The economy is quite the complex area of study. Most people find it too boring and tedious to ever fully delve into it’s science. Those that have only a moderate understanding of how economics work, usually only for personal use in business and private finances, still do not find the topic of the economy attractive or exciting in any way. Of course, there are a handful of mathematicians and those in otherwise dull occupations, that find the whole process fascinating and infinitely appealing. This should scare the bejesus out everyone. For one, because too few people take interest in economics, and secondly, because the ones who do are idiots.

 

What is the Economy? To understand economics we must first strip down all the complications and mystical aura that surround it’s practice today. To understand Economy, we must first understand Man. Man, of course, is a very strange being. He is an animal, yet he has found within his mind the ability to reason. He is, in reality, a blob of cells… yet he has found within his talents the ability to create. Whether by the divine will of God, or the natural evolution that spans millennia, Man has managed to thrive and prosper upon this third rock from the sun.

Man, and his value, is constituted by his consciousness. Without the consciousness, Man would no longer be a being of volition and worth… but a vegetable, of no significance whatsoever. It is the consciousness that makes people valuable, for the consciousness is the person. However, that consciousness is not automatically sustained. We must work to sustain it. Our body is the natural support of our being, and the only tool instinctively set aside for our use. But that is not all that must be used to sustain our existence, and the continued stream of cognition (the thought process, emotions, and volition within the human mind), for we also live in an environment, surrounded by other individuals. The objects that surround us in our environment are what we must use to nourish our bodies, and thus support our consciousness. We apply value to these objects as they are needed by us, but independently these inanimate objects posses no value of their own. Time is also a factor. Time ages our bodies, and thus the span of our lives cannot be eternal, but rather we must maintain our existence only as long as time, and circumstance allow. Time thus also becomes valuable to us.

 

And so the objects that we use to sustain our existence and happiness become our property (as long as it is not taken from others who were using it). The only legitimate way to obtain property is to either A) Use or transform unclaimed objects for personal usage, B) trade currently owned property for someone else’s property, as long as both parties agree, or C) are given property by an owner via gift or charity. If property is attained in any other fashion, either through theft, force, the threat of force (coercion), or any other form of violence that involuntarily takes property away from someone who is using it for his/her survival or happiness… it is illegitimate.

 

As long as property is attained in a legitimate manner, justice prevails. Property Rights, should always be held as the most sacred of all rights. The right to own the property of your means to survival and happiness, the right to own your own body, the right to your own brain, and thoughts, and speech. Without the right to own, there are no other rights. Ownership is defined as the ability to control. When ownership is private to the individual, and his own affairs, that is freedom.

When it comes to the theories of property and ownership, there are really only three options. The idea that all property is owned by God, or by Nature, is fair enough. However, as God is omnipotent and omniscient by definition, he can and will enforce his own will over his ownership: the whole of existence. How we use it in the meantime is the matter of concern. Also, Nature is not a single entity, nor does it posses a consciousness of volition (decision making)… thus, as we are all part of Nature, what we decide to do with the objects that surround us, is indeed an equal part of Nature and Nature’s “will”.

 

So we are left with the three choices of property and ownership. Either A) Everyone owns everything in an equal share, B) Some people own everything, and others do not, or C) Each individual must own their personal property. If Ownership is defined as the ability to control, and to decide over… and the property of our own bodies are put into the mix… we can easily eliminate those that do not make sense.

‘B’ is an obvious failure. Unless there is a certain class of humans who are morally and intellectually superior to all other humans, then this is a completely fallacious theory. ‘A’ can also be seen as a failure, though it is a popular ideal.

 

For one, if every single individual in the nation, or, if this is taken to it’s logical extreme, the entire world, owned everything in equal share, it would automatically be seen as the load of stupidity it really is. As Rothbard argued, in order for this ideal to become actuality, and if we figure that there are 6 billion people on the planet, then each individual would own exactly 1/6-billionth of everything and everyone everywhere. If  a person living in Michigan were to decide to use his body, or other faculties, to cook himself a pizza, he would have to seek the approval of every single person on the planet. This could not ever work. How could a person living in Ethiopia possibly have any say over a person trying to cook a steak in Michigan. So, if this theory is to be put into practice, it must ultimately fall to a governing body of “representatives” to decide on behalf of everyone. This would then automatically become B. The entire concept is anti-nature. Humans are not cells in a collective body, we think and act as individuals. We would have to dramatically part from nature to institute a system such as this.

