The "prosperity map" presented in figure 3 -2 below graphically displays the competing roles of work and theft in promoting prosperity and presents definitions for the terms of theft used in this book.
The "prosperity map" is a plot of output (as measured by motivation and ability) on the vertical axis and theft or victimization on the horizontal axis. Material wealth or prosperity which is the sum of output and theft is measured by the slanted dotted lines. Every society has rules that define the bounds of legality. Ideally these should be vertical lines closely spaced about zero to minimize both legal theft and legal victimization. In reality the lines of legality are distorted by political power structures in society to enhance their prosperity through legalized theft. The spectrum of wealth ranges from the poor in society to the middle class and finally the upper or ruling class. While there are both legal thieves and victims in each class, most of the victims of legal theft are among the poor and the middle class. On the far right lies a line of rebellion which defines the limit to which people will allow themselves to be victimized. The location of this line of rebellion (which is measure of the independence and self-reliance of the people) is the primary restraining effect on the degree of legalized theft in the society.
The prosperity map provides a means to classify various types of theft. Theft occurs whenever resources are transferred (involuntarily) at other than free market value. The parenthetical (involuntary) is included to exclude gifts which by definition are non-theft exchanges. Theft that occurs within the rules of society is "legalized theft" which is a primary focus of this book. Theft that occurs beyond the line of legality is of course illegal or criminal theft. For the purpose of classification, theft has been separated vertically into right wing and left wing theft. Right wing theft occurs when those who control the production of wealth in society abuse their power. They first distort the rules of society to legally permit theft and then use the rules they have created to legitimize their acts. Right wing theft is the classic ruling power structure theft of history that primarily manifests itself in American society in the forms of industrial and professional feudalism. Left wing theft is the abuse of popular power to distort the rules of society to permit theft. Prior to the rise of democracy, legalized left wing theft was extremely limited. However in many modern democracies including America, government has become an instrument of legalized left wing theft by forcibly redistributing the wealth of society from those who earn it to those who do not. Unfortunately both of America's major political parties are to a considerable extent hostages to political forces who advocate and benefit from right wing and left wing theft.
Most Americans share a strong social bond which is evidence of the altruism we feel towards our fellow citizens. We realize both intellectually and instinctively that our own prosperity is inexorably linked to the prosperity of those around us. We support laws against "criminal behavior" which are all overt forms of theft, both because we wish to protect the lives of others, and because we wish to protect our prosperity from such overt acts of theft. We work hard to produce the wealth needed for own prosperity, and we are continually seeking innovative ways to work smarter so that we can achieve greater prosperity with the same or even less effort. For ourselves we seek freedom from the control and theft by others and we also seek to promote such freedom in society, because we all benefit from the prosperity of a free society.
The production of goods and services in modern American society requires complicated interactions both among individuals and between individuals and the material resources in society. Order requires that there be rules that direct and control the interaction of human and material resources. Inevitably almost every rule results in advantages to one group or another. This ability of the rules of society to alter the distribution of wealth creates an irresistible temptation to at least try to enhance one's prosperity at the expense of others by promoting rules that are deliberately biased in one's own interest. When these efforts are successful, the resulting legalized theft saps the prosperity of the society nearly as effectively as the more visible criminal form. Any form of theft diverts the attention of both the thief and the victim away from productive activity toward either pursuing or resisting theft.
The insidiousness of legalized theft lies in the amoralization of such acts of theft created by the false legitimization of a legal framework. Clearly the appalling statement that "I was only following orders." used to justify the Holocaust represents an extreme example of such amoralization. However the modern dictum that "you only get what you negotiate" is only slightly less absurd when used to justify the outcome of negotiations between an individual and a large organization. The presence of widespread legalized theft in any society violates the social contract that is the basis for that society. This situation erodes the sense of common purpose and eventually leads to a breakdown in the social structure.
