Yesterday we gave in very broad outline some of the monetary reforms that will be required to implement Capital Homesteading. Perhaps the biggest reform, however, is in people’s thinking about money. Most people are absolutely convinced that the only source of money for new capital formation is existing accumulations of savings, which by definition are a monopoly of a private sector élite (capitalism), or the State (socialism).
|Money should work for you, not against you.|
There is a problem with that, however. The only two possible systems under what Louis Kelso and Mortimer Adler called “the slavery of savings” are capitalism and socialism, neither of which does anything to secure the natural rights of life, liberty, and private property to every child, woman, and man. And (despite what you might have heard from either capitalists or socialists) neither capitalism nor socialism has been all that successful — if we define success as providing the environment within which every child, woman, and man has the maximum opportunity to become more fully human.
So, did Kelso and Adler mean that savings are evil or unnecessary? No, they just meant that savings should be the servant of people, rather than that people should be the slave of savings . . . or those who have savings — which is next to impossible as long as we have to depend on past savings to finance new capital formation.
To try and get around the slavery of savings or justify it, capitalists (who, to do them justice, at least have the honesty to call themselves capitalists) either say most people can’t own capital and must rely on wages and welfare for income, or other people could own if they just had that “special something” that makes the élite the élite. Private property and other natural rights are fine . . . for those who are fully human. . . .
|"The theory of the communists: abolition of private property"|
For their part, socialists (especially those who don’t want to be known as socialists) either abolish private property outright, redefine private property so that it is no longer a natural right in the same way as life and liberty, or just abolish all natural rights and hand it all over to the collective . . . as if the collective, an abstraction constructed by human beings, could have something that God gave only to human beings. It is impossible for a human creation, an abstraction, to have rights that human beings do not.
So, capitalists and socialists, you’re both wrong. Capitalists, every single human being has the natural right to be an owner, as well as the limited bundle of socially determined rights that define how someone may exercise the right to own in a particular context. Socialists, the collective only has such rights as actual human beings delegate to it, not the other way around.
You see, this whole “money thing” deals not just with one right, but with the whole Big Three of life, liberty, and private property — all of which have been under continuous attack throughout the modern era when the source of rights shifted from the human person, to the State or community. After all, no rights matter if you don’t have the right to life to begin with. If you don’t have that secured to you, anyone who feels like it can just bump you off because you’re inconvenient to someone else for some reason.
|Liberty is freedom of association and contract.|
Liberty? Another way of saying liberty is free association and contract. Free association is key to the exercise of all rights because if others can dictate with whom you associate and can enter into contracts with, then you aren’t able to freely associate, are you? You aren’t free.
Of course, even if you are allowed to enter into contracts, but aren’t allowed to own (have private property in) anything or control what you ostensibly own (ownership and control are the same in all codes of law, as Louis Kelso pointed out), then the “matter” of contracts is missing, and you can’t participate in money creation. All contracts, and thus all money, consist of offer, acceptance, and consideration.
This last, “consideration,” is the thing of value that you own that induces someone else to enter into a bargain with you. If there is no consideration, there is no contract, and no money.
So you see, all three natural rights, life, liberty, and private property are kind of important if you want to have a just society.
So, how do we get away from the slavery of past savings and avoid the Scylla and Charybdis of capitalism and socialism? By creating new money in ways that create new owners, as we’ve been describing on this blog. And what to do about it is what we’ll look at tomorrow.