Peace through wealth

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Peace Through Wealth by Dr. David N. Snyder. (An article that originally appeared on a blog during the Iraq War as an anti-war essay.)

Capitalism refers to an economic and social system in which the means of production are predominantly privately owned and operated, and in which investments, distribution, income, production and pricing of goods and services are determined through the operation of a market economy. It is usually considered to involve the right of individuals and groups of individuals acting as legal persons or corporations to trade capital goods, labor, land and money.

Due to the effect of having the means of production privately owned, there is competition and incentive to produce the best quality products at the best possible prices. Thus, it has effectively made nations and people wealthy and as a wholesome consequence there has been less poverty, hunger, and warfare among nations that properly allow for capitalism.

There are many nations that appear to follow capitalism that have much poverty and hunger and civil strife, but if you examine the countries closer, you will find that they are not really capitalist. For example, in many impoverished nations there are no property rights. Businesses and home owners do not own the land under which their house or business lies. If the house or business becomes too profitable, inevitably the corrupt governments seize the home or business or tax them so highly so that the entrepreneur loses everything and a new business person is put in his place.

When the majority of the people are wealthy or living comfortably there is no motive for them to revolt against their governments. There is also little to no reason for them to join movements which call for suicide attacks against another. Most of the suicide attackers have little to live for, with few or no possessions. When people have possessions and private property their concerns are more geared to protecting and keeping their wealth rather than extremist ideologies which deprive others of their life, liberty, and pursuit of happiness.

Che Guevara was a Marxist guerilla fighter who killed ruthlessly anyone who did not adopt his Marxist ideas. He has become somewhat of a cultural icon and symbol for the left. He was a mass murderer, very pro-war and a communist. But all of the deaths and killings in the name of communism (probably around 100 million) were wasted (by the communists) because the economic philosophy ended up being proven wrong as it did not work in practice.

The Cold War ended without a single bullet fired, because communism was bound for failure. There was no incentive for factories to compete or produce quality items.

Capitalism on the other hand, has many incentives for competition, quality, and quantity. As a result it employs the most number of people so that the maximum number of products can be produced and sold. Mother Teresa and numerous others have done wonderful charity work for masses of impoverished people. But in terms of hiring people, providing a wage for life, and feeding families, perhaps no charity has done as much good for the masses as Bill Gates and other mogul-capitalists. The mass production of computers and software has employed billions in all parts of the world. These wages are used to feed their families, purchase homes and other goods, which in turn, hires even more people.

On the right, Ronald Reagan said, “peace through strength.” On the left, Dennis Kucinich says, “strength through peace.” Both are excellent points, but I prefer: “Peace through wealth.”

As capitalism has flourished, there is trade between nations. Wherever there is free trade and prosperity between nations, there has been peace. Very rarely do trading partners go to war against another. As we open up more markets and free trade, there is more peace. President Nixon opened the door to China’s isolationism and China slowly became more capitalist. Today China is virtually a capitalist nation, retaining communism only so that democratic elections are not performed. China trades with almost the entire world and the country has been coming out of poverty at a record rate. In a (year 2009) Newsweek article, Fareed Zakaria of CNN wrote that at least 400 million people came out of poverty during the Chinese capitalist boom shortly after the start of the twenty-first century.

The economic and humanitarian cost of war

Wars are expensive. This is why historically taxes have always gone up during and after wars. This is why wars should only be done when absolutely necessary.

  • Historic tax rates in the U.S., highest tax bracket:
  • Post World War I 77%
  • World War II 75%
  • Korean War 91%
  • Vietnam War 77%
  • 1988-1990 (peace time) 28%

Some severe Recessions in the U.S. and its causes:

  • 1918-1921 Post World War I
  • 1929-1939 Great Depression, Federal Reserve
  • 1953 Post Korean War
  • 2007-2013 Iraq War

It is a myth that wars improve the economy and makes a country stronger. As you can see from the above statistics, wars lead to very high taxes and also to Recessions and sometimes Depressions. It is a common myth that the U.S. exited the Great Depression via World War II. While World War II was probably a justified war, it was not the war that led the U.S. out of Depression, but rather aggressive domestic programs and a massive increase in industrialization as the economy went from a predominant agrarian society and into an industrialized, modern economy with greater free trade with other nations. Also, there was a massive influx of new workers during World War II and beyond with the entrance of women into the workforce in large numbers and they increased the overall productivity of the Gross National Product.

Wars are inhumane. In all recent wars civilians account for 99% of the casualties. In many cases torture and war crimes get committed by one or both sides. They do tremendous damage to buildings and infrastructure. The utilities and currencies get disrupted. Life enters a stage of chaos and anarchy during war for the people living at the front lines. Often we get placed in charge of re-building the nation after it is destroyed, which again costs billions and trillions of dollars. Again, where is this money going to come from? If you are a taxpayer, do you have a mirror? Democrats are typically known as the party to care more about people and their welfare than the GOP, so should be opposed to war on at least these humanitarian grounds.

