October 13, 2024

By Stephen Stofka

This week’s letter continues my look at the two types of Golden Age voters. Last week’s post was about those who look to the past as more – fill in the blank here. On the TV show All in the Family, Archie Bunker was a comic representation of this type of thinking. The lyrics of the show’s theme song Those Were the Days echoed a nostalgia for an earlier time in American history.

This week’s subject is the second type of voter, those who believe that people can construct a better society. In the extreme, that better society is a utopian Golden Age. Nineteenth century writers called this type of person perfectibilians, who believe that man’s imperfect or corrupt nature can be perfected. They believe that creating institutions and institutional rules which encourage sharing, equality and community can help perfect flawed human nature and improve society. Out with selfishness and exploitation. In with charitable spirit, equity and respect.

Hesiod, the 6^th century BCE Greek poet, recounted the myth of the Isles of the Blessed, islands in the Atlantic where reincarnated people lived in an idyllic state. Thomas More placed his Utopia, published in 1516, on an island off the mainland in the New World. More detailed the institutional practices that sustained this utopian society: a society based on agriculture with small democratic urban areas. There existed a welfare state with no private property, but each household had one or two slaves. More’s acceptance of slavery in his vision of utopia distances a modern reader. And the excess population on this idyllic island? They were shipped off to the mainland. Who made those decisions? More’s utopian vision sounded more like a version of hell.

More’s work was fiction. Some hope and believe that human society can improve toward a utopia that lies in the future. Reformers in the 19^th century, known as Ricardian Socialists, advocated for reforms that they hoped would correct the social ills that emerged or erupted during the Industrial Revolution. These included poorly paid and overworked people crowded into dense urban areas. Children worked long hours and suffered horrible injuries from dangerous machinery. The reformers sought a more equitable system that distributed the surplus of economic activity and trade to worker cooperatives, not capitalists.

John Stuart Mill (1806-1873) Mill favored the idea of worker’s coops and profit sharing rather than Communism, which he thought did not account for individual differences of talent and effort (Roncaglia, 2005, p. 240). More radical reformers known as Utopian Socialists sought the abolition of private property entirely. Robert Owen was a Scottish financier who set up the utopian community of New Harmony, Indiana in 1826 – 1828. It was a kibbutz style working community with no private property and the workers shared profits. Owen believed that if poor workers were productive, they might improve their habits (Heilbroner, 1997, p. 112). The experiment failed and Owens suffered severe financial losses.

Karl Marx (1818 – 1883) was the most prominent of these utopian reformers. Murray Rothbard, an Austrian economist, considered Marx primarily as a millennial Communist. Watch out, big revolution ahead and the purging of the old ways. Then, the new order and a flourishing of human society.  

Flourishing good. Everybody likes flourishing. Revolution and other cataclysms bad. Some voters are resistant to change or reform because existing arrangements suit them. Last November, I wrote about the many subsidies and tax expenditures that benefit some at the expense of others. Improved society? Check. I’m all for that. Lose my subsidy? Get your hand out of my pocket, comrade. In his 1965 book The logic of collective action public goods and the theory of groups, Mancur Olson (2012) argued that people cling to their benefits, especially when the benefits go to a small number of individuals or companies, but the costs are spread out among all taxpayers. Because the cost to each taxpayer is small, there is less incentive to advocate for reform.

In the United States, the reformers of the Progressive Era advocated more practical and less radical reforms that instituted conditions we take for granted today. These included women’s suffrage, more humane working conditions, laws against child labor, and a civil service system based on merit rather than cronyism and corruption. The Sherman Anti-Trust act and other business reforms curbed the power and growth of vertical monopolies (see notes below) like the Standard Oil Company. In 1914, the Federal Trade Commission was established to prevent price fixing and other forms of collusion between businesses that distorted the free market.

Can human nature be reformed? To those who believe that people are inherently corrupt, there is a flaw in the perfectibilian strategy. There will always need to be regulators to constantly monitor human behavior in the marketplace and our shared social spaces. That puts too much concentration of power in the hands of government regulators. Because regulators are people, they will by nature be corrupt, pursing their own self-interests, their inherent drive for control. Who will regulate the regulators? Who will reform the reformers?

The price system promotes a competition between individual self-interests. In a transaction between John and Mary, John’s corruptible nature is pitted against Mary’s corruptible nature. Out of that contest of self-interest, a benefit to both people emerges. This is the marvel of the price system. Unlike the price system, a regulatory system lacks natural checks and balances. Governments can pass a law that induces people to act more charitably, for instance, but government cannot mandate that people be more charitable. Some people have a more charitable spirit than others. On the other hand, the Greek philosopher Aristotle believed that acting in a virtuous manner would promote a more virtuous character. If a government forces people to act more charitably, will they develop a more charitable character?

Two types. Two visions. One looks to the past. One looks to the future. Simple, isn’t it? Unfortunately, many voters have a complicated set of perspectives and tendencies that defies simple analysis. We might be a blend of nostalgic and perfectibilian. Are people inherently corrupt, seeking to serve their own parochial interests rather than the greater good? What do you believe?

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Photo by Joel Filipe on Unsplash

Keywords: progressive, human nature, prices, regulation

Heilbroner, R. L. (1999). The Worldly Philosophers the Lives, Times, and Ideas of the Great Economic Thinkers (7th ed.). New York: Simon and Schuster.

Heilbroner, R. L. (1997). Teachings from the worldly philosophy. New York, NY: Norton & Company.

Olson, M. (2012). The logic of collective action public goods and the theory of groups. Harvard University Press.

Roncaglia, A. (2005). The wealth of ideas: A history of economic thought. Cambridge: Cambridge Univ. Press.

Vertical monopoly: one company owns or controls the various stages of extraction, refining and production, for instance.