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NOTES from FEE
30 S. Broadway, Irvington-on-Hudson, NY 10533
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The following is abridged from a speech delivered at
Evenings at FEE in March 2006.
A specter is haunting Europethe specter of communism
by Richard M. Ebeling
It may seem strange to quote from the famous opening line of Karl Marx and Frederick Engels
Communist Manifesto in this day and age. After all, the Soviet empire is gonerelegated to the dustbin of
history (to use a Marxian phrase). And nothing seems as fully repudiated by the reality of socialism in
practice as the idea of central planning.
Yet it remains true that the specter of communism continues to haunt much of political thinking and
public policy. French President Jacques Chirac stated recently that Liberalism [he means classical liberalism]
is as dangerous an ideology as communism and, like communism, it will not prevail. Europes model,
Chirac insisted, is the social market economy, an alliance of liberty and solidarity, with the public
authority safeguarding the public interest.
It is worth taking a moment to reflect seriously on Chiracs claim that classical liberalism is
as dangerous an ideology as communism.
Communism rejected human beings as unique individuals and reduced them to being part of a social class.
Everyones destiny was determined by uncontrollable historical forces, and the Marxist ideologists
claimed to possess a special insight and knowledge about those forces. Communists instigated terrorism,
violent revolutions, purged members of enemy classes through mass murder and slave labor, and imposed
absolute dictatorships wherever they came to power. In the former Soviet Union alone it has been estimated
that as many as 65 million innocent men, women, and children were murdered in the name of building the
bright and beautiful socialist future.
The Liberating Force of Classical Liberalism
What has liberalism been guilty of that would justify Chiracs statement that it is as dangerous
as communism? Beginning in the 18th century and throughout the 19th century, classical liberalism insisted
on the freedom and dignity of the individual. Liberalism campaigned against and brought about an end to
human slavery, first in Europe and then around the rest of the world. Liberalism called for ending the rule of
kings and princes or at least restraining their powers through constitutional government and peaceful
elections. It called for impartial rule of law, and the end to torture and other cruel punishments.
The liberal economic agenda included the abolition of all privileges, favors, and subsidies that benefited the
aristocracy, as well as the end to all monopolies created by government regulation and protection. It called for
free enterprise, freedom of trade and occupation, and freedom of movement.
In other words, classical liberalism has been an ideology for the liberation of man from political oppression
and economic poverty. It has been the foundation for human freedom and material prosperity in the
modern world. It has served as the foundation of the American Republic.
Private Enterprise Under Attack
So what is liberalisms crime that makes Chirac and many others compare its danger to that of
communism? This returns us to the title of my talk: Is the specter of communism still haunting the world?
While the ideal of Soviet-style socialism has been rejected, the socialist critique of capitalist society
continues to dominate the thinking of intellectuals and public policy makers around the globe. The rationale
for the vast network of government welfare programs as well as regulation and control over private enterprise is
based on the socialist analysis of the market economy. When private enterprise is left free, the socialists
claim, the selfish profit motive will guide businessmen to act in ways that harm the common or national good.
Workers searching for employment will be exploited and abused by greedy employers unless government
protects them with workplace rules and regulations, including the establishment of a fair wage. The state
must take on the role of paternalistic provider of health care, old-age pensions, unemployment insurance, public
housing, education, and a wide variety of other social services. Why? First, under unrestrained capitalism
workers will not earn enough to provide these necessities for themselves. Second, private enterprises driven by
mere self-interest will inevitably fail to supply these goods and services in sufficient quantity.
In the name of protecting people from such unrestrained liberalism, governments everywhere,
including here in the United States, have created everexpanding bureaucracies that regulate nearly every
aspect of our lives. Even the former captive nations of Eastern Europe have imposed such anti-liberal policies,
because of internal political pressures or rules imposed by Brussels on member-nations of the European Union.
As a consequence, our world today is in the grip of anti-capitalism. State bureaucracies ruling over antimarket
policies have grown into ideological and political elites who arrogantly presume to know and dictate how we should
all live and work. Those holding political power may be compared to the nobility of old, before whom the commoners
had to grovel so they might live and prosper.
Since regulatory and redistributive agencies hold the financial power of life or death over nearly every
private enterprise, the degree of special-interest politicking and the frequency of discovered political
bribery and corruption should come as no surprise. To survive in such a politicized environment many private
businesses, large and small, try to win favors, privileges and subsidies for themselves at the expense of their
domestic and foreign competitors who in turn try to do the same.
I doubt that incremental reforms alone will end this anti-market system of interventions and controls. The
change can only come through a revival of true liberalism, and the implementation of a real free-market
The Glory of Capitalism
Such an agenda must begin with an educational campaign to tell the true story of classical liberalism.
