TGIF: The Nonsense of Statist Political Economy

In the video "How Capitalism Makes You Less Free," self-described Marxist Grace Blakeley, author of Vulture Capitalism: Corporate Crimes, Backdoor Bailouts and the Death of Freedom, boldly asserts that all societies must have some kind of economic planning. That's hardly news in 2024. Free-market liberals, or libertarians, have long taught that the issue is not planning versus no planning but who plans: free profit-motivated, consumer-oriented individuals independent of the state and other coercion or force-wielding centralized bureaucrats and their cronies, with or without democratic window-dressing. 

Blakeley rejects independent planning in favor of democratic planning. But that means coercion must be in the picture. For all her concern about freedom, she doesn't use the word as everyone else does.

Blakeley, a 30-year-old commentator on political economy with two books now under her belt, seems confused. She's worth discussing because her views would be well-received on American college campuses.

Her answer to the great social question is a complex system of multi-layered purportedly democratic planning and accountability. Worker-managed entities and other democratic bodies would check one another to keep them in line. Any other form of planning, ranging from business owners running their own firms in competitive markets to the centralized "fusion between public and private power" would be forbidden. Her argument heavily relies on horror stories involving profit-seeking businesses. Of course, democratic people's republics have never committed atrocities. The collectives she envisions would always serve the public interest because of "democratic oversight."

Need I point out that this is oversimplified and that some distinctions are required? Fully private profit-and-loss decision-making -- independent of the state -- is what authentic liberalism, or libertarianism, calls for. It requires no state whatsoever because entrepreneurs can produce law and rights protection. On the other hand, the "fusion between public and private power" is fascism, the negation of free private consensual enterprise. Like all fascism, Nazism was socialism with a thin veneer of private ownership.

Blakeley would have us believe that a bonafide free market is not an option. (She doesn't regret that. But why not?) So let's stop talking about it. We must choose between coercive planning for the rich and coercive planning for all.

"Capitalism requires a certain amount of centralized planning to function," she says. It is a "central part of the way the capitalist system works":

In the [pre-World War II] laissez-faire period [Henry] Ford does whatever he wants; the state does what he says. In the postwar period Ford has to manage his relationship with workers and he has to manage his relationship with the state and all three of these parties had to come together and try to decide what happens next. What changes in the neoliberal period [beginning in the 1980s] ... the decision-making power is basically returned solely to capitalists and their allies within the state.

Now hang on. What laissez-faire period? She told us laissez faire was impossible. So how did the impossible exist?

She has more problems. If the state did what Ford told it to do, why does she call that laissez faire? This is basic stuff that she can't get right.

After the war we got a sort of fascism, but Blakeley won't call it that. The federal government (gun in hand) tried to orchestrate cooperation between business and labor. (Ayn Rand properly labeled John Kennedy's New Frontier "the new fascism.") But then when Reagan (and Thatcher) came to power, we returned to the impossible laissez faire that can't exist. Confused? So am I, and apparently so is she.

Here's another gem. "Individualism is hampering any kind of change because it's hampering our ability to organize collectively." Never mind that for centuries, individuals have voluntarily joined together in formal and informal markets to accomplish what one could not do alone. Blakeley poses as a champion of workers, but she's an elitist. She knows better: what we need are coercively organized "democratic" collectives for everything. She condemns the "gig economy" because it does not have real employment. It's elitism in populist clothing.

And here's another doozy:

I harken back to this Marxist socialist idea of freedom, which looks at -- yes, individual freedom and autonomy, but also your freedom as a member of a group to shape the conditions that affect your life and your existence.

Where is room left for individual freedom and autonomy?

Even in this mixed economy, people -- thanks to the coordination that market exchange and prices make possible -- substantially shape their lives. Of course, they would have even more control if the government would get out of the way by abolishing housing and land-use restrictions, occupational licensing, business-permit requirements, central bank fiat money (that causes inflation and recessions), theft-by-taxation, immigration barriers, victimless crimes, intellectual "property," surveillance, and other impositions. To the extent workers are unfree, it's because politicians and bureaucrats have the power to privilege themselves and their cronies at everyone else's expense.

Democracy, of course, is majority rule. What's so great about forcing everyone, Rousseau-style, to obey the majority? Should the majority prevail on everything? If not, what's beyond its reach? How is that line drawn, by vote? What keeps the majority from crossing the line it establishes? What happens to the individual, the smallest minority?

Democracy settles nothing. It simply shifts problems from the realm of consent, where problems are manageable thanks to the profit incentive and price coordination, to the realm of coercion, one-size-fits-all answers, perverse incentives, one-vote impotence, and the mirage of accountability. (Compare a consumer who, without notice, switches products to a citizen who wants to switch democratic rulers.) 

