The Roots and Impact of Libertarianism

(9-20-2014 Edition)

The proponents of Libertarianism will all tell you they are for individualism, personal liberty, and political freedom. They say that because that sounds good to us. After all, who would be against individualism, personal liberty, and political freedom?

However, as you will see, the agenda of Libertarians is actually about gaining and maintaining the freedom of the wealthy to use their money to rule, and it’s not about what’s good for the vast majority of us. It is good for the wealthiest few, and detrimental to the majority.

Of course, the term Libertarian is used by many people in many different ways. In fact, some socialist intellectuals have argued that the term "Libertarianism" is a synonym for anarchistic socialist action. But, on the other hand, conservative Republican Barry Goldwater's presidential campaign platform was Libertarian oriented, as was Ronald Reagan’s. So, for the purposes of this article, the term Libertarian is a Reaganite right-wing ideology that espouses a Hamiltonian “Christian Meritocracy” that is against government regulation and taxes but supports what they call a “free market” (meaning without government regulation or oversight).

The key to understanding modern Libertarianism is that it arose in America in response to President Franklin D. Roosevelt’s New Deal politics and programs of the 1930s and 1940s, because Roosevelt was hated by very rich Republicans and Libertarians who called Roosevelt a “traitor to his class.” Some even accused him of being a “socialist” —  a tactic often used by conservative extremists against liberal progressives.

Roosevelt, of course, pulled no punches in his response, and he said: “The liberty of a democracy is not safe if the people tolerate the growth of private [corporate] power to a point where it comes stronger than their democratic state itself. That, in its essence, is fascism – ownership of government by an individual, or by a group.”

But, as you will see, Libertarians hated Democracy and claimed it would destroy Liberty. They still do. And the cruel irony is that, because of the persistent political actions of Libertarians and Republican extremists since the 1940s, we now have a very divisided sham "Democracy" that has in fact been destroying our Liberty.

That's why we need to understand how this happened, and why we are in this predicament.

Not All Libertarians Have Called Themselves Libertarians

Until recent decades most Libertarians said the were Republicans, as many do today. But it was the first critics of President Roosevelt who began to call themselves “Libertarians,” and they believed strongly in very lax, Laissez Faire government with very limited power, and they opposed President Roosevelt’s New Deal policies because Roosevelt held private banks and corporations accountable and regulated them properly. The "Libertarians" believed that private enterprises should be left to their own devices and be free to do as they pleased.

Today Libertarians are not much different, and, despite what they say in public, most Libertarians are profoundly anti-democratic, as Ronald Reagan was.

Today, of course, some Libertarians, such as the ones at the Koch-founded Cato Institute, insist that Reagan was not a Libertarian. But the history of American conservatism is pretty clear, and most historians and scholars agree that fiscal conservatives and libertarians favor small government, low taxes, limited regulation, and “free enterprise” – which is what Ronald Reagan favored, and what the Koch’s Cato Institute favors – which means they want banks, financial institutions and corporations to be free to operate without government regulations and “interference.”

The relationship between conservatives and libertarians was clear in the 1950s. For example, William F. Buckley Jr., in the first issue of his magazine National Review in 1955 helped make explicit the beliefs of American conservatives. He wrote this about conservative convictions: “It is the job of centralized government (in peacetime) to protect its citizens’ lives, liberty and property. All other activities of government tend to diminish freedom and hamper progress. The growth of government (the dominant social feature of this century) must be fought relentlessly. In this great social conflict of the era, we are, without reservations, on the libertarian side.” And Ronald Reagan agreed with that.

History shows that the modern conservative political movement, combining elements from both traditional conservatism and libertarianism, emerged following World War II but was rooted  political  in reaction to and against Roosevelt’s New Deal. Ronald Reagan was part of that, and he was vehemently against the New Deal, against organized labor, and against all progressive values, and he continued to be throughout his presidency.  And, looking back at how the conservative libertarian movement has evolved from after World War II to modern times, it is undeniable that conservatism and neo-conservatism still tout and defend “free-market” libertarianism.

Furthermore, in defining conservatism, Ronald Reagan said: "If you analyze it I believe the very heart and soul of conservatism is libertarianism.” – Published in 1975 in Reason magazine.


