Libertarian Book Reviews

Capitalism and Freedom

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When Milton Friedman’s Capitalism and Freedom came out in 1962, his was a rare voice defending classical liberal values and the free enterprise system.  For years his ideas were unloved in ruling circles, as the leviathan unleashed by F.D.R.’s  New Deal pressed its tentacles even further into the flesh of American society through Johnson’s Great Society and beyond.

But after nearly a generation wandering in the wilderness, Friedman lived to see the vindication of his ideas, as big government solutions repeatedly failed, and free market approaches out-performed.

The fall of the Soviet Union and communism in Eastern Europe should have sealed the argument.  But bad ideas never truly die.  They merely go dormant.  The anti-liberal contagion awaits the day to entice and poison new audiences, in new generations, with the false promise of heaven on earth, for the price of their soul and their freedom.

A major source of objection to a free economy is precisely that it does this task so well.  It gives people what they want instead of what a particular group thinks they ought to want. Underlying most arguments against the free market is a lack of belief in freedom itself.

The fascinating thing is how far ahead of his time Friedman was in 1962, and also how advanced his thinking remains, even for today.

Among the things Friedman proposed were: school vouchers to replace public school funding, elimination of agricultural price support programs, elimination of all tariffs and trade restrictions, repeal of rent control and minimum wage laws, elimination of Social Security, repeal of occupational licensure laws, ending military conscription, privatizing national parks and public toll roads,  reeling in the Federal Reserve System to remove discretionary powers (he’d essentially have it run on auto-pilot), eliminate foreign economic aid,  balance the federal budget, on average, year to year, elimination of public funding for state colleges and vocational/professional training, allowing equity-based investment (pay a percentage of future earnings) for college education, elimination of anti-discrimination laws, fair employment, fair housing laws, anti-segregation laws, application of antitrust laws to labor unions and other government-granted monopolies,  elimination of corporate income tax (but have tax on retained corporate earnings for individual income tax returns), a flat individual income tax rate, rejection of “social responsibility” instead of profit as the primary duty of corporate officials, elimination of estate taxes,  a negative income tax to replace other forms of welfare (in a way, similar to a UBI), etc.

It is amazing how much of these items has already been accomplished or are at the forefront of debate today, nearly 60 years later.

I’d recommend reading (or re-reading) Capitalism and Freedom to anyone interested in girding themselves for mental strife, to do battle with the modern opponents of freedom, whether they are Facebook friends, or college professors.  Friedman’s mastery of the economic matters (he won the Nobel Prize in Economics in 1976) and his gift for explaining his arguments in a non-technical, but rigorous fashion, is unparalleled.

Income Tax: The Root of All Evil

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Before there was a libertarian movement of that name there was, in the United States, the Old Right.  These were anti-Progressive, anti-interventionist Republicans and conservative Democrats (remember them?) opposed to the New Deal.  They were staunchly individualist.  During the war hysteria that came in the 1940s, the the following Cold War hysteria, the Old Right was pretty much swept off the stage of public discourse.  But you probably know some of their names:  Albert Jay Nock, Senator Robert Taft, Gov. Al Smith,  H.L Mencken, and Frank Chodorov (1887-1966).

Frank Chodorov was involved in a variety of magazines, through the 1940s and 1950s, including his own journal, analysis,  and the Foundation for Economic Educations’s The Freeman, which he edited.

However, Chodorov is best known today for his 1954 book,  Income Tax: The Root of All Evil, his indictment of the 16th Amendment and the havoc it unleashed on the American way of life.  By Chodorov’s audit of the ill-effects of the income tax, it caused a long list of ailments, such as making us more bellicose, enabling the imperial presidency, upsetting the balance between the states and the federal government,  feeding class warfare, corrupting our charities,  and exploiting the poor.

In name, it was a tax reform. In point of fact, it was a revolution. For the Sixteenth Amendment corroded the American concept of natural rights; ultimately reduced the American citizen to a status of subject, so much so that he is not aware of it; enhanced Executive power to the point of reducing Congress to innocuity; and enabled the central government to bribe the states, once independent units, into subservience. No kingship in the history of the world ever exercised more power than our Presidency, or had more of the people’s wealth at its disposal. We have retained the forms and phrases of a republic, but in reality we are living under an oligarchy, not of courtesans, but of bureaucrats.

The remedy?  The same as used to repeal Prohibition:   Ratify an new amendment to repeal the 16th Amendment, 3/4 of state conventions.  It is an intriguing idea, certainly. Republicans currently control the state legislatures in 30/50 states,  or 60%.

Although one wishes a 1954 book on the income tax would no longer be relevant, the intervening years and the full range of tax “reforms” have not undone Chodorov’s original analysis or his recommendations.  And not only relevant, Income Tax: The Root of All Evil is a delight to read, a propose full of energy and grace.

