From the Easy Chair

Defining Capitalism and Communism

Professor: Dr. R.J. Rushdoony

Subject: Conversations, Panels and Sermons

Lesson: 41-214

Genre: Speech

Track:

Dictation Name: RR161AV87

Year: 1980s and 1990s

Dr. R. J. Rushdoony, RR161AV87, Defining Capitalism and Communism from the Easy Chair, excellent colloquies on various subjects.

[Rushdoony] This is R. J. Rushdoony, Easy Chair number 203, September 25, 1989.

This evening Otto Scott and I are going to discuss, first of all, Capitalism and Communism.

We are grateful to some of you who have written in off and on suggesting this and we finally decided it was time we did. It is a very important subject. One of our problems today that we face in every sphere is that definition has become difficult. People war against definitions, because a definition puts a line between one thing and another. It says black is black and white is white. And definitions are not wanted in a time of Relativism, in a time of Existentialism. So defining these things, Communism and Capitalism is not agreeable to the modern mind.

I would like to add, also, that in defining Capitalism we have further problems, because Capitalism is one thing and Capitalists are another. We have hundreds of Capitalists in Moscow who are doing everything they can to establish business relations with the Soviet Union even as we have had countless numbers also in Red China. These men may be Capitalists in that they head up capitalistic enterprises in this country, but they are, in essence, Socialists. They have no commitment to any creed except profit. And as a result they are very often the poorest champions of Capitalism when it comes to expounding what it means.

Before we get into some of the precise definition, I would like to ask Otto to make some general comments, too, as a prelude to a study of this subject.

[Scott] I agree with you that they are not Capitalists. You are talking about some of the CEOs of our larger corporations who have been trying to do business or set up a negotiations to do business, partnership with the Soviet Union or with the Communist China and so forth.

In a European sense, these are mainly Social Democrats.

[Rushdoony] Yes.

[Scott] And we have here a problem that Dwight Murphy, Dr. Murphy pointed out in his wonderful quartet on some of these subjects is that we have all sorts of Socialists in the United States who do not call them Socialists. They call themselves liberals. Liberalism in the United States is absolute Socialism. But they escape the illness of being Socialists by calling themselves Liberals. And they are extremely liberal toward Communists who have, by definition are anti Capitalists.

So this ... we have, as you pointed out, we have a problem with definitions in this country because we do not use the classic definitions. They have been distorted. A classic 19th century or earlier Liberal in this country cannot describe himself. He is called a conservative or radical right because the title ... the world Liberal has been stolen by Socialists who are masquerading as Democrats or democratic minded persons. So we are here... here in a semantic jungle which makes all the descriptions of these areas extremely difficult.

[Rushdoony] Yes. Now let’s try defining each of these separately and then, perhaps, draw contrasts. First of all, how would you define Communism, Socialism, Social Democracy, the welfare state, all these things which are essentially variations of the same thing?

[Scott] Oh, Communism I would define as the total ownership by the government of everything including the people.

[Rushdoony] Yes, very good.

[Scott] Socialism, as it is described and not as it may be in reality, is described as the state ownership of the means of production. That is all the tools by which we use to produce things, not necessarily the people.

[Rushdoony] But it can include the tools of living, like housing.

[Scott] Well, if you take all the tools of earning a living away from the people, then they are just as much an instrument of the government as if they are under Communists.

[Rushdoony] Yes.

[Scott] But they have a softer term for it. They call it Socialism. Somebody asked me this at the CMR meeting. I said, “Kerensky was a Socialist.” And I said, “Kerensky was the first man to introduce violence after the Czar left Russia. He put his parliamentary opposition in prison.”

Well, then he said, “You don’t think he was really a Socialist?”

I said, “Yes, he was a Socialist, because the Socialists are the people who protect us from Communism by bringing us closer to it.”

[Rushdoony] Yes. Once the czar left power, not Russia, Kerensky was hard on the right and soft on the left which was a clear indication of where he stood on things.

[Scott] And he had the soldiers come in and put the old monarchists members of the Duma into prison.

[Rushdoony] Yes.

[Scott] He introduced violence.

[Rushdoony] Yes.

[Scott] Lenin introduced more violence against him, so he left disguised as a woman, which was very fitting.

