In the opening four posts of this section of the blog I have constantly referred to the commonly held beliefs of how Britain and the US grew rich as being myths. While individual freedom, enterprise and innovation were definitely part of the story, these factors were not combined with minimal government intervention and free trade. Rather, both countries used protectionism and government intervention to support their nascent industries, and only when these industries were strong enough to compete did they promote free trade. At that point they used a variety of means (including military intervention) to persuade or force other states to accept free trade, such that those states effectively became suppliers of raw materials to the West, while not developing their own manufacturing industry. The very path by which Britain and the US became rich was denied to others.
In parallel with this period of growth in the West, a political and moral philosophy has evolved that feeds the false popular narrative of how we became rich, and justifies the great inequality that has resulted.
Although Western civilisation encompasses many countries and cultures, there must be some unifying aspect to their values and beliefs that makes it meaningful to talk of them as a single civilisation. So that you can consciously challenge what I am about to say, I suggest you ask yourself what these commonalities are before reading further.
I would suggest that the political and moral philosophy that underpins Western civilisation is individualism. I will provide the justification for this statement next week. For now, I want to get to heart of the matter and explain what this philosophy is, and why it matters so much.
In essence, individualism is the philosophy that every individual should be free to do whatever they choose, so long as in exercising this right they do not impinge on the corresponding rights of others. The role of government and the law is first and foremost to preserve these rights of individuals: laws are set primarily to make illegal any action that would impinge on the freedom of others.
The other side of this coin is that the role of government is not to plan interventions to make society better. Society is too complex and government too incompetent to do this effectively, and any such interventions will inevitably limit the above mentioned freedom of the individual. Hence, a concept at the core of individualism is “the sovereignty of the individual”.
It is accepted that there are some activities where government intervention is required, because these cannot be successfully delivered by the uncoordinated efforts of private actors – national defence would be the best example of this, and it is even usually accepted that some level of welfare spending is necessary. But the last few decades have seen a continual erosion of the areas in which government action is recognised to be necessary.
The intimate connection with mainstream economic theory should be obvious. The conclusion of orthodox economics, specifically the neoclassical school of microeconomics, is that the best outcome for society is achieved if individuals and businesses make decisions motivated by their own self-interest as consumers in a free market, as free from government intervention and regulation as possible. Meanwhile individualism is arguing that morally, all individuals should be left free to pursue their own self-interest, with government and law being limited to preventing this freedom being impinged by others. Justice is achieved only by allowing society to operate freely in this way.
When societies are allowed to run along these lines, not only does the economic outcome enable the greatest wealth for the greatest number (according to the economic theory), the final distribution of wealth is inherently the most just, rewarding each for their contribution to society. Any intervention by government to redistribute wealth can only do so according to the subjective views of those in power, and is therefore arbitrary. In fact it is free markets, free of government interference, that distribute wealth in the most just way.
The two schools of thought – the ethical-political and the economic – become intertwined into one worldview. Assuming that this is a defining characteristic of Western culture (and I will give the justification for this next week), what impact does this have on society?
We’ll consider this by talking about you. You probably think you’re one of the good guys – most people do. If you’re reading this, then you probably care about social justice in the world, and you also probably have a reasonably advanced level of education.
Let’s assume you’re part of the segment of the population that did well in school (and if you aren’t, pretend that you are for a moment, imagine what it’s like). Maybe you weren’t a high-flier, top of the class, but neither did you ‘fail’ – you got your A Levels, and most likely went on to University.
And as a result, you were able to get a job that pays a decent salary. Or perhaps you’re in one of the many jobs that require a degree education but only pay the national average salary – a teacher or social worker for example – but it’s a living wage, and the job comes with a degree of self-respect.
So now here you are, earning at least enough to get by, albeit maybe always with one eye on your bank balance, but all as a result of your own hard work. And by contrast, you can think of the people you’ve passed along the way. The ‘popular’ or ‘cool’ kids in school, who teased you for getting good grades, or not liking the ‘right’ bands or wearing the latest fashions. Many of them are probably not doing so well as you these days, and that’s what they deserve. Similarly, your dysfunctional noisy neighbours at University, who had a go at you for being a student – you’ve left them far behind now, while they’re stuck in the same miserable place.
All in all, the point is, you deserve what you have. You’re entitled to it. Like the adverts tell you, you have it “because you’re worth it”.
So if someone comes along and says that what you have is a result of some injustice in the world, they must be wrong. Any political or moral viewpoint that suggests you don’t deserve what you’ve earned is clearly flawed and unjust.
And therefore, the flipside of this coin is that any point of view that recognises and confirms that you do, indeed, deserve what you have, is likely to have some merit. Even if you are broadly speaking an egalitarian person, concerned with social justice, there is a limit to how much it is reasonable to expect you to do or to give up to help others. So it’s important to cling to those philosophies that recognise that you did, indeed, earn what you have, and that you do deserve it.
This same rationale applies to our national identities. How did the myths about how Britain and the US grew rich become so dominant? Because those myths are seductive. Because they tell us what we want to hear. Because they tell us we’re the good guys on the global level.
No one wants to hear a different story, and thus the soothing narrative of individualism sucks us in. It cradles us in its arms. It whispers into our ears how special, how deserving, how exceptional we are. It lulls us to sleep at night. You don’t need to agonise about the “less fortunate” in society – the liberal free market will gradually make everyone richer. Any attempts by government to intervene and improve the situation will only make things worse in the long-run because governments are so incompetent. You have what you have because you earned it – other people just aren’t as smart or didn’t work as hard – go to sleep and stop worrying about it.
This post has been markedly different to any other in the blog. I strive to ensure that my posts are rooted in empirically observable facts and then proceed through logical argument. While my histories of how Britain and America became rich a few posts ago are contentious, I would stand by them as being historically accurate (allowing that all the complexity, detail and nuance of these histories can’t really be reduced to a brief blog post). My description of individualism given above can easily be checked against philosophical and political texts.
But my description of the influence of this ideology on Western society is, of course, highly subjective. Having had this mental model presented to you, you can try it out for size. I believe once you become aware of this pattern of behaviour you will start to see it repeatedly: in the operation of politics, in the broad sweep of Western cultural norms, right down to the highly annoying behaviour of all the dysfunctional people you know. Ultimately, if what I am saying is correct, you should be able to see its influence on yourself, if you have the bravery to look closely and honestly enough.
But that’s just my perception. Why have I strayed into the realm of subjective philosophy?
The conclusions reached about the economic system in earlier sections of the blog are so difficult to believe, despite being logical arguments based on empirical facts, because they contradict the commonly held beliefs generated by this hidden ideology. The system of thought becomes a lens through which we understand society, skewing our perception and understanding of economic phenomena. And hence part of the path to creating an economy that provides enough for everyone is to become conscious of this ideology, of its enervating influence, and then seek to understand the economic system through a dispassionate analysis of facts, freed from this distorting lens.
But to get back to fact-based analysis, the analysis in this post rests on the assertion that individualism is a foundational philosophy of Western society, so next week I will present the evidence for this.