Though he seems the most business-friendly of the political bunch, Dr. Ron Paul, Republican U.S. Congressman from Texas, is not a true friend of capitalism. Essentially a religious conservative, albeit with a libertarian, laissez-nous faire economic worldview, Dr. Paul is usually on point from a capitalist standard in matters related to the economy, especially fiscal and monetary policies. However, in his most recent speech to political followers and Tea Party activists, not only did he fail to defend capitalism, but he attacked and undercut its base: He slandered big business.
At the Southern Republican Leadership Conference in New Orleans, Louisiana, as blogged today by The Wall Street Journal, Dr. Paul said, “In the technical sense, in the economic definition, he [President Barack Obama] is not a socialist. He’s a corporatist,” meaning, he takes “care of corporations and corporations take over and run the country.”
Now, setting aside for another day whether President Obama is or is not technically a socialist, and whether or not he really takes care of corporations, I simply want to point to the moral meaning behind Dr. Paul’s denunciation in calling anybody a “corporatist.”
Corporations are voluntary associations of individuals who combine their limited financial resources to form a running commercial enterprise with limited liabilities on themselves. Corporations are created, man-made instruments for the purpose of economy of large scale. If economic or economizing activities yield goods and services to support men’s lives, then such productive activities should be deemed morally virtuous. If so, then corporations, voluntarily formed, should be deemed a moral good. Therefore, businessmen who run or work in corporations are to be recognized as heroes, not villains. And in a free society, corporations, being the centers of economic power with zero political power, are the nodes of moral activities for all individuals. So, the term “corporatist” or “corporatism” is an epithet that should be taken with pride and distinction. A capitalist society would be a “corporatist” society.
Yet, this was not how Dr. Paul used the term this afternoon. He used it as a derogatory invective, as an immorality. Being thoroughly educated in Austrian economics, Dr. Paul would never accuse any two-bit ticket scalper, or any price-gouging gas station manager during a shortage, of being a “profiteer”; after all, to be driven by the prospect of profit is an economic virtue. But because he is ignorant in a non-divine, rational morality, one operated not by commands but by principles, Dr. Paul could not help himself but see commercial activities, at best, as amoral, and at worse, as immoral. He could not help but conflate economic power with political power. For these reasons, he would readily use “corporatism” as a derogatory term and would condemn anyone of it with seeming moral righteousness.
He is mistaken in the worst possible way. While he is the best political figure in the current crop of politicians, this error eliminates him–so close, and yet so far. For a person is not a defender of capitalism if he is unwilling and unable to defend the morality of corporate-formation.
To be sure, in a mixed economy as ours is, there are concrete cases of so-called “public-private partnerships”; that is, there are cases of socialism in which big private businesses are being coerced by regulatory governing bodies into partnerships to produce certain goods or to provide certain services for the sake of “the society.” Perhaps in some cases, the private firms voluntarily push for industry-wide regulations to force out their competitors by political means instead of by free-market means. But all of these cases are instances of fascism, a clear species of socialism. Conversely, if a government bureaucrat favors a certain industrial policy, or favors a particular corporation over another in an industry, by sheer personal whim, favoring a personal connection over a market-driven relationship, and then to use his political power to make it happen and to move markets; then this is a clear case of cronyism, again another species of socialism.
So if President Obama did do any of the above–and I am, again, setting this investigation aside–but if he did them, then Dr. Paul should have called him out on them, and called him technically as either a fascist or cronyist, or both. But instead, he called the latter by what he thought was a most reprehensible moral term, a “corporatist.” With “friends” like these …
In sullying the morality of corporations, Dr. Paul undercut any moral case he would make to champion full capitalism and limited government in the political arena. When to be called a corporatist is a bad epithet, no one would want to become or aspire to become a businessman, to trade, to deal, to make money, to produce. And to make it even worse, an Obama, is to be seen as the epitome of corporatism. The very term is thus sullied into a package-deal in which the essence of a moral activity is conveniently, deliberately forgotten and is replaced with a misdirected condemnation. Dr. Paul weakened his own argument. Who wins when he condems someone not as a fascist or as a cronyist but as a corporatist? Not big corporations.
For his lack of an enlightened moral code, Dr. Paul’s speech is of the same ilk as Mr. Michael Moore’s facetious “documentary,” his so-called Capitalism: A Love Story. Dr. Paul’s remark affirms once again that a conservative, no matter how free-market-oriented he professes to be, is no true defender of capitalism.