[Rushdoony] And was ready to return more or less kept his things almost packed expecting them to call him back as the great expert.

[Scott] The thing that always amused me was that he moved into the czar’s apartment with his mistress in the name of the people.

[Rushdoony] Yes. Most of your Socialist leaders have lived better than kings and czars of the past.

[Scott] Well, then we go back into the Social Democrat. What is a Social Democrat? Social Democrat in the... at least as they describe themselves, were Socialists who wanted to be voted into power.

[Rushdoony] Yes. They wanted everything by peaceful means, but usually when they got into power they regarded the right as potentially violent so they used coercion.

[Scott] There is now way to have Socialism without compulsion.

[Rushdoony] That is right.

[Scott] Because it is against the instincts of the people. To take a man’s... to take away the fruits of one’s labor is essentially robbery. {?} Was correct about that.

[Rushdoony] Yes. I think we need to add one more thing to our definition of Communism. Disguised Socialism, which is variously Fascism and National Socialism or Nazism in such forms what you have is an evasion of the central issue, namely state ownership of property. So what they do is to allow title to remain in your hands, but then they tax it, they control it, they regulate it so that if you are the actual owner you have very little say so about anything. And Mussolini was very astute. He recognized that the people would never buy Communism in Italy. So he was going to give them their Socialism with another name. And Fascism is actually what we have in the United States today.

[Scott] That is true. And... and to bring up Mussolini is appropriate because he is the father of the system.

[Rushdoony] Yes.

[Scott] The Fasces, as you know, were the sheaves, the group of arrows. One arrow could break, but if you put the bundle of arrows together then, of course, there became almost impregnable. You couldn’t break them. And Hitler, building upon Mussolini’s system stressed, to a greater extent than Mussolini, because he had, I think, a more disciplined population, the fact that every person owed to the community everything. The community which classically we call the state, but really we will say here the community and the government, you owe the government, you owe your country everything. All your property and all your effort and by carrying this to an insane degree, you then have a totally regulated society for the greater good.

[Rushdoony] Yes.

[Scott] That was the rationale. Always for the greater good.

[Rushdoony] Yes. I believe both the Republicans and Democrats in this country are on the whole fascistic in their platforms and philosophies.

[Scott] Well, the... we have the regulated society.

[Rushdoony] Yes.

[Scott] ... today. This is what I have come to call it personally in my mind, a regulated society. Because if something occurs, one of the arguments against having it occur again is that it is an unregulated area.

[Rushdoony] Yes.

[Scott] And this is an area that needs regulation. What ... who is going to be responsible for seeing that this dreadful accident doesn’t recur? So then you have a whole series of regulated areas. Now in both instances, in the instance of the Soviets, you know, the word Soviet means in Russian committee. So it is the committee form of government that they claim they have. You had the Duma organized into committees and every profession was to be monitored and governed by its leading specialists. The same thing in Germany. The Reichstag was in charge of everything. Same thing in Italy. And, of course, in those instances they personalized the government by a single person, an individual, a Stalin, Mussolini, Hitler. We have it without the personalization.

[Rushdoony] Yes. You mentioned the Soviets. So very, very interesting aspect of that system is that it did not come from Marx. Karl Marx expected paradise to begin the moment you overthrew the Capitalists. So it was going to be instant paradise.

[Scott] It was almost like an African independence.

[Rushdoony] Yes.

[Scott] I think... I... I think black Africa thought independence meant you got so much money.

[Rushdoony] Yes. Well, there was one American Socialist, Daniel De Leon, who was the only one who thought of what comes after the revolution. And he developed this committee structure in his writings and it was borrowed by Lenin and Trotsky without any credit, because they had no idea what to do. It was going to be instant Utopia. And when everything fell apart and hunger and famine developed, their Soviets, committees which they had begun to realize they had to have somehow in the earliest days were expanded and extended to control the whole country.