The recent collapse of the former Soviet Union was the result of many years of oppressive legalized theft that destroyed the sense of altruism on which a sense of common purpose was based. In a recent news article about Russia a reporter encountered a well dressed money changer and asked his Russian friend why the man was not at work in a state job. The friend said it was common knowledge that the man had a job which he never worked at a state factory. The man allowed his boss to pocket the pay check he received for the phony job in return for an agreement to receive a pension in 10 years when he "retired". That this scheme was viewed by many with admiration for successfully beating the system presents a sobering look at the nearly impossible task faced by Boris Yeltsin. The collapse of the Soviet Union shows that the people of the former Soviet Union no longer have a strong sense of altruism. The absence of altruism and a sense of common purpose removes the foundation for a national social unity. Like the collapse of a dying star, Soviet society is splintering in a desperate attempt to find social units small enough to achieve a sense of common purpose. The world watches and hopes this process can stabilize without the catastrophic rebound of a super nova.
Modern American society is traveling down a path similar to the former Soviet Union and in so doing squandering the precious investment of our sense of self-reliance and self-esteem which are cornerstones of our sense of common purpose. The relative isolation of the American frontier both forced Americans to be self-reliant and severely inhibited attempts by political power structures to institute and enforce systems of legalized theft. The freedom from theft provided by our society nurtured a strong sense of altruism and patriotic spirit. The success of early social welfare programs was due in large part to this legacy of self-reliance and sense of common purpose. People were ashamed to accept welfare and made every attempt to become self sufficient. While there were opportunities to go to work for someone else, there were also many opportunities to be self-employed either in farming or many retail, professional and small industrial occupations. Self-employment provided early Americans with control over their own destiny and freedom from the theft of others. Even most of the employee jobs were in small businesses where there was a close tie between the work performed and the economic value of the output produced.
The vast expansion of large corporations, powerful professional organizations and pervasive government programs mostly since the Second World War have gone a long way toward feudalizing American Society and creating a serf mentality among large segments of the American people. The popular statement "don't bite the hand that feeds you" epitomizes this serf mentality. In a free society, the hand that feeds you is your own. While social cooperation is important, only in a feudal society do you owe your prosperity to the control and power of others. As for biting, in a free society you have the right and obligation to speak out against immorality and oppression. You also have the right to expect protection from the fear of reprisals. These concepts are fundamental to the ideals on which our nation was founded and absolutely essential to a renaissance of American prosperity and world leadership.
The only solution to the dilemma of freedom in American society is both an educated and involved populace that understands the importance of freedom from theft to our overall prosperity. Freedom from theft means relinquishing our control over the lives of others and demanding that others do likewise for us. Relinquishing control means mutually forfeiting the wealth involuntarily transferred through those controls and turning our talents toward useful effort. This effort will require major reforms in the operation of government and the other political power structures in American society. However the rewards for the restoration of freedom to American society can be a renaissance for our country based on a rejuvenation of common purpose and a revitalization of American prosperity.
America's diversity is both our greatest asset and our biggest social challenge. American prosperity has been driven by the profusion of social and technical innovations that have resulted from the free interaction of the diverse cultural, ethnic and intellectual backgrounds of our people. However this diversity also contains the seeds of disorder because such diversity undermines altruism from biological homogeneity. No other nation has succeeded as well in creating a sense of national unity from such a diverse cross section of humanity. There are many contemporary examples of societies that have lost their altruistic glue and been devastated by civil strife. China, India, Northern Ireland, Lebanon and recently Yugoslavia are only a few examples.
Prosperity through freedom is the basis for American unity and the great beacon of opportunity which America offers for the prosperity of humanity. From the Pilgrims to the present day immigrants, people come to America seeking an opportunity to apply their talents and reap the rewards of their efforts in a climate of freedom. Our national motto, "E Pluribus Unum" is true on two levels. Yes America is a great melting pot where peoples of many cultures have blended to form a more homogeneous society capable of biological altruism. However the real source of American nationalism is not altruism born of cultural homogeneity, but altruism born of common purpose sustained through freedom. These ideals have encouraged Americans of diverse backgrounds to join the American mainstream secure in the knowledge that American freedom would permit them to also retain their cultural identity.
