Although there is very little on which we agree, Marxists and socialists have provided me with some excellent philosophical discussions. One such person recently wrote this article in which he attempted to take to task the libertarian concept of freedom. The piece starts out well enough as he does a decent job describing how libertarians view the concept:
“What the libertarians mean by freedom is that the government does not interfere in the lives of private citizens. If we were freed from government coercion, people would have a good life, because the free market would regulate our lives, and we would need no bureaucrat to tell us how to live wisely.”
Nothing there that I take issue with. The rest of the piece, though; is littered with logical fallacies and false conclusions. His primary thesis is that if an individual must work in order to survive, then he is not free; true freedom is to choose leisure over labor. Throughout, he draws on his personal experiences in education and in retail work to show why leisure is preferable to labor. The way to achieve such freedom of leisure, he says, is through a guaranteed UBI (Universal Basic Income). In a separate article, he examines the UBI proposal extensively.
A driving belief of Marxists, socialists, and supporters of a UBI is a class analysis which claims that in society, there is an exploiting class and an exploited class. Libertarians regard this analysis as correct. The difference is that the former conclude that the exploiting class are capitalists (business owners), and the exploited class are workers; the latter conclude that the exploiting class is the state and those connected to the state, which takes money by force, and the exploited class is everyone else. The difference between the two analyses couldn’t be clearer. No business owner forces anyone to work for him or purchase his product. The state, on the other hand, can only exist through the use of force.
Free market economists liken labor to material resources in that both are scarce. Because of this scarcity, business owners must offer competitive wages in order to attract an adequate labor force. The profit and loss system is the market’s way of signaling whether resources are being efficiently used. If a business can only be profitable by offering sub-satisfactory wages, he will be unable to lure workers, and his venture will fail. If, in order to make a go at it, he offers wages that attract the labor he requires, and then his business makes losses, again his venture will fail as the market has signaled to him that he is making inefficient use of labor resources, material resources, or both.
Socialists will argue that labor is losing its status of scarcity. That as technology increases, and production becomes more automated, the job market decreases. While it is obviously true that certain technological innovations will cause certain jobs to become obsolete, it is wrong to assume that this process will result in increasing unemployment. The labor that is freed by increasing technology becomes available to be put to use in another, perhaps new, sector. Because human desires are limitless (wouldn’t everyone like a personal masseuse, a yacht, a helicopter, a yacht upon which to land their helicopter, etc.?) the demand for labor is also limitless. In his UBI article, he adequately analyzes past shifts in employment by stating:
“Fast forward to 200 years ago, the production of the steam engine implied that factories could produce manufacturing goods in vast quantities and shorter periods of time, allowing a new and more complex form of division of labor to be created. Farmers were moving out of the farms, from which they were either forced out or lured out because of the greater economic opportunities connected with city wage work.”
It is a lack of imagination that prevents this same analysis from being applied to today’s labor conditions.
Socialists will point to employment statistics which show falling labor force participation rates as proof that technology and automation are eliminating the demand for labor. Many will also point to the even higher lack of labor force participation among young people, especially young minorities. They will say that young people, coming into an automated world, are finding that not enough jobs exist through which they can earn a living. This analysis ignores the enormous interventions into the markets that states have undertaken and continue to undertake at increasing rates. Ever-increasing taxes, minimum wage laws, constant creation of artificial regulations, and bureaucratic red-tape all place huge hindrances on the market and is the true cause of a shrinking labor force. Inflationary monetary policies and artificial credit expansion create the unpredictable boom-bust cycle that makes the market largely unpredictable. When markets are unpredictable, business owners will postpone or cancel plans for expansion. Entrepreneurs will be less willing to take the risks necessary to create new ventures. The boom-bust cycle is not a natural phenomenon of a free market economy. It is caused by the aforementioned monetary and credit expansion policies that are only possible through state-created central banking (see here).