[Scott] Well, now look at the way it has developed here. It is a very interesting development here. First of all, beginning under Theodore Roosevelt, perhaps even a little bit earlier, certain agencies were created by Congress to oversee certain areas of activity, like the railroad commission, the ICC, Interstate Commerce Committee which oversaw the railroads and saw to it that they didn’t have excess profits and all that. Gradually one by one congress has created these agencies. Now each of the agencies has got a charter to govern a whole area of activity and the agency operating under congressional law has made a bunch of regulations, all kinds of regulations regarding the proper conduct of the area that they supervise. If you break one of those regulations and they discover it, they can fine you or they can close you down. If you appeal, you have to go to the courts that are set up inside the agency, because each agency has an inspector general and each agency has its own court system.

[Rushdoony] Yes.

[Scott] So it enacts legislation. It manages legislation and it adjudicates legislation. Only after you get through that baffle, if you are no longer... if you are still alive and... and haven’t run out of money or time, are you allowed to go into a federal court. Now we have created so many of those agencies that if you get into trouble with an agency, then, of course, you appeal to your Congressman. Your Congressman then intervenes and depending on who you are and what you have done for him and so forth and so on, you may or may not get decent treatment. This, of course, opens the gate to corruption.

[Rushdoony] Yes.

[Scott] But it also opens up the gates and as long, long ago to monitoring every activity in the country while the façade of the tri-partite government remains intact.

[Rushdoony] Yes. Well, you mentioned Theodore Roosevelt. The interesting thing is that Roosevelt introduced into national thinking something which previously only a few alien Socialists who couldn’t speak much English were talking about, namely the supposed conflict between property and people. And Theodore Roosevelt who was basically an American rabble rouser, who loved to pick up some ideas that he could bring the changes on, picked that idea up. And ever since it has been with us in politics, as though property, as such, constituted an entrenched evil in the United States.

[Scott] Well, they made property abstract.

[Rushdoony] Yes.

[Scott] If... if you say a person’s home or their clothes or their shoes that gets it closer to what property actually consists of.

[Rushdoony] Yes. And people are fools because they believe that if you attack something when the wealthy have it then you are improving your status, but if the wealthy man is liable, ultimately you are.

[Scott] Well, what does... good does it do you if a wealthy man goes broke? It doesn’t put any money in you pocket.

[Rushdoony] Yes. When the income tax amendment was ratified one man in Congress stood up and said, “What if they start taxing all of us?”

And he was laughed down. It was for millionaires only.

[Scott] He said that it might even go as high as 10 percent. And they said, well, no, that is lunacy.

[Rushdoony] Yes.

[Scott] The people would never permit it.

[Rushdoony] Yes.

[Scott] Now they overestimated the people.

[Rushdoony] Yes. They forgot that by using envy you can get people to pass laws to hurt someone else even if it hurts you.

[Scott] Well, that is the essence of envy.

[Rushdoony] Yes.

[Scott] Even if it hurts you, it matters not if the other fellow is hurt. That is hatred.

[Rushdoony] Yes.

[Scott] Hatred and envy. Well, the... the matter actually goes back farther. It goes back, ultimately, I suppose, to the Reformation. It took a big jump forward in the French Revolution. In the 1870s... by the 1870s a recent scholar that I read wrote about the rise of authoritarian Socialism in the United States and this was because the more prosperous students went in those days to Europe and mostly to Germany and in Germany imbibed both the higher criticism of the Bible and the idea of scientific Socialism. And, you know, for a long time these people had an almost mystical reverence for the word scientific.

[Rushdoony] Yes. Well, at the time of the Reformation there were various groups who seized power in Munster and elsewhere who believed that total control by the people, the common man was going to usher paradise on earth.

[Scott] You had the levelers.

[Rushdoony] Yes. And, of course you had groups earlier in the Middle Ages who held like beliefs and for a time even Rome itself was in the hands of the radical mob.

[Scott] Well, Rome was a welfare state in the centuries of its decline.

[Rushdoony] Yes.

[Scott] And that, of course, totally destroyed its productivity. And there was less and less to share. Toward the end they got down to rations where there was the greatest amount... greatest amount of food in the ration system to an able bodied man, much less to a woman and much less to a child.

[Rushdoony] And under, I believe, Valentinian, something like 276, they were able to push through a welfare system whereby if you were on welfare your children and your grandchildren automatically got it.

[Scott] Qualified, yeah.

[Rushdoony] Yes. So that it became a hereditary right. And they haled Valentinian as a god that...

[Scott] Well, he was a great benefactor.

