by: David Marotta
“Looking Backward 2000-1887” by Edward Bellamy is a socialist utopian science fiction story published in 1888. The story consists of a Bostonian man who falls into a deep sleep and then awakens 113 years later in the year 2000 to find the United States has become a socialist utopia. It’s assumptions laid the groundwork for nearly every socialist perspective and assumption.
One common socialist assumptions is that government collectivism is so essential for success that there is no such thing as self-sufficiency.
On Tuesday, October 8, 2019, David John Marotta appeared on WINA Newsradio 98.9 and AM 1070’s The Schilling Show to take a closer look at socialism’s claim that self-support is impossible.
In Looking Backward, the idea of self-sufficiency is introduced in Chapter 12 when the main character, Julian West, marvels that this future government provides the same annual income for both those who are incapable of working and those who work the hardest. Julian West comments on this practice saying, “It is a very graceful way of disguising charity, and must be grateful to the feelings of its recipients.”
Dr. Leete, the tour guide of the book, reacts emotionally to his use of the term “charity”:
“Charity!” repeated Dr. Leete. “Did you suppose that we consider the incapable class we are talking of objects of charity?”
“Why, naturally,” I said, “inasmuch as they are incapable of self-support.”
But here the doctor took me up quickly.
“Who is capable of self-support?” he demanded. “There is no such thing in a civilized society as self-support. In a state of society so barbarous as not even to know family coöperation, each individual may possibly support himself, though even then for a part of his life only; but from the moment that men begin to live together, and constitute even the rudest sort of society, self-support becomes impossible. As men grow more civilized, and the subdivision of occupations and services is carried out, a complex mutual dependence becomes the universal rule. Every man, however solitary may seem his occupation, is a member of a vast industrial partnership, as large as the nation, as large as humanity. The necessity of mutual dependence should imply the duty and guarantee of mutual support; and that it did not in your day constituted the essential cruelty and unreason of your system.”
There are really multiple incorrect ideas in Dr. Leete’s reaction all of which are common to those who lean toward socialism.
“Who is capable of self-support?”
The idea that no one is capable of self-support and that self-support is impossible is one of the common justifications for socialism. However, this argument nearly always relies on the fallacy of equivocation (using a word in more than one sense throughout your argument), and Bellamy’s argument delivered by Dr. Leete is no exception.
The dictionary definition of “self-support” is “the condition of surviving without reliance on outside aid” or “without outside assistance.”
In one sense, “self-support” could mean that you provide for yourself without relying on the aid, the charity, of others. This is the definition Julian West means.
In another sense, “self-support” could mean self-subsistence, everything that you need you provide for yourself without any need to ever involve the outside world. This is the one that Dr. Leete pivots to in order to create the fallacy and his argument.
In one definition, most families support themselves. Although it is true that within a family, one breadwinner may support the rest of the household, when you take families as economic units, most families are self-supporting. They do not rely on charity, aid, or assistance in order to function. Yes, we buy food from the grocery store and are paid a wage from our employer, but no one is purposefully providing us with welfare or supplementing our lifestyle.
In the other definition, no one can support themselves. Most if not all people in our modern society do not live on self-subsistence. Instead, we have specialized our own efforts and then benefit from the specialized advantages of others through free trade. We let a different family grow our food, mow our lawn, or generate our entertainment, for example.
Additionally, most if not all governments do not exclusively provide for themselves from only local sources in our modern era. We engage in free trade and let a different country grow our bananas, manufacture our shirts, and assemble our technology, for example.
Even though these two definitions produce different conclusions, it doesn’t matter that the same word has two definitions. For Dr. Leete to prove that Julian West is wrong, his argument needs to use the same definition that Julian West uses. When Dr. Leete pivots to the second definition, he is avoiding a real argument and engaging in a logical fallacy.
Using Julian West’s definition, Dr. Leete’s argument falls apart. The simple fact that we are “a member of a vast industrial partnership” by participating in global trade does not mean that we must rely on the charity of others. In fact, it is because of our participation in global trade that many of us can live without the need for additional aid. Our salaries earn us the independence that enable us to live without charity. We are able to acquire that independence earlier than our self-subsisting peers because of our specialization. The poet can feed his family from the wages of his poetry without needing to learn how to grow his own food. Trade enables his self-support.