Friedrich A. Hayek

Many Libertarians believe in an old theory concocted in 1944 and written in a book titled The Road to Serfdom by Friedrich A. Hayek (or F. A. Hayek), an Austrian-American aristocratic economist who not only hated Franklin D. Roosevelt’s democratic New Deal. He hated Democracy and democratic government.

Hayek’s theories are still expounded by Libertarians, one of whom recently wrote that: “Under democracy, rulers confiscate the income of productive members of society and redistribute it to various supporters in order to keep themselves in power. ... In order to finance a campaign, a politician must promise to steal (i.e., tax) money from those who earned it and give it to others who have no legal or moral right to it.

If that sounds familiar to you it’s because we heard the same kind of rhetoric from Republican candidates in recent presidential campaigns.

They’ve claimed that government is “taking money out of your pocket and giving it to someone else.” And that expresses a very old Libertarian idea established by someone who hated Democracy and believed that government should NOT promote the general welfare (as the Preamble to the U.S. Constitution declares we should).

Such contradictions are typical in Libertarian logic, because while Libertarians claim to speak for the Founders of America and the Framers of the Constitution, they actually deny what the Founders and Framers actually wrote and intended. In fact, Libertarians who hate Democracy are like the hypocrites who masquerade as Christians and claim to speak for Jesus but simply ignore his core universal message in the Golden Rule.

The tragedy is that modern Libertarians
regard Hayek as a hero. They parrot his words apparently not realizing (or perhaps fully realizing) that those words justify Elitism, Oligarchy, and Plutocracy.

After all, Hayek's explanation of why democracy is inherently perverse is that “the largest group of people whose values are very similar are the people with low standards.”

In Hayek’s mind the average people, the common people, have “low standards.” And that is the mind set of today’s ruling Oligarchy and Plutocracy, which operates on the idea that the wealthy are blessed and deserve to rule, while the poor deserve to be poor -- which is the core tenet of Reaganism and the Reaganite Gospel of Prosperity.

Hayek also wrote: “It seems to be almost a law of human nature that it is easier for people to agree on a negative program -- on the hatred of an enemy, on the envy of those better off than on any positive task."

That elitist mind set is expressed today by all the right-wing politicians and political pundits who claim that the working poor and the poor are merely “envious” and “jealous” of the wealthy who are successful. And they claim that the working poor and the poor deserve to be poor because they are just lazy and not “self-reliant,” as Libertarian Ronald Reagan claimed. 

What Hayek expressed, albeit in very clever language, was the class hatred and bigotry common to aristocrats born in the 19th century. And the fact is that later Libertarians from Robert Welch and Fred Koch to Charles Koch and Ronald Reagan express the same thing, in even more cunning and misleading language.

However, what Hayek, Welch, Koch and Reagan did not understand is that the working poor are the hardest working people in the world. They are as self-reliant as they can be, given the circumstances under which they live, and their standards are the highest in the world – to feed, house and clothe their families, and love one another.

One of the great Founders of America put it well when he wrote: 

Government is instituted for the common good; for the protection, safety, prosperity and happiness of the people; and not for the profit, honor, or private interest of any one man, family, or class of men. Therefore the people alone have an incontestable, unalienable, and indefeasible right to institute government and to reform, alter, or totally change the same, when their protection, safety, prosperity and happiness require.” – John Adams, 1776

Franklin D. Roosevelt, like Thomas Jefferson, understood that. But Roosevelt’s critics did not, and they still don't.

Ayn Rand

Another influential figure who opposed Roosevelt’s New Deal and tout Libertarian ideology was Ayn Rand, an author born in 1905 in Russia. Her wealthy family was financially ruined after the Russian Bolshevik Revolution of 1917, which ushered in Soviet-style Communism. She grew up hating Russian Communism, and she moved to America. Then, when the wealthiest few and the unregulated economic system they had created became so corrupt that it caused an economic collapse in 1929 followed by the Great Depression, Rand simply misunderstood the solutions provided by President Franklin D. Roosevelt’s New Deal, and therefore suspected and feared it.

Ayn Rand’s assumptions and suspicions were a result of her experience in Russia, and because of that she just assumed and feared that Roosevelt’s solutions were the same as the Soviet Socialists. She, like Hayek, feared the New Deal would create dictatorship and rule by an elite, but she ignored the fact that it was rule by a wealthy elite that had cause the economic collapse of 1929, and she failed to recognize the value in Roosevelt’s needed reforms, regulations, safeguards and protections for the people.

