The “Trouble with Liberty” is that the Plutocrats write the History

Perhaps there will be some good that comes from the “Tea Party” after all, if the prospect of a “libertarian” junto in DC propels the Beltway punditocracy to form a circular firing squad as means of execution. Case in point is this essay, The Trouble with Liberty, by Chris Beam at NY Magazine, that has been making the rounds. Beam apparently spent considerable time getting the official “libertarian history narrative” from Cato, and then, after being careful not to impugn the respectability of “reasonable” libertarians(read: minarchists) by associating them with the rabble-rousing fringe(read: anarchists), proceeded to nonetheless rip a new asshole in Cato’s libertarian myth. Beam’s argument in a nutshell is that libertarianism is utopian, that it doesn’t deal with the world as it is, and that it retreats to the comfort of a counterfactual theoretical world where it doesn’t have to prove itself. This leads Beam to write: “There are reasons our current society evolved out of a libertarian document like the Constitution.”

Needless to say, Beam’s treatment elicited a number of babbling rejoinders disputing his conclusions. But I am not interested in that. I would instead suggest that Beam’s premise is vulnerable. And I don’t have to expend much energy demonstrating this. I can just simply reach into the circular firing squad and pull out Ezra Klein, who in his zeal to discredit the Tea Party, has started talking about the Plutocratic origins of the Constitution. I don’t think Klein quite gets the fact that “Constitution as Plutocracy” not only takes out the Tea Party Patriots but it also takes out the Corporate Liberal Mythology as collateral damage. Indeed, Ezra Klein also manages to inadvertently debunk the premise of Chris Beam’s argument. This circular firing squad has managed to debunk Tea Party Constitutionalism, Corporate Liberalism and Cato’s minarchist myths in one fell swoop. If they keep firing and piling on, perhaps the emperor’s clothes will be the only thing left.

Indeed, there have been many who have felt the need to pile on this matter, but I will only point out David Frum’s contribution. Frum attacks Beam’s premise as well, disputing that the “Founders” were libertarian. Instead he views them as “State-Builders” and devotes considerable space to demonstrate this, essentially arguing that political libertarianism would have been “doublethink” to the 18th century American mind. Frum claims that libertarianism is only a post WWII phenomenon, after the achievements of “progressive State-building society” had afforded “psychological libertarianism,” i.e, personal liberty, the means to counter the consequences of such a destructive philosophy. Frum claims that “psychological libertarianism” would have been abhorrent to the 18th century American mind because of it’s immediate self-destructiveness at the time. Hence, Calvinism was the dominating tradition. Frum concludes that if the Founders as “state-builders” gave us a government that has now become too big and expansive, then it may be time to take up the libertarian task to reverse this. However, Frum exhorts us to do so without being deluded by a false history.

The Founders were state-builders, very much in the model of the British statesmen of the 18th century. And if the government they built has become too big and too expensive, if the libertarian impulse summons us to take action to contain and constrain that government, very well let us take up the task. But we can do that task without duping ourselves with a false history that denies the reality of the past and – ironically – belittles the Founders’ actual achievements by measuring them against standards they would surely have rejected, if they had ever understood them.

Here, I’m in agreement with Frum. But we cannot allow Frum to simply exchange one set of Plutocratic myths for another.

Certainly, the “Constitution as Plutocracy,” or the “Constitution as Elitist State-Building” would render Beam’s “utopian” critique against libertarianism, the charge that it doesn’t deal with the world as it is, as nonsense. It is a legitimate critique against that very thing. The one bit of comedic irony about Beam’s piece which was so diligent about separating out “respectful libertarianism(minarchy)” from the “radical fringe” before laying the wood to the Cato’s gentlemanly, polite libertarian myth is that the term “minarchy” was actually coined by modern radicals as a disparaging term for such post-revisionist mythology. Beam likely didn’t get that bit of info in the Cato official narrative.

