no moral convictions of their own…no ideas about right or wrong which might interfere with the intentions of the leader.
- Even the striving for equality by means of a directed economy can result only in an officially enforced inequality—an authoritarian determination of the status of each individual in the new hierarchical order.
- Morals are of necessity a phenomenon of individual conduct…they can exist only in the sphere in which the individual is free to decide for himself...Only where we ourselves are responsible for our own interests…has our decision moral value.
- In this sphere of individual conduct, the effect of collectivism has been almost entirely destructive.
- A movement whose main promise is the relief from responsibility cannot but be antimoral in its effect, however lofty the ideals to which it owes its birth.
- Injustices inflicted on individuals by government action in the interest of a group are disregarded with an indifference hardly distinguishable from callousness…the grossest violations of the most elementary rights of the individual...more and more often are countenanced.
- Almost all the traditions and institutions in which democratic moral genius has found its most characteristic expression…are those which the progress of collectivism and its inherently centralistic tendencies are progressively destroying.
- Neither good intentions nor efficiency of organization can preserve decency in a system in which personal freedom and individual responsibility are destroyed.
- To imagine that the economic life of a vast area…can be directed or planned by democratic procedure betrays a complete lack of awareness of the problems such planning would raise…To undertake the direction of the economic life of people with widely divergent ideals and values is to assume responsibilities which commit one to the use of force; it is to assume a position where the best intentions cannot prevent one from being forced to act in a way which to some of those affected must appear highly immoral.
- We shall never prevent the abuse of power if we are not prepared to limit power.
The Road to Serfdom made a powerful case that collectivism, by its nature, produced moral decline, and that it remains true even for collectivism supported out of desires for moral improvement. Since the direction that a system of social organization actually changes our morality is far more important than the direction one might hope it would lead, Hayek’s insights into the dystopian results of utopian collectivist thinking still merit careful consideration, three-quarters of a century later, at a time when support for socialist government interventions is again on an upswing.
Joakim Book has recently published an essay at AIER arguing that Rothbard was wrong to change his mind about free banking in Scotland. Rothbard had originally praised the episode of Scottish free banking in his 1983 book The Mystery of Banking, but then changed his mind in a 1988 essay on The Myth of Free Banking in Scotland. While the topic has been debated extensively throughout the 90s and 00s between free bankers and full-reserve advocates, it is worth responding to this latest argument against the Rothbardian position.
Setting the stage
Before moving on to answering Mr. Book’s specific charges against Rothbard, it is perhaps useful to briefly recount the background to the dispute over free banking. Is it possible to have stable fractional reserve banking in a free market, so-called free banking, where banks issue more bank notes and demand deposits than they have cash on hand to redeem? Or is such a system based on special privileges granted to banks, and will it inevitably result in bank panics and business cycles? Rothbard’s position was the second, while Lawrence White in the early 1980s, first in articles and then in his 1984 book Free Banking in Britain, advanced arguments for the feasibility of free banking on theoretical grounds while using the example of the Scottish experience with free banking 1716-1844 to show that it had also worked in practice. Rothbard’s initial praise for the Scottish experience was based on White’s first paper detailing the episode of free banking, but reading White’s 1984 book and reviewing the histories of Scottish banking himself made Rothbard change his mind and criticize the Scottish system, and White’s portrayal of it, harshly.
The present argument
The charges against Rothbard are three in number:
- Rothbard interprets the low failure-rate of Scottish banks as proof of government protection, whereas White and others see it as proof of the stability of the system.
- The Bank Restriction during the Napoleonic Wars apparently also applied to Scotland, meaning that the Scottish banks were rendered immune from the legal claims of their clients. This is “completely false” according to Mr. Book, as the only reason the Scottish bank customers did not demand specie was that they preferred bills of exchange and bank notes.
- Rothbard claims that the Bank of England was a lender of last resort to the Scottish banking system – which according to Book is a wrong-headed interpretation of the evidence.
As argument number 2 appears to me to get at the heart of the issue, I will deal with arguments 1 and 3 summarily before moving on.
