Monday, November 14, 2011

THE VIRTUE OF LIBERTY ( MORALITY, LIBERALISM, AND THE FREE MARKET)

THE VIRTUE OF LIBERTY MORALITY, LIBERALISM. AND THE FREE MARKET
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IV.
Morality, Liberalism and The Market Economy
By Tibor Machan
Different philosophers would give different accounts of the connection between markets and morality even if they supported classical liberalism and free markets. For instance, a utilitarian would not stress individual rights and moral space but the usefulness of market processes in the achievement of the general welfare. Pure Kantian deontologists- who are concerned about our freedom to make principled decisions about our conduct- would, in turn, probably stress the point about moral space and personal autonomy secured via a free market economic system. There is no universal agreement on this, but that doesn't have any bearing on the truth. Yet one can appreciate some skepticism in light of such wide disparity of viewpoints. I'll try to abate this skepticism with the natural rights approach.
I am no subjectivist- it is ultimately a self-defeating position and thus is paradoxical to even articulate. There are, let's say, "best answers" to moral questions. The issue in the present discussion is that when one lives in a certain political economic system- wants to operate and make oneself at home within that system, and maybe even defend these when they are criticized from one's neighbors, one's fellow citizens, foreigners, and so forth- one must be reasonably confident that this system is consistent with certain basic moral values by which all human beings are obliged to abide. For example, if in a free-market society one had to lie all the time, the system would be morally intolerable. It would be evident that even though the system might be successful economically, it would be morally wrong, unfit. If a system inherently conflicts with a basic virtue such as honesty, justice, or generosity, then most probably it is flawed. One reason that socialism, fascism, communism, and other systems have a problem with credibility is not only that they are economically inefficient and cause poverty and misallocation of resources, but also because they engender ways of living that are morally degrading and make one feel guilty about the kind of life one is leading. The issue is whether the market economy is such a system. Or is it one that is even compatible with a moral outlook on life?
There are, of course, competing moral outlooks on human life. With which is the free market, capitalist political economy compatible, which gives that system its moral support if any? More importantly than that question, is such a moral position sound so that we may conclude that free market capitalism is, therefore, morally well grounded?
While these are the relevant questions to ask, we are not going to be able to answer them here conclusively. But while they are the most important questions for a thorough, in-depth inquiry, there is a less comprehensive yet fruitful way to approach the issue at hand. One can ask whether our ordinary moral principles and moral ideals are compatible with and support the free market.
One can be an altruist, egoist, hedonist, Christian, Buddhist, or adhere to any one of a number of other moral systems, yet most of us see the truth of certain moral ideals. We may not rank them in importance the same way- that depends on what "ism" is correct; but no one could sensibly claim that being a coward is an exemplary way to behave or that being a cheat or a liar is morally right. The same goes for being unjust or cruel. Virtues such as prudence, honesty, courage, generosity, and justice are part of any bona fide moral system.
In other words, there are some central virtues that (regardless of one's philosophical or religious orientations) all of us happen to recognize as binding upon human beings. This is somewhat similar to the way most of us see the physical world, regardless of the physics we subscribe to. Whether we lived in Newton's, Einstein's or Bohr's scientific reign, rocks were hard in any case and water liquid and the sky blue. We live in a common physical universe and we tend to live, unless we are pathological and very deeply disturbed, in a common moral universe and, of course, in both areas there exists ample disagreement on the fringes.16
So, similarly, while there are very great differences between moral systems, at a certain level there is only the ordinary human question: "Is the human community that we would find coexisting with a free market economy a morally decent one? Would a capitalist economic system be more or less in accord with the dictates of ordinary human morality than other political economic options?" That is the question that I want to address now.
First, let me raise a few issues about morality. Why there is morality at all- what gives rise to this dimension of reality and human life? The answer lies in the fact that we do not have any automatic ways of guiding ourselves in life. So human beings everywhere anytime will have to raise the question, "How should I live?"