Frum is partially correct about about the “not so libertarian founding fathers.” Frum’s insistence that libertarianism would have been alien to the 18th century American mind is another half-truth. “American Liberty,” which inherited from “British Liberty,” which itself was born out of the long administrative anarchy that followed the “Glorious Revolution of 1688” in England, was largely government by civil institutions. This was the long tradition of self-government that had slowly evolved from a cultural standpoint. In terms of self-government, the concept of “the State” would have indeed been an alien concept to the American common mind. But not to the elite minds(the enlightenment concept of the State), or the merchant traders, the bankers, and the Southern slave-holding land owners. After American victory in the Revolutionary War, the common man had no need of any constitution or central government. But these “elite State Builders” would fight over what type of central government to impose in a pit of interests against interests, particularly with an eye toward territorial expansionism.

Thaddeus Russell’s book, A Renegade History of the United States, pokes serious holes in Frum’s assertions about the “libertarian psychology” of early Americans, particularly among the “common folk.” We’re left a competing version of history that views the “Constitution as Plutocracy” and “Calvinist morality” as a ruling class morality promulgated to get the “common laggard” in line with the program.

Politically, libertarianism has American roots, but these roots would Jefferson and Thomas Paine in Paris, not Philadelphia. That which was too radical for America was exported to “Revolutionary France,” a country that had no “anarchical civil institutional governance” tradition comparable to British Liberty. Rather, it’s tradition was the bureaucratic Ancien Régime. And it would be in France where the radical liberal class critique of “the State” would germinate and take hold. Revolutionary France would eventually become “Revolutionary Europe” by 1848. The relative failures of these “revolutions” to produce meaningful lasting “democratic changes” led to a radicalism that would dispense intellectually with the enlightenment concept of the liberal state, including liberal political economy, altogether. This radicalism separated into factions of libertarians/anarchists vs Socialists/Marxists culminating with the Paris Commune.

One thing to keep in mind is that original radical American liberalism, by which it is meant Paine and Jefferson, after being exported to Europe and going through the ringer of it’s largely caste society, wasn’t emerging on the other side particularly compatible with any liberal institutional elements; never mind the State; we are talking private property, markets and the bourgeoisie classes and it’s civil institutionalism. Although the “bourgeois class theory” crafted by the original French Laissez Faire economists, in critique of Political Economy, serves as the foundation of all modern radical politics, radical politics would diverge far from it’s “bourgeois” roots.

In France, you could loosely define three libertarian wings that would emerge: capitalist(Bastiat), Socialist(Proudhon), and Communist(Déjacque). But libertarianism exported to greater Europe would become more or less solely identified what today we would call left-wing anarchism, meaning anti-property, anti-market, anti-bourgeois. It’s not difficult to see why this probably occurred. Liberal enlightenment drew a distinction between the State, which was force bound by a social contract, and civil society, which was a product of (traditional) anarchic spontaneous order. This was “British Liberty” from which America inherited from. However, most segments of Europe lacked this “anarchic civil institutional tradition” and viewed this “bourgeois order” was anything but spontaneous; rather, such an order was entirely a product of the State and State privilege.

In the United States, libertarianism would stick to it’s liberal roots. There had always been a definitive strain of radical Jeffersonianism that can be traced through the likes of Warren,Emerson, Thoreau, and Spooner, but it would be the civil war that would spawn what might call the first self-identified libertarian movement in the United States. Lysander Spooner would deconstruct the Constitution as an “illegitimate document,” which would be the hitherto most coherent “American Enlightenment Natural Rights” rejection of the enlightenment liberal State. But it would be Benjamin Tucker, who would synthesize French libertarianism, in particular Proudhon, with consistent Jeffersonianism, to form “individualist anarchism,” or liberal anarchism. With Tucker, you see the traditional enlightenment liberal distinction between civil society and the State, but, for the Tucker, the State was a creator of monopoly. Tucker comprised the four monopolies: money,land,tariff, and patent, that were identified as the source of social oppression and economic exploitation. The source of class exploitation was thus the State. The resolution to this problem was to abolish it. This was the logical conclusion of liberal enlightenment, to abolish the State and rely wholly on the social instincts of humans, with complete laissez faire in civil society. Since, in the American tradition, markets, trade, and exchange were seen as spontaneous properties of civil society, markets were a natural component of “individualist anarchism.”

