The Post-War America That America Does Not Want


By DR. RUTH ALEXANDER, Economist and Lecturer

Delivered at the War Congress of American Industry, under auspices of National Association of Manufacturers,Waldorf-Astoria, New York, December 4, 1942

Vital Speeches of the Day, Vol. IX, pp. 171-174.

THE Post-War America we don't want. I might be chivalrous and say your guess is as good as mine. With this difference—that for five years I have traveled thousands and thousands of miles, addressing all kinds of audiences, and my words today are not confined to personal opinion. They represent a symposium of opinions contributed by average American citizens of all classes, all over the country.

They do not want a socialist or communist America. They have expressed themselves on that repeatedly at the ballot box. Nor do they want socialism disguised by any other name. Many have been attracted by such slogans as the "New Democracy" or a "Planned Economy," about which they are both vague and curious. But when the full implications of such a society are realized, Americans of all classes denounce them as academic fairy tales dangerously unfit for realists.

I am not unaware of the power of words. And when a man styles himself a Liberal and promises bigger and better liberty if we will only be reasonable and surrender our liberties, obviously he exerts tremendous magnetism. That is what the collectivists have done. They have used our traditional American words to undermine our traditions. While plagiarizing the language of our Forefathers they have heapeddiscredit upon the institutions created by those Forefathers.

The ranking principle of our traditional government is segregation of powers. It is not only the cornerstone of the Constitution but the very cradle of liberty. Yet concentration of powers is the rock on which the modern "liberals" stand . . . a concentration presumably benevolent and on behalf of the so-called common good—but a concentration, nevertheless. In all honesty, who is more entitled to be called a Liberal—he who would diffuse power among the many or he who would centralize power in the hands of the few?

The post-war America that America wants includes a showdown on words. We do not want to buy compulsion as the latest fashion in freedom, only to return home and repent of our purchase too late. We want a fair trade name on every bill of goods in the politico-economic field as well as in the commercial field. We want the Fair Trade Practices Act enlarge to include ideas as well as things.

We don't want to consent to collectivism by default, because we don't understand it. Yet today the best ally collectivism has is the confusion of its enemies. That is even greater than the devotion of its disciples. Just to keep the record straight, we stand to gain security and we stand to lose freedom, in a collective economy. And within all of us there is a continuous conflict between these two powerful drives—the urge to be secure and the urge to be free. Obviously the ideal society would correlate a maximum of freedom with a maximum of security. But that necessitates working a miracle on human nature. It also necessitates a more steady average in human nature than all our education has been able to accomplish. Human nature is characterized by enormous differentials in endowment and that is one of the persistent tragedies of Nature—not one of the attributes of capitalism.

There are men who are not afraid of freedom. They not only court its responsibilities and risks, but they find it the most powerful incentive to work and to save. They are not motivated by service to the common good save as a secondary result of their work. They are motivated by the will to self reliance, knowing full well that only those who are economically self-reliant can be politically free.

On the other side of the picture there are men who desire security above all else. Who are we to judge whether they are "better" or "worse" than those magnificent adventurers who live only to be free? The point is that they exist and must be reckoned with. When they exist in large numbers, and whether their urge to security has been artificially stimulated by preposterous promises or is an innate characteristic, they condition the collective State which is an entirely different kind of State from the American free State. Because of their inability to work effectively for their own support, they pose as working primarily on behalf of others. This ruse apparently entitles them to reap the laurels of "liberalism". But perhaps we should be grateful that they bother to work at all!

The leaders of a security-minded People can do what they will providing only that they furnish bread and games to the multitude. Subsistence needs represent the uttermost in physical and psychic needs of the masses and that makes their leaders humanitarians whether they are tyrants, as well, or not. Every despot, from Nero to Hitler, rose to power and glorified himself as the leader of the collective, the interpreter and arbiter of the common good. In Germany today the "common good" is interpreted to mean the superiority of the Aryan race and the horrors of anti-semitism. All men are chained together in mutual dependence and freedom has become a mere target for abuse.