Furthermore, since Rand simply hated government control because she had seen what Soviet-style government had done in Russia under Stalin, she supported Laissez Faire government that left capitalism unregulated. She believed it was the only social political economic system that "protected individual rights" and ensured “free enterprise.”

History has proven many times that is not true.

That is obvious just considering the fact that the economic collapses of 1929 and 2008 were similar and were both preceded by lengthy periods of Republican Laissez Faire government that left banks, corporations, financial institutions and industries largely unregulated and provided them with free license to operate as they chose with little or no government oversight, and little or no taxation.

Clearly, those and other instances have always shown that banks and corporations, when left to their own devices, are usually tempted by greed, become corrupt, and exploit and take advantage of people any and every way they can. In fact, that was the case in the 1920s, and it has been the case increasingly since Reaganism infected America.

Private banks, corporations and financial institutions of course like to think — and want us to believe — that they are ethical and trustworthy, and that because they are successful in business and have acquired great wealth, they are entitled to be in control of the country in all the ways that have been made available to them by the three branches of the federal government, which have increasingly served the interests of the wealthiest few.

The problem is that absolute power has corrupted absolutely. Corruption is rampant in America’s government, private banks, corporations, and industries. That’s why they think they are entitled to rule, and they are oblivious to the harm and hardship they have caused the majority.

In spite of that fact, many Libertarians and Republicans still consider Ayn Rand’s book, Atlas Shrugged, (like Hayek’s book The Road to Serfdom) a prophetic work. But Americans who have been told that Hayek and Rand were correct should understand that they were very mistaken in some very crucial ways.

Fortunately, due to the success of Roosevelt's New Deal, early Libertarianism went nowhere in the 1930s and 1940s because the vast majority of the American people loved President Roosevelt for what he had done and was doing. He had reined in the banks, financial institutions and corporations whose greed and corruption had collapsed the economy and caused the Great Depression. He not only put needed regulations and programs in place, he also put millions of poor Americans to work, enabled America to win World War II, and ultimately enabled the middle class to grow large and great. (See the article on Roosevelt's New Deal.)

The John Birch Society and McCarthyism

Unfortunately, by the 1950s,
Libertarianism produced the John Birch Society and McCarthyism, and McCarthyism was a sneaky and deceptive way to attack Roosevelt’s New Deal and sling mud at progressives by accusing them of being socialists or communists.

McCarthyism’s “Red Scare” tactic was much like the tactics used by “Tea Party” members against President Obama. But in the 1950s McCarthy was taken seriously by the Congress in The House Un-American Activities Committee, which was driven by Republican Senators Joseph McCarthy and Richard Nixon. And, at the same time, Screen Actor’s Guild President Ronald Reagan was accusing progressives in Hollywood of being communists. (And by the way, one of those accused by Reagan and the Committee was Frank Capra, the Director of the great movie, It’s a Wonderful Life, starring Jimmy Stewart.)

Unfortunately, McCarthyism and the “Red Scare” tactic worked. The tide and the political pendulum began to swing to the Right, despite the brief successes of President John F. Kennedy. Right-wing extremists in America believed that his domestic agenda was too favorable toward organized labor, African-Americans, women, and other groups that were considered as inferior by certain white males who held much of the wealth and power. They didn’t like “bleeding heart liberals,” who they labeled as socialists or communists.

Within a short period of time John F. Kennedy, Robert F. Kennedy and Martin Luther King, Jr. were assassinated for the same reasons, and by then progressives were devastated. The Democratic Party became deeply divided and split between progressive peace advocates like Eugene McCarthy and conservatives like Hubert Humphrey – which enabled Republican Richard Nixon to become president in 1969.

Because America was actually feeling stunned, confused, and still very divided by all the events and the issues that had been fought over during the 1960s, because Richard Nixon’s presidency ended in disgrace, and because the presidencies of Gerald Ford and Jimmy Carter were negatively affected by things beyond their control, the scene was set for the entrance of Libertarian Republican Ronald Reagan, who had been trying to become president since 1976.