In addition to his argument about diminishing demand for labor, he also presents an argument that implies the current labor force is poorly structured. He lists what he calls “bullshit” jobs including accountants, managers, lawyers, consultants, bankers, and financiers who earn an unjustly high income but whose labor provides a “lack of intrinsic value for the society.” His conclusion to this is that if only the bullshit jobs were eliminated, then the capital that goes into those jobs could instead be put toward paying a UBI.
There are several ways to refute this argument. First, any person who is providing a service through voluntary transaction is necessarily providing value. If he wasn’t providing value, the person purchasing the service would keep his money and spend it elsewhere. The decision to partake of the given service is made because the service is valued more highly than the money cost.
Second, it is true that some of the professions he lists earn incomes that exceed the intrinsic value their job provides to society. Bankers and financiers especially, and lawyers and accountants to a lesser extent. These jobs are artificially protected and their salaries artificially inflated as a result of the workings of the state. He correctly states that bankers and financiers “get government bailouts, which is not available to working class people,” but later states that these jobs should stop being produced altogether. Perhaps, but ultimately it is the special state-granted privileges these jobs receive that should be eliminated. Once that happens, the market can determine whether these jobs should exist, and at what salary.
Finally, he is correct that bullshit jobs do exist in today’s economy. However, he is looking in the wrong place. The true bullshit jobs are bureaucrats, politicians, policy makers, lobbyists, generals, dignitaries, and anyone who works for the state. None of these people provide any good or service through voluntary transaction. Each of their salaries is paid entirely through coercive taxation. One only needs to take the word of a former “public servant” to see just how bullshit these jobs truly are.
Let’s return to the definition of freedom. Again, he throws libertarians a bone by saying, “freedom means to own one’s own source of labor.” This is a correct summary of the libertarian principal of self-ownership, but somehow from this he deduces that “right-wing libertarians think that the current oligarchs are the rightful owners of the labor, while socialists believe that workers themselves are the rightful owner.” This is so far from the truth as to be laughable. Workers voluntarily trade their labor for wages so that they can afford to purchase the necessities and amenities that life has to offer. Libertarians believe that workers should keep every penny of their wages, while socialists believe workers should be subject to heavy taxation by an oligarchic government, so this commentary is exactly wrong.
The retort will likely be that business owners earn more than their “fair share” of the income of the business. This constitutes little more than envy and greed. It was the business owner who invested the initial capital to create the business, and who risked all of that capital solely on his belief that the venture would be successful; he had no guarantee that it would be. The business owner offers a wage to a potential worker in return for his labor. No business owner puts a gun to the potential worker’s head to accept the wage, and workers are always free to seek better and more lucrative employment. Likewise, he doesn’t put a gun to the heads of his potential customers; he is only successful by providing a product that serves his fellow man. Additionally, it is always possible for the worker himself to be entrepreneurial; he can attempt to start his own business, and if successful he now becomes the business owner.
Another idea at play here is the economic concept of time preference. The business owner takes a long term return on his labor, while the worker takes a short term return. If a business owner has to invest $100,000 to begin his business, and it takes several years for the business to become profitable, it makes sense that he should earn a return that incentivizes him to take the risk of that initial investment. Workers put up no initial capital and demand to be paid weekly in return for their labor. Workers have a shorter time preference than the business owner. This concept can be likened to a loan where the bank takes a long time preference, and lends money to a borrower who has a short time preference. The bank is willing to forgo the money in the present because it expects to make back more than was lent through the borrower’s payment of interest, while the borrower is willing to pay back more over time than what was borrowed because he wants the money now.
The real person who takes more than their “fair share” are those who work in the state. They are simply busy-bodies who do nothing but interrupt the natural workings of the free market system. In the author’s UBI article, he historically states:
“As societies gradually became more complex thanks to technology and the production of grain surpluses that could also be stored, a whole layer of government bureaucrats, kings, tribal leaders, military officers, and priests were created to run this more complex society. For the first time in human history, it was possible to have a small group of people, who were not primarily responsible for doing the most basic tasks of survival for humans.”