But it should be noted that the “laissez faire” in the original American libertarian movement was anti-capitalist. And this stems from Proudhon’s influence on Tucker. Anti-capitalist here means a rejection of both the Lockean proviso in land and capital, at least the passive “earning” of interest on money. Both thought these things were products of State-enforce privilege and not something that would naturally emerge in a laissez faire civil society.

The meaning of the term “laissez faire” itself, unfortunately, has become completely divorced from it’s original meaning. Yes, it translates as “Leave it Alone” in English but in the historical context, “Leave it Alone” refers to a rejection of State privilege in corrupt French political economy. And as a libertarian doctrine, which is what it is, historically, it means a rejection of Political Economy itself. The French Laissez Faire economists viewed l’industrie, which was their own version of depoliticized market civil society, as eventually supplanting political economy. This is actually not a “capitalist order,” because capitalism refers to Political Economy. However, they viewed some things natural to Capitalism, particularly the Lockean proviso in land and interest on money, as things that would occur naturally in a depoliticized market civil society. Proudhon, who also incorporated laissez faire into his depoliticized market civil society, disagreed that the Lockean proviso in land and interest on money would result from such a thing. There’s a “famous debate” between Proudhon and Bastiat on this matter. In any event, it is a perversion that “laissez faire” has now become synonymous with “laissez faire capitalism,” which literally means “unfettered Political Economy.”

Tucker would further push “laissez faire” to it’s ultimate end point of recasting liberal enlightenment by rejecting “natural rights” in laissez faire Civil Society. On this point, he was influenced by Max Stirner. This would divorce laissez faire civil society from any impersonal duty, even the duty to respect another’s liberty. In the end, a laissez faire social order, one that would maximize human cooperation, could not be built on myths, but rather from an organic institutional framework that balances human egoism with human self-preservation. Libertarianism, birthed from liberal enlightenment, answers Hobbes not with Locke or Rousseau, but with laissez faire.

An interesting question at this point is how in the world did libertarianism ever become associated with “right-wing conservatism” in the 20th century? One immediate response is that the European-flavored anarchist version , of course, never did. It’s the liberal anarchist version in the United States that suffered this unfortunate destiny. And there are a number of contributing historical factors that worked in tandem to explain why this occurred.

First, in the United States, post civil war, libertarian “laissez faire” was competing against an expropriated political version that fueled the rise of the “Bourbon Democrats” who were advocating reform of post civil corrupt political economy. Yes, “laissez faire,” politically in the US was seen as Reform movement; it was in a very real sense the first iteration of the progressive reform movement. Do I need to remind anyone that both Woodrow Wilson and Franklin Roosevelt were both Bourbon Democrats and were elected as Bourbon Democrats in their first elections as President. Their “betrayal” would push the Bourbon Democrats into the GOP, forming the basis of the so-called “Old Right.”

Secondly, the libertarian movement of Benjamin Tucker’s Boston School and his “Liberty” periodical would not survive the fire that destroyed his publishing house nor his emigration to France. The so-called “laissez faire” political reform movement that would morph into progressive, corporate liberal governance set him to mourning that the “trusts” of the “Corporate State” had become so formidable that actual “libertarian laissez faire” was more or less doomed. “Liberal Anarchism” lost it’s most dedicated, fearless champion.

In addition, European immigration would import the anti-property, anti-market version of libertarianism that would largely become identified with “anarchism” in America. When parts of this movement eventually resorted to violence, it served to discredit anarchism and radicalism in general.