Blakeley should read Benjamin Constant's classic essay, "The Liberty of the Ancients Compared with that of the Moderns." She is an ancient -- and in this context, that's no compliment.

Even with hampered markets, general living standards in the West and other places have been dramatically rising for hundreds of years because of the Industrial Revolution and global liberalization. Consumption inequality has fallen. The labor-time price of all goods has dropped. The division of labor and trade have created broad-based wealth. Global poverty has plummeted. Despite government interference, rich and poor get richer. We need more freedom, not less.

Finally, though much more could be said, Blakeley and her fellow socialists must come to terms with Ludwig von Mises's proof that socialism, democratic or otherwise, cannot produce high living standards for a modern society. For that, we need real prices, exchange ratios, for producer and consumer goods; otherwise no one can rationally calculate the best way to produce what we want in a world of scarcity and uncertainty. But you can't have real communicative prices without markets, and you can't have markets without free trade in labor services and goods and resources. That requires self-ownership and private property. Abolishing private property, Marx's chief hope, would destroy our ability to increase prosperity for all.

That is the century-old Mises-Hayek argument against socialism. The socialists lost. Someone should do Grace Blakeley a favor: send her a copy of one-time British Marxist David Ramsay Steele's From Marx to Mises: Post-Capitalist Society and the Challenge of Economic Calculation.

The Logic of It All

This is how some people think: Business has long used the government to gain benefits it could not get in the marketplace. I have the cure for that: Abolish the market and expand the government to encompass all of society.

What Is Easy and What Is Not Easy

It is easy to oppose Israel's massacre in the Gaza Strip. Just watch a few horrifying videos. What is not easy is understanding the price system, its prerequisites -- private property and free exchange -- and its benefits for mankind, including civil peace.

Can't We All Get Along?

Pre-Zionism and pre-Israel, Arab-Muslims, Arab-Christians, and Arab-Jews (yes!) got along in many places as neighbors and friends. Compare that to Europe. Arab and Jewish nationalism messed it up. See Avi Shlaims's Three Worlds: Memoirs of an Arab-Jew.

TGIF: What Is Self-Determination?

People go on quite a bit about self-determination these days. Some decry the denial of self-determination to "the Palestinians." Others insist that only "the Jewish people" can have the right to self-determination between the Jordan River and the Mediterranean Sea. Israel passed a law declaring that principle in 2018.

Unfortunately, I see too little thought behind the term self-determination. What is it? What self are we talking about? What is determination?

This and the related issue of nationalism are big topics with an unsurprisingly big literature. I will resist talking about nations and nationalism. Karl Deutsch got it right: "A Nation ... is a group of persons united by a common error [fiction might have been the better word] about their ancestry and a common dislike of their neighbors." I also appreciate Ernest Gellner's insight: "Nationalism begets nations." It's not the other way around. Moreover, individuals, often with power agendas, beget nationalism. Finally, nationalism begets more nationalism because disliked neighbors may feel the need to respond.

Here, I just want to help clarify the terms. If I do my job, I am confident I will offend everyone on some thorny controversies.

Let's start with self. I know what that usually means. Persons are selves. (Persons don't have selves.) Everyone knows what it means to be a self and to be self-conscious The self-evident needs no elaboration.

Determination in one sense refers to the process and outcome of human action. We determined what would happen by doing what we did. Or we tried to. A person can determine an outcome for himself (I determined I would get a haircut today) or for someone else (I determined that you would get a haircut today). We'd want to call only the first example of self-determination. We could also call it self-ownership, a felicitous phrase.

What distresses me as an ethical and methodological individualist -- a libertarian -- is that I don't see the term being used this way. The priority is the group, the nation, the people, and the like. Where are the persons?

A group has no self; it comprises many selves -- as many as it has members. What makes it a group can be a range of common interests or traits and continuing relations; they might have customs, mores, expectations, roles, rules, and more. But none of that keeps the group from being a collection of individuals. When a group decides, we mean that the members decide. The group does not literally decide.

When we say a group is dispossessed of its land or subjected to genocidal aggression, the crimes are against individuals. Individuals should not be reduced to mere members, representatives, or symbols. This is not to minimize genocide. The point is to keep the spotlight where it belongs: on individuals, who can live or die and without whom no group exists. If a group is important, it's because it is important to the individuals who comprise it. They may regard their association as crucial to the lives they wish to live. But they are still individuals. They decide (unless the state or someone else interferes). They value. They are the group.

