Equality and Liberty

The issue of the “right” and the “left” always interested me. I am an economist though, and not a political scientist, and therefore I am not the most appropriate person to talk about the political left and right. However I cannot resist the temptation of making some observations which in my opinion are obvious. And these observations are of course open to criticism and corrections.

I believe that we normally speak of political left and right, while we should only speak of economic left and right. I believe that for most people, the expression “extreme right and left”, represents an axis with Communism on the left side and Nazism on the right side. For others, that have spent more time on the subject, the “left” and “right” is examined under a two or even a three dimensional representation, where you have both the political and economic axes put together. The following diagrams are such representations (source Wikipedia). According to them, a point on these diagrams represents a person’s political and economic views.



In my opinion things, and therefore diagrams, should be much simpler. There should only be an economic axis, with socialism on the left side and capitalism on the right side. Actually it does not have to be socialism on the left and capitalism on the right. It could be the other way round, but since we are used to refer to socialism as the “left” and to capitalism as the “right”, it is a good idea to do so.

And I refer to the pure form of socialism, with 100% social ownership of the means of production, and the pure form of capitalism, where the government only ensures the freedom of its citizens. And with “freedom” I mean that the government only ensures that the political and economic rights of its citizens are not violated by any domestic or foreign parties. For instance that nobody forbids them to express their opinion (political freedom), and that nobody steals their property (economic freedom).

Anarchism should not be included in this axis, because it represents a very basic form of social organization. It represents a jungle, and you do not need any form of organization to run a jungle. I am not saying that this is the way that anarchists perceive their political philosophy. I am saying what I think their philosophy really is, in order to explain why I believe that Anarchism is irrelevant to this discussion.

I have noticed that many people that talk about socialism and capitalism do not even realize what these two politico-economic philosophies stand for. They do not realize that socialism stands for equality, and capitalism stands for freedom. And I am convinced that most people do not realize that societies have to choose whether to prioritize freedom or whether to prioritize equality. And they do not realize that, because they are missing a very important fact, which is that equality can only be enforced. A free society will always generate inequality.

Imagine that you split the world in equal and identical pieces of land, and there is no capital. There is only land and nothing else, and all people have to cultivate their own piece of land in order to survive. And you let people free to decide how much to work, and allow them to keep the whole product of their labor. Also assume that there is a robot called “government” that does not allow anybody to steal the products of other citizens, or force other citizens to do something which is against their own will. Very soon this society of equality will be transformed into a very unequal society, since some people will prefer to work more, some people will prefer to save more, some people will be more clever than others etc.

And if you want this society to be a society of equals, you will have to reduce the amount of liberty that these individuals enjoy. For every bit of equality that you want to introduce, there is an exactly equal amount of liberty that must be sacrificed. At the extreme, that is when one wants all citizens to be perfectly equal, one must totally sacrifice liberty i.e. pure socialism with 100% social ownership of the means of production, together with abolition of private property. At the other extreme, you let people free to progress according to the amount of their effort and skills, and you sacrifice equality.

Of course it does not have to be either 100% freedom or 100% equality. There are many combinations in between, and that’s what the economic axis is representing. But this trade off is very important, and people have to keep it in mind when talking about “left” and “right”. Therefore there is no difference between political and economic freedom. They go hand in hand. I do not mean of course that they cannot temporarily deviate. Of course they can. But that is only temporary, and it can happen only during the transition periods.

For instance when Pinochet was introducing free market reforms in Chile, he was very authoritative towards the communists who were opposing such reforms. Or when socialists take power in a relatively free country, they do not socialize the means of production immediately, but they do it gradually. And until socialists manage to transform the free country to a socialist one, the country operates with a relatively free market economy, but with an authoritative (socialist) government.

But as I said such deviations can only occur during the transition periods. In the end the general who believes in the free society will become the victim of his own free market reforms, and the socialists will eventually turn the free society to a society of equals. And let me also give an example to demonstrate how closely related economic and political freedom are.

Imagine a free market economy where the majority of the population is represented by white Christians. And you have a minority of black Muslims. In a free market it will be very difficult for the political system to spread hatred for the black people. Because if I, as a white man, have black people as customers or suppliers, or employees, or associates, and I am happy with them, in the sense that they somehow contribute to my profit, I will perceive them as friends.

Remember that it is individualism that is the building block of a free market and free society. But let’s suppose that somehow the political system introduces some laws against black people i.e. preventing white people from doing business with them. But then a fundamental principle of the free market would be violated. Because by definition in a free market I have the right to choose who my clients are, who my suppliers are, and who my employees are. If there are any restrictions preventing me from choosing who my employees, who my suppliers and who my customers are, then there is no free market and free choice. Therefore economic and political freedom are inseparable, in exactly the same way that equality and authoritarianism are inseparable. Actually political freedom is only a subset of economic freedom. Economic freedom means that you have the right to do business with a jew, with a black person, with a muslim etc.

Therefore political freedom do not need to be included in the diagrams which are used to describe a person’s economic and political philosophy, because it is already included in economic freedom. I therefore believe that one needs only to talk about economic freedom or economic equality. There is actually no need to write socialism and capitalism at the two sides of the axis. You can simply write the words “freedom” and “equality” and choose a point on this axis. Or maybe use the words “liberty” and “equality”.


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