The Worst Enemies of Capitalism, They Say, Are Those Intransigent Doctrinaires of Laisser-Faire and Manchesterism Who Render Vain All Attempts to compromise with Labour

The most absurd justification of interventionism is provided by those who look upon the conflict between capitalism and socialism as if it were a contest over the distribution of income. Why should not the propertied classes be more compliant? Why should they not accord to the poor workers a part of their ample revenues? Why should they oppose the government's design to raise the share of the underprivileged by decreeing minimum wage rates and maximum prices and by cutting profits and interest rates down to a "fairer" level? Pliability in such matters, they say, would take the wind from the sails of the radical revolutionaries and preserve capitalism. The worst enemies of capitalism, they say, are those intransigent doctrinaires whose excessive advocacy of economic freedom, of laisser-faire and Manchesterism renders vain all attempts to come to a compromise with the claims of labour. These adamant reactionaries are alone responsible for the bitterness of contemporary party strife and the implacable hatred it generates. What is needed is the substitution of a constructive programme for the purely negative attitude of the economic royalists. And, of course, "constructive" is in the eyes of these people only interventionism.

--Ludwig von Mises, epilogue to Socialism: An Economic and Sociological Analysis, trans. J. Kahane (Indianapolis: Liberty Fund, 1981), 495-496.

On the Necessity of Terror under Socialism

A fundamental fact that explains the totalitarianism and all-round reign of terror found under socialism, in such countries as the Soviet Union and Communist China, is the incredible dilemma in which a socialist state places itself in relation to the masses of its citizens. On the one hand, it assumes full responsibility for the individual’s economic well-being. This is the main source of its popular appeal. On the other hand, in all of the ways one can imagine, a socialist state makes an unbelievable botch of the job. While it promises planning and order, it delivers chaos and anarchy, making the individual’s life a nightmare. . . .

The reason for these facts is the socialist rulers’ terror of the people. To protect themselves, they must order the propaganda ministry and the secret police to work `round the clock. The one, to constantly divert the people’s attention from the responsibility of socialism, and of the rulers of socialism, for the people’s misery. The other, to spirit away and silence anyone who might even remotely suggest the responsibility of socialism or its rulers—to spirit away anyone who begins to show signs of thinking for himself. It is because of the rulers’ terror, and their desperate need to find scapegoats for the failures of socialism, that the press of a socialist country is always full of stories about foreign plots and sabotage, and about corruption and mismanagement on the part of subordinate officials, and why, periodically, it is necessary to unmask large-scale domestic plots and to sacrifice major officials and entire factions in giant purges.

--George Reisman, Marxism/Socialism, A Sociopathic Philosophy Conceived in Gross Error and Ignorance, Culminating in Economic Chaos, Enslavement, Terror, and Mass Murder: A Contribution to Its Death (Laguna Hills, CA: TJS Books, 2018), Kindle e-book, 64, 66.

In a Perfect Display of Marxist/Socialist Logic, the Competition that Would Put an End to the Exploitation of Labor Is Prohibited on the Grounds that It Would Introduce the Exploitation of Labor

In sharpest contrast to capitalism, a socialist state effectively enslaves the workers and makes them mere means to the ends of the ruling elite. It does so, first of all, by means of the initiation of physical force against all other, potential employers, whose activities are simply prohibited. Their potential competition for labor is made a criminal offense on the grounds that if it were allowed to exist, the workers would be “exploited.” Thus, in a perfect display of Marxist/Socialist logic, the competition that would put an end to the exploitation of labor by the socialist state is prohibited on the grounds that it would introduce the exploitation of labor. Of course, the socialist state’s prohibition of employment by anyone but itself serves to forcibly hold the workers in service to it, as much as if they were chained to their jobs.

On top of this, in response to the universal shortages that accompany its economic chaos, and necessitate that it decide which products it is more important to produce than others, the socialist state again and again decides where specifically workers will  work, whether they want to or not.  In the Soviet Union, millions of them were sent to work in openly slave-labor concentration camps in Siberia. Workers in the Soviet Union were prohibited from leaving their jobs without permission from their state employers. All university and technical school graduates were compulsorily assigned to a job for a period of two to three years following graduation.

--George Reisman, Marxism/Socialism, A Sociopathic Philosophy Conceived in Gross Error and Ignorance, Culminating in Economic Chaos, Enslavement, Terror, and Mass Murder: A Contribution to Its Death (Laguna Hills, CA: TJS Books, 2018), Kindle e-book, 62-63.