[Rushdoony] Yes, but I think they killed him a little later. He had run out of things to promise them.

[Scott] About 10 or 15 years ago in an excavation, not intended to be an excavation in the central part of Italy, they uncovered a whole series of underground chambers that had always been underground chambers. They were quite surprised, because first there was a relatively modest structure at the top and then as they went down they found the subterranean chambers. And they finally found out, by means I am not sure I could understand, that this was a place that was used by the tax collectors, the tax gatherers. They would go in there and they had in there the baths and bedrooms and so forth so they lived fairly well. Then they would put on old clothes and go out and mingle in the people to spot those who were spending more money than they were supposed to have. Then ...or... or just to spot those who were well off. And then they would go back in and come out again in their official garb to collect taxes. And, you know, of course, that the Roman tax system, toward the end meant that you paid the taxes or you were sold to slavery. Men used to kill themselves at the tax season and families used to flee the whole empire and join the pagan tribes.

[Rushdoony] Yes.

[Scott] ... to get away.

[Rushdoony] Yes. Well, we haven’t gotten around to defining Capitalism.

[Scott] Well, let’s try the Capitalist period as a means of definition. In the beginning the results of your efforts were yours to keep and in the 18th century when Capitalism really began to flourish this gave rise to a tremendous spurt of invention and innovation and employment. And, of course, the English went through the pioneering stage where they had women pulling carts of coal and things like that because the pioneering stage is always difficult, but by the middle of the 19th century we had in full growth the greatest leap forward in the human condition in the history of the world and in the United States we were lucky. We were able to take the fruits of England’s pioneer period and apply it without going through the same privations. We stole their technology for textiles and things like that. We also had a very good patent system where you had the monopoly on your patent for 28 years. Some men, of course, were cheated like ... the people who contended with Eli Whitney and the cotton gin, but never... and he never really collected what he should have.

But in any invent a great many inventors became rich. Well, in the middle of the 20th century, our 20th century, I discovered that the patent office no longer believes in patents. All you have is the ability to give licensees. You cannot keep a patent to yourself. It is no longer allowed, because it is considered unfair.

[Rushdoony] Yes.

[Scott] So we abandoned Capitalism some time between the middle of the 19th century and the 20th century.

[Rushdoony] Yes. I would say that the heart of Capitalism is a belief in freedom as the most productive way of life.

[Scott] It is a meritocracy based upon effort and based upon the recognition that whatever you earn you can keep.

[Rushdoony] Yes.

[Scott] That is Capitalism.

[Rushdoony] Yes, that intelligence, hard work and thrift...

[Scott] You don’t have to come from any class.

[Rushdoony] Yes.

[Scott] You don’t have to study under anybody. It is an open field.

[Rushdoony] Yes. And this is why as long as the United States was free in this respect, it was the dream of the world to go to America.

[Scott] It was really the marvel of the world.

[Rushdoony] Yes.

[Scott] The average man turned loose for the first time in history to use his own brain and muscle, however he wanted, as long as it was within the law and didn’t impinge upon the rights of others, a flood of innovation.

[Rushdoony] My father did his university work some few years before World War I and he spent his summers in France and did a little traveling in Germany and Switzerland and so on. And he said that there was a great deal of incomprehension in Europe about the United States, because they could not understand how what they regarded as the dregs of their country came to the United States and became rich and were so successful. And they simply assumed that the gold was there on the ground to be picked...

[Scott] It must be easy.

[Rushdoony] And that it must be easy. Yes.

[Scott] It must be easy. Now it is the same attitude that my father had. Somebody told him that I was back in New York City after I had run away as a boy. He said, “You know your son is here in town and he is working as a journalist.”

And my father said, “How is that possible? He has no credentials.”

[Rushdoony] Yes. That is an old world outlook.

[Scott] That was his outlook.

[Rushdoony] Yes.

[Scott] And now this is the American outlook, because they say, “Where did he go to school?”

