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Capitalism

Freedom of Choice is What Sets Capitalism Apart — Not Competition

By Guest Post February 1, 2019

by Antony Sammeroff for the Mises Institute

Capitalism has often been described by as “a system of competition” by its adversaries, or a system “based on competition.” Naturally, this assertion is usually coupled with a spirited oration on how this “tooth n’ nail” competition psychologically corrupts us – pitting man against man in a “race to the bottom.”

Many of capitalism’s most vocal advocates have, themselves, imbibed this premise uncritically. They leap to fervent defenses of competition, extolling its virtues — real or perceived. In my view, this is a mistake. To accept without evaluation the presupposition that capitalism is a system of competition — in contrast to other hypothetical systems of cooperation (namely socialism and communism) — is to frame the very debate itself in leftist terms and play the game on an unfairly tilted game-board.

Competition Is Fierce for Government-Controlled Resources

This is not to say that those who defend competition do not raise some worthy points. For example: If not competition, then what is the alternative? Is there to be one central provider of each good and service available who gets to decide on our behalf how it is best to be produced and then allocated? Add to that, that if competition is wrong in the market, then why not in the political sphere? Surely democracy is out of the question if competition is a corrupting factor, because what do political candidates do if not compete for office? Think of the competition this generates between political parties, not to mention the ensuing competition between firms and individuals for preferential treatment from politicians and legislators, competition between lobbyists, think-tanks, and voters, to receive benefits out of the public purse. If the free and voluntary section of society is a system of competition, how much more so is government? Surely democracy is a “system of competition.” Politicians are competing for the very machinations of control in our society. For the right to pass and enforce laws which apply to everyone (whether they agree with them or not) and to force them to pay for their enforcement. They are not simply competing for market share where the winner of the competition is the one that satisfies the most demand. We can sidestep the more mundane economic arguments in favor of competition for the moment, such as the case that it increases efficiency and cheapens goods while driving innovation, as we are all familiar with them already.

Capitalism Is About Voluntary Exchange

This is not to say that competition is necessarily an evil either. The problem lies in defining capitalism as “a system of competition” — in comparison to other systems which are supposedly “cooperative” — is a rhetorical ploy. Those who profess it may honestly believe it to be so, but it’s not true. Capitalism is not “a system of competition.” any more than any other system. Capitalism (at least in its free-market, laissez-faire ideal) is a system of the voluntary exchange of goods and services in the absence of physical coercion, theft, compulsion or fraud, predicated upon the fundamental right to own and accumulate property.

Or, for brevity: Capitalism is a system of voluntary exchange, predicated upon the right to own property.

One might even venture, therefore, that it is capitalism that is the system most characterized by cooperation.

Granted, upon seeing this definition, many would still debate us over the morality of accumulating property. Or perhaps whether the “negative” right to ownership when it comes to the rich should take precedence over the “positive” right to healthcare or education at their expense when it comes to the poor. We can even debate whether the relationship between capitalists and their employees are really free of coercion given the power disparity between the two groups. Indeed these are debates I delight in exploring further. However, none of this is a justification for defining capitalism as a system of that is more competition-based than others.

Because Scarcity Exists, Competition Will Always Exist Under Any System

After all, it is not the presence of private property or the free exchange of goods that creates the presence of competition in a capitalist system. Scarcity causes that. In any situation of scarcity of resources, there is bound to be some form of competition over those resources (as well as over how those resources are allocated).

If we have a system that allows voluntary exchange, some competition is bound to arise out of that, but that would happen under any system. Even if you had a completely communistic society, which was centrally planned and involved no exchange of money whatsoever, people’s time would still be limited. If you were a filmmaker in this society, you would probably want as many people to see your films as possible. As would every other film-maker. This would put you at least somewhat in competition with them. Does this mean that communism, too, is a system of competition? Certainly, you would be competing for the only customer — the sponsorship of the state. Corruption and cronyism would surely be the result. Who gets their film made and who doesn’t? Who allocates the highly desirable job of being a film-maker over the undesirable job of being a street-sweeper or refuse collector, and how can their favor be courted? The competition will commence, but instead of being decided by the free and voluntary exchange of film-goers, investors and film-makers it will be decided by someone else, I would argue, in a rather more authoritarian fashion. (For a particularly vivid and chilling illustration of how communism substitutes market competition over customers (which is at least tied to the provision of desirable services) for the completely unmeritocratic competition over gaining favor from the corrupt power structure of the state, I refer the reader to Ayn Rand’s first novel, We The Living.)