The second sentence of the quote illustrates exactly the libertarian point. The small group of people he describes don’t contribute toward the survival of society. They are merely parasites who live off of the work of those unfortunate enough to not have made it into power. The first sentence begs the question of, if a more complex society with increased productions occurred naturally, then how come after it has come to be does it all of a sudden require a ruling class to “run this more complex society”? It doesn’t, and this phenomenon is what led to the institution of slavery. Once a group of people gains the power to wield control over other people’s lives, where does this power end, and how is it morally justified? Libertarians are morally correct to state that it is never permissible to own another person or their labor. It is the socialists who defend ownership of others.
As he delves into his own personal experiences as related to his concept of freedom, it can be argued that what he is truly seeking is not freedom but the ability to live without working, being productive, and serving his fellow man. Granted, he is seeking this for all, but it can’t be denied that this is the ends he seeks. It’s impossible to deny that the majority of people would prefer to choose leisure over work. That is what mankind has been working toward since he came into existence. Unfortunately, it is not possible to legislate this desire into existence, and to advocate for such legislation is wrong. As much as we may wish it to be true, we do not yet live in a fully automated world. Machines and robots are ever making life easier and more prone to leisure, but still there are needs that must be met. As he has demonstrated, it is through the natural progression of human labor, ingenuity, and capital accumulation that increases in production have been possible. Impeding this progression through the interventions of central planners can never be as efficient as what occurs naturally and is a large reason why mankind is still so far away from being able to provide a life of leisure to all.
When he draws on his educational experiences, he correctly points out that the tendency for real learning comes through self-directed learning. When people pursue that which is important and of interest to them, retention of information is greater than that which is mandated. He even rails against the “government-mandated school system,” but fails to conclude that the solution to this problem is abolition of that system. He is also correct when he says that this system is “backed up by powerful forces.” John Rockefeller once said, “I don’t want a nation of thinkers, I want a nation of workers.” He backed up those words by giving over $180 million in 1902 to the government’s General Education Board which was responsible for huge increases in the power and scope of “government-mandated” schools. The reasoning behind his words, and his purpose for such giving was simple. He wanted his businesses to be protected from competition. If he had workers who were also thinkers, the likelihood that one of his workers would start a competing firm and be able to produce the same goods more efficiently and cheaper was high. Libertarians will be quick to point out that if there were no state, there would have been no mechanism through which he could have carried out these desires.
All people should be free to study exactly what they want to study. If a person wants to study in an area where they will make a lot of money such as software development, that is their right. If a person wants to study art history, where the potential to make money is far less, that is also their right. Because everyone owns themselves and their labor, it would be wrong for the art history scholar to steal from the software developer, even in the name of fairness and equality. In the same way, it would be wrong for the art history scholar to use government coercion to steal from the software developer on his behalf. Each individual made his choice as to where to dedicate his studies. Each must be willing to take personal responsibility and accept the consequences of their decisions and actions.
The descriptions of his experience in retail are similarly reasoned. He “hated selling shoes,” especially when the store got busy and his leisurely job became less so. Freedom came when he wasn’t having to focus on selling shoes, but could instead focus on personal interactions and conversations with his co-workers and the occasional customer. Why did he take such a job? Presumably it was for the money. If those busy times never came, would it have remained profitable for the store to keep him employed?
The thesis that true freedom is to be free from the need to work is all well and good. The problem is that humans have needs. The fact that people must eat, drink, clothe themselves, and have shelter means that one has to find a way to satisfy those needs. The only moral way to satisfy those needs is to work. It is immoral to take from someone else to achieve those ends. Using government to take for you is equally wrong. Government legislation cannot eliminate needs.
Economist Walter Williams wrote, “Let me offer you my definition of social justice: I keep what I earn and you keep what you earn. Do you disagree? Well then tell me how much of what I earn belongs to you – and why?”