Perspectives on Capitalism

Laissez Faire capitalism is actually Laissez Faire Trade and it is an ideal form of capitalism much as Communism is an ideal form of government or economics. When viewed in their pure form both are superior. There is no doubt that Communism is not only a pure form of Christianity but it is superior to virtually every other form of government, although Communism is probably more a philosophy of economics than government. In its pure form Communism would require very little government and would be closer to anarchy than democracy. Unfortunately in practice Communism has failed in every instance it has been tried because it cannot accommodate human nature. The result is rather than elevating mankind to a superior level it reduces everyone to the lowest level of the basest member and Laissez Faire Capitalism has the same problems.

In theory Laissez Faire Capitalism would bring prosperity to the world. It would be a place without unemployment where everyone was a productive member of society and the wealth would be shared by everyone on the basis of their contribution to the common good. In this theory there would be no government restrictions or controls over business or trade. Monopolies and cartels would be possible because these would increase productivity, efficiency, and generate more revenues to be shared by all either in the form of lower prices or dividends on their investments. Alas – in practice what we get is greed, higher prices, and reduced availability to the mass. There are two active cartels in the world today, OPEC and DeBeers, both keep tight control over product availability to maintain high prices, and these exist in economies that are controlled by governments, you can imagine the situation if there were no controls.

Communism failed because humans are frail creatures who succumb to greed, sloth, envy, and the other deadly sins. The same is true for Laissez Faire Capitalism. At the beginning of the Industrial Revolution trade and business was virtually unrestricted but instead of glorifying mankind it highlighted the worst characteristics of mankind. This was the period of the Robber Barons, the entrepreneurs who formed monopolies to restrict supply and thus raise prices. The drive to profit led to a destruction of the environment and the death of water ways, the extermination of species, child labor, unsafe working conditions, and corruption in government, slums, and disease. Eventually most of these actions came under government scrutiny and eventually laws were introduced to control or eliminate them – over the resistance of the entrepreneurs. The result is what we now have which is a form of controlled capitalism but a far cry from Laissez Faire Capitalism.

Perhaps the foremost proponent of Capitalism or one of the most influential, has been Ayn Rand and her various novels, which are actually expositions of her philosophy of self-determination. Essentially Rand’s position is that the government has no right to dictate or govern your actions as long as those actions don’t harm others. However her characters are flawed and their actions are sometimes illegal. Roark commits arson because his work has been compromised and he feels it within his right to destroy what he created regardless of who owns it or who paid for it. This is how she constructs the situation in which to mount her argument regarding self-determination, but this is a literary fiction and must be viewed through the lens of reality. In practice what she is saying is that anyone who has created or produced anything retains ownership rights eternally. This means that if you modify your automobile the manufacturer has the right to confiscate it and destroy it. If you add rooms or change the roof of your house the architect or builder has the right to prevent you. In essence Rand’s view is extreme and untenable because it violates the law at many levels, but her essential philosophy is that a person should stick to their principles regardless of the cost. Unfortunately, like communism her views are extreme and to a great extent unrealistic because they are untenable in the real world.

At a more fundamental level Rand makes a further point and that is that the strong cannot be forced to support the weak. If a person is a ne’er-do-well or an outright failure the government has no right to force an individual through taxation or other means to support or help that person. Each person should rise and fall based on their own actions and the strong should not be coerced into helping the weak. This is a common thread through all of her work and the foundation of many extreme right wing beliefs. This is the essential position taken by Bastiat in his 1830 paper “The Law”.

What is missing or at least what is minimized is the dichotomy of law versus morality. Essentially the position held by Rand is that the government has no right to coerce--through the law – an individual to support someone else who is less capable, less industrious, less intelligent, or simply lazy. In effect the collective authority has no right to enforce morality or obligate a person to a moral standard. This coercion is via taxation and social programs but in reading Rand’s novels she takes this coercion a step further and maintains that no one has the right to demand anything from an individual and that an individual retains his rights over everything he produces. Clearly this is an extreme position and falls outside of any form of capitalism or even reality. But this isn’t the most egregious flaw in Rand’s philosophy or in Laissez Faire Capitalism.

