individualism for the masses

BK Marcus is an amateur political economist with no formal education in the subject.

He works from Charlottesville, Virginia as an editorial consultant for the Ludwig von Mises Institute and managing editor of Mises.org.

He is no longer a house husband, nor a faculty spouse, but he is still a dilettante and a layabout, at least in spirit.

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"It is no crime to be ignorant of economics, which is, after all, a specialized discipline and one that most people consider to be a 'dismal science.' But it is totally irresponsible to have a loud and vociferous opinion on economic subjects while remaining in this state of ignorance."

Murray Rothbard

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Benjamin Tucker Marcus
February 19, 2010

bordering on the naive

January 27th, 2007 by bkmarcus

My "what were you taught" post on schooling bias and the Nazi hatred of capitalism drew a critical comment from someone who clearly doesn’t read this blog.

My impression is that some people troll technorati for recent posts on their favorite subjects. I suspect this is how, for example, I got biblical literalists attacking my post on our childbirth instructor’s citation of Genesis 3:16 (1,2). "Attacking" might be too strong; they fell just short of being insulting, as does "chris" in his first sentence:

This is overly simplistic, bordering on the naive. The Nazis were masters of propaganda, and one of their tactics was to appropriate the mantle of European Socialism while carefully building up a Corporate State. Mussolini was more honest: "Fascism should more properly be called Corporatism". Germany’s industrial corporations backed the Nazis all the way, and profited handsomely. The "Socialism" angle was a joke.

I’m not going to do a point-by-point reply to every foray from the loyal opposition, but the comments from "chris" (I’m using scare quotes because he entered his web address as "http://FooledYou") are so thoroughly wrong in nearly every regard, one might almost believe they came from a libertarian provocateur posing as an agnorant leftist.

Almost.

(1) This is overly simplistic, bordering on the naive.

Let’s move on …

(2) "The Nazis were masters of propaganda, and one of their tactics was to appropriate the mantle of European Socialism while carefully building up a Corporate State."

Yes, they were masters of propaganda. So what?

Are we to conclude that nothing they said about their own ideology was true? Are we to treat their anti-Semitic rants as evidence that they didn’t really hate the Jews, that they were just trying to ride the wave of anti-Semitism and appropriate the mantle of, say, the Christian Socialists, who were equally anti-semitic in their propaganda? (Some suggest that Hitler learned the art of Jew-bating demagoguery from "Handsome Karl," the Christian Socialist mayor of Vienna, back when Adolf still lived there.)

Furthermore, my original point — that our schools do teach us that the Nazis attacked communism but do not teach us that they attacked capitalism, and that this omission constitutes significant bias on the part of the schooling establishment — is in no way refuted by an appeal the Nazis’ disinformational mastery.

No, presumably, the point lies at the end of the sentence:

"…while carefully building up a Corporate State."

This is our first hint at the central problem in our disagreement. It seems "chris" thinks that the Corporate State has something to do with capitalism.

This is the equivocation fallacy I address in "Straw Men & Ham Sandwiches," where the opponents of capitalism fight the straw men of mercantilism and corporatism in order to then declare victory over capitalism.

Of course, the question isn’t what "chris" or the 21st-century Left understand by the C-word. The question is what people understood by the word at the time, what Göbbels would have meant, and what he would have known his audience meant, which was private ownership of the means of production.

The Corporate State of right-wing socialism was every bit as much an attack on "the anarchy of the market" (to use the Marxist phrase) as was left-wing socialism.

(3) "Mussolini was more honest: ‘Fascism should more properly be called Corporatism’."

Again, this might be an interesting point if "corporatism" had anything to do with capitalism. This may or may not be a case of someone using a word because he assumes he knows what it means but has never bothered to look it up.

Corporatism (or "Corporativism") is the official term for the economics of fascism. To quote Mussolini on the subject reveals far less than the quoter seems to believe.

To throw another monkey wrench into the works, Wikipedia claims that Mussolini never said it:

Several variations of the alleged quote exist. However the veracity of this quote is highly doubtful since the most common cited texts for the quote do not contain anything like this alleged quote.[2] Despite this, the alleged quote has entered into modern discourse, and it appears on thousands of web pages,[3] and in books,[4] and even a conspiracy theory advertisement in the Washington Post.[5] However, the alleged quote contradicts almost everything else written by Mussolini on the subject of the relationship between corporations and the Fascist State.[6]

In one 1935 English translation of what Mussolini wrote, the term “corporative state” is used,[7] but this has a different meaning from modern uses of the terms used to discuss business corporations. In that same translation, the phrase “national Corporate State of Fascism,” refers to syndicalist corporatism.

Just to be clear: an advocate of capitalism cannot support corporatism, and no advocate of corporatism supports capitalism. They are completely antithetical arrangements.

Capitalism — private ownership of the means of production — is a decentralized economic system (thus the Marxist equation with "anarchy") while corporatism is an attempt to put the economy under the political control of state-privileged agents.

The confusion presumably comes from the words "corporate" and "corporation." But the political corporations of economic fascism are not the business corporations of economic capitalism. The former are government-created cartels; the latter are market-created firms.

Unfortunately, even in the business world, the word "corporation" means at least a half-dozen different things, some overlapping, some conflicting (and I recommend chapter 6 of How The West Grew Rich on the different origins, histories, and functions of the different types of corporation), but it should be easy to recognize the difference, at least in principle, between a firm that has to compete without political privilege and any entity created by the state.

(4) Germany’s industrial corporations backed the Nazis all the way, and profited handsomely.

Yet again, this might be interesting if it had anything to do with capitalism.

It seems "chris" is ready to equate all commerce, trade, production, and profit-seeking with the C-word, whether these goals are pursued through market competition and innovation, or through lobbying, political privilege, and rent-seeking.

Capitalists are often the worst enemies of capitalism.

What David Friedman says of Adam Smith should be true of any ideological defender of private property and economic freedom: "He was a defender of capitalism — not of capitalists" (Hidden Order, p. 63).

A capitalist is someone who seeks profit from capital investment. Sometimes they seek their profit from honest entrepreneurship. Sometimes they petition the state for a coercive advantage. Sometimes (e.g., John D. Rockefeller) they pursue one strategy at one point in their career and the other in another.

Economic fascism has concisely been defined as private profit and socialized losses. It would certainly be naive to think all profit-seekers would decline such an arrangement. In fact, it is probably safe to say that behind almost all massive interventions into the market economy, there are private profit-seekers pulling the strings.

Capitalists supporting fascism does not translate to fascists supporting capitalism.

(5) The "Socialism" angle was a joke.

I think I’ve show that it wasn’t, but suppose I’m wrong. Suppose the Nazis never meant any of it. Doesn’t it still reveal schooling bias that even my most educated friends are surprised to learn that the Nazis claimed to be socialists, claimed to oppose capitalism, claimed that they hated the Jews because Jews were the epitome of capitalism?

The Jew is uncreative. He produces nothing, he only haggles with products….

As socialists we are opponents of the Jews because we see in the Hebrews the incarnation of capitalism, of the misuse of the nation’s goods.

Joseph Göbbels

[Thanks, Stephen Carson, for drawing attention to this passage.]

Is it not evidence of indoctrination that this very debate is so alien and disorienting to people who got A’s in their history classes?

Posted in economics, history, metablog, schooling | 5 Comments »