If individuals, however many, peacefully, freely, and regularly associate, establishing a culture, customs, and rules of governance, we can say as a matter of convenience that the group exercises self-determination. If they are invaded and then drive the invaders away, we can say the group has restored its self-determination. But we must be careful: a group tyrannized by one of "its own" or by a democratic majority is no more self-determined than a group tyrannized by an outsider or a majority of outsiders. What counts are individuals, their values, and the nature of their associations. 

Democracy is not self-determination!

So the principle of self-determination cannot be directly applied to nations or peoples, such as "the Jewish people," "the Palestinian people," etc. -- only to persons. Woodrow Wilson is best associated with the phrase national self-determination though he did not use it in his Fourteen Points speech during World War I. He didn't help things. Strictly speaking, there is no right of national self-determination. (And remember, nation is a political, not a metaphysical, concept.) Only persons -- not states, nations, or "peoples" as such -- have the right to exist.

The need to re-individualize self-determination seems relevant to current controversies. Putting individuals first may produce overlooked approaches to peaceful resolutions.

Methodological individualism seems unassailable -- what is there besides persons, their property, and their relationships? Coercive government interference sows problems. Equally unassailable is ethical individualism. Who would oppose societies of thoroughly free and voluntary associations, starting with respect for individuals and their property? Speak up or forever hold your peace.

Lying Politicians Gonna Lyingly Politick

House Speaker Mike Johnson speaking on Holocaust Remembrance Day:

We remember what happened then [in Nazi Germany], and today, we are witnessing American universities quickly become hostile places for Jewish students and faculty.

The very campuses which were once the envy of the international academy have succumbed to an antisemitic virus. Students who were known for producing academic papers, are now known for stabbing Jewish peers in the eyes with Palestinian flags.

Faculty who once produced cutting-edge research are linking arms with pro-Hamas protestors calling for a “global intifada.”

Administrators who were once lauded by their peers for leadership are barring Jewish faculty and choosing not to protect their Jewish students. Jewish students are physically threatened when they walk on campus, as their peers hold posters repeating the Nazi propaganda and the program: the final solution.

Now is a time for moral clarity – we must put an end to this madness.

The Purpose of the Antisemitism Awareness Act

The point of the House-passed (and misnamed) Antisemitism Awareness Act is not to empower the Education Department to sue and defund colleges under civil rights law. It is to make lawsuits unnecessary by chilling expression.

Zionism versus Judaism

From the start, political Zionists identified their program with Judaism the religion (despite their secularism, even atheism).

Also from the start, Jews -- including the most tradition-bound Jews -- vigorously disavowed that identification. They were shamed as self-hating traitors to "their people." As a consequence, many went silent and eventually acquiesced in the creation of Israel, the self-identified "Jewish state." Some even converted to Zionism.

So don't blame non-Jews for being unclear about the relationship between Zionism and Judaism.

Richman and Woods

Tom Woods and I discuss alleged antisemitism on U.S. college campuses:

TGIF: Another Bogus Antisemitism Scare

I've been watching and thinking about the nationwide campus antiwar demonstrations in support of the suffering Palestinians of Gaza, and the appalling reaction to and "coverage" of those events. Something important needs to be addressed.

I won't be concerned here with the violence committed by anyone, including the police, or by lesser misconduct, such as occupying and damaging buildings and other violations of university rules. It's also irrelevant whether the demonstrations stand any chance of ending Israel's onslaught or ending U.S. and university complicity in it, or whether most of the pro-peace demonstrators share a libertarian orientation. (Not likely.) All that is for another time.

I want to examine the overwhelming depiction of the demonstrations as nothing more than rank antisemitism -- the blind hatred of all Jewish people because and only because they are -- by birth, blood, belief, or practice -- Jewish.

Are the demonstrations antisemitic and hence pro-Hamas, as Spiked magazine and many other observers claim? Are the protestors tapping into what CNN's Dana Bash called "a deep undercurrent of antisemitism"? (The smears know no bounds.)

To sort this out, I thought I might employ one of my areas of expertise. I spend a lot of time watching excellent British television police dramas. I consider myself a student of British detective techniques. (The Brits take their police dramas very seriously.)

Among other things, I've learned that if a crime is alleged to have been committed by a particular person, but you have no damning CCTV or credible witnesses, you begin your investigation by asking if the "person of interest" has a plausible motive for the offense. If not, the chances are good that the person is innocent. People act, which means they have motives.

