Throughout the entirety of human history, man has never instituted capitalism as a system of government — not consistently. For as long as man has lived amongst men, there have been two primary political groups of individuals: rulers and the ruled. From the earliest tribal society that governed itself under a system of patriarchy, or even the more bestial maxim that “might makes right,” man has been subjected to the whims of his fellows – to chieftains, to warlords, to shoguns and emperors, kings and caliphs – eventually culminating in the dystopian dictatorships of the Twentieth Century. Through both the corruption of the mind and destruction of the body – though rarely just one or the other – mankind has enslaved itself to itself. Such are the necessary conclusions in the absence of a rational philosophy to guide man’s actions.
There have been men, however, who have freed themselves from the intellectual shackles of the world around them and carried the world forward on their backs through their inherently individual decision to think. After centuries of decay, man began to pull himself out of the Dark Ages, reexamining the long-forgotten Aristotelian line of philosophic thought and rejecting the then-dominant Platonist-Augustinian school. The Renaissance, as we now know it, sparked an expansion of the arts, science, literature, and philosophy such as had not been seen since the days of the old Roman Republic. As time passed, the Renaissance reached the pinnacle of its intellectual achievements known as the Enlightenment, on which all advances in every aspect man’s life have depended since that time.
It is in this climate that the philosophies that led to the American Revolution, the Declaration of Independence, and the Constitution of the United States were developed. Classically liberal notions of the rights of man, of limited government, and of equality before the law flourished at this time; it was these ideas that found their way into the fabric of our nation’s system of government, and it was these ideas that spawned the structure of a modern constitutional republic.
Constitutional republics are representative forms of government in which the citizens of a country elect statesmen to act in their stead in political matters, though only certain powers are allotted to these statesmen and they cannot exceed the authority given to them by their constituents. All those with representative positions, in turn, are subject to periodic elections in which the public may choose to keep the incumbent or replace him with someone who better reflects their interests. In capitalist constitutional republics, all government authority is restrained to protecting man’s life, liberty, and property from initiated force – any initiation of force against any man, no matter the size of the majority supporting that initiation, would be prohibited.
The internal structure of capitalist constitutional republics would primarily consist of the courts, the police, and the military – the primary purpose of the legislature would be to record all just laws in a clear, objective fashion and outlining punishments for infractions against those laws. Moreover, the powers of a capitalist constitutional republic would be divided in such a way that no branch could – without conspiratorial cooperation with the other branches – seize control and violate the constitution. At the same time, the power should be further divided into different levels with different spheres of authority – e.g. the federal government directs foreign policy while the states manage most domestic crimes like murder, rape, theft, etc. Should all other protections fail, it is the people that are the ultimate guardians of their nation’s constitution and of their own liberty. These notions of checks and balances and a multi-tiered federalism were included in the U.S. Constitution by the Founders, by and large protecting America from outright attacks on the part of socialists and anarchists for over two centuries. However, the Constitution itself is not without flaws, and those imperfections left the door unlocked for gradual statists – largely progressives among other sorts – to violate the individual rights which the Constitution was crafted to protect.
When examining the steady rise of statism in the United States, some misguided advocates for capitalism have become discouraged, arguing that republicanism is an inherently flawed system that inevitably leads toward more socialist forms of governance. The entire concept of a constitutional republic, they argue, is flawed, not just the concrete manifestations of it. Thus, they reject the idea of a Lockean limited state and turn instead to the Hobbesian notion of the Leviathan – a benevolent yet autocratic ruler who maintains individual liberty throughout his rule.
In defense of this notion, they point toward the incredible success of the city-state of Singapore under its autocratic Prime Minister Lee Kuan Yew until his complete retirement from politics in 2011, though he had retired from the prime ministership in 1990. In spite of restrictive social policies (e.g. bans on chewing gum and homosexuality), Prime Minister Lee Kuan Yew pursued largely laissez-faire economic policy, rivaling Hong Kong both in terms of its speed of development and of its economic “freedom” (despite that the social policies deny man his property rights, rights which are inherently economic as well). The autocratic power that then rested in the office of the prime minister (though it is dubious as to whether it still does) was wielded primarily in a retaliatory as opposed to an initiated manner. Additionally, the immutability of Lee Kuan Yew’s position as Prime Minister prevented opposition parties – Communists, for example – from seizing control and derailing the system, and the apparent hereditary nature of the post (Lee Kuan Yew’s son Lee Hsien Loong assumed the prime ministership in 2004) prevents tenuous exchanges in power. Ergo, argue the Hobbesians, a benevolent dictatorship is preferable to a republic and is consistent with capitalist ideals.