Moral theories and their basic moral principles, such as egoism, altruism, utilitarianism, and hedonism, are all proposed answers to the question that gives rise to morality. Are we to live, basically, so as to pursue pleasure; or so as to maximize well-being throughout society, or to do ourselves the greatest good, or maybe so as to prepare for everlasting salvation in an afterlife? That's the sense in which these moral systems or theories are answers to the basic question, "How should I live?" It is because we need an answer to that basic question, and because it's important to act consistently with this basic answer, that when we talk about human institutions such as marriage, science, business, sports, and legal or political systems, in the back of our minds it always comes up whether they accord with morality. Are these institutions morally proper or do we have to "sell our souls" for them to be tolerable?
One of the most serious problems we face with the market economy and what goes on in markets, namely, commerce or business, is that many of the world's moral traditions maintain that the pursuits of prosperity and morality are either incompatible or in outright conflict. "Jesus said to his disciples, `I tell you this: a rich man will find it hard to enter the kingdom of Heaven. I repeat, it is easier for a camel pass through the eye of the needle than the rich man enter the kingdom of God.'..." (Matthew 19:23-24) People who want solely to be wealthy are not doing what is morally proper in the tradition of Christian morality. People who want to be rich or prosperous are usually disparaged as materialists, decadent, and greedy.
Even in the United States of America, where business had at least been given legal protection and flourished so much that the rest of the world had for some time looked upon the country with some measure of envy and had relied on its economic assistance, when a political party even appears to secure certain advantages for business, it is condemned as fostering avarice and spreading meanness and callousness. Profit-
making is belittled and public service is championed far above private industry, at least by the society's moral leadership.
It is often claimed, quite plausibly, that a free market economy encourages a hedonistic, decadent type of life. Clearly one reason that the countries that used to be the Soviet Union have turned toward perestroika and economic reforms that favor privatization and competition, is that such a system is admittedly more conducive to generating prosperity for human beings than are command economies. Yet, at the same time, this is deemed by many to be a mere practical policy adjustment, not something that can claim strong moral support. Instead a free market is thought to give rise to frivolity, trivial pursuits, and conspicuous consumption. In many near-capitalist societies it is widely argued that the concern with wealth is a degrading feature of society. Any society that encourages people to think about goods and services that will enrich them- going shopping instead of doing the kinds of works associated with Mother Teresa- is not morally worthwhile.
It is widely maintained, both in the West and in the East, in Africa as well as in Asia, in the Arab as well as the Christian parts of the world, that a better, more humane, or morally upright society would worry about culture and art, spiritual growth, helping the poor, and similar noble things. Indeed, it is paradoxical that while many of us concern ourselves a great deal with the poor and how they ought to be helped to become well off, when people are well off we condemn this as something low and base. And many of us fail to see that those other noble projects we are supposed to pursue instead of profit are all very heavily dependent on the availability of capital that the profit-motive produces. In short, everyone seems to depend on good business but no one seems to think that business has much that is good about it. Indeed, the profit-motive has been widely regarded either as a private vice that just happens to lead to public benefits or an innate drive no one can resist without immense moral vigilance.
So the major problem with capitalism- and this is true whether one comes from the political right or left, whether one is a conservative or a social democrat- has been that it encourages a preoccupation with wealth, with living the good life here on earth, with living at least a reasonably pleasurable and pleasant human life, and not interested in spiritual concerns. Maybe it does not foster the excellent life of the saint or the hero but it is the kind of life you can at least be content with and enjoy. Most people in such societies concern themselves with retirement, vacation trips, and related pleasantries. This is something lowly to think about; one's soul is said to be demeaned by it.