Competition is just a feature of living in a world of scarcity and would exist in any system. Socialism cannot do away with competition – nor can any other system.

Opportunity Cost Means Competition Is Everywhere

The implications of these facts reach into any circumstances of scarcity beyond the economy. For example, supposing two friends each invite me over to dinner of an evening, I might have to make a choice between their invitations which will result in one of them losing out on my company. Does this then mean that friendship is a system of competition?

We can’t see all of our friends all of the time, or even all of them at the same time. Even if we do, we are bound to have to split our attention between them. In addition to that, we can only maintain so many close friendships at once, and we definitely can’t be friends with everyone. All of this means that inevitably we have to make choices. We each make decisions on who to make and maintain friendships with based upon our value judgments, conscious or unconscious. Perhaps based on how happy we feel around them, how long we have known one another, how much we have in common, how much we trust someone or how loyal they have shown themselves to be, how much they educate, enrich or enlighten us, or perhaps based upon what roles they allow us to fulfill in their lives. There can be countless other reasons. The fact is we decide. People who feel that they will benefit from our company, for whatever reason, will make attempts to spend time with us. We will invariably begin to make choices on who to spend time with based upon our values, schedule, and what other activities we are willing sacrifice to see them. These are basic facts of life, but they hardly make friendship a system of competition.

Similarly, on the market, our time and resources are limited. We make value-based judgments about choices of products and services to consume based upon what utility we think they will bring to us, sacrificing some options to others. Maybe we will choose a coffee shop based on which has the best-tasting coffee, or maybe based on which provides the nicest atmosphere, or maybe based on which is closest, or where the customer service is best, or which is the cheapest, or which we have gone to the longest and therefore find familiar, or perhaps even based on which we think has the best ethos — for example, because they are a social enterprise that only sells fair trade produce and deliberately seeks to employ and train disadvantaged people. The fact is we decide. Each service provider believes they will benefit from our custom and will make attempts to attract us, placing an upward pressure on the quality of services and a downward pressure on price which we may correctly identify as a form of competition. Since human beings are not infallible, sometimes someone might buy a coffee that they don’t end up liking, but over the long term, the competition is likely to be won by the satisfaction of customers.

The Benefits of Free Choice

The miraculous wonder we miss when we focus our attention upon the competition which derives from choice is the ability to choose itself. For example, supposing two commercial events are being held on the same evening. Each prospective patron will want to choose whichever event appeals to them the most, and for whatever reasons they choose based upon what they value in an event. Now, to simply mention that these events are “in competition”

The Mises Institute, “Austrian Economics, Freedom, and Peace”

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Children

16 Things Parents of Expensive Boarding Schools Want for their Children’s Education

By Terence Gillespie March 27, 2018

Take careful notice that none of the principles these wealthy parents seek costs a single penny to develop. I don’t think they know that. That everybody could do one or all of these things with their own kids just as well as Exeter or St. Paul’s could. — John Taylor Gatto

This article is a summary of the Boarding School part of J.T. Gatto’s speech: “What Does ‘Educated’ Mean?” If you’ve got 90-minutes to spare, I highly recommend downloading the transcript and listening to the entire speech.

(Note: Rather than put everything in quotes, I’d prefer to make this article more readable by keeping John’s words in normal text. I have shortened and condensed John’s speech for quick reading but these are his ideas and words. I’m the beneficiary of John’s wisdom and experience while making them more accessible to other homeschooling parents who may be on the same path.)

16 Things Parents of Expensive Boarding Schools Want for their Children’s Education

Now let’s take a look at what the parents at the finest and most expensive private boarding schools in America want from schooling. I’m talking about the twenty ritziest private boarding schools in America. Schools like Groton, and St. Paul’s, and Deerfield, and Kent.

The schools have had an enormous effect on 20th century Society through the efforts of their graduates. Because of that importance, I’ve reduced the practices in these places to a formula so that you can see clearly that there’s nothing they do that isn’t easily within your reach. The formula looks like this in an elite boarding school.

But, I’m going to warn you in advance to take careful notice that none of the principles these wealthy parents seek costs the single penny to develop. I don’t think they know that. That everybody could do one or all of these things with their own kids just as well as Exeter or St. Paul’s could.