The Marxians Still Cling to the Theory of Increasing Poverty Purely on Account of Its Propaganda Value

The theory of increasing poverty among the masses stands at the centre of Marxist thought as well as of older socialist doctrines. The accumulation of poverty parallels the accumulation of capital. It is the "antagonistic character of capitalist production" that "the accumulation of wealth at one pole" is simultaneously "accumulation of misery, work torture, slavery, ignorance, brutalization, and moral degeneracy at the other." This is the theory of the progressive increase in the absolute poverty of the masses. Based on nothing but the tortuous processes of an abstruse system of thought, it need occupy us all the less in that it is gradually receding into the background, even in the writings of orthodox Marxian disciples and the official programmes of the Social-Democratic parties. Even Kautsky, during the revisionism quarrel, was reduced to conceding that, according to all the facts, it was precisely in the most advanced capitalist countries that physical misery was on the decline, and that the working classes had a higher standard of life than fifty years ago. The Marxians still cling to the theory of increasing poverty purely on account of its propaganda value, and exploit it today just as much as during the youth of the now aged Party.

--Ludwig von Mises, Socialism: An Economic and Sociological Analysis, trans. J. Kahane (Indianapolis: Liberty Fund, 1981), 341.

If This Notion about the Source of Capital Is Not True, then Wealth at One Pole Cannot Cause Poverty at the Other; If It Is True, Then We Can Make Any Regulations We Like about the Distribution of Wealth

Karl Marx says, "An accumulation of wealth at one pole of society indicates an accumulation of misery and overwork at the other." In this assertion, Marx avoids the very common and mischievous fallacy of confusing causes, consequences, and symptoms. He suggests that what is found at one pole indicates, or is a symptom of what may be found at the other. In the development of his criticisms on political economy and the existing organization of society, however, Marx proceeds as if there were a relation of cause and effect in the proposition just quoted, and his followers and popularizers have assumed as an indisputable postulate that the wealth of some is a cause of the poverty of others. The question of priority or originality as between Marx, Rodbertus, and others is at best one of vanity between them and their disciples, but it is of great interest and importance to notice that the doctrine that wealth at one pole makes misery at the other is the correct logical form of the notion that progress and poverty are correlative. This doctrine rests upon another and still more fundamental one, which is not often formulated, but which can be detected in most of the current socialistic discussions, viz., that all the capital which is here now would be here under any laws or institutions about property, as if it were due to some independent cause; and that some have got ahead of others and seized upon the most of it, so that those who came later have not been able to get any. If this notion about the source of capital is not true, then wealth at one pole cannot cause poverty at the other. If it is true, then we can make any regulations we like about the distribution of wealth, without fear lest the measures which we adopt may prevent any wealth from being produced.

--William Graham Sumner, "What Makes the Rich Richer and the Poor Poorer?" in The Challenge of Facts and Other Essays, ed. Albert Galloway Keller (New Haven: Yale University Press, 1914), 65-66.

The Only Wise and Intelligent Policy in the Field of Political Economy Is to minimize the Relations of Government to Industry; A Separation of State and Market Will Cut the Ground from under Plutocracy

Plutocracy, by its very nature, invites vicious lobbying for special favors, legislation, exclusive franchise and monopoly privileges, by all sorts of diverse economic groups which seek to enhance their economic positions, not through the market, but through political privileges designed to "get around the market." Economically, this is disastrous since monopoly privileges fetter competitive enterprise and deter economic growth. Politically, plutocracy turns the legitimate functions and powers of government into a political "blackjack" to be wielded by the wealthiest pressure groups against their enemies, and eventually, the rest of the population. It practically assures political graft and corruption, the undermining of governmental morality, and the general deterioration of any serious respect for the ideas of republican government. In fact, civil liberty becomes incompatible with the aims and methods of plutocracy. Looked at from any angle, plutocracy is:

. . . the most sordid and debasing form of political energy known. . . In its motive, its processes, its code, and its sanctions, it is infinitely corrupting to all institutions which ought to preserve and protect society.

Thus, Sumner fears plutocracy because this unholy alliance of political and economic power will most assuredly destroy his conception of civil liberty and republican government, and his vision of an efficient, rational economic system capable of change and growth. Given these facts, the only wise and intelligent policy in the field of political economy is to minimize to the utmost the relations of government to industry. Sumner believes that a separation of state and market--like church and state--will "cut the ground from under plutocracy."

--Dominick Thomas Armentano, "The Political Economy of William Graham Sumner: A Study in the History of Free-Enterprise Ideas" (PhD diss., University of Connecticut, 1966), 68-69.

Sumner Holds That the French Merchants Had Put Laissez-Faire Exactly: "Let Us Manage Ourselves," "Do Not Meddle; Do Not Regulate; Do Not Give Orders"

For Sumner, as for Bastiat and Spencer, laissez-faire does not mean "things left to themselves" or "the unrestrained action of nature"; on the contrary, it means "the. . . rational application of human intelligence to the assistance of natural development." Sumner holds that the French merchants had put it exactly: "Let us manage ourselves." Thus, he conceives laissez-faire to be a policy of self-management where individuals apply brains "to trade and industry so as to develop and improve them" without the guidance or wisdom of interfering statesmen or legislators. To the statesman the warning is clear: "do not meddle. . . do not regulate. . . do not give orders. . ."