I am reminded of what the great Frenchman de Tocqueville said about us in this connection. I quote—

"No one in the United States has dared advance the maxim that everything is permissible in the interest of the social whole . . . an impious adage invented in an age of tyranny to shelter the tyrants of all future generations."

But even the worship of the common good as a holy absolute is but a secondary symptom. The disease is collectivism—the superiority of the social whole, or the State, over the individual as such. Our Constitution is a veritable manifesto of individualism. We want to keep it that way. We don't want it twisted by judicial interpretation or by any other technique to mean that the State can aggress against the individual, even on his behalf. We know that when we give the State the power to help us we give it the power to hurt us. As the great Samuel Gompers so truly said—"What the legislature gives, the legislature can take away."

The very reason we don't want a Planned Society as our post-war economy is because Planning necessarily involves intensification of authority. Authority involves power and power involves penalties . . . not for transgression against civil or criminal law, but for the mere fact of disagreement of and non-cooperation with the Plan. While the Planners may regret persecution, they have no shred of doubt of its necessity. Power is not only the core of collectivism, but it is also its Achilles Heel, as far as America is concerned. We know the genealogy of Power. We know it is the greatest agency of corruption known to his history. And, strangely enough, it seems to matter little whether power is originally beneficent or malignant, preserver or destroyer. It invariably ends up as a sort of fifth column of the spirit and destroys freedom before our very eyes. Thomas Jefferson warned us of it when he said—

"Even under the best forms of government those entrusted with power have, in time and by slow operations, perverted it into tyranny."

There are several other reasons why we don't want planning in the generally accepted sense of the term—namely, over-all planning by special agencies of government in whom are vested both economic and political powers. I can mention them only briefly. We don't want a managed economy, because of the impressive magnitude of its potential mistakes. Under a free economy individual mistakes may be many in number but are limited in scope. The all-powerful State of collectivism on the contrary, can make or break a nation in one single sweep. It is unhistoric to claim that mistakes will not be made or even to claim that they will be minimized below the average of individual mistakes. Even though the State poses as the Sculptor of Society it remains a body of men, sharing the frailties common to universal human nature.

Mistakes are not necessarily evil in themselves. In fact, the right to be wrong is one of our most precious rights. Without mistakes we would not have had experiment and without experiment we would not have had invention and without invention we would not have had "modern" civilization—for whatever it proves to be worth in history's guest book. But there are mistakes and mistakes. Suppose a war is a mistake—as certainly this war is proving to be for Hitler. He drags down the whole German people with him, whether they like it or not. And that is even worse than some of the mistakes the capitalists are said to have made!

The question of minority rights, the disappearance of civil rights, and compulsory enforcement of the Plan, however wise in provisions, all cry out to be analyzed. They are additional reasons why we don't want a Planned Economy in our post-war period. Indeed, I could give you reasons by the hour—but your schedule gives me twenty minutes! If Ibut have whetted your appetite to hear about what we DO want by talking of what we don't want, then I shall be content.

We want capitalism. I do not apologize for the word or the concept. I do not cringe before collectivism and attribute only virtues to it. Nor do I attribute only virtues to capitalism. I do say that by comparison with all other forms, capitalism wins in a walk. Capitalism is the great Liberal and the great Liberator. Capitalism is the great humanitarian, for it has provided the highest standard of living for all classes known to mankind. Capitalism is the New Freedom—not yet two centuries old—a mere babe at the breast of history. Capitalism has not "had its day," as the collectivists tell us with their brazen proposals to improve upon that which they were unable to originate in the whole of their long dark tribal past wherein all were responsible for each.