[Rushdoony] Yes. That is true. I can recall talking to an airline captain shortly after World War I and he had a foreign route and he said that everywhere the thing that impressed people when he talked to them was, first, he had a uniform. That was impressive. The uniform with a captain’s hat. And, second, when he talked to them he mentioned the fact that he had a farm in California which he had bought near his in-laws and his father-in-law was running it. I have forgotten the size of it. But to everyone there it seemed like a real estate, a, very considerable estate. And he said the fact that before the war when he had been drafted in the air corps he had a university degree, he had a captain’s hat and he had land, that was all that mattered to them.

[Scott] He had everything.

[Rushdoony] Yes. So they were to respect and honor. They were ready to respect and honor him. But the said if he had gone there in civilian clothing and had not mentioned his degree or his position or his land, it would have been very different.

[Scott] Of course. Well, in the beginning of the Capitalist period in the United States, which, of course, was derivative, because we picked up from the first industrial power, the intellectuals who had lineage and degrees were very upset.

[Rushdoony] Yes.

[Scott] ...people like Emerson didn’t like the new men.

[Rushdoony] No. One of the interesting things to me, Otto, is the fact that because we did not have a past as the European countries did, we had no entrenched aristocracy and nobility, it made a very, very considerable difference in the perspective of people. For a long time in this country if you wanted to retire and you were a very wealthy man, you retired to Europe because there was something dishonorable about being able bodied and not working.

But on the continent things were different. You have probably read professor Hutt, H U T T...

[Scott] Yes, I knew him.

[Rushdoony] Capitalism and the Historians.

[Scott] Yes.

[Rushdoony] How a great deal of the dirt on Capitalists in Queen Victoria’s reign was brought out selectively by the aristocracy in order to damn these upstarts, the Capitalists. And, of course, Karl Marx made heavy use of all that material to prove what inhuman and brutal monsters this new breed had to be. And we have that attitude prevailing as though profit rather than productivity was the main goal.

[Scott] It was a marvelous illustration of the power of propaganda.

[Rushdoony] Yes.

[Scott] Because the fact is from 1790 to 1890 the world made a leap forward, unbelievable proportions in one century and since. The living standard of the entire world has gone up. When the French Revolution began in the 1790s, killing people, killing rich people as a means of improving the world, and the industrial revolution took an upward leap in the same time, the 1790s, from then until now you see skyscrapers all around the world. You see automobiles. You see television. You see all these marvels, all from the industrial revolution and from not any longer the original inspiration of Capitalism, but at least the continuation of it...

[Rushdoony] Yes.

[Scott] ...in... in... in the abstract form of corporate enterprises and so forth. And how people could talk down this advance proves to me the enormous power of words and literature and art when it comes to dominating the minds of the world.

[Rushdoony] Yes. I mentioned at the beginning the difference between Capitalists and Capitalism and how people are called Capitalists today who in the old fashioned sense never would be. In Time magazine for September 25, 1989 on page 54 there is an article cleverly titled, “The Empire Shrinks Back.” And it is about Robert Campot, the Canadian developer and I will quote just a few sentences.

“A one time machinist’s apprentice and a self made real estate tycoon, Campot, 66, borrowed his way to the to shelf of the U. S. retailing industry. He spent 3.6 billion in 1986 to buy the allied group of stores holdings, Brooks Brothers, Bonwit Teller and Jordan Marsh. Last year he won a 6.6 billion dollar bidding war with R. H. Macy for control of Federated Department stores, a costly victory that gained him a crowned jewel for his retailing kingdom, Federated’s glittering 17 store Bloomingdale’s chain. But now Campot is being forced to put Bloomies on the block as his highly leveraged empire begins to crumble. It is crumbling because among other things, he has borrowed and borrowed and borrowed and suddenly he is faced with one billion dollars in annual interest payments.

“So he is going to have to sell more than just Bloomingdales which is now on the market to get out of the hole he has dug for himself.”

Well, here is a speculator who has done nothing but borrow money and profit... make money initially in real estate which has been by playing the inflation game.

[Scott] Of course.

[Rushdoony] No production.

[Scott] Right.

[Rushdoony] No production anywhere along the line. And that I called Capitalism when it isn’t.

[Scott] Well, not in the classic sense.

[Rushdoony] No.

