The Compromised Case for Capitalism — Laissez FaireLaissez Faire

In his book on the entitlement state, Never Enough, William Voegeli notes that leading conservative spokesmen engage in a fascinating practice: they make bold, abstract declarations of their support for free markets and limited government–and then they hedge with what Voegeli calls a “to be sure” statement.

Voegeli quotes Ronald Reagan’s 1980 acceptance speech, in which Reagan declares that “it is time for our government to go on a diet”–but, to be sure, not a starvation diet: “It is essential that we maintain both the forward momentum of economic growth and the strength of the safety net beneath those in society who need help. We also believe it is essential that the integrity of all aspects of Social Security are preserved.”

We need to end Big Government . . . but, to be sure, we need reasonable regulations and wealth redistribution programs. Your wealth belongs to you. . .but of course we’ll take whatever amount we deem necessary to meet the needs of others. The free market is good. . .but, to be sure, not a really free market.

Other examples aren’t hard to come by. In the run up to the 2010 elections, leading conservatives Arthur Brooks and Paul Ryan published an op-ed in which they said Americans faced a stark choice:

Do we still want our traditional American free enterprise system, or do we prefer a European-style social democracy? This is a choice between free markets and managed capitalism; between limited government and an ever-expanding state; between rewarding entrepreneurs and equalizing economic rewards.

Brooks and Ryan made it clear which side they came down on: we ought to choose capitalism, but to be sure, “Nobody wants to. . .take away Grandma’s Social Security check.” What we need is “a free enterprise society with a solid but limited safety net.”

But here’s the problem: a compromised case for capitalism bolsters capitalism’s opponents by advancing and reinforcing their anticapitalist principles.

The basic principle of capitalism is that the individual has an unalienable right to pursue his own life, wealth, and happiness–and that no one may interfere with that right by initiating force against him.

Now look at what happens once you add a “to be sure” to that principle:

Conceding that the individual doesn’t have the right to all the wealth he earns means that society and its representatives in government should be able to arbitrarily decide how much of his wealth he gets to keep.

Conceding that it’s sometimes okay to force the individual to serve “the public interest” rather than his own happiness means that political leaders are to be able to dispose of his freedom whenever they find it convenient.

A basic principle, Ayn Rand warned, cannot be compromised without rejecting the principle altogether. “There can be no compromise,” she observes, “between a property owner and a burglar; offering the burglar a single teaspoon of one’s silverware would not be a compromise, but a total surrender–the recognition of his right to one’s property.”

Those concessions–the “to be sure” lines added by conservatives–have historically helped to unleash an ever-expanding government. Conservatives have conceded the basic premise of the entitlement state–that other people’s need is a claim on our wealth–and so have been reduced to merely haggling over the price to be exacted from the entitlement state’s victims.

Ironically, Brooks and Ryan are aware of this problem. In the same op-ed they write:

Why not lift the safety net a few rungs higher up the income ladder? . . . More generous pensions for teachers? Hey, it’s only a few million tax dollars–and think of the kids, after all. Individually, these things might sound fine. Multiply them and add them all up, though, and you have a system that most Americans manifestly oppose.

If we compromise on capitalism, if we grant that the “public interest” or the “needs of others” trump the individual’s right to his life, wealth, and happiness, then how can we oppose that process? On what basis can we say these things don’t sound fine?

Set aside whether or not you think programs like Social Security and Medicare are desirable. The point I want you to think about is whether a compromised case for capitalism can succeed in limiting government–or does it concede the basic principle of welfare statism and thereby help bolster the trend of ever-growing government?

If you agree with Brooks and Ryan, what argument would you make to the person who points to suffering Americans and asks that we “lift the safety net a few rungs higher up the income ladder”? Where and how would you draw the line? And would that line ever stop moving?