Listen to the homage paid capitalism by Karl Marx, its greatest student and its most effective enemy. I admit he intended his tribute to rank as an obituary, but the news of capitalism's death has always been greatly exaggerated. I quote—

"The bourgeoisie (the capitalists in Marx's vernacular) during its rule of scarcely one hundred years has created more massive and colossal productive forces than all the preceding generations together. Subjection of Nature's forces to man, machinery, application of chemistry to industry and agriculture, steam navigation, . . . clearing of continents for cultivation . . . whole populations conjured out of the ground . . . what earlier century had even a presentiment that such productive forces slumbered in the lap of social labor?"

How can even the most flippant collectivists rate capitalism as a mere whim of history after such recognition as that? Do we want this flame to flicker and die because we refuse to defend our defender? Must we continue to fawn on our collectivist friends who bathe themselves in the sickly-sweet perfume of pity that we, too, may falsely be flattered as fake "Liberals"? Don't we know that the system which made mass production possible is the most humane system of all?

For, capitalism, no other, finally defeated tyranny. Capitalism, an economic phenomenon, defeated the despotic State, a political phenomenon. Tyrannies have always come from above and below and capitalism produced the great middle class—the miracle of history. Its material benefits even Marx must admit, but its spiritual influence is incalculable. Freedom is of the spirit the very essence, and capitalism freed the individual from fear of State interference. "Capitalism is the only possible basis for democracy" That is the succinct verdict of the late Robert Hunter who spent forty years of his life a socialist.

The mechanism by which capitalism released individual energy to the uttermost is simple. A man makes his living by giving his fellow men a product better and cheaper than his competitors. His fellow man is both judge and jury of his worth as expressed in his product. Every capitalist, large or small, faces a continuous plebiscite of consumers. Every sale is a vote for or against him. He is completely at the mercy of the buyer, even under monopoly conditions, in the long run.

Unlike the collectivist State where consumer buying is based on decree, the capitalist cannot force the public to buy what it doesn't want. He can, and does, exert pressure through advertising, but there is a limit to the persuasion of advertising. We want a capitalist State because it is a People's State. In it, the People exercise freedom of choice unlimited by the dictates of the Planners and limited only

by the income of each. This income, in turn, is limited by natural endowment, but it is not largely determined by circumstances, as the collectivists would have us believe. The rise from poverty to riches has been effected all too frequently for Americans to be defeated by unfavorable circumstances. In a free society, each man puts forth from himself his own condition and sphere.

The relationship between capitalism and constitutional democracy is more than coincidence. The two are not only mutually dependent but they are running mates that move with all the precision of parallel lines. In a democracy the people can have whom they want. Under capitalism, the people can have what they want. The powerful weapon of patronage is in the hands of the people, not the politicians. As voters, they can reward or punish. As consumers, they can reward or punish. That is why we want a capitalist democracy. We want to keep the patronage in the hands of the People.

For the true capitalists are the people—the people everywhere—the rich people and the poor people, but above all, the middle class people. The collectivists have tried to paint the capitalist as essentially a rich man, characterized by greed and exploitation, and caricatured by striped pants and a cut-away coat. On the contrary most capitalists are "the likes of those" who earn their living by selling their labor or their products for a profit.

How can this possibly be an "evil" thing? And if it is not an evil thing for a poor man to receive private profit in the shape of wages how is it an evil thing for a richer man to receive profit in the shape of salary? Why should differential reward for differential services be denounced as antisocial? As far as its influence on class cleavage is concerned, you know as well as I that many in the higher income brackets properly belong in the lower classes and that many in the lower income brackets are the aristocrats of us all. It is one of the tragedies of life that ability and character do not always coincide. But shall we blame that on capitalism? Would it be otherwise under collectivism?

Capitalism did not create poverty. It inherited poverty from collectivism. And it has done more to alleviate poverty than all preceding centuries. For that reason, if no other, capitalism must be salvaged as the humane way of life. I know its imperfections. I know competition is called cruel, though rather should we say that competition rests on justice untempered by mercy. But even this is humane because it is impersonal. No conceivable natural law could approach the refined cruelties of the collectivist State where personal grudge and political favoritism are the order of the day. The law of demand and supply is not the author of the castor oil technique of the German concentration camp. A Planned Society is responsible for that!