[Scott] But if you notice from Braudel’s The Wheels of Commerce trilogy, I still have your set, by the way, which I have to bring back to you, but I have a set of my own. Time after time Amsterdam, England, now the United States and before them Florence and Genoa in the city states of Italy first became rich by work and then having collected money by work expanded into banking and then from banking expanded into speculation in the name of finance. And by that time they moved into another dimension entirely where they forgot that wealth comes form work.

[Rushdoony] Yes.

[Scott] And wealth became something that you made money out of. Money begets money. That sort of thing. By that time I don’t think we can call this Capitalism.

[Rushdoony] No.

[Scott] There... there is no term for it.

[Rushdoony] Alexander Solzhenitsyn in Warning to the West, July 1975 was talking precisely about that. These so called Capitalists who are really anti Capitalists.

I would like to quote what he wrote. “But just as we dissidents feel ourselves your allies here, there also exists another alliance. This is the alliance between our Communist leaders and your Capitalists. The clumsy and awkward Soviet economy which could never cope with its difficulties on its own, is continually getting material and technological assistance. And if today the Soviet Union has powerful and military police forces, we have western capital to thank for this. This is something that is almost incomprehensible to the human mid. A burning greed for profit that goes beyond all reason, all self control, all conscience only to get money. Nothing has changed in Communist ideology. The goals are the same as they were. The whole existence of our slave owners from beginning to end relies on western economic assistance. The forces of the entire Soviet economy are concentrated on war. So indirectly you are helping their military preparations. You are helping the Soviet police state,” unquote.

[Scott] Well, here we come back to the departure from reality involved in the pursuit of wealth as separate from manufacturing or creating things from the source of wealth which is the earth. Carries these men into a totally different dimension where—and I have noticed this in the men that I interviewed who were financially sophisticated. They look at human beings as pawns in the game, as factors, not as persons. It is a question of how... what are the assets? What are the sum total of the assets? How much in terms of Chinese money? Orin Atkins used to say, “What does their stock cost?”

Now Amsterdam and the tulip craze, you remember.

[Rushdoony] Yes.

[Scott] When the tulip bulb was given a monetary value and they went up and up and up into astronomical sums. When the... when the crash came reality came in. Of course, people lost homes. They lost everything they had, because it was a speculation. In that sense, a stock in Wall Street is not regarded as how much money does it make. It is regarded as how popular is it. The main thing is if you can persuade people that a company is a moving company and is coming on...

[Rushdoony] Yes.

[Scott] ...it is going to do well, you get a lot of betters on that stock and the more people who buy the stock, the higher the price goes up. And then some stocks go straight up into the blue sky. The smart fellow says, “Well, this is irrational,” and he gets out.

The Tokyo stock exchange is in the midst of that sort of fever. They might as well be ...

[Rushdoony] Yes.

[Scott] ... exchanging tulip bulbs, because their stock prices have gone all beyond any sense of reality. And our financial structure has long ago departed from reality. They can supply the ... the money and the access to the IMF. They are talking now, you know, of making this most favored nation agreement with the Soviet Union.

[Rushdoony] Yes.

[Scott] Allowing it into the IMF, the export import bank and so forth and so on, integrating its economy into the economy of the West if they will put a gold backing behind the ruble.

Well, of course, between South Africa and Russia they have almost all the gold in the world. They would be the only people who could afford to do such a thing. How long would they keep the promise? That is somebody nobody asks.

[Rushdoony] Yes.

[Scott] But we are dealing here with a abandonment of reality. And there are no words for this particular phase, no ... no term covers it.

[Rushdoony] Is episode with regard to Campot, borrowing and borrowing and the banks lending and lending until he has one billion a year in interest alone to pay and the thing begins to crumble, is not unusual. I have been citing to Dorothy incidents that resemble this, not quite as large. One well known American figure who from almost nothing has reached the point where now he is one of the biggest men in the country, recently bought something and took over 950 million dollars in debts.

[Scott] Yes.

[Rushdoony] And there is no way what he bought will ever earn that.

[Scott] Well, then, of course, he has to go the pawn shop.

[Rushdoony] Yes.

[Scott] And he has to start hocking some of the assets that he has... he has gotten... gone broke to obtain. And the same way that anybody else would

[Rushdoony] Well.

[Scott] And, of course, the figures are hard to keep in... in view, because we only see pieces of the pattern. General Motors, for instance, makes 75 billion dollars a year. And it is very difficult for both you and me, I believe, to keep track of what inflation has done to the ... to these figures.

