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Advancing Austrian Economics, Liberty, and Peace

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Freedom, Inequality, Primitivism
and the Division of Labor

Murray N. Rothbard


The Left, of course, does not couch its demands in terms of stamping out diversity; what it seeks to achieve sounds semantically far more pleasant: equality. It is in the name of equality that the Left seeks all manner of measures, from progressive taxation to the ultimate stage of communism.

But what, philosophically, is "equality?" The term must not be left unanalyzed and accepted at face value. Let us take three entities: A, B, and C. A, B, and C are said to be "equal" to each other (i.e., A=B=C) if a particular characteristic is found in which the three entities are uniform or identical. In short, here are three individual men: A, B, and C. Each may be similar in some respects but different in others. If each of them is precisely 5'10" in height, they are then equal to each other in height. It follows from our discussion of the concept of equality that A, B, and C can be completely "equal" to each other only if they are identical or uniform in all characteristics?in short, if all of them are, like the same size of nut or bolt, completely interchangeable. We see, then, that the ideal of human equality can only imply total uniformity and the utter stamping out of individuality.

It is high time, then, for those who cherish freedom, individuality, the division of labor, and economic prosperity and survival, to stop conceding the supposed nobility of the ideal of equality. Too often have "conservatives" conceded the ideal of equality only to cavil at its "impracticality." Philosophically, there can be no divorce between theory and practice. Egalitarian measures do not "work" because they violate the basic nature of man, of what it means for the individual man to be truly human. The call of "equality" is a siren song that can only mean the destruction of all that we cherish as being human.

It is ironic that the term, "equality," brings its favorable connotation to us from a past usage that was radically different. For the concept of "equality" achieved its widespread popularity during the classical liberal movements of the eighteenth century, when it meant, not uniformity of status or income, but freedom for each and every man, without exception. In short, "equality" in those days meant the liberation and individualist concept of full liberty for all persons. Thus, the biochemist Roger Williams correctly points out that the "`free and equal' phrase in the Declaration of Independence was an unfortunate paraphrase of a better statement contained in the Virginia Bill of Rights...`all men are by nature equally free and independent.' In other words, men can be equally free without being uniform." [48]

This libertarian credo was formulated with particular cogency by Herbert Spencer in his "Law of Equal Liberty" as the suggested fundamental core of his social philosophy:

....man's happiness can be obtained only by the exercise of his faculties....But the fulfillment of this duty necessarily presupposes freedom of action. Man cannot exercise his faculties without certain scope. He must have liberty to go and to come, to see, to feel, to speak, to work; to get food, raiment, shelter, and to provide for each and all the needs of his nature...To exercise his faculties he must have liberty to do all that his faculties actually impel him to do....Therefore, he has a right to that liberty. This, however, is not the right of one but all. All are endowed with faculties. All are bound to ... [exercise] them. All, therefore, must be free to do those things in which the exercise of them consists. That is, all must have rights to liberty of action.
And hence there necessarily arises a limitation. For if men have like claims to that freedom which is needful for the exercise of their faculties, then must the freedom of each be bounded by the similar freedom of all....Wherefore we arrive at the general proposition, that every man may claim the fullest liberty to exercise his faculties compatible with the possession of like liberty by every other man. [49]

Thus, only the specific of equality of liberty?the older view of human equality?is compatible with the basic nature of man. Equality of condition would reduce humanity to an antheap existence. Fortunately, the individuated nature of man, allied to the geographical diversity on the earth, makes the ideal of total equality unattainable. But an enormous amount of damage?the crippling of individuality, as well as economic and social destruction?could be generated in the attempt.