Ad 1): Here I think we must return a Scots verdict – while it is true that we would regularly see firms go out of business in a free market, as more successful entrepreneurs displace the less competent, it seems to me that the banking sector is a special case. Presumably, the clients of the bank would not hold bank notes if they feared there was a risk of the bank going out of business, so people would only patronize very sound banks, meaning that the banking sector would be more stable than the surrounding economy. That’s just speculation, however. Since we don’t have any similar systems to compare the Scottish experience to (the English banks that White compares the Scottish to were artificially weakened due to government regulations meant to protect the Bank of England), we can’t say one way or the other what the low number of bankruptcies indicates.
Ad 3): It is hard to understand how Mr. Book can sustain this charge, let alone describe Rothbard’s position as a “strange historical twist”. It is true, as Mr. Book relates, that in the crisis of 1793 the British government, not the Bank of England, was the source of help for the Scottish banks (a fact that does little to sustain the notion of “free” banking in Scotland), but this is not news to Rothbard, who relates the exact same incident. Nor does it disprove Rothbard’s point about the importance of London for the Scottish banks, for while he does not say that the Bank of England was the lender of last resort to Scottish banks, he does cite the historians Frank W. Fetter and Sydney Checkland to the effect that “(r)edemption in London drafts was the usual form of paying note holders” and “the principal and ultimate source of liquidity [of the Scottish banks] lay in London, and, in particular, in the Bank of England.” That expert historians say something is obviously no guarantee that it’s true, but I think it behooves Mr. Book to realize that his argument is with these gentlemen, instead of making it seem like Rothbard invented the central role of the Bank of England to the Scottish system.
Getting gold in Scotland
Did Scottish banks at any point suspend convertibility, contrary to their legal obligations and the act of 1765 that governed Scottish banking? It is true, as Mr. Book alleges, that the Bank Restriction Act of 1797 only referred to the Bank of England and the Bank of Ireland – but that does not mean that Scottish bankers redeemed their bank notes in gold. As a leading authority on Scottish free banking notes, as soon as the leading bankers in Edinburgh got news of the suspension from the Bank of England, they met together and decided to follow suit.1 In clear violation of the law, the Scottish bankers en masse suspended redemption of their notes for the duration of the suspension in England. The result, as hard money advocates would predict, was a massive inflation in Scotland and erosion of the reserves of the Scottish banks. They went from having reserves of gold covering 10-20% of their outstanding issue of bank notes to only 0.5-3.2%.
While this development hardly speaks to the purported stability of so-called free banking, it does not contradict Mr. Book’s charge that specie redemption was still possible in Scotland. After all, since the action of the Scottish banks in refusing to redeem their notes was clearly illegal, presumably a disgruntled client desirous of gold could take his bank to court. Why didn’t anybody do this? Surprisingly, we need only read the article on the bank restriction by George Selgin that Mr. Book himself links to in support of his claims to realize why. For the Bank Restriction Act did affect Scottish banks: while it did not make Bank of England notes legal tender, if anyone insisted on using such notes in payment of debts, “he was to be protected from arrest for debt” (Selgin quoting Frank W. Fetter). In other words, the legal remedies available to persons insisting on payment in gold were severely curtailed – in Scotland particularly so, as the Act deprived bank creditors of the right to summary diligence, a special procedure under Scots law for the enforcement of debts.
As is to be expected, the suspension of convertibility in Scotland lead to the complete disappearance of silver and gold coins from circulation2, per the working of Gresham’s Law, and bank notes proliferated, leading to the above-mentioned outcome that bank reserves dwindled to a fraction of what they were before the suspension.
All this leads us back to Rothbard. Rothbard claimed both less and more than Mr. Book attributes to him. He didn’t claim that the Act of 1797 applied to Scottish banks, merely that they used the opportunity to suspend convertibility – and this not on his own authority, but on that of Professors White and Checkland. However, Rothbard also claimed much more than simply a temporary suspension in Scotland during the early 1800s. It is worth quoting him at length since this claim seems to have escaped Mr. Book’s attention:
Now I come to the nub: that, as a general rule, and not just during the official suspension period, the Scottish banks redeemed in specie in name only; that, in substance, depositors and note holders generally could not redeem the banks' liabilities in specie. The reason that the Scottish banks could afford to be outrageously inflationary, i.e. keep their specie reserves at a minimum, is that, in practice, they did not really have to pay.
