Will the Right Defend Economic Liberty?

By Jonah Goldberg

Thursday, May 02, 2019

Republican leaders will have to acknowledge that market capitalism is not a religion. Market capitalism is a tool, like a staple gun or a toaster. You’d have to be a fool to worship it. Our system was created by human beings for the benefit of human beings. We do not exist to serve markets. Just the opposite. Any economic system that weakens and destroys families is not worth having. A system like that is the enemy of a healthy society.

— Tucker Carlson, Fox News, January 2

In the immortal words of Buffalo Springfield, “There’s something happening here, what it is ain’t exactly clear.”

Carlson is hardly alone. At the precise moment when socialism is mounting something of a new Spring Offensive, many conservatives are abandoning their posts and refusing to defend what was once holy ground. President Trump has helped make protectionism more popular on the right than it has been in generations. Socialized medicine or some near approximation remains unpopular on the right, but it now has advocates of a kind it never had before. At various purportedly conservative publications, the New Deal is back in good odor, as are various notions of “economic nationalism.” An editor of American Affairs proposes ditching the Left–Right distinction altogether to forge a new “party of the state” that would have conservatives, among other things, embracing the administrative state rather than dismantling it. Both Patrick Deneen’s Why Liberalism Failed and Yoram Hazony’s The Virtue of Nationalism (each nominated — along with my book Suicide of the West — for Conservative Book of the Year by the Intercollegiate Studies Institute, with Hazony winning) take dead aim at classical liberalism, arguing that the West took a wrong turn when it embraced John Locke.

One is tempted to borrow a line from President Trump and call for a total and complete shutdown of political debates until we can figure out what the hell is going on.

And my friend Tucker is still at it. At the recent National Review Institute Ideas Summit, he again tore into the free market as a “tool” and many of its defenders as tools of a different sort. He conceded that he wasn’t necessarily advocating a “different economic system,” but he did want more planning. “All I’m arguing for is a clear-sight picture of what the goal is. That’s all I’m arguing for. No problem is solved unless you have a very clear image in your mind of what you want the result to be.”

Is economic freedom a means or an end? That’s the fundamental question here. To put it another way: Is economic liberty simply a form of liberty itself? Is liberty itself a goal, or a tool?

There was a time when the mainstream position on the right was that the goal, at least as it pertains to the role of government, was liberty itself. Not anymore. Many conservatives have grown disenchanted with the arguments for economic liberty, because they see them either as rationalizations for wicked “globalization” or as inimical to various notions of nationalist solidarity.

The answers to these questions (in order: both, yes, both) once united the Right and illuminated the battlespace with the Left. For more than 70 years, the vast majority of conservatives and libertarians have argued that freedom in the economic realm was not just the engine of prosperity (tool) but was also a good in and of itself (freedom!). That is why, until recently, “conservative economist” and “libertarian economist” were largely interchangeable terms. For the Left, tolerance of economic freedom ran along a spectrum — from absolutely none to an at times grudging acceptance or even modest celebration so long as the proceeds from markets funded egalitarian goals.

But this divide goes back farther — even if the labels get murkier. Yuval Levin, in his wonderful book The Great Debate: Edmund Burke, Thomas Paine, and the Birth of Right and Left, demonstrates that, in the Anglo-American tradition, one of the defining differences between conservatives and progressives is illuminated by the metaphors they choose. For Edmund Burke and his heirs, the preferred images invoke space. The role of the government is to create a zone of liberty where people may flourish according to their own abilities. The state is like a gardener or a warden who protects his charges but otherwise leaves them alone. For the Burkean, the “statesman’s task is therefore not to drive society toward some particular ultimate and just condition,” Levin writes, “but to create and constantly sustain a space in which the people may exercise their freedom and enjoy the benefits of life in society.” Burke wanted a literal safe space for freedom.

Thomas Paine and his heirs use the language of direction and progress. The government isn’t a gardener so much as a shepherd leading his flock to a single destination where all inequities and injustices will be redressed. For Paine this could be achieved only through the blunt application of reason in all things: “It is time that nations should be rational, and not be governed like animals, for the pleasure of their riders.” Virtually every progressive or socialist movement shares this worldview to one extent or another. The job for planners is to guide the wheel of history in their preferred direction, toward their preferred destination.

These two orientations, Levin argues, define the progressive version of liberalism and the conservative one: “a politics of vigorous progress toward an ideal goal or a politics of preservation and perfection of a precious inheritance.”

First, let me just say, mark me down in the precious-inheritance column.

Second, it is important to concede that the new planners of the Right make some perfectly fine points. No one should worship the market as if it were a religion. Government has a role to play in helping the unfortunate, keeping markets honest, and all that. These are easy concessions to make because they are in fact not concessions but broad statements of common conservative opinion and sentiment.