But is this all true? Granted, it is probably an exaggeration- some of it may come from envy, some from the fear of loss of power- but some of it comes from an honest worry. Enough people both left and right are genuinely concerned with the possibility that a fully free market economy would, for example, commercialize most of the professions. Whether one would be a dentist, an operator of an art gallery, a museum curator, or a professor of philosophy, it is feared that in a free market economy all of these would be gobbled up by commerce. Philosophy would be sold on the market and therefore cheapen itself. We would get corrupt versions of Plato and Aristotle so as to make it saleable in the marketplace. That we would water down our very complex scholarship because instead of selling four copies as most serious scholarly books do, if we water it down it will sell 5 million copies. In capitalism we try to get rich and so we don't write complicated and interesting philosophical texts, we write cheap "accessible" stuff only.
And clearly there is something to all this- we can see the best sellers are not exactly Aristotle's Metaphysics. They tend to be titled I'm OK, We're All OK, How to Be One's Own Best Buddy?, or Looking Out for Numero Uno. So it is a serious fear that in a free market one must lower standards to a common denominator which will make goods and services commercially successful but otherwise base. These are some of the matters that lead people to consider the market morally suspect and morally worrisome.
The first thing to be said about this is that part of the reason for finding the market morally suspect is that there are dominant moral systems, moral outlooks which actually maintain that trying to live a reasonably successful, happy, and pleasant life here on earth is base, lowly, and beneath the human soul. Now if any of these moral systems were actually right- if one in fact ought morally to renounce success, prosperity, good health, etc.; if a life that is enjoyable or satisfactory is a morally base or defective one- it would therefore be undeniable that a society with a free market is wrong. If one were to believe that somehow people should live lives of constant, relentless poverty, asceticism, self-abasement, suffering, etc., then one could not be a supporter of capitalism. One would then probably support socialism since that system fosters plenty of suffering, poverty, deprivation and neediness.17
Thus, clearly, we can't avoid getting into a brief discussion of moral systems, even though ordinary morality does not clearly renounce the good human life here on earth. The virtue of prudence, for example, clearly encourages commerce and even the profession or specialty of business, if not the relentless, obsessive striving for massive wealth.
Unfortunately there are some systems that while accepting the general moral values such as honesty, generosity, courage, and prudence elevate a virtue such as charity to the top and place prudence at the bottom or exclude it entirely. If a moral system really maintains that our primary goal in life is to be charitable and it is only way down the line that we may take care of ourselves- to be prudent- then we probably could not be a defender of the market. So is that right, does that make sense? Is that the sound morality?
No, it is wrong. Charity is not the highest moral virtue and in fact prudence is a more important or higher virtue than most people believe. One reason for that is that what morality is concerned with ultimately is how to be good at what we (essentially, naturally, centrally) are. To live a good life is to live a good life of the kind we have some control over, some understanding of. Obviously if we lived the good life of a dog and went around barking excellently it wouldn't be a great human life. If we did live excellently as angels, then again we wouldn't live a good human life but a good angelic life. Since, however, we are not angels, it wouldn't be morally relevant to practice angelic virtues.
So the question of morality is what it is to live a good human life. When we ask the question, "How should I live?" the "I" is a human being in our case. Humanity then must come in very directly when answering the question. We need, first of all to know what is it to be a human being so that we can answer the question "How to live this kind of life that is my life, how to live it excellently?"
Thus the issue arises as to what human nature is. What is it that every human being is, regardless of all the accidentals, and all the incidentals
(race, height, age). What is it simply to be human? That is one of the central issues that must be considered when we try to answer the question of morality. For me to answer, "How should I live my life?" I need to know what kind of being I am.
Now what I am does not exhaust the issue of how to determine what I should do, but it is the beginning. And what I am is a rational animal, a biological entity with the facility to think for myself and with a necessity to guide my life through thinking. In the case of human life there is no relying on instincts nor on direct communication with God. We are pretty much left with having to think through what to do. This is our facility; we have to learn things, we have to use our heads. This is what it is to be a rational animal.
But it is not to be forgotten that we are not just rational but also animals. We have to sustain ourselves and indeed flourish as such. We have to excel as rational biological entities. So the question, "How should I live, what will human excellence amount to?" is to a large extent answered by noting that we must rationally govern our own lives. We need, first and foremost, to govern ourselves with the facts of our lives and the world around us in mind, including what principles of conduct will guide us to success in this endeavor. That is what will make us good.
