The Fading Dream of American Individualism (Part 3 of 3)

Conclusion of previous columns

Herbert Hoover and George W. Bush

History has a way of repeating itself. George W. Bush was the Herbert Hoover of his time. Like Hoover, Bush said that we needed individualism and capitalism, but not ‘too much’ capitalism. Bush was an advocate of what he called ‘compassionate conservatism,’ which was code for stopping short of complete socialism, but continuing the trend of government intervention in the economy.

Bush’s name became associated with laissez-faire capitalism, but in truth he wanted just as much government intervention as most of the Democrats. He agreed with government policies to require the irresponsible lending that brought the financial system to the brink of collapse. After he left office, Bush reportedly said that he wanted to be remembered as Franklin D. Roosevelt, not Herbert Hoover. That’s why he intervened in the economy after the 2008 crash, as any Democrat would have done. In fact, George W. Bush was the Hoover of his time. He found that capitalism and socialism cannot mix, and when the disaster hit, he didn’t know what to do. His successor was more than happy to step in and take a decisive position on the whole issue in unabashed favor of the socialist side.

The difference between 2012 and 1933 is that America is already a heavily regulated, semi-socialist, entitlement transfer-of-wealth state. Back in the 1920s America was more a private economy than a government-controlled one. Today it has reached the 50-50 point and Obama is aggressively (through Congress when he can and otherwise through unilateral regulation) pushing the country well beyond the 50-50 mark. Once most medical care is provided by the government under the influence of Obamacare, America will be more like a Western European democratic socialist state than not. Short of riots in the streets, there’s generally no return from such a system.

Of course, there will be rioting in the streets, in one form or another, once American growth fails to achieve the potential of the previous two centuries. Simply put, if the policies of  Obama and the anti-individualist premises of Herbert Hoover continue, we’ll no longer see a context where each generation of Americans lives better than the last. This is because capitalism (or its next-best cousin, hampered capitalism) is the only system that is capable of delivering this state of affairs that only Americans take for granted.

If You Want Prosperity, Capitalism Must Not be Hampered

In his book, Hoover, makes a fatal mistake; a trap into which both liberals and conservatives routinely fall. He writes, ‘To curb the forces in business which would destroy equality of opportunity and yet to maintain the initiative and creative faculties of our people are the twin objects we must attain.’

What he’s saying is that we must do two things: (1) We must intervene in the economy so that everybody has a ‘fair’ and equal chance (as politicians define it). Yet at the same time, we must, (2) not stifle creativity and inventiveness, qualities which only flourish in a free market. He thinks we can have both. We can’t. The minute government steps in and picks winners and losers is the minute you’re punishing creativity and growth. Why? Because political favor and pull are elevated to just as high a level as economic accomplishment. Remember, in an unregulated market, businesses must please customers. In a hampered or socialist economy, businesses must please government officials.

This is why every time there’s a new regulation, the cost is passed on to the customers. The liberal and socialist reply to this is to condemn companies for wanting to make a profit. Why doesn’t anybody — in either party — condemn government for forcing the costs up in the first place, through regulating? It all stems from this fatal error that government can somehow mandate ‘equality of opportunity.’ That’s not what government can do. Government can only protect private property and equally protect all individuals from the threat of violence, fraud or contract violation. This is plenty, and it’s crucially important to have a government do these things for the survival of not only the economy, but civilization itself.

But government cannot mandate ‘equal opportunity.’ The only way to do this would be for government to make everyone equal. Maybe liberals and socialists like Obama actually believe that everyone is equal in ability, character and talent. But conservatives like Herbert Hoover himself say no such thing is true. If people aren’t equal in talent, skill, character and ambition, then how in the world is government to make them that way? Or how is government to manipulate the environment in such a way to make it happen? It defies nature and everything we know about the facts of reality. Yet it doesn’t stop the government from spending trillions of our dollars every year trying.

If only Herbert Hoover, and the conservatives who followed him, believed what Hoover himself wrote in his book: ‘Our individualism is no middle ground between autocracy —whether of birth, economic or class origin — and socialism. Socialism of different varieties may have something to recommend it as an intellectual stop-look-and-listen sign, more especially for Old World societies. But it contains only destruction to the forces that make progress in our social system. Nor does salvation come by any device for concentration of power, whether political or economic, for both are equally reversions to Old World autocracy in new garments.’

As eloquent as Hoover’s attack on socialism is, in the same breath it undermines his ability to fight it. Why? Because he implies that financial success in a free society is just as much an example of ‘Old World’ autocratic power as the political power of Kings and Commissars. This is the most fatal mistake of all.

Privately owned, and honestly earned money — whether one or a billion dollars — is never an example of unjust power. It’s the result of pleasing customers, at a profit. There’s nothing unfair about this and government does not need to ‘curb’ it!

Herbert Hoover was no different from today’s conservatives. He decried socialism, but he claims that unhampered capitalism is just as bad. He apologizes for the fact that under capitalism, some become wealthy because of their success. Yet he claims to be against socialism and for individual initiative and responsibility.

So long as conservatives keep apologizing, there will be those such as Barack Obama in our own time who will make no apologies, and are more than happy to ‘transform’ us into a society where freedom is nothing more than a distant dream.

‘American Individualism’ by Herbert Hoover. Doubleday, Page & Company, New York, 1922.


Be sure to “friend” Dr. Hurd on Facebook. Search under “Michael Hurd” (Rehoboth Beach DE). Get up-to-the-minute postings, recommended articles and links, and engage in back-and-forth discussion with Dr. Hurd on topics of interest.