[Quoting Professor Checkland] The Scottish system was one of continuous partial suspension of specie payments. No one really expected to be able to enter a Scots bank … with a large holding of notes and receive the equivalent immediately in gold or silver. They expected, rather, an argument, or even a rebuff. At best they would get a little specie and perhaps bills on London. If they made serious trouble, the matter would be noted and they would find the obtaining of credit more difficult in future.
Rothbard goes on to describe a legal battle in the 1750s over the redemption of bank notes that ended up with a nominal victory for the cause of redemption, but in reality the courts refused to force the banks to pay up. The clear conclusion must be that convertibility of Scottish bank notes were only sporadically enforced throughout the existence of the much-vaunted system of free banking in Scotland.
This result should not surprise us, as the system was inherently unstable. While Mr. Book focuses on the issue of bankruptcy rates, this is not Rothbard’s main reason to deem the system unstable. Instead, he focuses on the fact (again using Checkland as his source) that throughout the existence of an independent Scottish banking system, the Scottish banks expanded and contracted credit in a long series of business cycles, as also Huerta de Soto has pointed out. What the Scottish bankers did was secure legal privileges in order to be able to engage in fraudulent credit expansion, and it is only after reading deeper in the history of Scottish banking that Rothbard realized this and subsequently changed his mind on the issue. Far from criticizing Rothbard, Mr. Book, who himself writes often and persuasively about the role of financial history, should recognize him as a kindred spirit – and accept the Rothbardian strictures on free banking in Scotland, based as they are on sound theory and historical inquiry.
The goal of this essay has been to show that, contrary to Mr. Book’s criticism, Rothbard’s change of mind on the issue of free banking in Scotland was based on a better understanding of the episode and was not, as Mr. Book alleges, “the imposition of perfectionist normative judgments” on the historical record. More generally, we have again shown that the claim that Scottish experience validates free banking theory is not supported by the evidence. On the contrary, the attempts by Mr. Book and other free bankers to explain away or ignore the myriad examples of government privilege and intervention in the Scottish case is starting to sound like a no true Scotsman fallacy – they are either ignored, or explained away as not really affecting the financial system.
Free banking has not passed the free market test, at least not in any of the cases that have been brought forward by the free bankers to support their claims. True free banking would indeed be a very stable system – but one with very high reserves. As Mises said:
Suspension of the bank-notes’ convertibility and legal-tender provisions had transformed the ‘hard’ currencies of many countries into questionable paper money. The logical conclusion to be drawn from these facts would have been to do away with privileged banks altogether and to subject all banks to the rule of common law and the commercial codes that oblige everybody to perform contracts in full faithfulness to the pledged word. Free banking would have spared the world many crises and catastrophes.
It is a mistake to associate with the notion of free banking the image of a state of affairs under which everybody is free to issue bank notes and to cheat the public ad libitum. People often refer to the dictum of an anonymous American quoted by Tooke: "Free trade in banking is free trade in swindling." However, freedom in the issuance of bank notes would have narrowed down the use of bank notes considerably if it had not entirely suppressed it. It was this idea which Cernuschi advanced in the hearings of the French Banking Inquiry of October 24, 1865: "I believe that what is called freedom of banking would result in a total suppression of bank notes in France. I want to give everybody the right to issue bank notes so that nobody should take any bank notes any longer."