--Dominick Thomas Armentano, "The Political Economy of William Graham Sumner: A Study in the History of Free-Enterprise Ideas" (PhD diss., University of Connecticut, 1966), 66-67.

History Is Only a Tiresome Repetition of One Story: Persons and Classes Have Sought to win Possession of the Power of the State in order to Live Luxuriously Out of the Earnings of Others

History is only a tiresome repetition of one story. Persons and classes have sought to win possession of the power of the State in order to live luxuriously out of the earnings of others. Autocracies, aristocracies, theocracies, and all other organizations for holding political power, have exhibited only the same line of action. It is the extreme of political error to say that if political power is only taken away from generals, nobles, priests, millionnaires, and scholars, and given to artisans and peasants, these latter may be trusted to do only right and justice, and never to abuse the power; that they will repress all excess in others, and commit none themselves. They will commit abuse, if they can and dare, just as others have done. The reason for the excesses of the old governing classes lies in the vices and passions of human nature--cupidity, lust, vindictiveness, ambition, and vanity. These vices are confined to no nation, class, or age. They appear in the church, the academy, the workshop, and the hovel, as well as in the army or the palace. They have appeared in autocracies, aristocracies, theocracies, democracies, and ochlocracies, all alike. The only thing which has ever restrained these vices of human nature in those who had political power is law sustained by impersonal institutions. If political power be given to the masses who have not hitherto had it, nothing will stop them from abusing it but laws and institutions. To say that a popular government cannot be paternal is to give it a charter that it can do no wrong. The trouble is that a democratic government is in greater danger than any other of becoming paternal, for it is sure of itself, and ready to undertake anything, and its power is excessive and pitiless against dissentients.

--William Graham Sumner, What Social Classes Owe Each Other (Caldwell, ID: The Caxton Printers, 1974), 27-28.

Protectionism Is Socialism and Socialism Is Any Device or Doctrine Whose Aim Is to save Individuals from the Difficulties of Existence and the Competition of Life by the Intervention of "the State"

To simply give protectionism a bad name would be to accomplish very little. When I say that protectionism is socialism I mean to classify it and bring it not only under the proper heading but into relation with its true affinities. Socialism is any device or doctrine whose aim is to save individuals from any of the difficulties or hardships of the struggle for existence and the competition of life by the intervention of "the State." Inasmuch as "the State" never is or can be any thing but some other people, socialism is a device for making some people fight the struggle for existence for others. The devices always have a doctrine behind them which aims to show why this ought to be done.

--William Graham Sumner, Protectionism: The -Ism Which Teaches That Waste Makes Wealth (New York: Henry Holt and Company, 1888), 111-112.

If the Term “Capitalism” Is Used to Designate an Economic System in which Production Is Governed by Capital Calculations, It Acquires a Special Significance for Defining Economic Activity

If, nevertheless, we do desire to discover for them a precise application, we should start from the idea of capital calculations. And since we are concerned only with the analysis of actual economic phenomena, and not with economic theory--where “capital” is often used in a sense specially extended for particular purposes--we must first ask what significance is attached to the term in business practice. There we find it used only for purposes of economic calculation. It serves to bring the original properties of a concern under one denomination, whether they consisted of money or were only expressed in money. The object of its computations is to enable us to ascertain how much the value of this property has altered in the course of business operations. The concept of capital is derived from economic calculation. Its true home is accountancy--the chief instrument of commercial rationality. Calculation in terms of money is an essential element of the concept of capital.

If the term capitalism is used to designate an economic system in which production is governed by capital calculations, it acquires a special significance for defining economic activity. Understood thus, it is by no means misleading to speak of Capitalism and capitalistic methods of production, and expressions such as the capitalistic spirit and the anti-capitalistic disposition acquire a rigidly circumscribed connotation. Capitalism is better suited to be the antithesis of Socialism than Individualism, which is often used in this way. As a rule those who contrast Socialism with Individualism proceed on the tacit assumption that there is a contradiction between the interests of the individual and the interest of society, and that, while Socialism takes the public welfare as its object, individualism serves the interests of particular people. And since this is one of the gravest sociological fallacies we must avoid carefully any form of expression which might allow it secretly to creep in.

--Ludwig von Mises, Socialism: An Economic and Sociological Analysis, trans. J. Kahane (Indianapolis: Liberty Fund, 1981), 106-107.

