DemocracyThe God That Failed (55 page)

On the other hand, the settlers brought something else with them from Europe. There, the development from feudalism to royal absolutism had not only been resisted by the aristocracy but it was also opposed theoretically with recourse to the theory of natural rights as it originated within Scholastic philosophy. According to this doctrine, government was supposed to be contractual, and every government agent, including the king, was subject to the same universal rights and laws as everyone else. While this may have been the case in earlier times, it was certainly no longer true for modern absolute kings. Absolute kings were usurpers of human rights and thus illegitimate. Hence, insurrection was not only permitted but became a duty sanctioned by natural law.
⁴

The American colonists were familiar with the doctrine of natural rights. In fact, in light of their own personal experience with the achievements and effects of natural liberty and as religious dissenters who had left their mother country in disagreement with the king and the Church of England, they were particularly receptive to this doctrine.
⁵

Steeped in the doctrine of natural rights, encouraged by the distance of the English king, and stimulated further by the puritanical censure of royal idleness, luxury and pomp, the American colonists rose up to free themselves of British rule. As Thomas Jefferson wrote in the Declaration of Independence, government was instituted to protect life, liberty, and the pursuit of happiness. It drew its legitimacy from the consent of the governed. In contrast, the royal British government claimed that it could tax the colonists without their consent. If a government failed to do what it was designed to do, Jefferson declared, "it is the right of the people to alter or abolish it, and to institute new government, laying its foundation on
such principles, and organizing its powers in such form, as to them shall seem most likely to effect their safety and happiness."

⁴
See Lord Acton, "The History of Freedom in Christianity," in idem,
Essays
in
the
History
of
Liberty
(Indianapolis, Ind.: Liberty Classics, 1985), esp. p. 36.

⁵
On the liberal-libertarian ideological heritage of the American settlers see Murray N. Rothbard,
For
A
New
Liberty
(New York: Collier, 1978), chap. 1; idem,
Con
ceived
in
Liberty,
4 vols. (Auburn, Ala.: Ludwig von Mises Institute, 1999); Bernard Bailyn,
The
Ideological
Origins
of
the
American
Revolution
(Cambridge, Mass.: Harvard University Press, 1967).

III

But what was the next step once independence from Britain had been won? This question leads to the third source of national pride—the American Constitution—and the explanation as to why this constitution, rather than being a legitimate source of pride, represents a fateful error.

Thanks to the great advances in economic and political theory since the late 1700s, in particular at the hands of Ludwig von Mises and Murray N. Rothbard, we are now able to give a precise answer to this question. According to Mises and Rothbard, once there is no longer free entry into the business of the production of protection and adjudication, the price of protection and justice will rise and their quality will fall. Rather than being a protector and judge, a compulsory monopolist will become a protection racketeer: the destroyer and invader of the people and property that he is supposed to protect, a warmonger, and an imperialist.
⁶
Indeed, the inflated price of protection and the perversion of the ancient law by the English king, both of which had led the American colonists to revolt, were the inevitable result of compulsory monopoly. Having successfully seceded and thrown out the British occupiers, it would only have been necessary for the American colonists to let the existing homegrown institutions of self-defense and private (voluntary and cooperative)
protection and adjudication by specialized agents and agencies take care of law and order.

⁶
This fundamental insight was first clearly stated by the French-Belgian economist Gustave de Molinari in an article published in 1849
(The
Production
of
Security
[New York: Center for Libertarian Studies, 1977]). De Molinari reasoned:

That in all cases, for all commodities that serve to provide for the tangible or intangible needs of the consumer, it is in the consumer's best interest that labor and trade remain free, because freedom of labor and trade have as their necessary and permanent result the maximum reduction of price— Whence it follows: That no government should have the right to prevent another government from going into competition with it, or to require consumers of security to come exclusively to it for this commodity, (p. 3) If, on the contrary, the consumer is not free to buy security wherever he pleases, you forthwith see open up a large profession dedicated to arbitrariness and bad management. Justice becomes slow and costly, the police vexatious, individual liberty is no longer respected, the price of security is abusively inflated and inequitably apportioned, according to the power and influence of this or that class of consumers, (pp. 13-14)

This did not happen, however. The Americans not only did not let the inherited royal institutions of colonies and colonial governments wither away into oblivion; they reconstituted them within the old political borders in the form of independent states, each equipped with its own coercive (unilateral) taxing and legislative powers.
⁷
While this would have been bad enough, the new Americans made matters worse by adopting the American Constitution and replacing a loose confederation of independent states with the central (federal) government of the United States.