In this way, the outcome of the mutually beneficial transactions in the free markets stands in contrast to the type of forced duty that Dr. Leete will later call “support.”
The idea, as expressed by Bellamy, is that if society helped you in any way, even if they did so unwittingly and as part of seeking their own benefit, then you have a duty to support society with a vast portion of any gain you received. Once this meaning is unpacked, it makes no sense. If others benefit you through voluntary transactions in their own self-interest, why would that obligate you to benefit them? How does their self-interested sale produce a duty to guarantee their support for the remainder of their lives?
And even if someone receives some benefit through the government, government mandates are not voluntary trade. Without being voluntary, the trade probably does not benefit both parties. It does not make sense to allow government handouts to become both the normal method of distributing goods and the justification for confiscating resources in the first place.
The fact that Bellamy’s argument is not logical has not stopped many modern politicians who lean socialist from repeating the same ideas.
“It takes a village.”
At the 1996 Democrat National Convention, Hillary Clinton gave a speech in which she referenced her new book It Takes a Village and suggested, “It takes a village to raise a child.”
The content of Clinton’s book was often very positive, probably due to ghost writer Barbara Feinman Todd. One section of the book describes the incredible importance of the first few years of a child’s life. Katherine Paterson’s book review in the New York Times describes some of the content:
In rebuttal to the controversial book on race and intelligence ”The Bell Curve,” she cites the Abecedarian Project, led by the University of North Carolina psychologist and educator Craig Ramey and begun in the 1970’s. More than a hundred low-income black infants, whose parents’ average I.Q. was 85, were provided with good nutrition and intellectual stimulation in a preschool where specially trained teachers talked and interacted with the children. A ”home-school resource teacher” met with the parents regularly to help them understand the value of talking and reading to their babies and suggesting appropriate ways to play with their growing children. By the age of 3, the experimental group of children tested 17 points higher on I.Q. tests than the children in the control group. These gains were sustained during years of follow-up study even though the children had gone on to a variety of schools.
While this study is included to show the importance of nutrition and preschool programs, making sure that your child is fed cannot really wait until a government preschool.
One of the most important parts of this described intervention was the encouragement of the parents to talk and read to their babies. One famous study suggests that by age three children growing up in lower income families may have heard up to 30 million fewer words than their more privileged counterparts. By kindergarten, the vocabulary of privileged children may be 20,000 as compared to 5,000 for their less privileged counter parts. Words that are part of an electronic media such as television don’t seem to provide the same benefit. More recent studies suggest that the conversational aspect of language or being read to provides the most significant benefits.
This is one of the reasons my wife and I support the work of The Soho Center which gives books to Head Start classrooms, after-school programs, children’s hospitals, Title I public schools, and many other child-related programs to encourage children’s literacy, school readiness, and school success. The benefit of reading every day during the early critical language development years is that it exposes children to a wide breadth of vocabulary.
It is difficult if not impossible for government to replace the important role of parents in teaching their children language skills during the first three years of life. Study after study also suggests that it is additionally important to have a father in the home (and a mother, though they don’t feel the need to perform studies to justify this point). And our public education system suggests that the responsibility for educating our children may extend far beyond the first three years of life.
Most of the criticism of Hillary Clinton’s book It Takes A Village came in the correction that it takes a father and a mother to raise a child, not just the government. Additionally, critics took issue with the idea that from Hillary Clinton’s perspective the village is Washington, D.C. and the support is given in the form of handouts and mandates that force others to provide entitlements.
“You didn’t build that.”
In a July 13, 2012 election campaign speech in Roanoke Virginia, President Obama commented, “If you’ve got a business—you didn’t build that. Somebody else made that happen.”
President Obama’s comments were an echo of comments made by Elizabeth Warren in a video during her 2011 Senate campaign in which she said:
I hear all this, you know, ‘Well, this is class warfare, this is whatever.’ No. There is nobody in this country who got rich on his own — nobody. You built a factory out there? Good for you. But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police-forces and fire-forces that the rest of us paid for. You didn’t have to worry that marauding bands would come and seize everything at your factory — and hire someone to protect against this — because of the work the rest of us did. Now look, you built a factory and it turned into something terrific, or a great idea. God bless — keep a big hunk of it. But part of the underlying social contract is, you take a hunk of that and pay forward for the next kid who comes along.