[Rushdoony] Yes.

[Scott] I mean, when ball players get a couple of a million dollars a year, when Barbara Wawa, you remember when she first got a million dollars a year? Everyone said that is wow. Well, now that is commonplace. Dan Rather gets four million dollars a year, a year. Well, of course, the dollar... the dollar doesn’t mean... I even see in the paper where a strong dollar is a bad thing.

[Rushdoony] Yes.

[Scott] Do these people know what they are saying?

[Rushdoony] Well, the whole thing has departed from reality. It is not Capitalism.

[Scott] No, it is something else.

[Rushdoony] Yes.

[Scott] It is something else. Just... and this happened in Milan and it happened in Genoa and it happened in Amsterdam and it happened in London and it happened in New York. And these bubbles break.

[Rushdoony] Yes.

[Scott] And then there is the dickens to pay, as they say.

[Rushdoony] Well, I think there is another aspect to this and there is so much here that it is difficult to cover it all, but fundamental to Socialism in all its forms, Fascism, Nazism, Communism, Social Democrats and so on is a belief in the benevolence of the state. The state replaces God as the source of goodness and justice and more.

[Scott] Well, that is where you get your regulation. The idea is that and a power which is presumably operating on behalf of all is inherently better than... what Woodrow Wilson used to call selfish interests of the individual. He was very strong against other men having selfish interests. And he exempted himself from that particular vice, of course.

[Rushdoony] Yes, he did.

[Scott] Just as most of our Socialist Liberals consider themselves operating on a more ethical basis than anyone else.

[Rushdoony] Well, I think as against this Socialist leaf in the inescapable benevolence of the state, you can contrast the fact that Adam Smith in The Wealth of Nations felt that it was dangerous and, in fact, should be prohibited that Capitalists should get together, because he said, “Men,” putting it in theological terms, “Men being sinners you let manufacturers together and they are going to set prices and work against the consumer.” And the same with unions. He was against any kind of associations like that that could come together to establish a particular interest against the people.

[Scott] Well, we are seeing this in a different form in the United States. The trade union is one thing. Corporations are something else. But nobody talks about ethnic networks. And we have ethnics.

[Rushdoony] Yes.

[Scott] And they are invidious to a democracy, because it means that other people who are not part of that ethnic network are up against a secret combination of interests that are not visible on the surface.

[Rushdoony] Yes. That is a very good point. Adam Smith didn’t bring it up because it didn’t exist.

[Scott] Because they were all the... they were homogenous.

[Rushdoony] Yes.

[Scott] ...in his day.

[Rushdoony] But the implication of Adam Smith’s perspective was that special interests should not work together in the marketplace.

[Scott] Well...

[Rushdoony] That it would work against the interests of the majority.

[Scott] Well, this comes into the business of insider trading. The Wall Street Journal is very strong in editorializes consistently against applying any laws against insider trading, because they feel that this is, for some reason or another, very bad. But I think if you are dealing with a ... network that is deploy involved in the market that is exchanging information that is not available to others, that you are dealing with... in a card game where somebody has got marked cards and you don’t.

[Rushdoony] Yes. Well, we have networks in congress, for example, the black caucus. If you had a white caucus there would be trouble.

[Scott] Well, indeed. The black caucus would be out voted if we had a white caucus.

[Rushdoony] Well, the doctrine of original sin was back of Adam Smith’s thinking because he was a Scot.

[Scott] He was a moral philosopher.

[Rushdoony] Yes. And he recognized that when people get together they do things they won’t do individually.

[Scott] Well, that its true. And it is also true. It becomes increasingly evident as we discuss this that our language has not kept up with events. We are using very old words which no longer truly apply. The left and the right, for instance, inherited from the French Revolution no longer applies. You can hardly... you don’t know anybody that is all left or all right and neither do I. Everyone now has got a whole conjury of opinions which cannot be placed in these categories anymore.

Although a liberal always assumes if he finds that I don’t share his views that I am a racist and a bigot.

[Rushdoony] Yes.

[Scott] It doesn’t necessarily follow.

[Rushdoony] No.