In an earlier post, I noted Robert Nozick’s criticism of the view that the state may tax us because we are in part 'social products'. Much of Nozick’s Anarchy, State, and Utopia reflects Rothbard’s influence, and this topic is no exception. As so often, Rothbard was there first, and Nozick did no more than restate his insights in more complicated fashion. In Power and Market, a work Nozick studied closely, Rothbard says: “It is precisely the process of the market by which the array of free individuals (constituting ‘society’) portions out income in accordance with productivity. It is double-counting to postulate a real entity ‘society’ outside the array of individuals, and possessing or not possessing ‘its' own deserved share. If by “organized society’ he [ the economist Henry M. Oliver] means the State, then the State’s ‘contributions’ were compulsory and hence hardly ‘deserved’ any pay.”
Justin Raimondo, longtime editor of AntiWar.com and a great friend of the Mises Institute, has died.
Far too young, we might add, at 67. We can only mourn the silencing of his voice, and acknowledge him as perhaps the most important libertarian foreign policy writer of the past several decades.
Yet unlike many peace advocates, Justin read and understood economics—not to mention history and political theory.
Justin was well known to many readers of mises.org. He authored two important books in the paleolibertarian genre: Reclaiming the American Right: The Lost Legacy of the Conservative Movement, where he called for a return to the noninterventionist principles of the Taft/Garrett "Old Right," and An Enemy of the State, his biography of his great friend Murray N. Rothbard. He shared a special bond and friendship with Rothbard, and the two spent countless hours together working and socializing. I had the pleasure of emailing and calling him from time to time over the years, and interviewed him here. I always came away laughing at his take-no-prisoners approach, and fortified by his relentless determination.
Justin truly hit his stride during Bill Clinton's Kosovo War, for which he criticized the former president (and his wife) mercilessly. Kosovo put Antiwar.com on the map, and made Justin a star in libertarian circles. His sharp tongue and sharp pen, translated well across a keyboard. And his acerbic style, coupled with real research and broad knowledge of world affairs, made for a new kind of online journalism. Certainly many of us fondly remember bookmarking Antiwar.com in the 1990s and 2000s, eagerly waiting for Justin's latest broadside against some deserving tyrant or war profiteer.
Here's a sample of his signature takedown of self-important pols, from just a few years ago:
Libya, Syria, Iraq, Kosovo — these countries, which lie in ruins, are grotesque monuments to the criminality of American “regime-change” operations, which have wreaked havoc everywhere they’ve been successful. With a record like this, it’s incredible that the same pack of buzzards in Washington are allowed to go on their merry way, without having to answer to anyone for their crimes. Indeed, the two leading candidates for the Democratic presidential nomination, Mrs. Clinton and Sen. Bernie Sanders, both supported this disastrous war War.
And of course he never ran out of wars to cover. We'll miss you, old friend.
World War I is the gift that just keeps on giving. Although the U.S. government’s intervention into this senseless, immoral, and destructive war occurred 100 years ago, the adverse effects of the war continue to besiege our nation. Among the most notable examples is the Espionage Act, a tyrannical law that was enacted two months after the U.S. entered the war and which, unfortunately, remained on the books after the war came to an end. In fact, it is that World War I relic that U.S. officials are now relying on to secure the criminal indictment of Julian Assange, the WikiLeaks head who released a mountain of evidence disclosing the inner workings and grave wrongdoing on the part of the U.S. national-security establishment, especially with respect to the manner in which it has waged it undeclared forever wars in the Middle East and Afghanistan.
Some news media commentators are finally coming to the realization that if the Espionage Act can be enforced against Assange for what he did, it can be enforced against anyone in the press for revealing damaging inside information about the national-security establishment — i.e., the Pentagon, the CIA, and the NSA. Therefore, they are calling on the Justice Department to cease and desist from its prosecution of Assange.
Of course, they are right, but the problem is that they don’t go far enough. Their mindsets reflect the customary acceptance of the status quo. The mindset is that we Americans simply have to accept the way things are and plead with the government to go easy on us.
That’s just plain nonsense. It is incumbent on the American people to start thinking at a high level, one that doesn’t just accept the existence of tyrannical laws and instead calls for their repeal. After all, isn’t that what our Declaration of Independence says — that when government becomes destructive of the legitimate ends for which it was formed, it is the right of the people to alter or even abolish it and form new government?