But at the level of rhetoric, where first principles are formed and clarified, this is all very troubling — and very wrong.

There are two obvious ways to make the case for economic liberty: deductively and inductively. Since we’re getting back to basics, let’s start with deductive, the way thinkers such as John Locke, Ludwig von Mises, Ayn Rand, Robert Nozick, and, most famously, Milton Friedman did. “Freedom in economic arrangements is itself a component of freedom broadly understood,” Friedman wrote, “so economic freedom is an end in itself.” The ability to enjoy the fruits of one’s own labors is axiomatically a form of liberty. The ability to buy and sell goods within reasonable constraints (variously defined) is obviously a form of freedom. A ban on the sale of firearms may be an infringement of the right to bear arms, but it is first an infringement of the right to spend your own money as you damn well please. As Nozick memorably put it, “the socialist society would have to forbid capitalist acts between consenting adults.”

If you take remotely seriously the claim that the pursuit of happiness is an inalienable right, it is almost impossible not to recognize that economic freedom is an irretrievably important component of freedom. To borrow a term beloved by Marxist and libertarian philosophers alike, economic activity is an important point of praxis — where theory is put into real-world action. The careers we choose, the music we play, the cuisines we enjoy, the fashions we embrace, the homes we live in — a linchpin of the “American dream” — all of these things manifest themselves in the economic realm because we so often need to pay for the things we want to do. You can spend your life as a monk, but someone still needs to pay for your books and candles. Many of our other cherished rights are often made possible only via economic liberty. As Friedrich Hayek argued, “there can be no freedom of press if the instruments of printing are under government control, no freedom of assembly if the needed rooms are so controlled, no freedom of movement if the means of transport are a government monopoly.” In countries where health care is controlled by the government, the right to life itself is heavily regulated by the state, because it is the state that ultimately decides what treatments and services are rationed.

This idea that the market is just a tool “like a toaster” is profoundly misleading, because it is only a half-truth. Of course the market is a tool. Markets help us make decisions, discover prices, impose efficiencies, drive technological innovation, motivate people to work via the profit motive, and so on. No need to belabor what we can all agree on. But markets are not just a tool. Would Carlson wave away the right to bear arms — guns after all are literally tools — the way he scoffs at the market? We should not worship guns either, but the right to bear arms, like the right to self-defense, isn’t simply a utilitarian concession, it is an inalienable right. Free speech serves as a tool every bit as much as markets do. The dissemination of knowledge, holding government accountable, taking in ad dollars for prime-time cable shows: The right to free speech makes all of these things possible. But is it just a tool?

Then there’s the inductive case. Carlson says that “no problem is solved unless you have a very clear image in your mind for what the result should be.” In ways large and small this is untrue. In our personal lives, many of the greatest things — the best solutions, often to problems we could articulate only in hindsight — were found through a process of discovery. From whom we love and marry to our favorite books, music, food, and friends to the vocations we dedicate our lives to — these are not the culmination of some plan. Science is many things, but without the benefits of accidental discovery, of pursuing blind curiosity, the volume of its accomplishments would be dismayingly slimmer. Parenthood is often a source of great joy; those joys are only rarely and intermittently the product of grand plans coming together.

Likewise, no one planned capitalism. It was in a very significant sense an accidental by-product of the quest for liberty, knowledge, and peace. The Calvinists described by Max Weber in The Protestant Ethic and the Spirit of Capitalism did not develop their theology to get rich, they got rich because of the changes of habit and custom their theology required of them. Religious pluralism itself wasn’t the plan, it was a compromise after a century of war. As the historian C. V. Wedgwood put it, the West came to understand “the essential futility of putting the beliefs of the mind to the judgment of the sword.” Religious freedom yielded new freedoms — to innovate not just theologically but economically. Trade itself is an innovative compromise that allowed us to get past zero-sum acquisition by force in favor of mutually beneficial exchange. The market creates peace and freedom by allowing strangers to interact without resort to violence.

Tilt your head just slightly and the historical record shows the causal arrows pointing in a different direction. Economic liberty created a demand for political liberty. Locke, both hailed by many and now vilified as the father of liberalism, was a devout, if idiosyncratic, Christian of Calvinist roots who believed economic liberty to be the keystone of liberty itself. The right to private property, including the ownership of one’s own life and body, and the right to own the fruits of one’s own labors, is what made freedom not simply possible but morally necessary and even divinely mandated. “The state of nature has a law of nature to govern it,” he wrote, “which obliges every one: and reason, which is that law, teaches all mankind, who will but consult it, that being all equal and independent, no one ought to harm another in his life, health, liberty, or possessions.” There are sound conservative objections to Locke, originally formulated by Willmoore Kendall in 1941. Locke was a passionate individualist but also a believer in unfettered majority rule. Kendall identified the explanation for this seeming inconsistency: He believed that humans by nature were moral and rational. Locke’s anthropological assumption is certainly worthy of debate.