The collectivist's answer is that while the German collective is ugly ours would be pretty. But collectivism means compulsion and compulsion carries within itself the seeds of cruelty. Where influence ends and coercion begins is a fine line indeed. Coercion of itself is the spiritual essence of cruelty.

The Scandinavian countries are often cited as examples of collectivism without compulsion. But they are not collectivist, properly speaking, and their cooperatives are no more cooperative than many of our advanced corporations. The end result, however, is their standard of living, which ranges from 54 cents to 75 cents, average income, per capita, per day (as of 1939). Ours tops the world at $1.36 a day—per capita, mind you!

The ranking target of attack on capitalism is, of course, its alleged trend toward monopoly. But monopoly is not an integral part of capitalism. It is a parasitic growth and hasno organic connection to its host. It is a sickness, if you will, but curable. Any scholarly and objective diagnosis would declare it to be a symptom—a symptom not of capitalism but of collectivist trends within the body politic. Because I recognize the collectivist ancestry of monopoly, I cannot defend it. But the collectivist, while attacking it as an appendage of capitalism, propose the most gigantic monopoly of ail history to take its place—the Total State. Does it make sense?

We must recognize that the threat of collectivism does not come wholly from without—from the foreign ideologies that have received such gracious welcome at our hands. That is only half the story. Every pressure group within our midst is a form of monopoly. And every organization that seeks government interference with the rights and liberties of others on its own behalf is a collective. It unites for the specific purpose of special privilege and every special privilege granted by the passage of discriminatory laws is a nail in the coffin of capitalism.

We hear complaints today about the special privileges being granted Labor. Well, who started it? Chickens do have a way of coming home to roost.

Collectivism is the oldest order of Society and resists a rival with cunning encroachment and masterful persuasion. It is the backward pull to the tribal age and offers the line of least resistance—reversal to security, where all powers and all responsibilities are concentrated in the same hands. This is the "very definition of tyranny," according to Thomas Jefferson. He said—

"The accumulation of all powers, legislative, executive, and judiciary, in the some hands, whether of one, a few, or many, and whether hereditary, self-appointed or elective, may justly be pronounced the very definition of tyranny."

From the perspective of history freedom is still in the first stages of its struggle with its ancient enemy, security. And capitalism is yet a child—a problem child, if you will—but with all the characteristics of early genius. She is the veritable Cinderella of civilization. Long before she finds herself she may be sent into oblivion, for capitalism is a young and fragile thing. Nothing is as sensitive as freedom and when society allows men to proclaim that freedom is an evil thing it is apt to withdraw the magic of its presence from us. We have allowed those words to fall unprotested from the lips of many of our so-called "Liberals," so that now we seem to be on probation. Only time will tell whether we keep or lose freedom. I quote just one of these pronouncements—from the pen of Prof. George Counts the eminent teacher of teachers at Teachers College, Columbia. In reviewing our history he states, "The line between economy and government is increasingly difficult to discern." And he continues with,

"It was evident that poverty, misery and slums accompanied the system of liberty and that the system had not brought about the general welfare which had been promised in its name."

Freedom did not arise with us, but with us it may die—for awhile. Somewhere on the horizon of history it will rise again for it is eternal as the light of the sun. Will you listen to a great description of a Free State and its Ruler from the ancient Chinese philosopher Mencius, who speaks from the vaults of history that which history knows to be ageless Truth?

"The best kind of government is that which is not even noticed by the people. The next is that which is loved and praised. The next is that which is feared. The next is that which is despised."

And the Ruler of the Free State he describes in this fashion— "I act not and the people of themselves are transformed. I love quiescence and the people of themselves become righteous.

I do not interfere and the people of themselves become prosperous.

I have no ambition and the people of themselves become great."