Blood may be thicker than water, but altruism based predominantly on biological homogeneity is neither possible for mankind nor even desirable because diversity is needed for innovation. Japan is an example of the successful application of cultural homogeneity to achieve social altruism. This remarkable achievement has enabled the Japanese to heal the wounds of centuries of civil strife and achieve a degree of order and discipline that has made the Japanese economy a marvel of productive efficiency. While we can debate the order/disorder tradeoff in comparing the Japanese and American social models, the issue for this chapter is not which social model is better at promoting prosperity. The American model of social altruism through freedom is the only path for humanity because the incredible diversity of our species makes a society based on the altruism of biological homogeneity impossible.
Culturally diverse societies depend on a system of freedom to nurture a sense of altruism and common interest. When social institutions support rules that promote the prosperity of the citizens obtained through their own efforts, the bond of common interest strengthens and the society prospers. However when political power structures in the society are allowed to bias the rules to enhance their prosperity through legalized theft, the bond of common interest weakens. As this bond weakens, people are more inclined to engage in both legalized theft and criminal theft to promote their own prosperity. Social institutions reflect this change in popular attitude and either promote or offer less resistance to schemes of legalized theft by the political power structures in society. The resulting orgy of theft reduces the level of prosperity both by demotivating the citizens from producing useful output today and by demotivating increases in ability for tomorrow's prosperity.
American society is presently drowning in an orgy of legalized theft by her social and political institutions and an epidemic in criminal behavior by individuals unable to obtain a legal facade for their actions. Countless societies throughout human history have fallen into similar circumstances. These societies either succumb to a violent internal restructuring or become dominated by and victimized by foreign powers. However the framework of American society and the precedent of history show that America has the ability to restore freedom from theft to American society and continue her role as a leader of mankind. The issue we face is the same issue other generations of Americans faced; do we have the will to restore a "new birth of freedom " to American society?
The success and endurance of America has been due to the flexibility of American society to respond with appropriate social innovations to counter the ever evolving schemes of human theft. The 18th century was a world of territorial feudal power structures with an hereditary ruling class. America's founders clearly understood the workings of these Old World political power structures. They wisely structured our government with checks and balances to minimize the abuse of political power. Their success was greatly enhanced by the absence of territorial feudalism in the American colonies. Unfortunately the existence of slavery in America prevented our founders from exorcising this form of feudal theft. Roughly 85 years after the First American Revolution, we fought a Second American revolution to complete the work of our founders and rid our society of human slavery. America's founders did not anticipate either the profound role of industry on human society or the growth of industrial feudalism. The breakup of America's trusts by Teddy Roosevelt forty years after the Civil War ranks as a Third American revolution.
Unfortunately none of the first three American revolutions totally eliminated the systems of theft they were directed against. While slavery was abolished, schemes of theft directed by majority groups within American society against minority groups continue to persist. While these systems are called "discrimination" implying that the minority group is being discriminated against, the real motivation is not sadism against the minority, but the enhancement of the prosperity of the majority through legalized theft. The civil rights movement of the '60s was another skirmish in the continuing battle against the feudal institution of slavery. While the institution of territorial feudalism was officially abolished, the growth of corporate farming with labor supplied by migrant farm workers is resurrecting this scheme of feudal theft in America. Similarly the establishment of anti-trust laws to prevent one company from controlling a key industry have been circumvented by large and typically inefficient corporate conglomerates who exist to promote the power of their rulers not the interest of their investors or the American public. American society is now embroiled in a fourth wave of professional feudal theft based on the control over the free market for human services. This adds to the remaining feudal baggage from the previous waves of feudal theft.
The central theme of this book is that freedom from theft is the road to both an American Renaissance and a new era of prosperity for all mankind. However freedom is not license. The proper function of a free society depends on a system of rules and incentives that creates an invisible hand of positive synergism that guides individual actions toward the best interests of society. However when the rules of society are misdirected, the negative synergism between social rules and human behavior can retard prosperity and even threaten the survival of society. The rest of this chapter discusses several ways in which misdirected rules can create negative synergism and thereby inhibit the prospects for social recovery.