What does that mean with respect to the Espionage Act? It means that the law should simply be repealed and that Americans need to start demanding repeal rather than simply pleading with the Justice Department to enforce it in a more judicious manner.
Let’s keep in mind that the law is the fruit of a rotten foreign intervention. Hardly anyone defends the U.S. intervention into World War I. That war was, quite simply, none of the U.S. government’s business. President Wilson, however, was hell-bent on embroiling the U.S. in the conflict. Wilson believed that if the force of the U.S. government could be used to totally defeat Germany, this would be the war to finally end all wars and to make the world safe for democracy.
Wilson’s mindset, of course, was lunacy. Sure enough, the U.S. intervention resulted in Germany’s total defeat, which was then followed by the vengeful Treaty of Versailles, which Adolf Hitler would use to justify his rise to power. Nazism and World War II soon followed. So much for the war to end all wars and to make the world safe for democracy. Tens of thousands of American men were sacrificed for nothing.
Moreover, Wilson had to force American men to fight in World War I. He conscripted them. Enslaved would be a better word. When a government has to force its citizens to fight a particular war, that’s a good sign that it’s a bad war, one that shouldn’t be waged.
In fact that was one of the reasons for the Espionage Act—not to punish people for spying but rather for criticizing the draft and the war. The law converted anyone who publicly criticized the draft or attempted to persuade American men to resist the draft into felons. And make no mistake about it: U.S. officials went after such people with a vengeance, doing their best to punish Americans for doing nothing more than speaking.
One example was Charles Schenck, who was prosecuted and convicted of violating the law after circulating a flier that opposed the draft. When the case reached the U.S. Supreme Court, the Court upheld the conviction, one of the earliest examples of judicial deferment to the military, a deference that would become virtually complete after the U.S. government was officially converted to a national-security state after World War II.
Another example was Eugen Debs, who got convicted for criticizing the war and for encouraging men to resist the draft. President Wilson called Debs “a traitor to his country.”
How in the world can such prosecutions and convictions possibly be reconciled with the principles of a free society? Freedom necessarily entails the right to criticize government for anything, including its wars, its enslavement of people, its tyranny, and anything else. Perhaps it is worth nothing that both Schenk and Debs were socialists, something that today’s crop of Democrat presidential candidates might want to take note of.
Longtime supporters of FFF know that one of my favorite stories in history is the one about the White Rose, a group of college students in Germany who, in the midst of World War II, began distributing pamphlets calling on Germans to resist their own government and to oppose the troops1.When they were caught and brought to trial, the members of the White Rose were berated by the presiding judge, who accused them of being bad German citizens and traitors, just as Wilson, the Justice Department, and the U.S. Supreme Court had said of Americans who were violating the Espionage Act.
Today, any U.S. official would praise the actions of the White Rose, but that’s just because it was foreign citizens opposing an official enemy of the U.S. government. The fact is that if the White Rose members had done the same thing they did in Germany here in the United States, U.S. officials would have gone after them with the same anger and vengeance as German officials did. And they would have used the Espionage Act to do it.
It’s time to acknowledge that the horror of U.S. intervention into World War I and the horrible consequences of that intervention. It’s also time to rid our nation of the horrific relic of that intervention, the Espionage Act. We need to continue demanding the dismissal of all charges against Assange. But let’s not stop there. Let’s repeal the tyrannical World War I-era Espionage Act under which he is being charged to ensure that this cannot happen to others.
Originally published at the Future of Freedom Foundation
In the wake of the Notre Dame fire, both French politicians and private donors, including billionaires, pledged to rebuild the Church. Emmanuel Macron promised — rather unconvincingly — to have the church rebuilt within five years.
In response, some observers questioned why a government should be in the business of rebuilding churches. After all, doesn't Notre Dame have insurance?
Well, it turns out Notre Dame doesn't have insurance, and that leads us to a larger problem with the church.
Notre Dame is a government-owned building. As a spokesman for the French consulate in New York told Marketwatch :
The French State is self-insured for Notre Dame. It has no insurance. It is supposed to cover its own costs.