Now such rational self-government can take many different shapes. When one says that this is the highest good, one can still ask millions of other questions because that is a very general answer. That is an answer that has to be true in fifth century B.C., in Mongolia, in South Africa, Sweden, or anywhere else where human beings ask the question that gives rise to morality. And if it is going to be a good answer, it cannot merely apply to North Americans in the twentieth century. There are human beings everywhere else and in other times and not just in the twentieth century in North America.
That is why the question is at first answered so generally, and seems such an empty response, so unsatisfactory: Okay, so I ought to live a rationally self-governed life. What does that mean, to me, now, here, in my life? What should I do?
The answer obviously has a lot to do not with just the fact that one is a human being, but with who one is in particular, with the individual that one is. Here we come face to face with a kind of individualism I call "classical." It isn't enough to say one is a human being; it is necessary to remember which human being one is. In order to do well at living it is not only important to excel as a human but as this or that individual human. This will, of course, bring into focus many differences amongst human beings. Very many different ways of living the good human life will have to be considered in morality, not just one. From the most general consideration of one's being a human being to the most particular one of one's individuality, there will be a very wide range of factors- concerning one's age, one's family, one's profession, nationality, sex, talents, history, opportunity, economic circumstance, and so on. Some of these will group a person with innumerable others,
some with only a few. All these matters will be of significance in how one answers the question, "How should I live my life?"
I don't want to enter into a lengthy discussion of morality, other than ask how it relates to classical liberalism and the market economy. One would hope that the answer to the proposed question of, how should I live- namely, to live by rationally governing one's own life- would bring forth some general principles. These would be the moral virtues that most of us need to guide ourselves in our lives. Only the classical individualist moral system would rank these moral virtues in a specific way, namely, so that taking care of oneself- or the virtue of prudence- would be fairly high up the list.
In other words, to put it bluntly, under classical individualism prudence is a very high virtue; it may not be the highest virtue, but it is one of the higher virtues. Generosity would not be the highest virtue though it wouldn't be the lowest, either. Maybe humility would be the lowest, if a virtue at all, unles we mean by it no more than honest modesty. (That is just a suggestion which I am not going to defend.) I simply wanted to indicate here that this is the way it would probably work out.
When it comes to living in a human community, this classical individualism would regard the opportunities made possible within a market economy exceedingly important to human life. The market economy's opportunities for improving one's life here on earth would be most welcome within the framework of classical individualism. Classical individualism would require most people to undertake- as one of their major tasks in life- to succeed economically. To be economically prosperous is a virtue, not a vice, if the classical individualist position I have outlined above is sound.
To be a successful, rational animal includes being a reasonably prosperous rational animal and therefore the attempt or effort to reach such prosperity- which is made so hospitable within the market economy- would not be something immoral or decadent or lowly but morally praiseworthy. The market economy, in turn, would become not a place where morality would wither but a place where it would flourish.
Let us consider this in the light of the very plausible yet not so ambitious insight that prudence is indeed an important moral virtue for everyone to practice. We have seen now that prudence is part of our common sense moral system as well as part of a system that makes very good sense as a sound morality for human beings here on earth.
The virtue of prudence may best be defined as the character trait guiding one to take care of oneself. If you are indeed a rational animal and prudence is indeed a moral virtue, then everyone ought to embark upon taking care of himself or herself. Prudence would guide one to make sure that one leads a prosperous, successful, healthy life. If one is an imprudent person, one neglects oneself and one's life. A prudent person is someone who makes sure that his or her life is reasonably well planned and taken care of.
It is important that we understand here a very broad sense of prudence because what prudence is in one's life depends on what and who one is. For example, if one's essential self is one's everlasting soul, then taking
care of oneself may very well involve a great many more spiritual concerns in one's life than if that were not the case. Prudence is neutral on this question. Its scope or reach depends on what the self is.