Let us turn from equality to the concept of inequality, the condition that exists when every man is not identical to every other in all characteristics. It is evident that inequality flows inevitably out of specialization and the division of labor. Therefore, a free economy will lead not only to diversity of occupation, with one man a baker, another an actor, a third a civil engineer, etc., but specific inequalities will also emerge in monetary income and in status and scope of control within each occupation. Each person will, in the free-market economy, tend to earn a monetary income equal to the value placed upon his productive contribution in satisfying the desires and demands of the consumers. In economic terminology each man will tend to earn an income equal to his "marginal productivity," to his particular productivity in satisfying consumer demands. Clearly, in a world of developed individual diversity, some men will be more intelligent, others more alert and farsighted, than the remainder of the population. Still others, meanwhile, will be more interested in those areas reaping greater monetary gain; those who succeed at wildcatting of crude oil will reap greater monetary rewards than those who remain in secretarial jobs.

Many intellectuals are wont to denounce the "unfairness" of the market in granting a far higher monetary income to a movie star than, say, a social worker, in that way rewarding "material" far more than "spiritual" and "material," it strikes one that if the social worker's alleged "goodness" indeed resides in her "spirituality," then it is surely inappropriate and inconsistent to demand that she receive more of the "material" amenities (money) vis ? vis the movie star. In the free society, those who are capable of providing goods and services that the consumers value and are willing to purchase, will receive precisely what the consumers are willing to spend. Those who persist in entering lower-priced occupations, either because they prefer the work or because they are not sufficiently capable in the higher-paid fields, can scarcely complain when they earn a lower salary.

If, then, inequality of income is the inevitable corollary of freedom, then so too is inequality of control. In any organization, whether it be a business firm, a lodge, or a bridge club, there will always be a minority of people who will rise to the position of leaders and others who will remain as followers in the rank and file. Robert Michels discovered this as one of the great laws of sociology, "The Iron Law of Oligarchy." In every organized activity, no matter the sphere, a small number will become the "oligarchical" leaders and the others will follow.

In the market economy, the leaders, being more productive in satisfying the consumers, will inevitably earn more money than the rank and file. Within other organizations, the difference will only be that of control. But, in either case, ability and interest will select those who rise to the top. The best and most dedicated steel producer will rise to the leadership of the steel corporation; the ablest and most energetic will tend to rise to leadership in the local bridge club; and so on.

This process of ability and dedication finding its own level works best and most smoothly, it is true, in institutions such as business firms in the market economy. For here every firm places itself under the discipline of monetary profits and income earned by selling a suitable product to the consumers. If managers or workers fall down on the job, a loss of profits provides a very rapid signal that something is wrong and that these producers must mend their ways. In non-market organizations, where profit does not provide a test of efficiency, it is far easier for other qualities extraneous to the actual activity to play a role in selecting the members of the oligarchy. Thus, a local bridge club may select its leaders, not only for ability and dedication to the activities of the club, but also for extraneous racial or physical characteristics preferred by the membership. This situation is far less likely where monetary losses will be incurred by yielding to such external factors.

We need only look around us at every human activity or organization, large or small, political, economic, philanthropic, or recreational, to see the universality of the Iron Law of Oligarchy. Take a bridge club of fifty members and, regardless of legal formalities, half-a-dozen or so will really be running the show. Michels, in fact, discovered the Iron Law by observing the rigid, bureaucratic, oligarchic rule that pervaded the Social Democratic parties in Europe in the late nineteenth century, even though these parties were supposedly dedicated in equality and the abolition of the division of labor. [50] And it is precisely the obviously frozen inequality of income and power, and the rule by oligarchy, that has totally disillusioned the equality-seeking New Left in the Soviet Union. No one lionizes Brezhnev or Kosygin.

It is the egalitarian attempt by the New Left to escape the Iron Law of inequality and oligarchy that accounts for its desperate efforts to end elite leadership within its own organizations. (Certainly there has been no indication of any disappearance of the power elite in oft-heralded Cuba or China.) The early drive toward egalitarianism in the New Left emerged in the concept of "participatory democracy." Instead of the members of an organization electing an elite leadership, so the theory ran, each person would participate equally in all of the organization's decision-making. It was, by the way, probably this sense of direct and intense participation by each individual that accounted for the heady enthusiasm of the masses in the very early stages of the revolutionary regimes in Soviet Russia and Cuba?an enthusiasm that quickly waned as the inevitable oligarchy began to take control and mass participation to die.