I have quoted Warren’s speech because she is clearer in her meaning that Obama was in his comments. Obama’s speech was debated heavily with liberal commentators suggesting his detractors were taking that phrase out of context. However, his commentators were correct in arguing that the speech “revealed a level of resentment toward the private sector that was startling” and “his affection for government becomes a chip on his shoulder, prompting him to dare those private-sector wise guys to deny the centrality of government in their success.”
Elizabeth Warren’s idea of a social contract is a convenient fiction. She speaks about the contract as though it has been signed and conservatives and libertarians are idiots to question it. But one of the basic principles of modern contract law is that a contract is not valid unless all parties voluntarily agree to it without coercion.
Those who lean toward the socialist perspective normally assume that every rational human would agree with such a contract and would want to join the rules of their utopia. They assume that only a mentally disturbed few would object. This is how socialists justify the use of force to quell dissent.
Elizabeth Warren cites four key public infrastructures which she asserts give the government a claim on a business’ profits: roads, education, police, and fire.
Roads are often the first suggestion liberals use to illustrate the importance of government funding because they are a source of common ground between liberals and conservatives. Every libertarian would be ecstatic if governments were limited to infrastructure we all use in common.
However, both Warren and Obama did not want to simply support infrastructure. They wanted, and still want, to soak the rich in order to “spread the wealth around.”
Current highway user fees (gasoline taxes and tolls) pay about half the cost of building and maintaining the nation’s network of highways, roads, and streets. Like the U.S. Postal system, 20% of the roads have 80% of the use. The remaining 80% of the roads are in rural areas where they are infrequently used. Often times, businesses pay the majority of the user fees while benefiting only from the 20% of the roads most commonly used. The U.S. Postal Service has a similar problem with its uniform postage cost. United Parcel Service (UPS) and Federal Express (FedEx) were able to provide business service at a much lower price.
I would not mind the Virginia Department of Transportation (VDOT) being the one responsible to keep the roads in good repair, but in my opinion they do not do a very good job. My experience is that pot holes are over filled in repairs making them moguls only to have them catch on snow plows and turn back into pot holes. During the past decade, I have not seen the job done well once. I’ve complained about the poor repair job to VDOT for the past few years and suggested that whoever they are contracting with to do the job is doing a poor job. But no one at VDOT has anything to gain by spending the time to hold contractors accountable for their work. This is a problem with many government services. They have little incentive to build things well. And they prevent private citizens from doing the job.
We used to have a neighbor willing to plow our streets for free as a service to the neighborhood. VDOT insisted that this was illegal and the neighbor was risking all types of punishment. In seemingly the same breath, they will complain that they are underfunded and overworked. I believe that if our neighborhood were given the same resources to spend, the job would be done faster, more effectively, and for a lower cost.
Instead of allowing this, we are told we must accept the government’s untimely and substandard work and in response be obligated to gratefully give the government a large hunk of what our businesses produce.
Elizabeth Warren suggests that businesses hire “workers the rest of us paid for.” The gratitude, however, should be from the worker who received the education. Without that education they might not have been able to get such a good job. The additional taxes to justify that education will be paid by the worker as they are taxed on their increased salary. The business is already contributing a big hunk of taxes to employ workers in payroll taxes, income taxes, Social Security, and Medicare.
Government may have paid for my high school education, but a government high school education isn’t worth very much. It certainly isn’t worth the amount of money we are spending. Every implication of economic science suggests that this monopoly on education purchased by society costs more to society than it benefits us.
My own public high school is currently ranked in the top 1% of over 23,000 high schools in the country. My children attended a high school in the top 7%. Over 93% of the country should be upset that they and their children have no choice other than to attend the school monopoly in their area. Without competition, school districts have little incentive to innovate or improve. In fact, they have little incentive to even respond to complaints. Milton Friedman considered school choice one of the most important issues in the United States when he wrote:
Our goal is to have a system in which every family in the U.S. will be able to choose for itself the school to which its children go. We are far from that ultimate result. If we had that – a system of free choice – we would also have a system of competition, innovation, which would change the character of education.
In contrast, Elizabeth Warren doesn’t support school choice nor publicly-funded vouchers. She voted against expanding charter schools in Massachusetts. The only choice she is willing to offer parents is to send their child to any school in a failing school district. If no one wants to attend the worst school, she suggests using a lottery system that may short change children whose parents bought a house specifically for the school district. She says she is in favor of improving school outcomes (who isn’t?) and wants to hold schools accountable, but has been quoted as saying, “We do not need high-states testing.”