As long as our fellow citizens have a distorted image of life before the welfare state, they will continue
to fear the loss of their social safety nets.
Liberalism and capitalism in the 19th century did not doom the worker to a life of perpetual poverty. Instead,
they kept creating new and better-paying employments as the decades went by. They produced the wealth and
rising income that resulted in the emergence of a phenomenon completely new to human history: a selfsupporting
and educated middle class that grew more and more as the lower classes bettered their economic well-being.
Through private investment capitalism kept raising the productivity of labor to new heights. Parents were
able to earn enough so their offspring did not have to join the work force at an early age. This produced
something unique in history: childhood, a time when the young could experience the innocence of play and
the opportunity of schooling before entering the world of work.
Classical liberalism fostered the private associations and charitable organizations that enabled the working
poor to provide medical care, pensions, and education for their families. Famines disappeared; poverty was
dramatically and continuously reduced; and hard and long hours of work were slowly but surely eased and
shortened to a degree never before experienced.
Capitalism has been the liberator of mankind. The great history and glorious achievements of that earlier
classical liberal epoch must be captured once again.
The Moral Case for Liberty
Setting the historical record straight, though vitally important, is not enough. We must reawaken the
moral case for liberty. The starting point for such a moral reawakening is the rejection of the collectivist
conception of man and society. Collectivists of all typessocialists, communists, fascists, interventionists,
and welfare statistspresume that the group, the tribe, the nation,or the social class takes precedence
over the individual. He is to serve and if necessary be sacrificed for the common good or general welfare,
since the individual has neither existence nor rights separate from the collective to which he belongs.
Compare this with the unique and starkly different philosophy of man and society captured in the American
Declaration of Independence: 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. That to secure these rights, Governments are instituted among Men, deriving their
just powers from the consent of the governed.
Rights precede government, and are not something given to man by any political authority. Each of us
possesses rights that may not be taken away or undermined by those in political power. We all possess
an inalienable right to our life, liberty, and property. We own ourselves, and by extension we have a
property right to what our creative minds and efforts have peacefully produced. We may not be enslaved,
sacrificed, or plundered by others, whether they are private individuals or organized governments.
The individual, not some mythical collective, is the center and starting point of society. The free market is
the arena in which people form relationships for mutual benefit on the basis of voluntary exchange. The free
man finds his own meaning for life, guided by the philosophy and faith of his choice. He refuses to
coercively impose his will on others, just as others may not use force against him. He persuades others to
live and act differently through reason and example, and not with the bullet or the bayonet. And no political
authority can make claims against his life, liberty, and honestly acquired property, because the function of
the limited government is to secure his freedom from predators and plunder.
This is the classical-liberal philosophy of individualism that must be reawakened in our fellow men if we
are to exorcise the specter of communism that continues to haunt the world. It requires a confident belief
that we are right, that both reason and history have demonstrated the value and benevolent results of what
Adam Smith once called the natural system of liberty.
The Principled Case for Freedom
How shall we do this? Well, we can only select methods consistent with the principles of freedom
that we espouse. The late Leonard E. Read, who established the Foundation for Economic Education 60
years ago, argued that each of us must be willing to follow a path of self-improvement in our knowledge
and understanding of the freedom philosophy. We must be willing to practice that ideal as best we can in
all that we say and all that we do.
In 1948, two years after FEE was established, Leonard Read delivered a talk that was later published
under the title The Penalty of Surrender. Compromise, Read suggested, can be a good and reasonable thing;
for example, in setting the time for a meeting or striking a bargain in the marketplace. In such cases all
parties feel that they are better off making the trade.
But principles should never be compromised. When they are, Read argued, it is an act of betrayal, the
surrender of something that should not be given away. We all agree with the ancient and Biblical injunction,
Thou shalt not steal. As a moral principle the injunction against theft may be either followed or broken,
but it cannot be compromised. As Read reminded us, If you steal just a teeny weensy bit you do not compromise
the principle. You abandon it. . . . The moral principle, whatever the amount of the theft, is surrendered and
This means no compromising of the principle of freedom.
It will not do to accept less government redistribution of other peoples wealth, or merely less regulation of
other peoples choices in the marketplace. We either respect other peoples property and peaceful decisions,
or we do not.
Such an approach may seem too radical or extreme. But unless we persuade our fellow citizens
what freedom really means, unless we explain how the free market works and why it is morally right,
we will fail to finally eliminate the lingering specter of communism.
Together we can do it. We can move the world to a society of freedom, if enough of us are willing to try.