 

Therefore, we must come to the conclusion, by the process of deduction, that the individual is the only rational entity to own the full control of his faculties and the property he attains through his labor, trade, or received gifts/charity. Through induction as well, we can see why it makes the most sense, according to nature, to arrive at this theory of property ownership. For if we think, speak, and act as individuals only (voluntary interactions and associations do not negate this fact, for if two people decide to do something, both the first and the second persons came to the conclusion to act in that way as individuals) it would only make sense that our interactions with nature and the objects in our environment, would be made on an individual basis as well.

 

Of course, there are two complications that arise once this is understood. First, there are not only one, but many individuals seeking survival and happiness. Second, the objects that surround us, and the space making up our livable environment, is scarce. So, we meet situations where some people have certain objects that others do not. This natural inequality is a mirror of our physical and mental states as well. Not everyone is exactly as smart as everyone else, and not everyone looks exactly the same as everyone else. When it comes to the objects we claim, use, and trade with one another, inequalities are not only natural, but inevitable. If we first understand this, we can put aside the Marxist ideas of “equality of circumstance”. Though we as humans are all descendants of the same species, live in the same environment (the Universe), and are similar in many, many ways… similarities do not equal sameness. We are neither islands unto ourselves (radical isolationism), nor are we mere parts of a single, greater entity (radical collectivism/conformism).

 

However, there are ways to overcome some of these natural inequalities. Some have said that freedom is being able to do whatever you want. This is not true. No matter how bad you may want to, there is no way you are going to jump over the Atlantic Ocean in one hurdle. Nature has unbreakable laws, and if we attempt to break them, we will suffer the consequences. In order to live, and pursue happiness in the world, we must obey the natural laws around us. This includes the laws ingrained in human nature, such as the law of reaction in defense against aggression. Unlike the fiat laws of man, these natural laws are infallible and purely organic.

 

Yet, though you may not be able to bound from America to Europe in a single leap, humans have managed to bend nature around us to our will. We have built boats, and planes, and cars. We must still obey the laws of nature to continue our survival and happiness, but we have used our reason and logic to create a way to reach our goals while still recognizing the advents of Time, Space, and Motion. These things have come about with much trial and error throughout human history, and we have learned much since civilizations inception, but we have not yet learned everything.

 

Thus, with the ability to overcome these obstacles using our brains, we have also managed to overcome much of the natural inequalities of circumstance. We will never be entirely equal, but what has been accomplished is to be marveled. People in Iowa have corn, while people in China have rice. Iowans cannot grow rice, and the Chinese cannot grow corn (I’m not sure if that is true, but there are situations in which this is true and relevant). So, to overcome the inequality here, they trade. Iowans give the Chinese corn in exchange for rice. China and Iowa can now benefit from corn and rice. This is also true on a more individual basis. If I have an extra couch that I do not need, but I badly want my neighbor’s tool-box, then I could trade my couch for the tool-box. Of course the neighbor would have to agree. He would have to find more value in my couch than in his tool-box.

 

That is only a couple examples of the market at work. What is the market? It is the system of trade and exchange naturally evolving from the individual interactions that are mutually beneficial to the parties involved. This can be as small as a garage sale (some people getting rid of what they don’t want for money, other people spending spare change for trinkets they want to have), or it could be as large as Wal-Mart (some people manufacturing and selling food in exchange for money, other people getting the food they need in exchange for the money they labored for).

 

The same applies to the labor market as well. Each person has a skill, or talent, or simply the ability to do basic work in general. They can trade that labor, and their time, in order to gain wealth which they will use to obtain other items (food, clothing, shelter, transportation, leisure, accessories). The employer, on the other hand, wishes to exchange his earned wealth in order to gain another person’s labor and time to produce something he needs. Wealth can be spent for something immediately, or it can be saved and stored back for later use. It can also be invested in ways that will create more profit for the individual.

 

This system is natural, organic, and based in human nature. It was not created by central planners, kings, presidents, or politicians. It arose spontaneously via free people… Workers, Entrepreneurs, Business-men, Consumers, etc. There is no need for force or violence, only trade and mutual exchange. This benefits both parties, and ultimately all of society as wealth is created, distributed, and spread around in a just manner. All actions are voluntary, all property is owned by individuals, and prosperity is grown at a rapid pace.

 

This system of freedom also allows for innovation. New technologies are created every day. These inventions can be used to further our lives, make our every day actions easier, and increase our happiness by giving us more time and leisure. There are some don’t like all the modern inventions and technology, they think it is taking us away from the natural and the organic ways of human living. I personally don’t agree (as I think all voluntary actions by humans are organic, and progress and change are just as much a part of nature as anything) but if they don’t want to take part… that’s up to them. No product is shoved down their throats, they don’t have to accept anything. They don’t have to purchase any item or service their don’t desire. Their life, their body, and their property is entirely in their control and ownership. Their choice is key to their freedom, their ability to decide over their own happiness and destiny is the cornerstone of their liberty.