Elite private schools want their children to learn good manners and to display those manners to everybody, even the humblest person, without thinking about it. So the manors would be reflexive. That’s because they know that manners will make their children welcome everywhere, even in strange settings where they’re not known, someone will recognize that this is a well-bred person.
The second thing elite private school parents want is hard intellectual knowledge taught to their children, undiluted; they don’t want it watered down.
Elite private school parents want their children to be advised only by people that they personally respect and Trust.
The next thing elite private school parents want is that their children be taught love and appreciation for the land, for the natural world of plants and animals, not for the scientific knowledge but because they recognize that unless you have a relation with nature, that’s easy your life becomes lonely and barren and abstract. That’s why these rich kids ride horses and sailboats. Not for the competitive sports aspect of it, because it puts them in touch with nature.
Next, they want their children to develop a public sense of decorum so that they can adapt naturally to every setting they find themselves in without provoking anger or opposition.
They want a common core of Western culture taught, not so they can pass tests, but so that all the generations the grandparents the parents and the children are certain to be comfortable with a shared set of ideas and tastes and values.
Elite boarding school parents want leadership exercises taught to their children. That’s an important ongoing theme of curriculum. They are not interested in their children being part of a managed herd.
A major concern of boarding school parents is that their children get individual attention.Their children are in small classes. By small, I mean nine or less.
They want continuous pressure put on their children to stretch their individual limits. That is, if you find four or five talents emerging, you don’t allow the kid to be satisfied with minimal performance.
There’s an emphasis in elite schools on hands-on, face-to-face experience. You never go to a book if you can go to the person who wrote the book or someone close to that person. You get as close to the origin and the idea as possible.
There’s an emphasis on writing. Homeschoolers read well but they don’t necessarily write so well. 300 words is good enough for a lot of uses. But if you can write a thousand words you can hold your own in any sort of debate, you can write op-ed pieces for the newspaper …it isn’t very hard to do.
They want kids at elite schools to develop the power of accurate observation. They don’t have to be Picasso or Rembrandt. They have to accurately transcribe what they’re able to see. The reason Charles Darwin’s book made such an enormous impact was Darwin drew; there are thousands of drawings in the book. And they’re not Rembrandt, but they’re accurate enough that you can see what the thing is.
Have experience with the master creations of music, of painting, of sculptor, of architecture, dance, poetry, the other arts. And have a familiarity with folk art as well.
Scientific knowledge of the sky above and the earth below.
Practice in learning how to handle pain. Physical pain, emotional pain, and intellectual pain. If you wonder where the tremendous American interest in sports came from, it comes from the aristocratic boarding schools of England.
The development of a determination to demand the highest quality performance from yourself. Even if other people say hey that was wonderful, and you know that it’s a lot less than you could have done I think you’re better off.

Conclusion

Nothing I thought was an education, and nothing that the wealthiest people in the country think is an education costs anything at all. Fifty million public school children in the United States could be reared this way. It wouldn’t cost anything.

Children

The Ultimate History Lesson: A Weekend with John Taylor Gatto

By Terence Gillespie March 12, 2018

In 2012, Richard Grove conducted and produced a 6-hour video interview with John Taylor Gatto. For those who don’t have the time to read and digest J.T. Gatto’s excellent work in book form, this interview provides an alternative. I’ve found it to be ideally listened to at double-speed! That makes it an ideal use of the next 2.5 hours of your time as John is a game-changer in the area of education.

The transcript of the interview is 41,500 words. All the material (and excerpts, below) is owned and copyrighted by Tragedy and Hope and please consider supporting their work in creating, presenting, and posting such presentations on Youtube.

The excerpts, below, are 1/20th of the entire transcript. They are not a summary of the presentation.

RG: is Richard Grove
JTG: is John Taylor Gatto

RG: Is there any connection between frustration and aggression? And what effect does schooling have on that?

JTG: Well, you answer your own question by asking it. The connection is intimate. School removes your volition in all important ways, even who you speak to. Are not they arts of association as valuable or more valuable than anything else you learn when you’re young?

Getting Into Harvard

I read how executive hiring is done and it almost never has to do with your training in whatever you’re been hired for. I’m thinking of Apple now, I believe. Is this the person we’d like to have around three years from now, bend an elbow with, or play golf with or just talk with? And that’s why you’re passed from set of executives, to set of executives. So they can sign off, yeah he’s ok, you know… We don’t tell kids that. It’s people who have the highest grade point average in the highest SAT scores. Well I spent an hour, not so long ago, within 10 years, with the admissions officer of Harvard College and, about 30 years ago an hour with the admissions director at Princeton. And let me tell you their polite dismissal of grades and SAT scores was intimidating to listen to. As if you’d have to be crazy to let somebody in.