Sports provide a unique window for observing human behavior, because sports strips away the social facade that often masks human interactions. Sports provide a visible contest between two individuals or groups openly acting in their own self interest under a simple set of rules designed to direct their self interest in the best interests of society. Several years ago when the San Francisco 49ers were headed for the Super Bowl, some of the fans complained when the 49ers would kick field goals inside the 20 yard line rather than go for the touchdown. They felt that going for the TD was more entertaining (i.e. "in society's best interest") and they were angry that the 49ers didn't respond to that motivation. These fans failed to grasp the reality that winning the game (i.e. prosperity for the 49ers) was their most compelling motivation. The solution to such conflicts between human self interest and social interest in sports as well as in society in general is to change the rules to redirect self interest. In fact the rules of professional football were changed to make the goal posts narrower which increased the incentive for trying for a touchdown.
A more pertinent example of this negative synergism is the social welfare system in America which is full of well meaning rules that depend on people behaving contrary to their individual self interest. The unemployment assistance programs are flagrantly abused by otherwise honest and hard working Americans who not surprisingly find themselves more motivated to find work as their benefits begin to run out. Years ago I knew several teachers who seemed to get laid off every June, collect unemployment during the summer and then get rehired in the fall. These examples show that the contrast between the working men and women of the middle class and the welfare mothers among the poor is no evidence of a higher morality or work ethic among the middle class. All of us are tempted to abuse the system when the rules favor our self-interest. There is menial work at low wages available to most of the people on welfare. However the rules of the welfare system discourage working by providing a subsistence living for free and making the incremental pay for working totally unattractive.
3.2 RECOMMENDATION: REVIEW ALL SOCIAL RULES FOR SELF-INTEREST CONFLICTS - We need to thoroughly review all the rules in American society and identify those with blatant self-interest/social interest conflicts. We then need to review the social benefits these rules were intended to promote. If these benefits are still deemed vital, we need to search for alternate formulations of existing rules to minimize self-interest conflicts.
3.3 RECOMMENDATION: REVIEW ALL SOCIAL RULES FOR SPECIAL INTEREST BIAS - We need to thoroughly review all the rules in American society and identify those with blatant special interest bias. These especially include rules that support industrial restrictions on the free market and rules that impose professional restrictions on the free market. We then need to review the social benefits these rules were intended to promote. If these benefits are still deemed vital, we need to search for alternate formulations of existing rules to minimize special interest bias.
The profit motive of the private sector provides a natural mechanism to redirect resources toward activities that are the most in demand. However the public sector which has no such mechanism tends to accumulate the useless baggage of organizations who have served their purpose and who now are directed at self-perpetuation.
3.4 RECOMMENDATION: REVIEW ALL PUBLIC AGENCIES FOR USEFULNESS - We need to review the objectives and operation of all public agencies to identify both duplication of effort and unnecessary effort. We then need to vigorously prune the dead wood of useless agencies and merge agencies that needlessly duplicate function.
Free market competition can only exist when the competitors are of roughly equal size. While there are economies of scale, there are also diseconomies of scale due to bureaucracy and loss of innovation. Most political power structures grow well beyond the free market optimum size to obtain control over the market.
3.5 RECOMMENDATION: REVIEW POLITICAL POWER STRUCTURE SIZE IMBALANCES - We need to examine the size of all political power structures in American society and determine whether size imbalances exist which significantly affect free market competition. Where such size imbalances are found, society needs to divide these power structures to restore free market competition and enhance the climate for innovation.