Meanwhile, Elizabeth Warren’s granddaughter attends the elite Harvard-Westlake School where the annual first year costs are $46,750. Presidents Barack Obama and Bill Clinton sent their children to the elite Sidwell Friends School where the annual costs are currently $46,540.
The liberal elite have choices. No one is or should be grateful for having their choices taken away from them.
Government paid for my High School education but it did not pay for my college education. For that, I thank my parents for living well below their means and saving and investing for years in order to send me to college. Additionally, I worked part-time every year I was in school and full time during the summers.
It might be great if we could rely on the police to keep us safe. But according to the Supreme Court, they have no legal duty to protect anyone. Police get criticized when they over-police high-crime neighborhoods. They also get criticized when they fail to police those same neighborhoods. In the rural areas of the county I live in, police response times average just over 12 minutes for priority one 911 calls. Many citizens and businesses recognize that relying on the police does not provide as much safety as if they were a little more self-sufficient.
When private businesses truly need security, they don’t rely on the police.
It is estimated that private security workers in the United States out number the police by a ratio of about 11:8. Additionally governments spend about $100 billion per year on policing while U.S. spending on security guard services is about $68 billion. Additionally, the private sector spends an annual $66 billion on cyber security. There is even more private spending on physical security infrastructure such as security systems, walls, fences, gates, locks, and vaults which is not counted. And then on top of all of that there are 2.5 million victims per year who use a gun to scare off their offender.
Businesses likely owe less of their safety to government police forces than most of us think.
In a TED talk about policing, Baltimore Police Lt. Colonel Melvin Russell suggests that we rely on the police much more than we should, saying:
We have put too much responsibility on law enforcement. Too much.
And then we have the audacity and the nerve to get upset with law enforcement when we take action. There is no way in the world that we, as a community, should be calling the police for kids playing ball in the street. No way in the world that we should be calling the police because my neighbor’s music is up too loud, because his dog came over to my yard and did a number two; there’s no way we should be calling the police. But we have surrendered so much of our responsibility.
Listen, when I was a little boy coming up in Baltimore — and listen, we played rough in the street — I ain’t never see the police come and break us up. You know who came? It was the elders. It was the parental figures in the community. It was those guardians, it was that village mentality. They came and said, “Stop that!” and “Do this.” and “Stop that.” We had mentors throughout all of the community.
As Police Lt. Russell suggests: We have surrendered too much of our personal responsibility. In his mind, if you want to have the village mentality, it will be people in the community acting outside of official government institutions who will be taking action.
The first fire brigade in the United States was the Union Fire Company, a volunteer fire department formed with the assistance of Benjamin Franklin in 1736. According to Wikipedia, “The United States did not have government-run fire departments until around the time of the American Civil War.”
Where I live, my house is protected by the Crozet Volunteer Fire Department (CVFD) founded in 1910 and proud to be “All Volunteer – All the Time.”
Oddly enough, according to the Cville Weekly, “professionals in the county fire department cannot also serve as volunteers. County officials say they need to keep the camps separate to comply with the Fair Labor Standards Act of 1938.” But according to the Crozet Gazet, CVFD president asked “And who is the county to tell an employee how to spend his free time?”
There is no reason why government has to be the provider of a fire department. And when government does provide funds for a local fire department, businesses pay their fair share of government fire departments when they pay property taxes in proportion to the value of their property. But a fire department in no way justifies government to take a huge chunk of corporate income for a business that has no physical building.
You may think all of this to be small-town politics, but these arguments decide whether we will be indebted to the all-providing state or free to form our own voluntary associations.
The invisible hand of Adam Smith
Behind the socialist idea that there is no such thing as self-sufficiency is the idea that some people, presumably a wise and benevolent government committee, are necessary to oversee and implement the support and infrastructure necessary for businesses to be successful. Nothing is further from the truth. Even the wisest and most benevolent government committee will lack the knowledge needed to run an economy and their influence could cause great disasters.
Putting too much power in the hands of mere morals is a dangerous thing to do. Clark Neily writing for the Cato Institute has a nice analogy about the failure of good intentions without omniscience:
Imagine you have omnipotent power over nature but a poor understanding of how it actually works. One day, after being stung during a picnic, you decide to get rid of all honeybees. What would happen? Before long, wide swaths of the terrestrial ecosystem would begin to fall apart. Crops that depend on bees for pollination would fail; various other plants and trees would be unable to reproduce and would start dying off, followed by the countless insects, birds, and mammals that depend on those flora to survive.