Ronald Reagan

Reagan did not step onto the national stage honestly. In fact, as is explained in the article on Reagan's Real Legacy, he made a secret deal with Iran during his campaign against incumbent President Jimmy Carter, and that secret deal ultimately enabled Reagan to win the election.

Thus Reaganism was established in America, which was and is very compatible with Libertarianism. For as defined by the Libertarian think-tank, The Cato Institute (which was founded by Billionaire Charles Koch), Libertarianism lauds not only what they claim is “freedom and liberty.” They tout something they call "the virtue of production," a term designed to enhance the status of those whose interests they serve — private banks, financial institutions and corporations.

The problem is that they fail to understand what production actually is.

Economics defines what production is, but Libertarianism attempts to narrow it down to fit their right-wing agenda, and to dismiss or ignore those who are essential to the means of production.

In other words, Libertarians want us to believe that “the virtue of production” is demonstrated mainly by “the producers of wealth.” But the fact is that these days nearly 50 percent of corporate profits come from the banking and financial sector and are “produced” merely by the manipulation of money and by making money with money.

That does not really fit the definition of "production." Furthermore, it is difficult to see its "virtue" when that kind of “creation of wealth” does not necessarily lead to the creation of jobs, nor to economic growth. It mainly makes the richest few much richer. By manipulating laws, they’ve managed to manipulate the power of money to serve their own self-interests.

The Libertarian idea of economic production fails to see, or ignores the fact, that economic production is actually the result of many things and many factors -- especially the labor of employees and workers, each of which should be recognized and rewarded fairly, and each of which is a crucial part of the means of production. But instead, Libertarianism and Reaganism devalues workers and employees and belittles their importance to the economy.

In spite of the facts of the matter, Libertarians and other Republican “free-market” advocates who serve corporate interests have refused to see the value of encouraging and rewarding workers as a crucial part of a free market economy. Instead they have treated employees and workers worse and worse, especially during the last three decades since Reaganism took hold. In fact, since the early 1980s they have striven to destroy or denigrate organized labor and discourage and even deny collective bargaining and negotiations between labor and management.

That kind of thinking and ideology is all part of the Reaganite “Gospel of Prosperity,” which touts the well known saying that “God helps those who help themselves.” But the truth is that Reaganism turned Christianity up-side-down by claiming that the rich are blessed by God and the poor deserve their lot because they are just lazy and are not "self-reliant,” as Ronald Reagan claimed.

That’s why Reaganism is still touted by Libertarians and by many other Republicans on the “Religious Right.” And even these days The Cato Institute still says, "Modern libertarians defend the right of productive people to keep what they earn, against a new class of politicians and bureaucrats who would seize their earnings to transfer them to non-producers."

That again reveals a misleading concept of who the producers really are. They want you to believe that the only real producers are those who rake in and wield the money. And that kind of thinking is common among Libertarians and Reaganites who have been pushing these ideas for a long time.

Modern Reaganites and Libertarians

A noticeable example of a Reaganite Republican pushing Reaganism was during the 2012 presidential campaign when Republican Mitt Romney criticized “non-producers” and labeled certain people as an “entitlement class” – which meant people receiving unemployment insurance payments and other federal insurance payments like Social Security (for which we all pay premiums our entire working lives).

Romney demonstrated the kind of distorted Reaganite thinking many people have been misled by. And that is really amazing when you think about it. After all, if there is an entitlement class, it is the wealthiest ten percent of the population who rake in half of the total income of the nation every year. And more specifically, it is the very wealthiest few who hold 95 percent of the nation’s wealth. And it is that entitlement class that apparently feels that their wealth entitles them to rule and make the rules.

And some of them are sticking to their guns and sticking to their story, still thumping their chest, waving the flag and thumping their bible, as Reagan did, still thinking that they can perpetuate Reaganism even though it has proven disastrous to the nation and world.

Why Reaganism Is the Worst Form of Libertarianism

Ronald Reagan brought Libertarianism to a new level because he sold his ideology as being both patriotic and religious, which was why he was able to establish his Gospel of Prosperity with the help of right-wing televangelists Jerry Falwell and Pat Robertson, who were given keys to the White House.