Notre Dame has no private insurance because Notre Dame is not a privately owned building. Like all church buildings constructed before 1905, Notre Dame is owned by the French state.
As recounted by Samuel Gregg for the Catholic Herald, the Catholic Church lost ownership of church buildings during the French Revolution. While the Church gained usage of its buildings during Napoleon's reign, state control remains:
The Revolution’s subsequent war against the Church included turning Notre-Dame into a temple for “the Cult of Reason” and “the Supreme Being” in 1793. Shortly after Robespierre’s fall in 1794, the cathedral became a storage place for weapons and food. It was seemingly forgotten to history.
A few years later, Notre-Dame’s fortunes changed when Napoleon determined that his regime’s security required reconciliation between the Revolution and the Church. Though the state continued (and continues to this day) to own the buildings, exclusive use of the cathedral was transferred to the Church following the 1801 Concordat between Paris and Rome. ...Though the Concordat provided the Church with some protection from anti-clericals, it also once again subordinated much of the Church’s life to the French state.
State ownership was again affirmed in 1905 with the "loi du 9 décembre 1905 concernant la séparation des Églises et de l'État." The law affirmed that only church buildings constructed after 1905 could be privately owned by the Church itself.
Today, the French state controls more than 32,000 churches, 6,000 chapels, and 87 cathedrals.
Moreover, any attempts to significantly change church buildings would have to be approved by government officials, and according to The Art Newspaper , this state of "dual administration" has "caused serious problems of management and conservation":
Under French law, the parish council owns the building itself and its furnishings and puts these at the disposal of the clergy for acts of worship. The parish council is responsible for the maintenance and restoration of the building but does not pay for lighting, heating or expenses connected with religious observances, which are the responsibility of the clergy. No building works can be undertaken without the agreement of the parish council, and the parish priest may not sell objects or remove them from the church without the permission of the mayor. If the church is listed, or classified as a monument of particular historical interest, the permission of the Commission on Historical Buildings must also be sought.
This led to conflicts, especially in the wake of Vatican II, when Catholic clergy enamored of the new iconoclasm in the church attempted to destroy altars, railings, light fixtures, and other church elements deemed too old-fashioned. Some secular authorities, on the other hand, valued these items as art, and prevented parish priests from selling off or destroying them.
In those days, the French state served as a bulwark against the clergy's bad taste. Mid-twentieth century clergy, after all, were notorious in their vapid and trite artistic sensibilities, which they pursued as a cloying display of their alleged devotion to the common man.
Had Notre Dame burned sometime between 1965 and 1980, French bishops probably would have insisted it be rebuilt with a brutalist spire of poured concrete.
Fortunately, most of those clerics are now dead, and few Catholics under age 50 think 1970s-style church architecture, furnishings, and art are nearly as charming as their elders seemed to think. This means the primary threat to Notre Dame now comes form the French state itself. Already, the terrible restoration ideas are pouring in, with suggestions ranging from a new glass-and-steel roof, to a spire designed to look like an Islamic minaret.
Since the French state owns Notre Dame, it's not a given the building will be actually rebuilt as a church. As I've noted before, many Frenchmen — including Macron and many of the donors — appear to regard the building's primary importance as that of a museum and community center. This could mean anything goes as far as reconstruction is concerned.
While Republicans continue to profess their opposition to socialism, their love of socialism is being demonstrated in the healthcare arena. Do you remember when they were campaigning for control over Congress and the presidency with full-throated calls to repeal Obamacare? Not anymore. According to an article in the Washington Post, Republicans have come to love and adore President Obama’s signature achievement as president. More important, of course, is their deep-seated, unwavering devotion to Medicare and Medicaid, the two socialist programs enacted during the leftist regime of President Lyndon Johnson.
The Post’s article states:
Even Republicans who furiously fought the creation of the law and won elections with the mantra of repeal and replace speak favorably of President Barack Obama’s signature domestic achievement.