Classical individualism holds that the human self is a natural being the flourishing of which must take place on this earth within the limits of a lifetime. Prudence for a classical individualist would amount to living well, flourishing as a rational animal here on earth.
Classical liberalism, in turn, is a political economic system that is most hospitable to rational animals in their effort to live prudently, to prosper in life, to flourish not just economically but also spiritually. Within this framework "spiritual" means the life and values of a being with conceptual consciousness, of self-awareness and of principled self-understanding. "Spiritual" is understood in psychological ways. Classical liberalism is the position that one ought to have the needed social conditions for devoting one's life to improvement or excellence as a whole person, although this also implies that one may not be prevented from neglecting this task.
At a more fundamental level, however, under classical liberalism one is governing one's own life regardless of the moral system that serves as the guide for such governance. This is why such a system is a more tolerant one than alternatives because despite its grounding in classical individualism, it makes room for the practices of different moralities. People don't govern human lives that are not theirs. So whether one's moral task is supposed to be an improvement of one's life in this world or for the sake of another world, under the classical liberal framework one has the right to do either, regardless of which is correct.
An individual is sovereign, in charge of his or her life, not that of others. There is no one who is one's natural master and one is no one's natural master. So this is a kind of moral individualism to take care of one's life whether long range (even after death into another spiritual realm) or short range (within this world).
The main point of this normative- natural rights- classical liberalism is that it welcomes the idea that every person must lead a moral life on his or her own, which includes the selection of the moral system by which that life is to be governed. That is one of the reasons, as noted above, why classical liberalism is legally and politically tolerant toward moralities that may not even be supportive of it. This is because under classical liberalism one has the right- i.e., others may not prevent one by force- to be wrong. It doesn't necessarily mean that classical liberalism is compatible with every morality in the sense that it is true regardless of which morality is true. It means that under a free system, that protects individual sovereignty, one is free to embark on most projects as guided by some moral system, right or wrong, and indeed one is free- that is none may stop one- to be immoral as well unless this immorality involves encroaching upon another's sphere of authority. (This should call to mind our previous discussion of the right to private property.)
Now there are some moral projects that one could not justifiably embark on: one could not, in justice, take a slave. If one belonged to a religion that required its adherents to take a hostage every two years, one could not do that with impunity. In legal trials in the United States, for example, when parents who are members of a religious sect have subjected their children to hazardous rituals, (such as holding up a snake to see if it will bite the child), the parents have been successfully prosecuted. There is a serious controversy about whether the right to religion freedom implies that parents ought to be protected when they subject their children to such rituals. But in a liberal legal system, despite its greater commitment to the principle of toleration than others, it is deemed that until one is an adult one may not be subjected to (potentially) deadly practices, that ordinary care is due a child from his or her parents.
Classical liberalism or libertarianism is not universally compatible with just any morality, but most moralities- whether Hindu, Jewish, Atheist, Christian, Buddhist, or Moslem- can be practiced within its jurisdiction to the extent, especially, that they all stress that one must make choices that are in accordance with virtue. Of course, as to what the virtues are for these various religions or philosophies depends on what their conception of human nature is. But within certain limits that is compatible. Why? Because they secure for people what Robert Nozick calls "moral space."18 This is an area or sphere or dimension of personal authority over one's life, where others would trespass if they started to dictated one's actions. If others started to tell one how to live or would subject one to certain moral edicts, they would not be justified nor allowed to do so. It would be against the law and thus forbidden. That would be a form of political trespass.