Granite Republic

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I’m not a frequent reader of fiction.  As I see it, there is enough real in this world to marvel at.  But I will, on occasion, pick up an alternative history novel.  It helps limber the imagination, broaden one’s view of the possible.  So, when J.P. Medved’s short story, Granite Republic, popped up on my Kindle recommended list, I gave it a try.  As a New Hampshire resident and a Free State Project participant, how could I not, given it portrays a libertarian revolution in New Hampshire?

The story is told via a stream of newspaper stories,  television broadcast  transcripts, magazine articles, blog posts,  emails, etc., as a confrontation between the libertarian-leaning state of New Hampshire and the left-leaning federal government comes to a head.  I won’t say much more, lest I give away plot details.  But I do recommend this gripping short story.

The one thing I expected to see, but didn’t, was an explicit mention of Article 10 of the New Hampshire State Constitution:

Government being instituted for the common benefit, protection, and security, of the whole community, and not for the private interest or emolument of any one man, family, or class of men; therefore, whenever the ends of government are perverted, and public liberty manifestly endangered, and all other means of redress are ineffectual, the people may, and of right ought to reform the old, or establish a new government. The doctrine of nonresistance against arbitrary power, and oppression, is absurd, slavish, and destructive of the good and happiness of mankind.

That would have been quite appropriate, I think.

The Dirty Dozen

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A brief note on The Dirty Dozen: How Twelve Supreme Court Cases Radically Expanded Government and Eroded Freedom.

I really had high expectations for this book, written as it was by a dream team of Cato (Robert A. Levy) and Institute for Justice (William H. Mellor) authors.  Add in a forward by Richard A. Epstein, and this book should be great.

The basic format is to take 12 issues, and for each one to examine the relevant Supreme Court decisions, asking for each one:

  • What is the Constitutional issue?
  • What were the facts?
  • Where did the Court go wrong?
  • What are the implications?

The general theme is to show how things went off the rails, how a particular Supreme Court decision, as the title suggests, “radically expanded government” or “eroded freedom.”

The book is quite readable, and will be approachable by anyone with basic knowledge of American government and our constitutional order.

The issues covered range from interstate commerce (Wickard v. Filburn) to campaign finance reform (McConnell v. Federal Election Commission) to gun rights (United States v. Miller.   These are all relevant, evergreen issues.  However, as the observant reader will no doubt notice, a lot has happened in these areas since this book was published back in 2008, like Heller and Citizens United.

As a result, much in the book is out of date.  But the approach, and execution, is brilliant.  (More, please!)  Again, I had high expectations for this book.  And now I have earnest wishes for the thorough updating this books deserves.  A new preface (added a decade ago) is not enough.

Pictures of the Socialistic Future

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Eugen Richter (1838-1906) is not a name that prompts immediate recognition, at least not in the English-speaking world.  He was, in the late 19th century, the preeminent advocate for free markets and institutions in German politics.  He took a stance, as libertarians do today, criticizing both left and right.  He was outspoken both against the socialists (Marxists) as well as against the conservative, Bismarck, especially opposing his tariffs.  He did this as a journalist, but also in the arena, with a seat in the Reichstag, as leader of various short-lived political parties, such as the Freisinnige Partei (Free-minded Party).

In 1891 Richter wrote a popular work, Sozialdemokratische Zukunftsbilder: Frei nach Bebel, literally “Social-democratic future pictures, freely adapted from Bebel.”  August Bebel (1840-1913) was a near-contemporary of Richter, and founder of the German Social Democrats.  Social Democrats back then were pretty much hard-core Marxists and remained so until after WWII.   So, to avoid confusion, the English translation of Richter’s book is titled, Pictures of the Socialistic Future.

This is a remarkable book, one that has aged quite well.  Richter gives us here a diary of a Berliner, a middle-aged, middle-class everyman, a bookbinder with wife and children and an elderly father, a man who is sympathetic to Bebel and the socialist platform, a man who is comfortable in his position, but knows that others struggle, and so is happy the day the revolution comes and with it a new government and new institutions to bring this vision to fruition.  The book continues, in diary form, given day-by-day snapshots of the ups and downs, from the euphoria of the revolution to the…well, one would not expect Richter to give this story a happy ending, would we?

What surprised me about his unfolding (and unraveling) of socialism is that all the leaders have the best intentions and proceed methodically on the soundest of socialist principles.  There is no evil dictator here, only a benevolent socialist leader, democratically elected.  This is not The Road to Serfdom.  The downfall of this socialist vision comes nevertheless, rotting from within, from economic inefficiency, from misplaced incentives, from malingering, and from the denial of human nature.  There is an intimation of the Economic Calculation Problem here, the core economic flaw of socialism, illustrated in fictional form long before economists like Mises would describe it rigorously.

This is a quick and easy read.  Henry Wright’s 1893 English translation, though it will send you headed for the dictionary on occasion, still works quite well.  The new e-book edition, by the Mises Institute, comes with a short introduction by Bryan Caplan.  If you want more on Richter’s life and thought, Ralph Raico wrote a piece, “Eugen Richter and Late German Manchester Libreralism: A Reevaluation” in The Review of Austrian Economics, Vol. 4, 1990, pp. 3-25.