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Core Problems of Marxist Economics and Philosophy

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Karl Marx - Author of the Communist Manifesto

Far too often in our political discourse, we tend to rely on platitudes and generalizations as our basis for criticism of philosophical opponents.  This approach may save us time, create good one-liners, and inspire loyalty from those who are likewise less-than-informed about the true nuances of the position of our opponent, but it is not an approach likely to make constructive progress or convince anyone not already disposed to agreement.

In the following article I have taken a close examination of what I can best ascertain to be the core premises of Karl Marx‘s theories and identified what I believe to be the problems in Marx’s assertions.

The Labor Theory of Value

The labor theory of value is central to Marx’s economics.  He adopted this theory from Adam Smith (“Wealth of Nations”) which is a fact often pointed out by opponents of the free market, but Smith was hardly a free market purist and his free-market economics was full of flaws.  By borrowing Smith’s theory of value, Marx built his economics and, I maintain, even his central political conclusions on an irreparable error of reasoning.

Under the labor theory of value, the price of a good is a direct derivative of the labor performed in its creation or provision.  Therefore, to Marx, the profits derived from the sale of goods can only come at the expense of the just price deserved by the worker who performed the labor to create it.  Because price is a reflection of the labor involved, any difference between wages and that price paid (profit) is, to Marx, an inherent exploitation.

Most economists, however, no longer take the labor theory of value or Marx’s specific economics seriously… even those who advocate socialistic policies for philosophical reasons.  This is largely due to the work of Austrian school and Neo-classical economists in the late 1800’s who developed the subjective theory of value.  Rather than viewing it as an intrinsic reflection of the amount of labor expended, these economists theorized that value or price is a function of two parties and their determination of value based on subjective personal criteria.  If value were not subjective, no exchange would occur because both parties must believe the exchange to be beneficial.  Therefore “profit” becomes not a disparity between the objective price to which labor is entitled and wages paid, but simply function of voluntary exchange for subjectively determined value.  Under the subjective value theory, the laborer has no inherent entitlement to anything other than the wage voluntarily agreed to be paid which is also itself a function of the subjective theory of value, being the price of labor.

Because the labor theory is a presumption so central to Marx’s conclusions, and not just his economics, the irreparable flaws in the labor theory permeate all of Marx’s theory.

Defining the Bourgeois

Marx’s theory is predicated on the class distinction between the Bourgeois and the Proletariat.  For Marx, the defining characteristic of the Bourgeois is its ownership of capital property, or the “means of production.” and thus the Proletariat are defined by their consequent non-ownership of the means of production and their resulting need to rely on the sale of labor for subsistence.

There are a few easily identifiable logical problems with this distinction which make it difficult to draw, and which make the presumed ever-increasing polarity between these two classes which is foundational to Marx’s theory a very problematic approach.

  1. How is this distinction to be drawn for purposes of deposing the Bourgeois of their means of production and bring it under the control of the Dictatorship of the Proletariat?  Many individuals of a wide range of economic circumstances own property which can be used as a means of production, and even more so who own property that could be rendered capable of such in a situation of incentive or need.  It is hard to see how any property fully falls outside of this distinction, and as a result how the Bourgeois is to be distinguished from property owners in general.
  2. Is not labor itself also a “means of production” in society?  Is this “human resource” of labor also to be brought under collective ownership in the dictatorship of the Proletariat, or is individual ownership of one’s own person to be retained?  The violent and oppressive history of the varied attempts to implement the Dictatorship of the Proletariat would certainly demonstrate at the very least a tendency toward state ownership of even this natural property.
  3. Once separated from their ownership of the means of production, does the group formerly referred to as the Bourgeois retain this label?  Since the defining characteristic of the Bourgeois is its ownership of the means of production, why do the individuals vested with the trust of managing the Dictatorship of the Proletariat not simply become a new Bourgeois, now that they have effective ownership and control of the means of production?
  4. Does not the feasibility of any revolution require participation by at least an element of the Bourgeois?  Military conflict implies, at least to some minimal degree, the employment of capital or productive means in the process.  This would make a Proletarian revolution, at least as a means for forcibly confiscating the productive property of the Bourgeois, a practical impossibility.

It seems the distinctions here are too nebulous to provide a definitive formula for action and policy, and thus would tend instead to simply justify with general rhetoric, revolutionary violence aimed at particular targets.  These would inevitably be those chosen by the revolutionary mob and would-be managers under the new regime, but would not necessarily include the entire Bourgeois as defined by Marx.

It is also important to note that Marx did not formulate a specific plan or picture of the resulting state after the revolution like more idealistic communal thinkers such as Plato and St. Thomas More (Utopia).  He instead viewed the rise in unrest and revolution among the working classes to be a historical inevitability.  To this extent, given the rise of labor-themed revolution worldwide in the generations since his writing, we must acknowledge that he has been vindicated by history.  How much this was a function of accurate prognostication or merely self-fulfilling prophecy is still up for debate.


