Reconsidering Redistribution: One Libertarian’s View

Last week, BBC News’s Mark Mardell reacted to Mitt Romney’s revealing contention that, because they’re dependent on government, forty-seven percent of Americans will vote for Barack Obama no matter what. The argument is that these lazy spongers on the system are dependent on government handouts for all of their necessities, and so shudder at the “personal responsibility” candidate, Romney.

Brooding on Romney’s words, Mardell wonders whether redistribution truly is an idea foreign to the United States. In so doing, Mardell draws especial attention to the difference in American and British attitudes about redistribution and the role of the welfare state.

Market anarchists hold what is perhaps a unique perspective on “redistribution,” as it were, one that leans less on easy rhetorical distinctions and rather more on the substantive facts of the relationship between the state and powerful corporate actors. Attacks on individual liberty and free competition actually do translate into an enormous overall redistribution of wealth — yet the redistribution is “upward,” that is, from the vast majority of people, who incidentally produce the vast majority of wealth, to the small few who benefit from American capitalism.

The great strength and underpinning of that system, at least from an ideological standpoint, is the deftness with which its beneficiaries, people like Mitt Romney, are able to pass it off as “competitive free enterprise.” Market anarchists contend that American capitalism, centered on monopolies of land and finance, bears no relation to genuine free markets, where “free” is employed in the legitimate sense of voluntary exchange without arbitrary privilege.

Redistribution is thus quite native to the American Way, only with its true character bedimmed by the careful disinformation of the United States’ political and economic elite. Mardell does well to note that “hundreds of years ago [redistribution meant] distributing the wealth of the masses upwards to the kings and lords.” He would do better still to recognize the similarity, indeed the perfect continuity, between the economic programs of yore and the finance capitalism that makes people like the GOP’s presidential candidate rich.

Appraising the whole catalog of coercive legal privileges built into and forming the structural basis of the American economy (and that of the world at large), the notion that we have every-man-for-himself, cutthroat competition is risible at best. To be sure, we of course do see that kind of fully-developed, aggressive competition among laborers, wage-earners of all kinds who live paycheck to paycheck.

They jockey for employment opportunities within an environment constrained by the many limits on competition that benefit politically entrenched Big Business. Corporate welfare is, in the United States, the only kind that adds up to anything at all significant, and the only kind that matters at all to the political class.

Beyond just the billions upon billions of dollars that are poured into favored companies each year in the form of direct subsidies and bailouts, the richest corporations benefit mightily from the various regulatory barriers, licenses, patents, and permits that forcibly prevent ordinarily people from capitalizing on the property and skills they have.

The deficiency or complete lack of competition in so many areas of economic life means that working people are met with a “take it or leave it” proffer from Big Business. When you haven’t anywhere else to go, you’ll accept pennies on the dollar for pay and you’ll pay twice as much as a product is worth.

And in both cases, there is upward redistribution just as certainly and concretely as there is when the state gives taxpayer dollars to corporations outright (see, for instance, TARP, which handed hundreds of billions to Wall Street).

It’s time to abandon the myth of the American system peddled by plutocrats like Mitt Romney. A huge piece of that myth is the puzzling, ahistorical notion that the state is the great protector of the poor and powerless. At every point and juncture, the state has been the preserver of the rich, of coercive privilege at the expense of competition. To end the continuous theft from productive people, it is necessary to end the state.

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