These principles- ones we call a person's individual rights- also protect an individual (more or less) from moral dumping. If I were a person who lives a slothful and irresponsible life I have to shoulder that myself. It will not be possible for me to expect that the community will absorb my vices. I have to live with my own vices. Of course there are some people who might join me in my viciousness and they will probably have to share the consequences. But so long as they do it voluntarily, they are equally responsible. So there is nothing problematic here. If I am married to someone who is equally slothful as I am or tolerates my being a liar or a coward, that's legally her right. It is her vice to have made such a careless judgment as to marry me. Moral evil is therefore largely contained. Not fully or exactly, obviously- there are some spillovers. In a market economy if a person is neglectful and burns down his factory, that may drive the price of some things up for awhile so other people are affected. But even then, they are affected in a voluntary way, not involuntarily, because, after all, trade is voluntary.19 And to the extent that one is trading with other people, the quality of their lives may affect others in a voluntary way, not by being imposed upon, but by choice. Maybe one didn't think this through when one started to trade with them, but nevertheless one ought to have done. That is the interesting thing about what's happening in international oil trade, for example. If we were to look at OPEC as a kind of voluntary association (it requires some imagination, I know), and it suddenly collapsed from inefficiency or neglect thereby driving up oil prices, it shouldn't be construed as coercive imposition even if it is the source of serious distress. It is something that we have accepted from the fact that we are willing to trade with people who could mismanage their affairs. People are perfectly free to change their way of life and change from being diligent people to sloppy people. That may affect our relationship to them in the marketplace. But it is a voluntary relationship, not a case of dumping.
Finally, another popular association with classical liberalism would have to be revised if classical individualism is the best ethics and serves as the foundation of the just polity. The idea that we heard elaborated in connection with Bernard Mandeville, Adam Smith, and others in the classical economic school, captured in the slogan "private vice, public benefit," would have to be revised the idea of "private virtue, public prosperity." Many people, even back then, regarded selfishness as something bad, and commercialism as base or low. They only see the overall consequences of it as good but the personal behavior associated with it morally wrong. But if one is thinking more
along classical individualist ethical lines so that in this world prudence is a significant virtue, then the kind of selfishness we expect from people in commercial, business, or economic affairs would not be a vice. The people in the business world, even when considered in light of standards of individual morality, could be regarded as commendable, honorable people. They, as specialists, would be acting morally as they attempt to make themselves and their clients prosperous. They would be improving their lives, including the lives they are attached to, those of their family, their children, and their friends. There is nothing wrong, indeed there is everything morally proper, with this kind of intelligent, prudent selfishness. And thus it isn't a paradox to have private selfishness20 or prudence result in public prosperity. Since it is morally praiseworthy it would also be practically praiseworthy. There would be no conflict between the practical and the moral.
Much of contemporary moral philosophy- and especially that moral philosophy which underlies liberalism and is often associated with understanding the market economy- suffers from this paradox. On the one hand charity is the supreme human virtue, as is self-sacrifice. On the other hand national prosperity, the wealth of nations is praised. But in private conduct we are praising the very things that don't create the wealth of nations. And we condemn the practices, such as selfishness, commercialism, and wealth seeking, that lead to this desirable public result.21
But if classical individualism is true as a moral system for human life, that paradox disappears because it is perfectly okay to pursue personal riches and thereby, as a side effect, bring about public prosperity.
Having now shown why morality and liberalism may well be the most compatible moral and political theories, let us take a brief look at some of the common questions posed about the moral qualities of free markets. I have already referred to commercialization as something that bothers people about the market economy. Another concern is the fate of the poor if we were to have a totally laissez-faire market economy, if no coerced transfer of wealth were permitted, if individuals' rights to private property were protected.
If the system of law that surrounded the market were consistently protected, it wouldn't be compromised even for evidently hard cases. This is a strict free market economy or capitalism. It doesn't even cave in at the public policy level to the handicapped or orphan's cry for help or to the unfortunates who are the casualties of earthquakes or hurricanes. It is wrong to sacrifice the integrity of the system.
Well, isn't that cruel? Wouldn't that be a callous system? Wouldn't we ultimately have condemn it on moral grounds? That is the general suggestion. Even those people who now want to transfer Eastern Europe to a largely market economy believe that there should be what is called a safety net. Many Americans who basically endorse the free market also favor this safety net, some minimal transfer of wealth. Some minimal robbery, to use my words for it, for the sake of compassion and charity and kindness to those who are truly unfortunate.