Written by Spencer Morgan

March 6, 2011 at 8:34 pm

Posted in History, Philosophy

Immigration, Naturalization and Natural Rights.

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by Spencer Morgan

With the recent controversy surrounding Arizona’s new bill to enforce Federal immigration laws, and similar legislative efforts in Utah, there is a lot of talk about the presumed “constitutional” duty for the Federal government to be involved in policing the borders of the union.  There is not very much talk, however, about what Constitutional clause or legitimate principle serves as the basis for such power.  State officials and Attorney generals wash their hands of the issue, accepting the unquestioned presumption that this is a federal problem resulting from a failure of a federal duty.  Rather than join the tired partisan debate about the “rule of law” and the need for safeguards to ensure equal enforcement, I’ve taken a very radical approach instead.  I decided to actually look at the Constitution itself, as well as at other writings and legislation of the era, to see what I could find.

The fact is, there is no clause of the Constitution which grants power or specifies any obligation for the federal government to police the borders of the several states for the purposes of preventing entry by non-citizens.  Our Constitution is unique from other historical governments, or at least was intended to be, in the sense that it did not begin with a presumption of any inherent government power.  Rather, in our tradition and under the ideology and understanding of the founders, all inherent power was presumed to reside with the individual by virtue of natural rights.  This means that the Constitution, if it is be be an enactment of written law at all consistent with the vision intended by the legally acting parties upon its adoption (the States, in their ratifying conventions), should be interpreted as only granting those powers actually identified in the document.

Naturalization vs. Immigration

Naturalization and immigration are two very different things.  Naturalization is the process by which a resident becomes a citizen entitled to the benefits of participation in the body politic.  Immigration is the simple movement of people.  The founders were not operating on the presumption (that is relatively new in our history) that all rights of free movement, trade, employment etc. were dependent on citizenship or naturalized status.  The Constitution did grant Congress the power to write rules for naturalization (citizenship) but it was in no way presumed that the grant of that status was to be viewed as a prerequisite for the use of natural, creator-endowed rights such as the right to form contracts, sell one’s labor for a price, or own property. That is why the 1790 Congress wrote the Naturalization Act (enacted by many of the founders and signed into law by Washington and Adams) which required that candidates for naturalization affirm their residency in the states for at least 2 years prior.  Why would they make the admission of a criminal act or fugitive status a prerequisite for a grant of citizenship?  They didn’t, because they didn’t view mere existence within the borders as a non-citizen to be a “criminal” act.  They knew foreign residents were here and coming in large numbers (a condition which contributed to a near doubling in population during the 11 years after the revolution) and wanted to be able to naturalize them efficiently.  In fact, one of the grievances cited by the colonists in the Declaration of Independence was the King’s efforts to obstruct the speedy naturalization processes that the colonies had set up under their legislatures.

Natural Rights vs. Privileges of Citizenship

It is entirely proper, of course, for government bodies to be determining based on the will and consent of their constituents (citizens) the process and criteria by which to bring new citizens into body politic.  The confusion pervading the modern debate about illegal immigration, however, stems from a misunderstanding of what “rights” a government grants to us and what “rights” it does not and therefore is not free to take away.  Natural Rights are those fundamental entitlements inherent to our condition of humanity, and evident by fact of our creation.  In the Declaration of Independence we read the following clause;

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.

Because these rights are viewed as inherent to the human condition and granted by a creative entity or process, they are not something which can rightfully be denied by government or made subject to a condition of citizenship.  Citizenship status can only be a prerequisite for the use of those privileges which actually depend on the existence of the state for their existence, such as the right to vote or the right to use court and government processes to sue for relief as a complaining party.  The mindset that mere human existence or the exercise of rights inherent thereto can be decreed to be “criminal” by a statute is fundamentally at odds with the philosophy of liberty itself.

Written by Spencer Morgan

March 6, 2011 at 7:09 pm

Posted in History, Philosophy

Imagination in the Service of Abuse.

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By Spencer Morgan

Imagination is one of our most wonderful abilities. It allows us to make objective determinations and to prepare for scenarios which we have not yet encountered. It is, however, a very dangerous basis for actions… especially actions which will impact another individual in a harmful way. Children are born with this wonderful gift and tend to use it harmlessly. They are usually aware of its lack of relationship to reality.

Many adults, however, use whatever remaining capacity they have for imagination in the ways public schools have trained them. They use it to engage in a very twisted and potentially destructive form of fantasy.  These fantasies obscure the obvious moral reality of a given situation and justify an act or situation based on the conditions of the imaginary construction, instead of the more immediate and apparent reality. It is upon the widespread participation in this very psychologically dubious exercise that a whole host of institutional, everyday abuses of real people depend.