This Constitution provided for the substitution of a popularly elected parliament and president for an unelected king, but it changed nothing regarding their power to tax and legislate. To the contrary, while the English king's power to tax without consent had only been assumed rather than explicitly granted and was thus in dispute,
⁸
the Constitution explicitly granted this very power to Congress. Furthermore, while kings, in theory even absolute kings, had not been considered the makers but only the interpreters and executors of preexisting and immutable law, i.e., as judges rather than legislators,
⁹
the Constitution explicitly
vested Congress with the power of legislating, and the president and the Supreme Court with the power of executing and interpreting such legislated law.
¹⁰

⁷
Furthermore, in accordance with their original royal charter the newly independent states of Georgia, the Carolinas, Virginia, Connecticut, and Massachusetts, for instance, claimed the Pacific Ocean as their western boundary; and based on such obviously unfounded, usurped ownership claims, they—and subsequently as their 'legal heir' the Continental Congress and the United States—proceeded to sell western territories to private homesteaders and developers in order to pay off their debt and/or fund current government operations.

⁸
See Bruno Leoni,
Freedom
and
the
Law
(Indianapolis, Ind.: Liberty Classics, 1991), p. 118. Leoni here notes that several scholarly commentators on the Magna Carta, for instance, have pointed out that

an early medieval version of the principle "no taxation without representation" was intended as "no taxation without the consent of the individual taxed," and we are told that in 1221, the Bishop of Winchester, "summoned to consent to a scutage tax, refused to pay, after the council had made the grant, on the ground that he dissented, and the Exchequer upheld his plea."

⁹
See Kern,
Kingship
and
Law
in
the
Middle
Ages,
who writes that

there is, in the Middle Ages, no such thing as the "first application of a legal rule." Law is old; new law is a contradiction in terms; for either new law is derived explicitly or implicitly from the old, or it conflicts with the old, in which case it is not lawful. The fundamental idea remains the same; the old law is the true law, and the true law is the old law. According to medieval ideas, therefore, the enactment of new law is not
possible at all; and all legislation and legal reform is conce
ived of as the restoration of the good old law which has been violated, (p. 151)

In effect, what the American Constitution did was only this: Instead of a king who regarded colonial America as his private property and the colonists as his tenants, the Constitution put temporary and interchangeable caretakers in charge of the country's monopoly of justice and protection. These caretakers did not own the country, but as long as they were in office, they could make use of it and its residents to their
own and their proteges advantage. However, as elementary economic theory predicts, this institutional setup will not eliminate the self-interest-driven tendency of a monopolist of law and order towards increased exploitation. To the contrary, it only tends to make his exploitation less calculating, more shortsighted, and wasteful. As Rothbard explained:

Similar views concerning the permanency of law and the impermissibility of legislation were still held by the eighteenth-century French physiocrats such as, for instance, Merrier de la Riviere, author of a book on
L'Ordre
Naturel
and one time governor of Martinique. Called upon for advice on how to govern by the Russian Czarina Catherine the Great, de la Riviere is reported to have replied that law must be based

on one [thing] alone, Madame, the nature of things and man.... To give or make laws, Madame, is a task which God has left to no one. Ah! What is man, to think of himself capable of dictating laws to beings whom he knows not? The science of government is to study and recognize the laws which God has so evidently engraven in the very organization of man, when He gave him existence. To seek to go beyond this would be a great misfortune and a destructive undertaking. (Quoted in Murray N. Rothbard,
Economic
Thought
Before
Adam
Smith:
An
Austrian
Perspective
on
the
History
of
Economic
Thought
[Cheltenham, U.K.: Edward Elgar, 1995], vol.1, p. 371)

See also de Jouvenel, SovereignJy, pp. 172-73 and 189.