The synergism between social rules and human behavior is such a strong force in human development because humanity is both thoroughly social as a species and incredibly independent as individuals. On a positive note, human independence is the motivation for both innovation and the vast array of political power structures that efficiently perform specialized functions in human society. Unfortunately human independence undermines the altruistic glue that directs individual behavior toward the broader social interest. Therefore the prosperity of human society depends on the successful implementation of "the rule of law". When properly formulated the rule of law discourages individuals from behaving contrary to the broader human social interest. However when improperly applied, the rule of law can actually facilitate anti-social acts of individual self-interest either by failing to address certain acts of theft or by providing the mantle of law to actually support those acts.
The corruption of the rule of law and the legalized theft this corruption supports is a fundamental roadblock to our American Renaissance. Corruption of the rule of law has been an integral part of human self-predation throughout history. This phenomena was well understood by the founders of America and their understanding helped guide the early history of our republic. Therefore we need to better understand the factors contributing to the pervasive corruption of the rule of law in modern American society. I believe the corruption of the rule of law in America has at least three sources: 1) An overly idealistic view of the nature of man 2) the complexity of modern society and 3) a decline in American self-reliance leading to an excessive dependence on central authority.
The relative isolation of America and our success at forging a reasonably tranquil society from many diverse interests have given us an overly optimistic and somewhat naive perspective of human nature. We can read about the strife in Northern Ireland, the genocide in Cambodia and the atrocities in Yugoslavia, but we can not really appreciate their significance. Even the periodic riots in America's inner cities seem somewhat unreal to us. Our emotional isolation is a strength because it permits America to pursue human ideals that would not even be considered in other countries. However our detached perspective is also a dangerous weakness if it causes us to misjudge the self-directed nature of our species. Allowing Doctors to regulate society's interests in medicine, lawyers to regulate society's interests in law and commercial interests to regulate society's interests in business is hopelessly naive for the present state of human development even in America.
Secondly the increasing complexity of modern life has been a strong factor in the decline of popular participation in the direction of the rules of American society. The explosion of knowledge in both the sciences and the social sciences and their complicated interactions in modern society leave the average citizen with a feeling of inadequacy. The political apathy we see in America is due at least in part to the intimidating complexity of modern life. Unfortunately the catatonic withdrawal of American citizens from the political process has left a power vacuum which is being filled by those who would distort the rules of society for their own profit at our expense. The solution to this dilemma is known to every successful CEO in America. The CEO delegates the daily decisions to the experts (i.e. our elected representatives), but the CEO stays in the picture to make the major long term policy decisions. Extension of the popular initiative process to the national level with decisions requiring a super-majority vote is the best way to restore citizen oversight to the long term direction of American society.
Third the most ominous factor contributing to the present corruption of the American political process is the decline in the level of self-reliance of the American people. Self-reliance and the spirit of individualism are essential both to the process of political democracy and to the processes of social and technical innovation that a free society promotes. Unfortunately both our evolution as biological power structures and our continued evolution as social power structures drive us toward a centralized command and control structure. The compelling preference of living power structures for strong central authority can be observed from the "top dog" behavior of wolves and domesticated dogs and to the kings and emperors of early human history.
The survival of self-reliance in America can only be achieved by social structures that allow individual Americans to control and direct their own lives. The most important factor in the success of the American revolution was the superior degree of independence and self-reliance of the American people. This self-reliant attitude was not a fluke of nature but a direct result of the social environment of frontier life in the American colonies. The American frontier and its magnetic effect on risk taking immigrants from around the world continually nurtured a self-reliant attitude in the American character. The closing of the American frontier in the 19th century and the maybe not so coincidental growth of centralized authority (big companies, big government, big unions, big corporate farms, big cities and pervasive national organizations ) in the 20th century have I fear done major damage to the sense of self-reliance in the American spirit. We can not endure as a nation of independent and self-reliant individuals if we continue to live in a social structure that requires us to forfeit control of our daily lives to central authority. Since the option of a beneficial dictatorship is neither possible in human society (due to the diversity and lack of altruism of humanity) nor desirable (due to the loss of innovation which would truncate the ascent of man), we must act to reduce the level of central authority to preserve the American dream for ourselves, our children and for all humanity.