Power Follows Property, I: Differences that Make No Difference

Both capitalism and the Pro-Life movement have a great deal in common. The corollary is also true, that both socialism and the Pro-Choice movement share a number of assumptions. Paradoxically, capitalism and the Pro-Choice movement, as well as socialism and the Pro-Life movement, also have similarities.

This is not intended to disparage any of these positions. It is a simple statement of fact. Nevertheless, while these similarities do not mean that these positions are substantially or essentially the same, it does serve to increase the already massive amount of confusion in the world. The fact is that all the similarities are rooted in unquestioning acceptance of a fundamental — and false — assumption: that the only way to finance new capital formation is to cut consumption and accumulate money savings, and the equally fundamental but partially true assumption that labor alone is responsible for all production.

We've gone over this many times before on this blog, but let's briefly summarize the arguments in order to understand why, despite all the acrimony, capitalism, socialism, the Pro-Life movement and the Pro-Choice movement all share common ground.

Given the assumption that the only way to finance new capital formation is to cut consumption and accumulate money savings, capital ownership must be restricted to those who can afford to cut consumption or who have so much income that they can't possibly consume all they produce, no matter how hard they try.

If we assume that labor alone is responsible for all production, it is in the long-term interests of the rich to take care of the poor by creating jobs, and capitalism is the way to go. If we assume that the rich are irredeemably evil and will selfishly do what is not in their own best interests in pursuit of short-term gains over long term sustainability, the only way to ensure that jobs are created is for the State to control the rich and thus the economy indirectly, or to control the economy directly by owning capital.

Of course, if we realize that advancing technology is displacing labor from the production process, then a just, third way in which every child, woman and man owns a meaningful capital stake is the way to go. That, however, requires that there be some means by which ordinary people without savings or the ability to cut consumption can acquire capital without redistribution of what belongs to others.

Without direct ownership of capital, a person has no effective economic power, but is at the mercy of whoever provides a job or welfare — or (increasingly) welfare disguised as a job. Without economic power, a person has no political power, although if those who truly have power have a sufficiently developed sense of self-preservation, they will do everything they can to maintain the illusion of democratic and popular power, e.g., elections, guaranteed wages, benefits, and welfare, and (especially) liberty, even license to engage in behavior contrary to traditional moral beliefs.

This puts the power elite into a bind, whether they are a private elite, as in capitalism, a public elite, as in socialism, or the combination of the two we end up with as we drift into the Servile State.

For example, unless the candidates in a "free" election are carefully vetted to ensure that they have no real program, there is always a risk that the great mass of people will get rid of the current elite, and saddle themselves with something worse.

Even more dangerous, if the State has insufficient social surplus on which to draw, or the private sector cannot produce enough to support what the politicians spend, the guarantees made so generously by the politicians will bankrupt the State.

Finally, the very fabric of society rots and falls apart when institutions such as marriage and the family come under attack.

As Aristotle noted, presumably "democratic" behavior is often the surest way to bring about the end of democracy.

Within the past savings paradigm there is no way to resolve these contradictions. There is a way out, however, and that is what we will look at on Monday.

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