No Capitalism, No Freedom

Last week Bill Anderson wrote an article, Capitalism and the State, which was a rebuttal to my article that I had written entitled, Mobocracy. Bill wanted to point out the 'flaws' in anarcho-capitalism. I must admit that I am confused; I was not aware that anarcho-capitalism had any flaws. Maybe I should investigate further to see if I can locate some of the 'flaws' that Bill is talking about?

Before having any discussion, I think it's always best to first define what it is that is going to be discussed. Bill has made the argument that the Capitalist System is Statist in nature. I find this preposterous! Capitalism is defined as, 1: An economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decisions, and by prices, production, and the distribution of goods that are determined mainly by competition in the free market.

Socialism is defined as, 1: Any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods. 2a: A system of society or group living by which there is no private property. 2b: A system or condition of society in which the means of production are owned and controlled by the state. 3: A stage of society in Marxist theory transitional between capitalism and communism and distinguished by unequal distribution of goods and pay according to work done.

Now I will admit that I am not an economics scholar, but even I can determine which system is Statist. If Bill is arguing that we do not have a true free market in this country, then we are in agreement. It will never be a truly free market as long as there is government intervention.

Since Webster does not have a definition for anarcho-capitalist, I had to use Wikipedia. I hope that Bill will take the time to look at the links that I have provided so he will better understand the true meaning of the terms in this article.

First of all, it is my belief that Capitalism is true freedom. I base this belief on several things, one being property. You cannot exist without property. Property ownership requires three things, boundary, claim, and control. All three things are required for property ownership to exist. As an example of this I would like to use the Moon. When we went to the moon and placed a flag on it, we had two of the three things needed for ownership of the Moon. First we had a boundary; we specified the area of our property, which was the Moon. Second, we had claim by the placement of the flag; we were claiming ownership. What was lacking was control. For a true claim of ownership of the Moon, others must respect our claim of control. You can have boundary and claim, but without control, you do not have ownership. All three things are needed for ownership. When you eat food, you are claiming an exclusive right to that food. By consuming it, you have all three things needed to be a property owner, and no one else can make a higher claim than you. There are also permissive property rights as well. If you come to my house and you are sitting on my couch, I have given you a permissive ownership of my property for that point in time. For that point in time, you have the boundary of the area you are sitting, claim that I have given to you, and control for that period of time. This is known as a permissive ownership. You do not have a legal ownership of the property since you are using it at my discretion. There is no getting around it, you cannot exist without property.

Capitalism is nothing more than a voluntary means of exchange. There are only two ways to deal with people, voluntarily or coercively. If you believe that it is okay to force people to do something against their will, then you could not possibly believe in freedom. I would even go so far as to say that Capitalism is actually synonymous with freedom because it is a voluntary exchange. Socialism is coercive in nature and therefore it could never be considered as freedom.

If we can all agree that we must have property to exist, then the next step is to determine who gets to make decisions concerning the property. As an anarcho-capitalist, I believe the decision is that of the property owner. Bill has argued that because Wal-Mart is a corporation, and not an actual person, that it should have no say in the property. As a business owner, I have been the president of many corporations myself, and I am pretty sure that I do exist. Corporations are formed as a way of doing business, and they are formed for many reasons, one being shelter from lawsuits. In the event that I am sued, they can't come after me personally. There are many other reasons that a group of people might want to form a corporation, taxes being one of them. The point is, real people do own corporations, so I still believe that they should be the ones to make decisions on their property, and not the public or the government. Bill's assertion that the State is the proprietor of Wal-Mart is ludicrous!

Now there are many things we could argue about corporations and the State. One of them being, why the hell should the government be in charge of deciding who can incorporate in the first place? Of course if I had my way, the government would have no say in anything in the corporate world. Then again, if I really had my way, government would not exist, so this would not be a problem. There are also other ways to keep government out of the process entirely, such as a trust.

Secondly, I believe there is no better system than the free market system. It is a system based on competition and voluntary exchange of goods and/or services. The only time this system fails is when there is an outside coercive force (government) that tries to regulate or tax it. As an entrepreneur myself, I have personal knowledge of this great system. I have heard many people talk against it, but none have offered anything better or more efficient. I really don't see how someone could talk against Capitalism. How are you going to convince people that they don't know what they want? The market is the people deciding what they want, and the market sets the prices based on supply and demand. Why doesn't Burger King charge $20.00 for a hamburger? The reason is because people would go to Wendy's and McDonald's, therefore putting Burger King out of business. Whenever there is a problem, it is the market, not government, that always comes through.

Socialism has always failed. No matter how many times I have conversations with people about Socialism, the arguments are always the same. It is a system based on non-production and non-ownership, and it will always fail. I have an acquaintance who is a Marxist, and she does not believe in private property. This makes for some very lively conversation. I tell her that if she does not believe in private property, how could she protest if I came up to her and took her clothes from her? If she has no claim to them, what would be her argument against my leaving her naked in the street? I really don't know where these looney people get these ideas.

What would be someone's incentive to ever risk capital in a Socialist society? If a janitor and a doctor made the same money, why would anyone take the time and become a doctor? Would Bill Gates ever risk capital to invest in anything if there was no hope for a return? Socialism is non-productive by nature. Why would anyone do anything to improve themselves or their community?

Bill then goes on to compare Jefferson to a Liberal. If he means Liberal in the classical sense, then I agree. If he is comparing him to a modern day Liberal, as in left wing politics, then he is lost. Modern Liberals are for big government, something Jefferson was against. I would not even consider Alexander Hamilton a modern day Liberal. He was a big government type of person for his time, but I feel that even he would think government is far too big today.

He then goes on to compare capitalist libertarians to Marxists, and that is where the whole thing goes from looney to just plain wacko as he tries to link the two together by his assertion that they both authorize the use of force. This of course is another blatant misunderstanding of the philosophy. Capitalism is an economic system, and Libertarian by definition is the non-initiation of force. Now if he means that libertarians will use force as a means of self-defense, then again I agree. The difference is libertarians will not initiate force, unlike the State.

From there Bill relates that only 'real anarchists' are the true anti-statists! Of course, he never really explains just what 'true anarchy' is. I think he is actually saying that he is a libertarian socialist or maybe even a Marxist, but that was never clear. If he means anarchy as in anomie, the bomb-throwing thug sense, well maybe he is right, but I also know that 'true anarchy' would never work. Freedom and liberty cannot exist in an environment of lawless hierarchy, which is why I am not a 'true anarchist.' I believe in laws, just not 'fake laws.' I have stated my position on this many times.

The rest of it is nothing more than quotes from Adam Smith, who by the way was a Capitalist. In closing, I would like to say that at first I thought Bill was just slightly confused, but after reading some of his posts in the forum, I can see that he is completely lost. He would do well to spend more time on Strike The Root reading, than writing.

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Mike Wasdin's picture
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Mike Wasdin is an Anarcho-Capitalist from Phoenix, Arizona. He also moderates an anti-government website on Yahoo.