Thirdly, libertarianism was based on classical economics, particularly the “labor theory of value.” Classical Economics, however, would be supplanted by the “marginalist revolution.” This wouldn’t intellectually effect the anti-property, anti-market European version of libertarianism, but it would affect the american “liberal anarchist version.” The marginalist revolution would serve as the foundation of neoclassical economics, which, among other things, would de-emphasize the “Political” in Political Economy and instead attempt to formalize economics into a mathematical branch of science akin to something like physics. For various reasons(which I have discussed on previous occasions), Neoclassical economics, particularly with the development of equilibrium theory and welfare economics, would begin to “scientifically” justify a larger role for the State. Enlightenment liberalism and it’s classical economics had distinguished between the State and civil society. But “modern liberalism” and it’s “neoclassical economics” now drew no distinction, indeed it was now more or less “the State.”

The marginalist revolution, however, would also produce a heterodoxical school that would become known as “Austrian Economics.” The first generation of this school, forged by the likes of Carl Menger and Eugen von Böhm-Bawerk, were actually pioneers, key contributors to marginalism. It would be the second generation, notably Mises and Hayek, that would actually become heretics. And this was due to the clash of enlightenment liberalism vs modern liberalism. The Socialist Calculation debates set the stage whether the “Walrasian Auctioneer” could set prices for market equilibrium. Whereas Benjamin Tucker, who had called liberal anarchism “scientific anarchism” and who had argued that such, based on classical economics, had eliminated the State from “liberal enlightenment,” leaving only civil society, the Socialists had ‘scientific statism” based on neoclassical economics that eliminated civil society from “liberal enlightenment,” leaving only the State.

Historically, Mises and Hayek actually lost the debate, leading both to abandon “Neoclassical economics.” Hence, the heresy. Both would set out to restore enlightenment liberalism within economics. Mises with his “Calculation Problem” critique of neoclassical economics and Austrian Economics praxeology; Hayek with his “Knowledge Problem” critique of Neoclassical Economics and his “evolutionary non-rationalist emergent order” strain within marginalism.

For both Hayek and Mises, libertarianism, which to them(given that Hayek was born in Vienna and Mises in Austria-Hungary) would have meant the anti-property, anti-market version, was an anathema. The objective was to restore the enlightenment liberal tradition of State and market civil society. This was the basis of the Mont Pelerin Society, which also included Milton Friedman. Friedman, however, who would lead the 2nd generation Chicago School, did not abandon Neoclassical economics. Whether the Chicago School or Austrian economics, the objective was to restore the enlightenment liberal tradition of State and market civil society, and both held capitalism, .e.g., the Lockean proviso in land and interest on money, to be natural things in market civil society.

Finally, you have to mention Ayn Rand. Rand, who experienced communist persecution as a child, would emigrate to America and formulate an “objectivist philosophy” to counter the communist “DoubleThink” of her youth. Rand would become popular for the same reason that the “counter-culture” would happen: it was rebellion against the Corporate Liberal New Deal collectivist clap trap reinforced by a regimented mentality of previous war generations. Rand, while providing a moral rationale for the enlightenment liberal tradition of State and market civil society, would also claim such rationale as a moral duty.

Thusly, considering all these factors working in tandem, one can see how libertarianism morphed into a “right-wing” phenomenon in the United States. Laissez-Faire was politically expropriated, an anti-property, anti-market version of libertarianism was utterly foreign to American Liberty, and World Wars, the New Deal and Neoclassical Economics would launch a “classical liberal wing” aligned with the GOP that would attempt to counter this with a resurrection of an enlightenment liberal tradition of State and market civil society. It was “right wing” because it was not only “capitalist” but attempted to counter 20th century liberalism by rolling the clock back to 19th century liberalism in regard to State and civil society.

End of Part I

Part II…to be published. “The Rise of the 2nd American Libertarian Movement and the Ultimate Failure of Libertarian Political Reform.”