The cost of war is simply too high. It cannot exist or continue unless more taxes are collected. The only way to do that is to raise taxes. Wars are too expensive. War causes the raising of taxes. The GOP (conservative U.S. political party) should be opposed to war at least on these economic concerns. Therefore, neither the GOP or the Democrats should support unnecessary wars.

Centrist-Libertarianism

The Libertarian Party of the U.S. comes the closest to the principles of the Founding Fathers with its insistence on the Constitution being the law of the land and not a “rough draft.” The Libertarians advocate for:

  • 1. Personal liberty, not legislating morality
  • 2. Freedom of expression and privacy
  • 3. Economic liberty
  • 4. Very limited government spending with no subsidies to certain industries
  • 5. Workers have a right to organize, but private business also have the right to refuse such organization as the owners of the property and business
  • 6. Supports free trade
  • 7. Few restrictions on immigration for those coming to work, but border still protected from attack
  • 8. Non-interventionist foreign policy and defense of the country only for real attacks and real threats
  • 9. Education left to the free market
  • 10. Health care left to the free market
  • 11. Utilities left to the free market
  • 12. Equality of opportunity left to the free market

The Libertarian Party is decidedly laissez-faire capitalist and capitalism has proven to be the best economic system, however, the Party tends to go too extreme on this and other factors. For example, discrimination could still occur under Libertarianism. The Libertarians contend that the free market will prevent discrimination and racism, but history has shown this is not always true. In some cases, it is more profitable for a business owner to deny certain customers on the basis of race, for example in some Southern states in the 1950’s and 1960’s and earlier.

The above list could be considered the right (wing) – Libertarian views on the major issues. A left (wing) – Libertarian view is that there should be all the personal liberties mentioned above, but with a socialist type economic system. As discussed on other pages of this site, the socialist model does not work in practice, however noble the goals might be.

The Solution

A solution is to create a middle way between these extremes, while still holding true to capitalism and the free market. I call this Centrist-Libertarianism. The two-party system shows no sign of leaving anytime soon, so this is not a call for any new political party, but rather to elect moderate Republican and moderate Democrats who advocate this political philosophy (or to a large degree as few will agree with all of these issues). The platform of Centrist-Libertarianism is very similar to the traditional Libertarian Party shown above, with noted exceptions on education (no. 9), health care (no. 10), utilities (no. 11), and equality (no. 12).

Centrist Libertarian Platform

  • 1. Personal liberty, not legislating morality
  • 2. Freedom of expression and privacy
  • 3. Economic liberty
  • 4. Very limited government spending with no subsidies to certain industries
  • 5. Workers have a right to organize, but private businesses also have the right to refuse such organization as the owners of the property and business
  • 6. Supports free trade
  • 7. Few restrictions on immigration for those coming to work, but border still protected from attack
  • 8. Non-interventionist foreign policy and defense of the country only for real attacks and real threats
  • 9. Education is so important for a democratic society and for a developed society that it must be free through at least the bachelor’s degree. In developed societies manufacturing jobs are being out-sourced to developing nations. In addition, an educated society is necessary to elect competent officials. Schools can be privately run, with the government providing vouchers to parents of children. The schools then compete for students to get their funds. This uses the free market model as the best schools survive and no poor children are denied an education because of the economic status of their parents.
  • 10. Health care is provided to all with citizens paying premiums based on their income levels and health condition or alternatively there is at least a public option for people to buy into. Government’s role is small, but deemed necessary for life and death situations such as national defense, police protection, and fire protection. Health care belongs in this life and death category.
  • 11. Utilities that are left to the free market could result in price gouging and some disadvantaged people being left without basic services such as electricity, water, and gas. Currently most utilities are government run or controlled, but not all. All utilities must be owned and controlled by the government so that all will have access. This includes Big Oil. Currently Big Oil makes trillions in profits per year. The government can buy Big Oil’s stake through the Fifth Amendment:

. . . nor shall private property be taken for public use, without just compensation.”

The government can take private property with just compensation. The government can acquire Big Oil and any other privately held utilities and then reap future profits from said utilities, thereby decreasing the tax burden on the citizens.

  • 12. Laws against discrimination are necessary and must be enforced by the government. The free market cannot always guarantee that there will not be discrimination. Equality is mandated in the Fourteenth Amendment with:

no state shall … deny to any person within its jurisdiction the equal protection of the laws.”

The extremes do not work. Bombing other nations to artificially create jobs in the short term does not work and is extremist and compatible with totalitarianism. Anarchy and too little government does not work either. The solution lies in finding the right balance, the right middle position in the size and scope of government and not engaging in cultural imperialism and unnecessary wars.