Rebirth of Reason


Implementing Capitalism
by Manfred F. Schieder

"The battle (for a better world) is primarily intellectual (philosophical), not political. Politics is the last consequence, the practical implementation, of the fundamental (metaphysical-epistemological-ethical) ideas that dominate a given nation's culture. You cannot fight or change the consequences without fighting and changing the cause; nor can you attempt any practical implementation without knowing what you want to implement." - (from "What Can One Do?", by Ayn Rand)
     This is the second part of my earlier article "Preparing for Capitalism" where I presented some reflections that will have to be taken into account to attain the implementation of liberalism (in the European sense of the term) as the future social system and Capitalism as its economic tool. In "Preparing for Capitalism", I set off the premise that side by side with the spread of the liberal ideas in a continuous increase of the teachings to the general public, it is necessary to also establish the further steps required for the practical launching of the system.
     Perhaps some readers will consider the present moment to be too early a time for such undertakings, but history has shown repeatedly that early starts not only yield readiness but also add their own measure of compulsion on historical developments. Hence, the time is right to speak of the training of the Administrators of Political Enterprises that will be needed in the future. Some of them will be found among the present managers of enterprises, some among free entrepreneurs, some among recent university graduates of every area of rational endeavor, students and further graduates from technical schools, economy seminar teachers and attendants and, further on, all those able and willing to participate in the intellectual-practical matters related with the effort involved. Their activities will specifically relate to two areas: a) Dismantling the State in its function as a government, reform it to become an Administration of the Means of Defense of the Rights of the Individual, and restructure the Courts of Justice and the military and police security organizations to fit them to the specific duties they will have to accomplish in said Administration, precisely as the ideas of personal liberty specify, and b) the directly related administration of said structure of defense which will exist on a par with Courts of Appeal and Mediation, private security systems, and so forth.
     Preparing these future administrators presents some related questions that could imply, at first sight, a contradiction in terms:
     1) Won't the preparation of the administrators not imply that a new nomenclature of bureaucrats will be set up, which will merely replace the already existing cadre of rulers?
     2) Hence, who will control the administrators?
     3) Won't the activity of the administrators not imply in itself a limitation of the liberties of the general population?
     4) Will it be possible to avoid any excrescence, any swelling, any bureaucracy of the new system?
     5) Doesn't the dismantling of the State down to the level of it merely becoming an Administration of the Means of Defense of the Rights of the Individual include in itself the unavoidable removal of the positions to be occupied by the new administrators themselves, particularly in view of the fact that the new administration will not have any monopolistic privileges of its functions, as mentioned earlier?
     6) Will this not promote a fight between the Administration and the further private organizations?
     An analysis of the foregoing six questions shows that question No. 5 contains the solution to the first four topics. The dismantling of the State implies the dismantling of the dismantlers who, additionally and through a proviso of the future Constitution, will not be allowed to turn their activities as administrators into a professional career for life. They will be allowed to occupy their position as administrators for only one period of 6 years during the whole length of their life and, at the end of their term, they will not be allowed, under any conditions and circumstances whatsoever, to participate ever again in any other or further tasks within the Administration or any other organization related with it. The control to attain this aim will be an extremely strict feature of the new system.
     However, it must be pointed out that the training as administrators itself, will turn them into natural and desirable nominees for any management position within any private enterprise, for these companies will not fail to appreciate the enormous amount of knowledge on the functioning of the Capitalist system gained by a person that has operated in the Administration of the Means of Defense of the Rights of the Individual. His (or her) activities and knowledge are per se totally different from the ones corresponding to judges, prosecutors, defense counsels or men of arms. Their task will not be to administrate justice or conduct armies, but merely to eliminate all those State departments and related organizations and components that interfere with the activities of peaceful and productive individuals and, once this aim has been reached, watch against any possible return of doctrines opposing the functioning, in favor of the peaceful and productive population, of the Administration of the Means of Defense of the Rights of the Individual. This means that they will be directly in charge of a) separating the State from any economic activity, and b) transferring to private entrepreneurs all State enterprises operating in the area of production, communication, transport, etc. This means, of course, that the State will be separated also from, among others, insurance companies, whose main interest was, is and will continue to be insuring production systems and the transport of their products. And, so too the banking, gold bullions production, money exchange, stock and trade markets will be strictly held by private individuals and/or associations of private individuals. This involves the fact that any so-called "legal tender" printing lacking the backing of real value (gold, etc.), will be constitutionally prohibited to any institution whatsoever.
     Education and further endeavors of all kinds will, of course, also be kept strictly in private hands.
     This new social system is truly a watershed, for it separates it from any system related with collectivism in any of its various manifestations and aspects. Ayn Rand determined this with strict preciseness when she wrote in her opus major "Atlas Shrugged" that "Congress shall make no law abridging the freedom of production and trade…" and, further on, set in Galt's Gulch the functioning basis of private undertakings.
     While collectivism or the nowadays existing "mixed economy", a noveau term of the still existing age old feudalism, is ruled by a State that requires everything to give it even the vestige of a productive activity - which immediately reveals the fact that centralization blocks every possibility for it to function in society's benefit - liberalism, in intellectual and practical opposition, opts for the total decentralization as the correct way to unclog the veins of society. Through an automatic system of rewards and punishments the market determines who provides the best products at the cheapest price and, accordingly, most efficient cost of production.