While the would-be participatory democrats have made keen criticisms of bureaucratic rule in our society, the concept itself, when applied, runs rapidly against the Iron Law. Thus, anyone who has sat through sessions of any organization engaged in participatory democracy knows the intense boredom and inefficiency that develop rapidly. For if each person must participate equally in all decisions, the time devoted to decision-making must become almost endless, and the processes of the organization become life itself for the participants. This is one of the reasons why many New Left organizations quickly begin to insist that their members live in communes and dedicate their entire lives to the organization?in effect, to merge their lives with the organization. For if they truly live and pursue participatory democracy, they can hardly do anything else. But despite this attempt to salvage the concept, the inevitable gross inefficiency and aggravated boredom ensure that all but the most intensely dedicated will abandon the organization. In short, if it can work at all, participatory democracy can work only in groups so tiny that they are, in effect, the "leaders" shorn of their following.

We conclude that, to succeed, any organization must eventually fall into the hands of specialized "professionals," of a minority of persons dedicated to its tasks and able to carry them out. Oddly enough, it was Lenin who, despite his lip service to the ultimate ideal of egalitarian communism, recognized that a revolution, too, in order to succeed, must be led by a minority, a "vanguard," of dedicated professionals.

It is the intense egalitarian drive of the New Left that accounts, furthermore, for its curious theory of education?a theory that has made such an enormous impact on the contemporary student movement in American universities in recent years. The theory holds that, in contrast to "old-fashioned" concepts of education, the teacher knows no more than any of his students. All, then, are "equal" in condition; one is no better in any sense than any other. Since only an imbecile would actually proclaim that the student knows as much about the content of any given discipline as his professor, this claim of equality is sustained by arguing for the abolition of content in the classroom. This content, asserts the New Left, is "irrelevant" to the student and hence not a proper part of the educational process. The only proper subject for the classroom is not a body of truths, not assigned readings or topics, but open-ended, free-floating participatory discussion of the student's feelings, since only his feelings are truly "relevant" to the student. And since the lecture method implies, of course, that the lecturing professor knows more than the students to whom he imparts knowledge, the lecture too must go. Such is the caricature of "education" propounded by the New Left.

One question that this doctrine calls to mind, and one that the New Left has never really answered, of course, is why the students should then be in college to begin with. Why couldn't they just as well achieve these open-ended discussions of their feelings at home or at the neighborhood candy store? Indeed, on this educational theory, the school as such has no particular function; it becomes, in effect, the local candy store, and it, too, merges with life itself. But then, again, why have a school at all? And why, in fact, should the students pay tuition and the faculty receive a salary for their nonexistent services? If all are truly equal, why is the faculty alone paid?

In any case, the emphasis on feelings rather than rational content in courses again insures an egalitarian school; or rather, the school as such may disappear, but the "courses" would surely be egalitarian, for if only "feelings" are to be discussed, then surely everyone's feelings are approximately "equal" to everyone else's. Once allow reason, intellect, and achievement full sway, and the demon of inequality will quickly raise its ugly head.

If, then, the natural inequality of ability and of interest among men must make elites inevitable, the only sensible course is to abandon the chimera of equality and accept the universal necessity of leaders and followers. The task of the libertarian, the person dedicated to the idea of the free society, is not to inveigh against elites which, like the need for freedom, flow directly from the nature of man. The goal of the libertarian is rather to establish a free society, a society in which each man is free to find his best level. In such a free society, everyone will be "equal" only in liberty, while diverse and unequal in all other respects. In this society the elites, like everyone else, will be free to rise to their best level. In Jeffersonian terminology, we will discover "natural aristocracies" who will rise to prominence and leadership in every field. The point is to allow the rise of these natural aristocracies, but not the rule of "artificial aristocracies"?those who rule by means of coercion. The artificial aristocrats, the coercive oligarchs, are the men who rise to power by invading the liberties of their fellowmen, by denying them their freedom. On the contrary, the natural aristocrats live in freedom and harmony with their fellows, and rise by exercising their individuality and their highest abilities in the service of their fellows, either in an organization or by producing efficiently for the consumers. In fact, the coercive oligarchs invariably rise to power by suppressing the natural elites, along with other men; the two kinds of leadership are antithetical.