“Quite obviously, more people have health insurance than would otherwise have it, so you got to look at it as positive,” Sen. Charles E. Grassley (R-Iowa) said in a recent interview….
“For the people who are in that tranche of expanded Medicaid, I think it has been very helpful,” said Sen. Shelley Moore Capito (R-W.Va.)….
The public’s increasing reliance on the ACA was reflected in the dramatic failure of congressional Republicans to roll back the law or even unify around a plan to replace it as it has grown in popularity.
Even President Trump is caving:
Bowing to pressure from some in his own party, Trump recently backed off a new pledge to take another crack at eliminating the ACA and said a vote on a GOP health plan — still unformed — would be delayed until after the 2020 election.
This is one of the horrific consequences of socialism: It creates mindsets of dependency on the government, much like going on heroin. Once people go on either heroin or socialism, they’re done. At that point, they cannot imagine life without their narcotic. And they come to love it.
President Franklin Roosevelt, who ushered in America’s welfare-state way of life, understood this phenomenon perfectly. He knew that if he could just make people dependent on governmental largess, the federal government would own them. That’s what Social Security, the crown jewel of American socialism, was all about it. FDR knew that once he got seniors on the dole, he and successor regimes would own them.
Roosevelt’s protégé, Lyndon Johnson, learned this lesson well from his mentor. Give seniors not only a welfare retirement dole but also free or heavily subsidized healthcare, and they would thereafter belong to the federal government.
That’s how we have ended up with entire generations of older people who have been scared to death of losing their Socials Security and Medicare and absolutely convinced that they would die without them. Equally important, you’ll never see any seniors, except libertarian ones, who dare to challenge the federal government at a fundamental level. They’re too scared that the government will retaliate by threatening to cut off their retirement and healthcare doles.
The Post article says that one reason why Republicans have become enamored with Obamacare is their fear of what will happen if it is repealed. This fear was expressed by former Ohio Governor John Kasich, one of the leading Republicans to embrace parts of Obamacare, who stated that ending the program would bring “total chaos.” Kasich reflects the conservative mindset — that socialism equals stability and that freedom and the free market equal chaos.
In fact though, government involvement in healthcare, including Medicare, Medicaid, Obamacare, occupational licensure, insurance regulation, and income-tax manipulation, have brought America a healthcare system that is best described as “planned chaos.” The Post article hints at the real situation: “Democrats have often acknowledged that the ACA is not a perfect law and can be improved….”
Indeed, if Obamacare was the panacea it was made out to be, there would be no reason for Democrats to now be advocating an expansion of Medicare to everyone in the country. The reason they are doing that is because despite (or because of) Obamacare, the healthcare crisis just keeps getting worse. And the reason it continues getting worse is because each new government reform makes the situation worse.
America once had the finest healthcare system in the world, one that was based on free-market principles. Healthcare costs were reasonably priced, innovations were soaring, and doctors absolutely loved what they did in life.
Medicare and Medicaid succeeded in destroying that healthcare system. That’s when healthcare costs starting soaring, healthcare quality began decreasing, and increasing numbers of doctors began opting for early retirement.
Rather than repealing Medicare and Medicaid, American socialists, including conservatives, instead began enacting reform upon reform, hoping against hope that their healthcare socialism would finally succeed. Nothing worked. Each reform only made things worse. And it’s no different with Obamacare. The healthcare crisis will only get worse.
The same holds true if Medicare for All is adopted. At that point, American socialists, both Democrats and Republicans, will be calling for a full-fledged federal takeover of healthcare, with doctors working for the government and with the government in charge of people’s medical treatment and medical records.
No one should look to Republicans to save our country from socialism. They threw in the towel and made peace with the welfare state a long time ago. The only thing they have left is empty pro-capitalist rhetoric.
The only hope for the future of American healthcare and American liberty lies with libertarianism and libertarians. It is only we who have the correct diagnosis and the right prescription for America’s healthcare woes: Repeal Medicare, Medicaid, and Obamacare and end all governmental involvement in healthcare. Separate healthcare and the state, just as our ancestors separated church and state.