     With reference to the second part of the 5th question and the 6th question posited above, this indicates that private organisms of security will cooperate with the official ones, obliging both to behave civilly: Courts of Appeal and Mediation, security systems within companies and communities will exercise an additional control on every possibility of bureaucratic expansion. The existing literature on the Capitalist system has analyzed these aspects beyond any possible doubt or question and supplies the answers and adequate methods. Already at the present time no conflicts of interests exist in related areas: private enterprises chose the Courts of Appeal corresponding to the commercial matters under dispute and the laws that constitute the basis of their activities include all the norms and procedures required for one Court to accept or, eventually, oppose the rulings of another Court and, in such cases, find an agreement. Financing these systems will be attained by charging for services rendered to those that require them and a small percentage added, if agreed upon by the specific purchaser, on every bill or invoice to specifically cover Court and security expenses against any possible malfeasance, misfeasance and nonfeasance in relation with any product and service that does not fulfill the conditions or services promised. This will also avoid channeling money specifically related with a given specification or service to a purpose different from the one established on the contract.
     The future Administrators will only be trained in private and secular schools and institutes, as pertains to a Capitalist system of private teaching. This will, in addition, strengthen the predominance of the individual virtues of the private citizens.
     Justice itself will be fully dedicated to defend the personal liberty of peaceful, productive citizens. To do so, it won't base its activities on the presently existing Roman legislation but on the so-called "negative laws", which fundamentally are already contained within the original Constitution of the United States of America. Understanding the opposition existing between both is of fundamental importance and would have to be learned by every citizen. Roman law obliges the citizen to do what the law orders him to do. It specifically rules what must be obeyed. On the contrary "negative laws" have a totally individualistic root and goal: here Justice rules not what must be done but merely determines what is prohibited to do. Everything else remains at the personal and direct decision of the individual, the sole limitation being not to damage the rights of other citizens. Liberalism has only one main prohibition: Nobody has a right to initiate an act of violence against another person or persons. This principle constitutes one of the main columns of the Objectivist ethic. Ayn Rand said: "No man - or group or society or government - has the right to assume the role of a criminal and initiate the use of physical compulsion against any man. Men have the right to use physical force only in retaliation and only against those who initiate its use." (The Objectivist Ethics)
     From the foregoing - and the full extent of the liberal ideology confirms it - it becomes evident that this system is totally revolutionary. It is essentially renovating since its purpose is the establishment of something that hasn't existed up to now in full extent: a society of individuals, a society that supplies the basis for every individual to reach his own peaceful and productive aims and not those of an impossible "society as an end of itself".
     What responsibilities correspond to each citizen in such a society? Primarily to learn and understand the function of its philosophical ideological root, which must be done by self-decision, through personal conviction, and not by external obligation. In his book "Socialism", Ludwig von Mises specifically touches this point (Part I, Chapter 4, Section 3). There he speaks of citizens in gesture but not in thought, those that enter a society believing that it merely involves taking up the clothes and habits that are part of it. While it is easily understood that form does not imply content, a fact that history has shown beyond any doubt whether we want to notice it or not, the attitude of complying with outward appearance is not sufficient to act in accordance with the spirit of the new social system. It merely ruins every attempt to better a society. The philosophy that liberalism defends is not a ready-to-wear suit. It is nothing less that accepting the new intellectual backbone, and this can be only attained through a mental effort.
     Hence, we see the direct, inevitable interaction existing between the expansion of the liberal ideology in a permanently increasing area and the training of those who will be in charge of dismantling the State to replace it by an Administration of the Means of Defense of the Rights of the Individual. As the French thinker Alexis de Tocqueville said: "The main task of a good government is to persistently teach the population to get rid of it."
     It is necessary to mentally implement the basis of this purpose. On those who listen to the doctrines of liberalism, the conviction of this unquestionable truth must grow: that the only possibility of generating a way of life proper to the individual, a way of life that insures prosperity and wellbeing and, with it, the possibility of reaching personal happiness, connects directly with clearing the peaceful, productive individual from all bureaucratic tangle, from all vested interests and every obstacle in his free, productive activity. Ludwig von Mises taught us: "Society has arisen out of the works of peace; the essence of society is peacemaking. Peace and not war is the father of all things. Only economic action has created the wealth around us; labor, not the professions of arms brings happiness. Peace builds, war destroys." ("Socialism", Part I, Chapter 3, Section 1)
     This is another way of saying that liberalism is the only social system adequate to the human being. Such a system implies a permanent revolution in the sense that within it routines have no place while innovation is added immediately if it promotes human progress.
     While collectivism represents the system that embodies reality in its worst possibility by degrading mankind from superior beings to a condition of bodiless components of a social structure, devoid of countenance and individuality, that kills his creative power, his purpose and ingenuity, it is liberalism and its economic tool, Capitalism, that provides the fertile ground on which every individual can attain his own purpose and realize it productively. Capitalism accepts the laws of nature and combines them in an infinite and continually novel way. In this way it attains a new reality: life at its maximum potential.
     The time to construct this society is ideal: it's NOW, and Ayn Rand pointed out that we have at our disposal a formidable and invincible weapon and an indestructible ally: REASON and REALITY.
     The reader has them at his disposal to initiate the most constructive and peaceful action. It's high time to use them!
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