The Terms “Capitalism” and “Capitalistic Production” Are Political Catchwords, Invented by Socialists to criticize and to condemn

The terms “Capitalism” and “Capitalistic Production” are political catchwords. They were invented by socialists, not to extend knowledge, but to carp, to criticize, to condemn. Today, they have only to be uttered to conjure up a picture of the relentless exploitation of wage-slaves by the pitiless rich. They are scarcely ever used save to imply a disease in the body-politic. From a scientific point of view, they are so obscure and ambiguous that they have no value whatever. Their users agree only in this, that they indicate the characteristics of the modern economic system. But wherein these characteristics consist is always a matter of dispute. Their use, therefore, is entirely pernicious, and the proposal to extrude them altogether from economic terminology, and to leave them to the matadors of popular agitation, deserves serious consideration.

--Ludwig von Mises, Socialism: An Economic and Sociological Analysis, trans. J. Kahane (Indianapolis: Liberty Fund, 1981), 105-106.

The Supporters of the Welfare State Are Utterly Anti-Social and Intolerant Zealots; They Advocate Enlightened Despotism

It is customary to call the point of view of the advocates of the welfare state the "social" point of view as distinguished from the "individualistic" and "selfish" point of view of the champions of the rule of law. In fact, however, the supporters of the welfare state are utterly anti-social and intolerant zealots. For their ideology tacitly implies that the government will exactly execute what they themselves deem right and beneficial. They entirely disregard the possibility that there could arise disagreement with regard to the question of what is right and expedient and what is not. They advocate enlightened despotism, but they are convinced that the enlightened despot will in every detail comply with their own opinion concerning the measures to be adopted. They favour planning, but what they have in mind is exclusively their own plan, not those of other people. They want to exterminate all opponents, that is, all those who disagree with them. They are utterly intolerant and are not prepared to allow any discussion. Every advocate of the welfare state and of planning is a potential dictator. What he plans is to deprive all other men of all their rights, and to establish his own and his friends' unrestricted omnipotence. He refuses to convince his fellow-citizens. He prefers to "liquidate" them. He scorns the "bourgeois" society that worships law and legal procedure. He himself worships violence and bloodshed.

--Ludwig von Mises, epilogue to Socialism: An Economic and Sociological Analysis, trans. J. Kahane (Indianapolis: Liberty Fund, 1981), 520-521.

People Have Uncritically Swallowed All the Lunatic Fantasies of Charles Fourier and All the Absurdities of Veblen; They Firmly Believe in Engels's Assertion That Socialism Will Be a Realm of Unlimited Freedom

But in all countries there are people who, although themselves fanatically committed to the idea of all-round planning, i.e. public ownership of the means of production, become frightened when they are confronted with the real face of communism. These people are disappointed. They dream of a Garden of Eden. For them communism, or socialism, means an easy life in riches and the full enjoyment of all liberties and pleasures. They fail to realize the contradictions inherent in their image of the communist society. They have uncritically swallowed all the lunatic fantasies of Charles Fourier and all the absurdities of Veblen. They firmly believe in Engels's assertion that socialism will be a realm of unlimited freedom. They indict capitalism for everything they dislike, and are fully convinced that socialism will deliver them from all evil. They ascribe their own failures and frustrations to the unfairness of this "mad" competitive system and expect that socialism will assign them that eminent position and high income which by right are due to them. They are Cinderellas yearning for the prince-saviour who will recognize their merits and virtues. The loathing of capitalism and the worship of communism are consolations for them. They help them to disguise to themselves their own inferiority, and to blame the "system" for their own shortcomings.

--Ludwig von Mises, epilogue to Socialism: An Economic and Sociological Analysis, trans. J. Kahane (Indianapolis: Liberty Fund, 1981), 517.

A Consistent Marxian--If Consistency Were Compatible with Marxism--Would Have to admit that Stalin's Political System Was the Necessary Superstructure of Communism

Trotsky was at a loss to explain how all this could be achieved by only one man and his few sycophants. Where were the "material productive forces," much talked about in Marxian historical materialism, which--"independent of the wills of individuals"--determine the course of human events "with the inexorability of a law of nature"? How could it happen that one man was in a position to alter the "juridical and political superstructure" which is uniquely and inalterably fixed by the economic structure of society? Even Trotsky agreed that there was no longer any private ownership of the means of production in Russia. In Stalin's empire, production and distribution are entirely controlled by "society." It is a fundamental dogma of Marxism that the superstructure of such a system must necessarily be the bliss of the earthly paradise. There is in Marxian doctrines no room for an interpretation blaming individuals for a degenerative process which could convert the blessing of public control of business into evil. A consistent Marxian--if consistency were compatible with Marxism--would have to admit that Stalin's political system was the necessary superstructure of communism.

--Ludwig von Mises, epilogue to Socialism: An Economic and Sociological Analysis, trans. J. Kahane (Indianapolis: Liberty Fund, 1981), 516.