Centralized power is always in danger of doing something stupid. In the article, “Centralized Planning Requires Omniscience” I wrote, “Centralized data collection encourages the hubris of centralized planning.” And when power is centralized in the government they are incapable of having enough information in order to influence commerce for the better. Mathematically, the best price is determined by the market.
The government is always trying either to set prices or to manipulate supply and demand. But there is no one appropriate price for some good or service. Price is set by millions of individuals deciding how much they want something and millions of providers choosing how much they are going to offer to the market. These decentralized decisions can all be made independently of one another and together they produce a free market.
When any component of that market is set by a command economy, the market becomes less efficient and some measure of harm is done. People who would have been willing to pay more than the government price are not allowed to and shortages result. Or people who would have been willing to pay a certain price are prevented from having that good because the government arbitrarily sets a higher price. Voluntary trade benefits both sides, but government action cannot help but push commerce off the economic equilibrium and therefore be less efficient.
Government intervention produces a fragile system. Trying to set one variable of an economic equation causes other components to blow up. Meanwhile a free market is self-correcting and infragile. It automatically corrects market imbalances.
Students of economic science will understand these basic principles, but liberals often get basic economics wrong. While studying economics in college does move people to be economically enlightened, simply having a college education does not correlate with economic enlightenment.
Any student of Adam Smith knows that people engaged in self-interested commerce create an economic system that is in the public interest. They do so without explicitly trying to do so. Economies that allow a division of labor produce markets where self-interested individuals can benefit others. This individualism produces a self-sufficiency even while individuals specialize.
In other words, free markets are the means by which a free people can work together without government intervention and coordination. It is a way to be self-sufficient and still rely on the expertise of others. It is a way to benefit from the work of others without compelling others to work for you.
For an economist, the beauty and moral value of a free market is seen everywhere, from a simple pencil to the fact that you can buy a bunch of bananas in the United States.
In their comments, Elizabeth Warren and President Obama show their disdain for the efficiency of free markets when they imply that everyone must rely on government collectivism.
Every nation has government, but they are not equally friendly and supportive of private enterprise.
The Index of Economic Freedom measures the impact of liberty and free markets around the globe, and consistently confirms the benefits of economic freedom finding:
- People in economies rated “free” or “mostly free” in the 2019 Index enjoy incomes that are more than twice the average levels in all other countries and more than six times higher than the incomes in “repressed” economies.
- There is a robust relationship between improvements in economic freedom and economic growth. Whether long-term (25 years) or short-term (five years), the relationship between gains in economic freedom and rates of economic growth is consistently positive. The economic growth rates of countries where economic freedom has expanded the most are at least 30 percent higher than those of countries where freedom has stagnated or slowed.
Unlike Elizabeth Warren’s economic indebtedness, classical liberals (libertarians) see the purpose of government as providing economic freedom so its citizens can thrive. The factors that produce better economies have been discovered and re-discovered multiple times throughout history. Planned and controlled economies cannot allocate resources efficiently. A centralized planner cannot know and respond to all of the signals as quickly as when the problem is crowd-sourced via the free market.
The choice before us: foster independence or foster dependence.
I am thankful that in my early money memories the lessons were all developing an internal locus of control, an attitude that hard work and grit could be used to overcome most of life’s inevitable setbacks and challenges. Personal success is not often dependent on government policy. Policies or politicians who imply otherwise do the country no favors.
Today’s Helicopter Government tramples over people’s independence by trying to do everything for their citizens. Instead of privacy, they monitor. Instead of independence, they foster dependence. Instead of freedom, they control.
Today families with decent incomes are purposefully lowering their income in order to qualify for subsidized healthcare insurance or reduce their student loan repayment. Families with lower incomes must forgo saving and investing as any countable resources over $2,250 would disqualify them for thousands of dollars of annual benefits.
The choices which must be made to thrive in the culture of government dependency is very different from the choices you would make to be as self-sufficient as possible. Government assistance through entitlement programs rarely produces independence. Instead, the toxic charity of government hurts the recipient.
David John Marotta is the president and CEO of Marotta Wealth Management. This piece originally published here.