But Reagan was a Libertarian Republican who actually served the interests of banks, corporations and financial institutions. That is why Reagan believed in very limited, Laissez Faire government with little or no regulation of banks, corporations and industry, which he clearly demonstrated when he said in 1989 in his farewell address: "There's a clear cause and effect here that is as neat and predictable as a law of physics: As government expands, liberty contracts."

That is blatantly untrue. But Reagan, like all following Reaganites and Libertarians, believed that private institutions, like big businesses, corporations, industries, banks, religious groups and other private interest groups, were the real providers of our freedom and liberty, not government.

That is also blatantly untrue, because without proper, efficient, well funded central government there has usually been chaos and anarchy, with rule of "Fiefdoms" (local domains ruled by feudal lords or oligarchical groups exercising complete local control). Or, to put it in modern terms, local rule by leaders of corrupt cities and states ruled by local martial law; crooked local governments; and even rule by local criminal warlords, gangs, cartels, mafias, etc., which often operate by paying off the local "legal" authorities.

However, as the Founders of America and the Framers of the Constitution said, a strong central government can and should secure the blessings of freedom and liberty for the people.

In fact, only good central government can do that, by properly regulating business and commerce, establishing and enforcing laws, providing for the common defense and safety of the people, promoting the general welfare, and ensuring domestic tranquility by establishing fairness and justice for all the people.

But, Ronald Reagan was led to believe differently by corporate executives, and he led many Americans to believe differently, because Ronald Reagan said: "Through more and more rules and regulations and confiscatory taxes, the government was taking more of our money, more of our options, and more of our freedom." And that is why many Reaganite Libertarians, Republicans and Tea Party politicians think democratic government, by its very nature, is bad.

Unfortunately, Reaganism was hugely successful because it was sold as being “patriotic and religious,” and many Republicans, Libertarians and “Tea Party” members still use the same corporate-inspired mantras that Ronald Reagan did.

The majority of Americans still do not see that. They do not see that Reaganism infected and still infects America like a giant plague of deception and deceit, which is why greed and corruption are so rampant, and why America is so deeply divided and in conflict.

Their 2014 Agenda

At a recent (2014) secret political action retreat attended by key Republican, Libertarian and Tea Party politicians, Charles Koch and his political strategists presented their agenda for government and society. That agenda includes ending the minimum wage, ending human services programs, ending Social Security, Medicare and Medicaid insurance, ending public education, ending student loans,  ending environmental protections including clean air and water regulations, ending national and state parks, ending regulation of the food production industry, ending regulation of business, corporations, banks and financial institutions, etc.

Leaders of the Republican Party at this retreat expressed their gratitude to the Koch brothers for their financial support and their great investment in Republican politicians (in buying TV ads attacking Democrats all over the country), and it was made very clear that Republican and Tea Party politicians are very aware that they are in office right now largely because of the campaign funding activity paid for by the Billionaire Kochs for many years, especially since the right-wing Supreme Court’s ruling in “Citizens United” v. FEC which enabled corporations and the wealthiest few to essentially buy elections.

However, what is even more important to realize is that much of the Koch agenda has already been fulfilled. In 1980 David Koch ran for Vice President on a Libertarian agenda, and that agenda has already been fulfilled in many ways, and is well on the way to being fulfilled completely, unless we the people do something about it.

For example, they wanted a “repeal of federal campaign finance laws, and the immediate abolition of the Federal Election Commission.” And the direct result of that was the Citizens' United ruling.

They wanted the abolition of Medicare and Medicaid programs, and the result has been a constant effort by Republicans, Libertarians and Tea Party politicians to either privatize or get rid of those programs.

They opposed any compulsory insurance or tax-supported plan to provide health services, and the result has been the watering down of the Affordable Care Act (“Obamacare”) to make it more profitable for health insurance companies. But they weren’t satisfied with that, and there has been a constant attack on “Obamacare” to get rid of any role for government regarding health care whatsoever.

They oppose all personal and corporate income taxation, including capital gains taxes, and the result has been that many multi-national corporations pay nothing in taxes, and even get millions of dollars in government subsidies.

Those are just a few of the many Libertarian agenda items in 1980, which Ronald Reagan and following Reaganites, Republicans, Libertarians and Tea Party politicians have been fulfilling and are still working on fulfilling – all of which are to the benefit of the wealthiest few and detrimental to the vast majority of Americans..