Let us take a hypothetical example of a possible case of such conflict between different kinds of elites. A large group of people voluntarily engage in professional football, selling their services to an eager consuming public. Quickly rising to the top is a natural elite of the best?the most able and dedicated?football players, coaches, and organizers of the game. Here we have an example of the rise of a natural elite in a free society. Then, the power elite in control of the government decides in its wisdom that all professional athletics, and especially football, are evil. The government then decrees that pro football is outlawed and orders everyone to take part instead in a local eurythmics club as a mass-participatory substitute. Here the rulers of the government are clearly a coercive oligarchy, an "artificial elite," using force to repress a voluntary or natural elite (as well as the rest of the population).

The libertarian view of freedom, government, individuality, envy, and coercive versus natural elites has never been put more concisely or with greater verve than by H. L. Mencken:

All government, in its essence, is a conspiracy against the superior man: its one permanent object is to oppress him and cripple him. If it be aristocratic in organization, then it seeks to protect the man who is superior only in law against the man who is superior in fact; if it be democratic, then it seeks to protect the man who is inferior in every way against both. One of its primary functions is to regiment men by force, to make them as much alike as possible and as dependent upon one another as possible, to search out and combat originality among men. All it can see in an original idea is potential change, and hence an invasion of its prerogatives. The most dangerous man to any government is the man who is able to think things out for himself, without regard to the prevailing superstitions and taboos. [51]

Similarly, the libertarian writer Albert Jay Nock saw in the political conflicts between Left and Right "simply a tussle between two groups of mass-men, one large and poor, the other small and rich ... The object of the tussle was the material gains accruing from control of the State's machinery. It is easier to seize wealth (from the producers) than to produce it; and as long as the State makes the seizure of wealth a matter of legalized privilege, so long will the squabble for that privilege go on." [52]

Helmut Schoeck's Envy makes a powerful case for the view that the modern egalitarian drive for socialism and similar doctrines is a pandering to envy of the different and the unequal, but the socialist attempt to eliminate envy through egalitarianism can never hope to succeed. For there will always be personal differences, such as looks, ability, health, and good or bad fortune, which no egalitarian program, however rigorous, can stamp out, and on which envy will be able to fasten its concerns.

[48]Roger J. Williams, Free and Unequal: The Biological Basis of Individual Liberty (Austin, Texas: University of Texas Press, 1953), pp. 4-5. Williams adds: "Does not our love of liberty, which seems to be inherent in all of us, rest squarely upon our inequalities? If at birth we all possessed the same potential tastes ... would we care about being free to pursue them as we individually desire? ... It seems to me clear that the idea of freedom arose directly out of this human variability. If we were all alike there would seem to be no reason for wanting freedom; `living my own life' would be an empty, meaningless expression." Ibid., pp. 5, 12.

[49]Herbert Spencer, Social Statics (London: John Chapman, 1851), pp. 76-78. In the remainder of the book, Spencer spins out the concrete implications of his basic principle. For a critique of the Law of Equal Liberty, see Murray N. Rothbard, Power and Market (Menlo Park, Calif.: Institute for Humane Studies, 1970), pp. 159-160.

[50]Robert Michels, Political Parties (Glencoe, Ill.: Free Press, 1949). See also the brilliant work by Gaetano Mosca, The Ruling Class (New York: McGraw-Hill, 1939), which focuses on the inevitability of a minority "ruling class" wielding power in government.

[51]H. L. Mencken, A Mencken Crestomathy (New York: Alfred A. Knopf, 1949), p. 145.

[52]Albert Jay Nock, Memoirs of a Superfluous Man (New York: Harper, 1943), p. 121.

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