Let me see if I can condense how you get into Harvard or Princeton. Of course, you can get into both by donating a building but how do other people get in? They are being analyzed on the basis of their ability to either become wealthy or famous. Either one will work. Fame is like wearing a billboard saying I went to Princeton. There’s that actress Jodie Foster, “I went to Princeton”. Look at where the rest of the actors and directors went, they didn’t go anywhere (laughter). But Jodie did so that’s one we hear about. The Harvard lady said, “we look for a record of excellence and what this excellence consists of.” It’s sometime in the first 18 years of your life, figuring out how to add value to the people around you. She didn’t say this in a way that catches public attention, so you might walk across the United States or bicycle the perimeter of the country or row across the Atlantic Ocean, as a physical way. You might start a little charity or set up some weather service or some pollution monitoring around Hartford. There are a substantial number, a small fraction but a substantial number, of kids doing this as we sit here. They’re writing a record of being able to add value to the community around them.

Hobbies

And then the other fellow, the Princeton guy said the same thing in different words. I asked him in 1968 roughly, asked him what part of a resume submitted to you do you look at first. The answer metaphorically caused my jaw to open. “Hobbies,” he said. I said, “I’ve been taught all my life to leave that off because it’s not germane.” He said, “on the contrary, it’s the only honest information you’re likely to get.” How did someone spend their time when it’s their free choice to spend? He said “it’s a window into their mind and their heart”.

What Kind of Hobbies?

I said what kind of hobbies? He said, “well ideally someone would have a physical hobby, an intellectual hobby and a social hobby”. That would show they are exploring these large… well, physical hobbies you mean football, baseball? Well, he said “it’s better than nothing but we would prefer not to see team sports”. I said I’d been told all my life that team sports identify your ability to work in a team. He said what happens in a team sport is if you decide to dog it, it’s very hard to tell which guy on the line has dogged it or not, or which running back has gone down quicker than he should have gone down. He said we prefer solo hobbies that involve physical danger. You mean you want kids to put their necks at risk? For example, what? He said well horseback riding is a dead giveaway. The horse weighs a half ton or more. If you do trail riding and you don’t know what you’re doing, your head gets caught on the branch and you’re the headless horseman. If the horse doesn’t like you it’ll roll over on top of you. I know immediately because the last time I rode a horse was down in Veracruz, Mexico and the horse didn’t like me and took me out on the main highway with crazed Mexican drivers going a hundred miles an hour in 18 wheelers. And it laid down on top of me. I was terrified! I could see these trucks coming. I didn’t like it and it’s the last time I rode. So he said you have to actually know what you’re doing. You can’t say is this an A job, or a B job . If you live in are intact, it is.

Then he said, “sailing a small boat”. These little 12 footers outside of land. If you don’t know what you’re doing you wind up in the middle of the Atlantic, you know. Or if wind comes up you can’t see landmarks because of the waves. I said, but those things are associated with the prosperous classes. What can somebody in ordinary circumstances do? He says well, we just let somebody in and this is probably one of the nicest factoids in my mind, in my life. We just let someone in who invented his own sport and kept records competing against himself, his past performance, his present performance. It was–get ready for this, visualize this—seat-less unicycle riding over broken terrain. If I had 10 lifetimes the plot of doing that wouldn’t occur to me. Aside from getting on a unicycle, let alone without a seat, let alone riding it over broken terrain. So they let him in because they knew he was on the fast track.

So we tell these lies and, of course, many of the people who tell the lie, believe the lie. Well surely they’re going to take valedictorians. Well, last year Harvard turned down eight out of every ten valedictorians who applied. And the two they took in, they didn’t take in because they were valedictorians. So by removing this component from the student imaginations y, u can control to some extent who even applies to Harvard and then who gets in. Because they don’t know what they’re doing. What’s the IT… “garbage in garbage out”.

Standardized Tests Don’t Matter

The evidence that all of us know standardized tests don’t measure what they claim they measure is that nobody, I mean nobody, that you encounter on the upper reaches of society would dream of hiring somebody on the basis of those tests or grade point averages. You’d be playing Russian roulette because they measure nothing. The grades largely measure that you memorize what you are told to memorize. I mean, there are a few other things but that’s the heart of it. So now you know you have somebody who’s obedient, and probably for a clerk that is a good measure. Not for someone who has to adapt to changing circumstances, you know, by the natural selection process of reality.