We are not talking about people who are hangers-on or who are free riders. We are talking about evident cases of misfortune in life. Any
liberal or any capitalist who wants to deny that there are such cases is living in a very strange world. There are such cases, and a system of free enterprise has to contend with the issue: what about that?
In reply, we must ask, compared to what? In back of the question, for example, "What about the poor?" lies usually a utopian ideal, a world mentally pictured in which everybody is happy, automatically taken care of. It is an illusory system in which the poor have somehow disappeared, as if by waving a magic wand. But there is no way to defend the market economy against the charge that it might mistreat the poor if the standard of proper treatment emerges from such a mental picture. Because, of course, in a free society it is possible, even though it might not be as likely as in, say, socialism or fascism or mercantilism, that some unfortunate people will suffer. There is no guarantee against this. Of course, it is also true no competing system of political life can guarantee against natural disasters, human immorality, or personal mismanagement of one's life. And the illusion that we could guarantee against exigencies is what governs a great deal of political and economic thinking, especially in the halls of academe.
Whenever questions arise about whether the free system isn't susceptible to various types of corruption, it rests, conceptually or philosophically, mostly on this ideal picture of a kind of Platonic, perfect society where universal prosperity, peace, and contentment are envisioned. Then people compare the proposed free market system to this.
In fact, however, political economies should be assessed comparatively. This may even be a kind of moral principle of normative criticism. And there is no reasonable doubt that the lot of the poor, on the whole, would be far better in a robust capitalist, classical liberal political economy than the lot of the poor even in the welfare state, let alone in socialism or communism.
Why? For one, there isn't the illusion created in such a system that things will be somehow taken care of by the system, by "big brother," by the central and supreme authority. That's an illusion and, often enough from the lips of some, an outright lie. Most of the people living in the United States know that they have had a welfare state now going in full swing for the last hundred years or so. Yet, they are now having a homeless problem, a health crisis, an enormous national debt, and constant financial scandals in various areas of government. So the welfare state is no remedy, where it does deliver on a promise, it necessarily destroys something in its wake.
Other countries that supposedly tolerated repression and oppression for the sake of eliminating poverty eliminated hardship by closing down the presses which reported on it. They didn't actually do away with indigence, but hid it from view so none knew until the borders finally opened and people went in and saw that there was poverty in Hungary, Poland, Bulgaria, and Rumania. So it turns out that the sacrifice of freedom for the sake of the poor never worked for the poor at all.
But that is only one side of the story. The other is that a free society would be of great moral benefit because it would make virtue possible as well as encourage it. People would not be able to say, "Well, I don't have to be charitable or generous toward my neighbor because the government has already taxed me and it's going to redistribute my wealth to them." Whatever virtue there is to charity, generosity, kindness, and compassion- and there still clearly is, even if it is not the first virtue- it would be up to citizens to practice it. It will be up to them to establish institutions which would promulgate these virtues: philanthropies, service organizations, relief agencies such as the Salvation Army, and Red Cross, and so on. As a matter of fact historically, the United States, which is the freest of large societies and the most classical liberal, seems to be where voluntary philanthropic, and charitable institutions to flourish best. There seems to be some connection historically between a genuine free society and one that achieves most socially desired objectives.
There is, of course, no guarantee that a free society will be satisfactory to all. Some people are satisfied only by some rather coercive institutions. A thief, for example, wants goods and services without having to work; a person cannot be satisfied if individual rights to liberty and property are fully protected. But even beyond this, sometimes free men and women are unwilling to do what is best for them and for those they should care about. Yet, if that is a common trait in society, nothing much can be done about it, certainly not by way of coercion. We have, I believe, learned this lesson well enough from recent history, at least.
A moral community has to be one in which unimpeded human choices have the maximum range of influence. Otherwise morality itself is void and null- or, at best, extremely confused, by way of all the dumping and indeterminacy that prevails in a coercive society. So while not having all one's noble goals guaranteed will incline some to be impatient with a free society, that impatience is itself a vice and should be contained.

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