 

But they cannot take away the ability to choose these technologies from anyone else. Similar concerns are raised against “immoral” advertising, art, and entertainment. Again, I do not take this position, though there are certainly types of art and entertainment I prefer over others, and some I do not like at all. However, as with technology, nothing is forced on anyone. Whether it be art, entertainment, advertising, marketing, merchandise, services, religion, food, clothing, homes, technology, or otherwise… everything is traded voluntarily on the market. Progress is allowed to flow naturally, and as for those who don’t want to go with the flow, they can opt out. They can form their own communities, they can completely separate from society if they see fit. Freedom ensures that all view-points, and ideas, are allowed to compete and flourish… as long as it’s non-violent and voluntary, it’s perfectly acceptable and tolerated.

 

It is through trade and exchange that so many great things have been introduced into society. We can now talk to friends and family hundreds of miles away, we can travel to see them in an amount of time unheard of in ancient times, food is distributed at incredibly cheap prices across the world. Beef, once considered a delicacy only available to the rich and nobility, can now be consumed by the poorest in society. Anyone can buy previous rarities such as chocolate, silk clothing, and clean water. Everyone has cheap access to technologies such as phones, internet, books, transportation, artificial light, heating & cooling, a secure shelter, even movies. A couple hundred years ago the poor could never have access to their time-period’s equivalents to these luxuries. The poorest people in this country usually have at least a shelter, clothes, food, access to transportation, and some even have a TV set. Two hundred years ago this would have been unbelievable. There were thousands upon thousands of more homeless people, more poor, more starving, less food, less clean water, less livable conditions, less time to spend the way you wanted. Just to look at our life-expectancy alone is to merit wonder and awe at the greatness of Capitalism.

 

There is certainly poverty now, and starvation, and other unsuitable conditions for many in society (especially with current situations). But we should be so thankful that in this country, at least for the first hundred years, freedom was allowed to flourish and give us these excellent technological innovations and increased state of living for even the poorest of citizens. Even despite the interventions of the State, the free market will always find a way to thrive, even if it is in an underground manner.

 

I hear people gripe and moan about waste, and the ridiculousness bottled water, and the silliness of selling land, and of greed engulfing society. I suggest  that they build a time-machine, and I would gladly send them back to the medieval era to live as a peasant. Waste? If someone doesn’t want to use and object any more, how is he “wasting” it to be rid of it. Bottled Water is ridiculous? Is it ridiculous that clean water, that in previous centuries could not be consumed by the poor and middle-class, is now one of the cheapest items of the market? Individual Ownership land is silly? How then can an individual grow a farm when he wants, raise animals, build a house, garden, or, and this is very important, speak his mind? If everyone, or the State, owns the ground you stand on, how is it that you can exercise your freedom? The philosophy of the socialists will put all of our liberties and rights in the hands of the State or the mob. Greed? Has it really increased? In my experience greed is far more prevalent when wealth is scarce and rare. When products, and services, and wealth is made plentiful, will there be more or less strife? Greed will always be part of human nature (as we are selfish beings), but to have a society in which greed is minimized and charity is maximized should be everyone’s goal. That is exactly what the free market does.

 

Another complaint, and possibly a more relevant one than those previously mentioned, is that of pollution. Is pollution a problem? Of course it is. When we cannot breathe air without smog, or drink water without toxic waste, or live without litter… we have a problem. But, as long as people demand cleaner air, water, and land… the free market will provide ways for it to be possible. Supply and Demand, the iron-clad laws of economics, will ensure that if people want cleaner fuel, it will be provided. If people want their land, water, and air cleaned, the free market will provide a means for it to be done. If people want to get rid of their garbage with less effluence,  the process will come about through market forces. There is no need for force, theft, or any involvement by the State.

 

As a side note, whether or not Global Warming is as great a threat as made out, or whether it is human made at all (or even if it has any truth to it whatsoever) is still up for debate. Either way, the same principle of voluntaryism and non-aggression applies.

 

At this point we have established quite well exactly what the economy is, and how it works, and how freedom creates prosperity and progress. Yet we still have not addressed the alternative (that of top-down central planning), which would destroy that prosperity, squash all innovation, and run the Economy into the ground. Let’s talk about the enemy of society… the State.

To be continued…

Part I: The Economy

Part II: The State

Part III: An Empire of Paper

- Justin T. Buell