Schooled to the Point of Extinction

It’s fairly easy without being a wise guy or very learned as long as you retained the ability to think independently from the data in front of you, to penetrate the masks, the contentions that don’t conform to everyday reality. So no one will hire you as a CEO and ask you what your… but if you examine the data that’s available about big-time politicians. Now we have, and I don’t think it would surprise anybody, that George Bush, the most recent one was a C average high school/prep school and a C average at Yale. What does surprise people is that the candidate he ran against was a C average in prep school, in the C average at Yale, and the lower C average than George Bush. Kerry of Massachusetts. The best evidence that the nation has been schooled to the point of extinction is that they were fraternity brothers at Yale and I’ll skip its interesting reputation; it only has 15 members. And they were fraternity brothers at Yale. There’s 308 million of us! I mean, mathematically I wouldn’t know how to set the odds but they would be stupendous. No one mentioned it, or if they did it was to quickly get over that. That should have been headlines of the New York Times and the Washington Post. “Fraternity Brothers at Yale Run for President!”

Amish

What “Educated” Means to the Amish

By Terence Gillespie March 2, 2018

That the Amish have done so well puts a realistic base of possibility under the ideal of an independent citizenry as the proper goal of schooling. — John Taylor Gatto

This article is a summary of the Amish part of J.T. Gatto’s speech: “What Does ‘Educated’ Mean?” If you’ve got 90-minutes to spare, I highly recommend downloading the transcript and listening to the entire speech.

(Note: Rather than put everything in quotes, I’d prefer to make this article more readable by keeping John’s words in standard text. I have shortened and condensed John’s speech for quick reading but these are his ideas and words. I’m the beneficiary of John’s wisdom and experience while making them more accessible to other homeschooling parents who may be on the same path.)

The Lancaster Amish

The old order Amish are a group of 320,000+ well-mannered, prosperous, law-abiding people who came to America in the early 18th century with little more than the clothes on their back. Everybody’s heard about the Amish, but very few people know the astonishing details, and here they are.

Virtually every adult Amisher has an independent livelihood as the owner of a farm or a business.
There’s almost no crime in the community, no violence in the community, no alcoholism in the community, no divorce in the community, no drug taking. There’s a little bit of each of those things, but it’s so microscopic that when it happens, it makes the front page of newspapers because it just doesn’t happen.
They accept no government help with health care, with old-age assistance, or with schooling after the eighth grade, and for most of the century not even that. They were compelled by the government to accept 1 through 8 schooling.
The success rate of Amish in small business is 95% (the rate for non-Amish business is 15%.)
All Amish children have a chance to take an expense-paid sabbatical year away from Amish life when they arrive at the verge of adulthood. The Amish don’t want someone in the community who doesn’t want to be there… and that is a principal reason that this group has grown 3,000 percent in the 20th century.
Almost every group member, when interviewed by outside investigators, reports total satisfaction with their lives, whether they’re children or adults.

They don’t have high school educations, they don’t have specialized training, they don’t use computers, they don’t use electricity, they don’t use automobiles, and they don’t have training in how to create a marketing plan.

And yet, the resources that have transferred over from the farm are these: an entrepreneurial spirit, a willingness to take risks, innovativeness, a strong work ethic, a cheap family labor pool, and high standards of craftsmanship.

The Amish Fought the Law and the Amish Won

You can figure out a lot of what an Amish believes in education is from the things they fought the government about and won.

When the Supreme Court ruled they had to go to school from 1st to 8th grade, they were prepared, in mass, to go to prison unless concessions were made, and they won these concessions.

They demanded that any school be within walking distance of home, they would not allow their children to be carried on buses.
They refused large schools where pupils are sorted into different compartments and assigned different teachers every year.
They demanded that all school decisions had to be signed off by the parents.
They demanded a maximum eight-month school year.
They demanded the teachers who taught their children to be knowledgeable in, and sympathetic to, Amish values in rural ways. They refused to hand their children over to professional educators.
They insisted their children be taught that wisdom and academic knowledge are two different things.
They insisted that their kids have practical internships and apprenticeships supervised by the parents. They were prepared to go to jail and lose everything before they would surrender their children to any form of state indoctrination, called schooling, which would break up their families, their traditions, and their communities, and leave their children restless, trained to leap and jump but without purpose or direction not knowing where they would land.

An education to an Amish-er is being independent, living in a closed community, as a valuable neighbor, and living a godly life.

On the cusp of the 21st century where you and I are perched, it hardly seems possible for a definition of education like this to have survived and even thrived. Yet how can we explain the baffling Amish who do it their own way, in spite of expert advice, and have abundant prosperity and abundant happiness?

That the Amish have done so well puts a realistic base of possibility under the ideal of an independent citizenry as the proper goal of schooling. It’s something I hope you’ll think about.