The flaw is the total lack of any morality or moral obligation on the part of the individual. The concept of Noblesse Oblige is ignored. While a person should establish and adhere to their own principles (within the law) they also must establish a moral code that acknowledges their obligation to society and to others. The strong and the powerful have a personal obligation to care for those under their control or influence. The crux of the argument is that the government or some central authority does not have the right to force the individual into fulfilling this moral obligation, but that same individual should have the moral fiber to voluntarily assume these responsibilities and in practice most do.

Theoretical positions must always viewed with some degree of skepticism because theories have the unfortunate history of failing in practice. More than one philosopher has postulated Utopia and every attempt to implement these philosophies has failed. This doesn’t mean these are bad philosophies it just means we should only take those portions that can realistically be applied and ignore the rest. Hence we have a capitalist society but not a laissez faire one.

Time and Time Again

Time is a problem and one that continues to plague scientists and Quantum Physicists in particular. The pesky problem is the question has the universe always existed or was there a beginning? The Universe is expanding and further out we peer, we are not only looking across billions of years but we are observing that the rate of expansion increases with distance (time). That only becomes a problem if you look at this situation in reverse, that is the expanding universe implies that at some point it was all squished together into what is called a “singularity” and the “Big Bang.” But, quite obviously this poses some very difficult questions, such as; where did this energy come from initially? what was there before the big bang?, will there be a “big crunch as the universe contracts? Of course these questions – even unanswered – lead to the additional questions of; is there a beginning of time? Is there and end of time? Is there a God? If the universe is pure energy then why does some of this energy manifest itself as mass? And of course that really fundamental question that remains unanswered – how did life begin and why?

To accept God as a creator goes against the basis of science so cosmologists are determined to find the answers to these questions based on science – in effect demonstrating that God does not exist. This struggle is becoming increasingly difficult as each scientific discover brings more questions and drives the convergence of philosophy and science ever closer. The universe is expanding at an inflationary rate – meaning the galaxies are moving away from each other at an increasing rate. Of course this poses some problems with the Einstein’s equations which limit speeds to the speed of light. Therefore, the speed of expansion is bounded and what happens when that boundary is reached – in fact as it takes ever more energy as the speed increases the expansion would slow and stop – meaning that the universe would begin to contract – much like a rubber band that has been stretched to its limit and snaps back to its original shape – the “Big Crunch” and that brings us back to the singularity of the beginning known as the big bang.

However, if our universe was indeed expanding at an equal speed in all directions it would lead to a spherical shape and the speed of expansion would not allow for the creation of galaxies (matter) so the universe must be irregular (The Universe in a Nutshell by Hawking). But in order to establish this view, physicists have postulated “Imaginary Time”, which is really not imaginary but simply another – and very bizarre – way of viewing our universe and reality. If we view our
real time reality as a line with our “now” as a center point on that line, then our past would be to the left and our future would be to the right or in front of us. But imaginary time runs perpendicular to that now point and it represents our movement away from the singularity. We can then move into the future which will cause the Singularity to move upward in order to keep the symmetry of the model. Or in an alternate view as we move away from the singularity our future expands.

This model also introduces the concept of multiple dimensions and histories. Unfortunately the number of dimensions continued to grow as efforts to support string theory expanded but more recently the number of dimensions has declined to a possible eleven. By introducing imaginary time the problems associated with singularities in real time disappear, so it allows for a smoother view of the universe. While all of this effort and scientific struggle are interesting they really don’t address some of the fundamental questions. St Thomas Aquinas stated that asking what God was doing before the creation was a nonsensical question that seems to be the position of current scientific thought as well. What was there before the Big Bang? Did space exist? Where did this primordial burst of energy come from? How was it created or was it spontaneous? If it was spontaneous then what were the conditions that allowed it and of course that implies that space – empty space -- existed prior to the Big Bang but that in itself is nonsensical.

Logically it seems that there was a beginning of time and there will be an ending of time and science seems to agree on this point. But the creation of space and time seems to still be elusive unless – of course – we accept God.