Perceived Differences and Ethnic Abuse.

Racial and ethnic abuses are frequently attributed primarily to the human tendency for fear of the different or unknown. It is often said that it is the apparent difference of the victim that forms the justification in the minds of the aggressor or the passive enablers. While fear of the unknown is very real, and perceived differences may make the exercise more palatable to certain people who have a legitimate desire to harm others for that reason, this mentality is only realistically attributable to a very small segment of those who are tolerating the act of abuse.

By assigning the blame for these abuses to the human tendency for hostility to the different, we have laid a philosophical groundwork for a fundamentally irrational solution to racism which has millions of people living in guilt and fear of the very acknowledgment of a cosmetic or ethnic difference. This only alienates individuals from one another because while one them is pretending to ignore a racial or ethnic difference, the person with whom they are interacting may be very proud of those distinctions and perceives the exercise of ignoring them as an insult.

Collective Abstractions: The Real Problem

This approach, along with perpetuating ethnic and racial divisions, largely misses the mark. It also does not explain the historical occurrences of widespread social and political abuse based on ethnic or social distinctions which are not visibly apparent. When we evaluate the mentality of someone who commits an act of aggressive violence against another individual, we just look carefully at the mindset that enabled the harm to be committed. Was the aggressor simply a sociopath who enjoys hurting people for the sake of doing so? It is certainly possible, but rare statistically and so this can not account for the widespread tolerance and even participation in such act that have occurred historically.

When we examine most of these historical occurrences of ethnic abuse, we can easily identify the specific mental exercise which really enabled the act of violence against the individual to be supported on any sort of widespread scale. It is the same psychological exercise that enables acts of violence in other, otherwise obvious, instances of immoral harm. It is the act of imagining that the harm is being done to a unit of a larger collective group, to which certain dangerous or “evil” attributes are assigned which enables the abuse. Whether these attributes are visibly apparent makes no difference, as long as people are willing to use their imagination to assign that attribute to a victim. This exercise serves to dehumanize the victim and obscure the obvious moral implications that we could not escape if we viewed the victim as another individual with inherent value. It is the abstract group or the individual’s associated status that is being acted against in the mind of those who justify it, not the individual.

Authority as a Basis for the Morality of an Act.

In addition to the exercise of viewing the individual victim as merely a manifestation of their identified group, another dangerous use of imagination is the assignment of inherent virtue by authority to obscure the otherwise obvious immorality of an act. If you saw one person force another person’s car off of the road, get out with a weapon brandished, kidnap that person and take their property at the point of a gun then this would obviously be a harmful crime under most systems of morality. Put a uniform on the aggressor and some fancy colored lights on the vehicle he is driving and it becomes an act that is not only morally permissible but likely to be applauded by most people. My purpose here is not to assess the actions of police in general or any specific case of alleged abuse, but for the reader to honestly ask;

“How is the fundamental morality of the act changed by the intangible designation of authority I attribute to the perpetrator?”

“Is this distinction really significant enough to result in the opposite of what would otherwise be a very obvious determination of this action as being violent and immoral?”

As Stanley Milgram observed in his well-known experiment, individuals are all-too willing to allow and even engage in acts they perceive to be causing pain and harm to another individual when the act is given a cloak of abstract authority. This video below describes in detail his psychological experiment and the results;

“Go chop down a forest”

The most sickening part is of this exercise is that it involves acting on the basis of a perception which is an impossibility.  We perceive that we, or those acting with our tacit or explicit approval, are acting not against the individual human that their actions inevitably are taken against, but against the group with which we identify him. Likewise, we perceive the aggressor not as an individual but as the incarnate embodiment of the virtues and priorities we have assigned to their position of authority.  Just as one can not chop down a forest but can only chop down trees, one can only take action against individuals and only individuals are capable of action. 

These social abstractions and fictional constructs have their legitimate descriptive and explanatory purposes, but as a basis for individual action and determinations of the morality of an act against an individual they can and have lead to the worst abuses in history.  They can not can alter the fundamental morality of the act in question… just as the forest does not really exist.

Written by Spencer Morgan

September 8, 2010 at 10:27 pm

Posted in Philosophy

Should We Consent to be Governed?

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by Spencer Morgan

This seems like a simple and important question, especially at the close of a century tainted by so many acts of mass violence by governments against those who were, at the time, their own subjects.  Yet this is a question that most people never ask.  Perhaps the question seems fundamentally irrelevant because we all instinctively know that we are not being offered this choice and have been born into conditions where our status as “the governed” is so apparent to be beyond our control.