In fact, the idea of a dictatorship of any kind is so contrary to the nature of capitalist governments that it cannot be considered capitalist at all. Giving one man or group of men unquestionable political authority, regardless of whether they abuse it or not, is precisely what capitalism intends to prevent – not because one may benefit from an “enlightened despot,” if there can be such a person, but because in the event of any violation against individual liberty, there would be no option for recourse. So long as the state has the authority to confiscate my life, liberty, or property from me at any moment, my life, liberty, and property cannot be said to truly belong to me, but to the state, even if that authority is never wielded. To apply this to a political issue in the United States, examine the recent debacle known as the National Defense Authorization Act (NDAA), which recently passed through Congress. Within the bill, there is a provision that permits the indefinite detention of American citizens on charges of terrorism without trial. It does not matter how many times President Obama states that he will not use that provision, nor does it matter how sincere his statements may be – he should not have such authority at all (he does not have it under the Constitution or moral law, regardless what the NDAA says).
Political philosophers often point out that the beauty of a constitutional republic is not that men choose their leaders – there have been several instances over the course of history in which tyrants seized control, not by violent takeover, but by majority vote. The notion of “one man, one vote, one time” is never an ideal prospect. Instead, the brilliance and importance of constitutional republics is that the citizenry can remove their leaders from seats of power peacefully, that leaders who begin overstep their authority can have that very authority taken away from them in the absence of revolutionary bloodshed. Naturally, this requires philosophic vigilance on the part of the public (or, at the very least, their cultural leaders) so that the alarm can be sounded early to prevent any lasting or significant damage. While American intellectuals have neglected their responsibility, the requirements for achieving an absolutely free capitalist system have remained unchanged, and that includes the requirement of a constitutional republic.
Other liberty-minded individuals have turned in the other direction for solutions when observing the problems of the American republic, opting for anarchy rather than taking their chances with a Hobbesian dictatorship. These objections, however, are much simpler to refute: without objective law, there can be no capitalism. Justice is one of the fundamental principles of a capitalist system. If men in a given jurisdiction are not all bound to the same objective, moral law, nothing but subjectivist chaos can ensue, most akin to the results of competing mafia families. Nothing could be further from capitalism. There can be no such thing as anarcho-“capitalism”.
Capitalism is the conclusion to a long chain of preceding philosophic conclusions, and cannot be supported without them — one cannot successfully build the roof of a house without first building a foundation and a firm superstructure, lest the roof collapse at the first gust of wind to assault it. Capitalism cannot exist in any other form except that of a constitutional republic, nor can the liberty which capitalism promises exist under any system except capitalism. Moreover, capitalism cannot exist without an objective, rational code of ethics — that is, rational egoism — that both outlines both man’s ultimate value (his own life) along with subsequent values and also his course of action to pursue those things. In a political context, this course of action involves respecting man’s rights to pursue his own life, liberty, property, and happiness under an objective code of laws that allows all other men to do the same along while producing justice when one man violates the rights of another through initiated force — i.e., it involves instituting a capitalist system of government. But even these premises are built upon more fundamental premises: that reality is understandable, that it is not subject to our whims, that reason is our tool to understand it, and that to succeed, we must understand it.
One must not respond to error with further error, to foolishness with further foolishness. The current problems in our current system of government do not justify causing even greater problems. Sadly, this is precisely what some advocates for liberty have decided to do. In light of the neglect which American intellectual leaders have paid to their professions over the course of the last century, those who claim to defend capitalism have implicitly accepted the premises of their opponents and have turned away from the objective principles which lead to the conclusion that capitalism is the system necessary for man to reach his full potential, which leads to the conclusion that there is only one kind of capitalism. It is inherently impossible to pursue capitalism while simultaneously rejecting those things which are necessary to achieve it. The American republic is an imperfect union, and it requires much change before it can reverse the socialist trends so prevalent within it, let alone consistently achieving capitalism. Even so, it can be achieved – not through discarding the republican structure necessary for its existence, but by embracing it.