But whichever way you come down on the integrity of Locke’s philosophy, the historical fact is that it served as a powerful weapon against notions of aristocracy and the divine right of kings. And the rising middle class — the bourgeois burghers and businessmen — of Western Europe used these ideas, as well as those of the liberal French philosophes, to press for greater and greater political liberty as a means to secure their economic freedom. As their ranks swelled, so did the coffers of the tax collectors, which led to even more demands not just for greater representation but for neutral rules set apart from the whims of rulers and from the hereditary prerogatives of aristocrats. “Historical evidence,” Friedman observed, “speaks with a single voice on the relation between political freedom and a free market.”

This points to the importance of rhetoric, which Wayne Booth defined as “the art of probing what men believe they ought to believe.” Locke’s analysis may leave room for serious correction, but the ideas he represented put the West and the world on a path toward freedom and prosperity. Changing what men ought to believe, as history has shown countless times, can take them off the path.

Consider the rule of law. As a component of liberalism, the “rule of law” is often listed as separate from “limited government,” and in some cases rightly so. But the rule of law is synonymous with limited government in another sense. When the rules apply the same to rulers and ruled, the arbitrary power of the state is curtailed. Defending free markets, often over the objections of monied interests seeking to rig the system in their favor, is indispensable to protecting freedom in general. For when the state is captured by factions, they will not stop at regulating economic arrangements alone.

This points to the real problem with the new crisis in confidence in the free market. It’s an attack on the wrong problem. Many a new fan of statism on the right has convinced himself that “globalists,” “elites,” “cultural Marxists,” or some other “neoliberal” cabal has rigged the system in its favor. In some specific cases, it is an understandable and defensible proposition. The problem arises when the inference is turned into a systemic indictment and the system in the dock is the market. The villain is not the market but the state. More specifically, the interests that capture the state, or mechanisms of it, are to blame. That isn’t the free market.

In The Wealth of Nations, Adam Smith wrote that “people of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.” This line has been quoted by critics of capitalism in all parties since 1776. They ignore what Smith went on to say. “It is impossible indeed to prevent such meetings, by any law which either could be executed, or would be consistent with liberty and justice. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies; much less to render them necessary.”

Smith’s point was the same one addressed exhaustively in The Federalist Papers: faction. Whether it’s banks or government unions, sugar farmers or the higher-education lobby, the most enduring threat to freedom, economic or otherwise, comes from factions’ seeking to marry the state to their narrow interests or agendas. Capitalism emerged in England in part because the king was weak and competing sources of power had to be accommodated. That’s how the Magna Carta was born. Nobel-prize-winning economist Douglass North demonstrated that the more diversely power is distributed in a society, the more the different institutions holding power are incentivized to agree to neutral rules that are fairly enforced for everyone. The more healthy institutions you have, the more room there is for other institutions to rise up, and the greater the number of opportunities that emerge for individuals to discover new sources of meaning and avenues to pursue happiness. Joseph Schumpeter demonstrated that monopolies can’t endure in a free market — if they do not have the protection of the state. Monopolies are the goal not simply of trusts and combines but of every faction convinced that its interests deserve special dispensation from the state or devoted to the idea that its vision of society should be binding on everyone.

For millennia the vast majority of human beings were poor and unfree because a handful of interests symbolized by the throne, the altar, the guild, or the sword used its power to stifle innovation in any form, because innovation is always a threat to the established order. Order is both good and valuable, when it is just. But too much order stifles innovation, and innovation — which is possible only where there is the freedom to innovate — is the indispensable wellspring of economic growth, material prosperity, and the pursuit of happiness. The Founders understood this, which is why, prior to the ratification of the Bill of Rights, the word “right” appeared in the Constitution only to protect intellectual property: “to promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”

Those who think that the solution to our problems lies in granting the government even greater power to “plan” how people should live are not merely making Friedrich Hayek cry, they are no doubt unwittingly following the path of every enemy of freedom since freedom was conceived as right for all, not just those at the helm. They may couch their appeals in the language of populism, socialism, or nationalism and defense of the common folk. But they invariably have in mind only one slice — their slice, their faction — of the public as truly deserving. “Believe me, sir,” Burke writes, “those who attempt to level never equalize. In all societies, consisting of various descriptions of citizens, some description must be uppermost.”