Perhaps our conditioning early in life in being subject to unquestioned parental authority leads us to naturally transfer that sense of allegiance to our particular nation-state which is, of course, more than willing to assume a parental role in our lives.  Whatever the reason may be, this question has deep implications on the way we view and interact with the group of individuals in any particular geographic location that operate as “government.”

All of the legislative tactics, political games, power positioning, policy papers and central planning march on, generation after generation, without this question ever being entertained by the very system whose legitimacy depends on the answer.

Why?  Because that question introduces a rational process which the legitimacy of any of our current artifices of government power can not hope to survive.  And deep down, those who operate on its behalf or benefit from its exploits, know it.

Because I intend this article to be the foundation for a series that systematically examines the underlying philosophy of government and personal liberty, this first central question must be answered.  The hypothetical exercise involved in answering this question is what has come to be know as “The Social Contract“, a subject itself which has varying definitions and has become a source of much controversy.

Each of us is born into life subject to some form of rulership and know instinctively that we have never engaged in voluntary act of consent to this state of servitude… at least not a giving of consent upon which the reality of that servitude depends.  Therefore it is not necessary to address the conceptions of the Social Contract which would claim that this nebulous event has the power to obligate any particular individual to be subject to whatever form or extent of servility in which he or she happens to be born.   This conception of the Social Contract has no real value, and serves merely as an attractive disguise for authoritarianism.

The Social Contract does, however, have great value as a hypothetical tool by which we can objectively determine the principles of just government, even if only to contrast such a conception with the actual practice and nature of every existing government.  It was in this capacity that the exercise of social contract theory yielded great advances in human understanding about natural rights and the proper role of government.  Once the archaic justification for kingly power known as “the Divine Right of Kings” was effectively sidelined to the dustbin of history, renaissance era philophers looked to other sources to justify and determine the proper limits of the governmental structures already in existence… an exercise which should continue for us.

John Locke’s conception of the Social Contract, in particular, resulted in the determination that individuals in a stateless existence (hypothetical or historical) would have consented to be subject to government only for its ability to more effectively protect their inherent, pre-existing natural rights of life, liberty and property.  Because these natural rights pre-existed the creation of government in Locke’s view, it is this natural law which government legitimately exists to uphold.  To the extent that it exceeds these boundaries or becomes hostile itself to these individual natural rights, it is illegitimate.  This is the philosophical refrain echoed in Jefferson’s text of the Declaration of Independence adopted in 1776 by the thirteen American British colonies with the words;

“That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it”

By imposing upon existing governments the obligations to natural rights and liberty we have derived through a hypothetical social contract undertaken freely by an otherwise unrestrained individual, we can derive a consistent set of principles and boundaries for evaluating the justness of any act of interference by government with the individual.  We can determine that because an individual in a state of nature, or a state without any existing apparatus of punishment and forcible restraint, would only willingly enter such an agreement to protect her natural rights and liberty from assaults by others.

“IF man in the state of nature be so free, as has been said; if he be absolute lord of his own person and possessions, equal to the greatest, and subject to no body, why will he part with his freedom? Why will he give up this empire, and subject himself to the dominion and control of any other power? To which it is obvious to answer, that though in the state of nature he hath such a right, yet the enjoyment of it is very uncertain, and constantly exposed to the invasion of others: for all being kings as much as he, every man his equal, and the greater part no strict observers of equity and justice, the enjoyment of the property he has in this state is very unsafe, very unsecure. This makes him willing to quit a condition, which, however free, is full of fears and continual dangers: and it is not without reason, that he seeks out, and is willing to join in society with others, who are already united, or have a mind to unite, for the mutual preservation of their lives, liberties and estates, which I call by the general name, property.” (2nd Tr., §123)

Thus government’s only just role, or the role which could be reasonably expected to be voluntarily accepted by our hypothetical ungoverned individual, amounts to the following:

  • The Protection of life liberty and property from aggression by others.
  • To serve as a neutral arbitrator responsible for adjudicating claims arising from acts of aggression against natural rights, and providing a mechanism of restitution for damages to the same.
  • The employment of force to bring individuals accused of such aggression to answer to due process and impose restitution.

We can see that by employing the hypothetical tool of the social contract and limiting government’s just functions to those which would be volunatarily accepted by a free individual, we arrive at a very limited conception of government power.  It is this idea of government existing merely to uphold a greater natural law which has resulted in the most significant advances for liberty in human history.  It has led to the formation of institutions which, though ultimately flawed themselves, have had as their purpose the enactment of restraints on governmental power over the sovereign individual.  In future articles I intend to examine in detail many of these philosophical questions and legal traditions as they relate to the ongoing struggle for individual liberty.

Written by Spencer Morgan

September 5, 2010 at 12:52 am