That's what I want to do here regarding the campus demonstrations, which are on their face objections to Israel's bloody (not just in the British figurative sense) seven-month campaign against the Gaza Palestinians. That campaign has taken at least 34,000 lives, injured and starved countless other people, and destroyed so many homes, hospitals, universities, and other facilities vital to life.

So here's the detective's challenge: why would non-Jewish pro-peace demonstrators on college campuses across the country knowingly, intentionally alienate their clearly Jewish pro-peace co-demonstrators with whom they encamp all day every day, sharing meals, having teach-ins together, and participating in ecumenical outdoor religious events, like Passover seders? Why would antisemites want to do it?

Does that sound remotely plausible? Are the Jewish students idiots who don't recognize antisemitism when they're supposedly drowning in a sea of it? Are the antisemites able to threaten Jewish non-demonstrators and pro-Israel demonstrators while keeping it a secret from Jewish demonstrators standing next to them? That seems unlikely.

What do they take us for -- those pro-Israel alarmists, who see an existential threat to all Jewish people every day around every corner? They assume (or pretend to believe) that anti-Zionism -- that is, opposition to a Jewish supremacist state -- is the same as antisemitism. But a moment's reflection reveals that this is bunk -- no matter how many times Israel's partisans say so. On a variety of grounds, many Jewish people fundamentally oppose Israel as a Jewish state. They have since the time of Theodor Herzl, the reputed founder of Zionism.

As an aside, this is not the first time that America has been subjected to a false antisemitism scare. The boy has cried wolf falsely many times before. Whenever Israel lays waste to Gaza, a sudden spike in antisemitism is reported by the Anti-Defamation League, AIPAC, and their congressional spokesmen. Isn't that interesting? Or is it? Could it be that the Israel lobby weaponizes antisemitism to shut up anyone who would object to Israel's crimes against humanity?  (For a close look at this weaponization, see Norman Finkelstein's Beyond Chutzpah: On the Misuse of Anti-Semitism and the Abuse of History.)

Israel's partisans tell us that America's campuses today are indistinguishable from 1930s Nazi Berlin. Jewish students, they say, are routinely harassed, threatened, and assaulted. They can't walk safely to class. The Hitler Youth rule. Really? I can't recall newsreels from the Nazi years showing Jews and non-Jews peacefully celebrating the sabbath and Passover with open-air religious services and meals. Have you ever seen films from Nazi Germany in which Jewish Germans enthusiastically sported tee-shirts emblazoned with sayings like: "Jewish Voice for Peace," "Not in Our Name," "Jews for a Ceasefire Now," and "Jews for Freedom in Palestine." Maybe the memory is suppressed, but I'm pretty sure I haven't.

My policy is to assume good faith in my opponents, but it's tough in this case. I am confident that the alarmists do not believe their own words when they say that terrorists and Nazis control the universities.

So why do they say it? Because it distracts attention from Israel's unending massacre. The apologists' agenda is to support Israel no matter what and to explain away the palpable atrocities. It's also an attempt to continue America's shameful complicity.

If Israel and its supporters were truly concerned about antisemitism (rather than needing it to prevent assimilation and abandonment of Israel), they'd do some soul-searching. Israel identifies itself as the Jewish state and claims to represent “the Jewish people” -- not only Jewish Israelis but Jews everywhere whether they want it or not. Thus Israel’s long mistreatment of the Palestinians encourages, at least tacitly, the relatively few antisemites, who are eager to point to anything they can use to describe “the Jewish people” as bad actors. "The Jewish state equals the Jewish people" — that’s what they’ve been told by the pro-Israel side. It’s not true, but they're happy to believe it.

In other words, Israel’s definition of itself and its abuse of the Palestinians ratify the antisemites’ crazy ideas about the international conspiratorial malevolence and collective guilt of "the Jewish people." Antisemites are encouraged to ignore the overrepresentation of Jewish Americans in the ranks of Israel's opponents.

Israel and its supporters then aggravate matters by strategically equating odious antisemitism with honorable anti-Zionism. That in turn gives cover to the antisemites, who can hide in plain sight among the anti-Zionists.

That amounts to Israel's protection of antisemitism!

You’d think that would be a bad thing. And it is. So why do Israel’s leaders and supporters do it? Because all that matters is the tribal sanctuary, Israel.

My Latest Interviews

Michael Liebowitz, the host of The Rational Egoist, interviewed me about my life in the libertarian movement. Enjoy!

Also have a look at my interview covering my libertarian experience and the Israel-Palestine conflict on the Bob Murphy Show.

Israel's Amazing Feat

Israel has accomplished quite a feat: its crimes against the people of Gaza are of such a large scale that they make Hamas's Oct. 7 crimes look small.