10
The much cherished moder n view, according to which the adoption of "constitutional government" represents a major civilizational advance from arbitrary government to the rule of law and which attributes to the United States a prominent or even preeminent role in this historical breakthrough, then, must be considered seriously flawed. This view is obviously contradicted by documents such as the Magna Carta (1215) or the Golden Bull (1356). More importantly, it misrepresents the nature of pre-modern governments. Such governments either entirely lacked the most arbitrary and tyrannical of all powers, i.e., the power to tax and legislate without consent; or even if they did possess these powers, governments were severely restricted in exercising them because such powers were widely regarded as illegitimate, i.e., as usurped rather than justly acquired. In distinct contrast, modern governments are defined by the fact that the powers to tax and legislate are recognized explicitly as legitimate; that is, all "constitutional" governments, whether in the U.S. or anywhere else, constitute state-governments. Robert Nisbet is thus correct in noting that a pre-modern

king may have ruled at times with a degree of irresponsibility that few modern governmental officials can enjoy, but it is doubtful whether, in terms of effective powers and services, any king of even the seventeenth-century "absolute monarchies" wielded the kind of authority that now
inheres in the office of many high-ranking officials in the democracies. There were then too many social barriers between the claimed power of the monarch and the effective execution of this power over individuals. The very prestige and functional importance of church, family, gild, and local community as allegiances limited the absoluteness of the State's power.
(Community
and
Power,
pp. 103-04)

while a private owner, secure in his property and owning its capital value, plans the use of his resource over a long period of time, the government official must milk the property as quickly as he can, since he has no security of ownership government officials own the
use
of resources but not their capital value (except in the case of the "private property" of a hereditary monarch). When only the current use can be owned, but not the resource itself, there will quickly ensue uneconomic exhaustion of the resources, since it will be to no one's benefit to conserve it over a period of time and to every owner's advantage to use it up as quickly as possible. . . . The private individual, secure in his property and in his capital resource, can take the long view, for he wants to maintain the capital value of his resource. It is the government official who must take and run, who must plunder the property while he is still in command.
¹¹

Moreover, because the Constitution provided explicitly for "open entry" into state-government—anyone could become a member of Congress, president, or a Supreme Court judge—resistance against state
property invasions declined; and as the result of "open political competition" the entire character structure of society became distorted, and more and more bad characters rose to the top.
¹²
For free entry and competition is not always good. Competition in the production of goods is good, but competition in the production of bads is not. Free competition in killing, stealing, counterfeiting, or swindling, for instance, is not good; it is worse than bad. Yet this is precisely what is instituted by open political competition, i.e., democracy.

¹¹
Murray N. Rothbard,
Power
and
Market:
Government
and
the
Economy
(Kansas City: Sheed Andrews and McMeel, 1977), pp. 188-89. See further on this chaps. 1-3. In light of these considerations—and in contrast to common wisdom on the matter—one reaches the same conclusion regarding the ultimate "success" of the American revolution as H.L. Mencken,
A
Mencken
Chrestomathy
(New York: Vintage Books, 1982):

Political revolutions do not often accomplish anything of genuine value; their one undoubted effect is simply to throw out one gang of thieves and put in another.... Even the American colonies gained little by their revolt in 1776. For twenty-five years after the Revolution they were in far worse condition as free states than they would have been as colonies. Their government was more expensive, more inefficient, more dishonest, and more tyrannical. It was only the gradual material progress of the country that saved them from starvation and collapse, and that material progress was due, not to the virtues of their new government, but to the lavishness of nature. Under the British hoof they would have got on as well, and probably a great deal better, (pp. 145-46)