[Scott] He is... he is caught in the stereotype of the other fellow.

[Rushdoony] Well, I think speaking of stereotypes and all, last Friday’s column by Ellen Goodman was a classic, because she was mourning the tragedy of Barney Frank.

[Scott] Well, it is a tragedy, but she wasn’t mourning the proper tragedy, I gather.

[Rushdoony] Right. A congressman involved with a homosexual prostitute and his usefulness dimmed, a great man, because these nasty people, the religious right and others like them will use this to hurt the truly repentant, great man.

[Scott] Well, the man is not the proper word. And a lot of preachers no longer serve the name of woman. We have to come up with new terms for these strange individuals.

[Rushdoony] Yes.

[Scott] These inverts so that they get their proper recognition.

[Rushdoony] Biological contradictions.

[Scott] They really are.

[Rushdoony] Poor Jeffrey...

[multiple voices]

[Scott] He said they were biologically insane.

[Rushdoony] Yes, biologically insane. And I think that is...

[Scott] It is the only time that Gore Vidal was ever shut up in mid voice.

[Rushdoony] Only time he saw himself for what he was.

[Scott] But we have, as you say, there are no Capitalists. The word isn’t even used anymore. The only people who use the word are the propagandists of the Soviet Union.

[Rushdoony] Yes.

[Scott] ...and China and Cuba and so forth. They call us Capitalists. But the modern euphemism is a mixed economy.

[Rushdoony] Well, a very remarkable man, Fred {?}, said that Socialism was virtually inescapable short of a radical, moral change in the people once your economy became an interventionist one. When the state began to intervene, he said, interventionism can only go in one direction. It requires more and more controls until you have total controls. A regulated society cannot stay partly regulated. This is why now the goal is to regulate the Church as well as the family. Regulations must go to the ultimate, total.

[Scott] Well, the {?} I think her name was, who wrote Our Emerging {?} Economy said the first reaction of businessmen to regulation is tolerant outrage, indignation. Then the specialists sit down and estimate how they can live and profit in between the crevices of that regulation. Once they achieve that, they adjust. And once they adjust they become part of a Fascist economy. Now we moving... we are moving a step beyond Fascism. We are moving into an area of which not even the Communists really covered, because Communism as a creed and Socialism as a creed, as an official creed is beginning to lose its luster. It is increasingly difficult to support a system which allows people to starve and which employs slaves. But the economy, the ecology has become a substitute for everything in the name of clean earth, in the name of clean skies, you know, clean air, water and so forth. We are now moving into an area where every living creature can be regulated, every industrial process must be regulated.

Just the other day or last week, as you know, a judge in San Francisco decided to apply all the air pollution regulations which will stop highway construction in northern California completely because he said it is no use having better highways anyway, because it just brings in more polluting automobiles into the city. And he is going to stop all the state, county, local activity until the air gets pure.

Now this is regulation of a sort which nobody has ever dreamed of before.

[Rushdoony] Yes.

Well, {?} was right. Once you intervene, no matter how little the intervention into the economy, step by step you go to Totalitarianism, total regulation. And we are moving very rapidly into it.

[Scott] We are and because it lacks a personal figurehead, like Mussolini or Lenin or Hitler, it is moving anonymously. It is moving through the bureaucracy.

[Rushdoony] Yes

[Scott] It is moving in the name of goodness and this is verifying de Tocqueville’s very dark prediction of the America society.

[Rushdoony] Yes.

[Scott] I have often wondered why de Tocqueville is so often referred to in an admiring term by Americans because I can only assume they haven’t read him.

[Rushdoony] Well, no. I don’t quite agree with that. I think they look at only one side of him. De Tocqueville saw the dangers as clearly as anyone did. But he also recognized that the old order was finished. And he saw the Christianity, not the Church, but Christianity in the United States as the meliorating force.

[Scott] Yes, he did. And he said this is a nation of churches. It is a religious nation. He said and it is a good nation, but he said if it looses its religion it will cease to be a good nation and it will become the most oppressive tyranny the world has ever known.

[Rushdoony] That is right. So he was ready to recognize that in this new age the one possibility of altering the dangers of the modern equalitarian society and redirecting it were in Christianity.

[Scott] Yes.

[Rushdoony] So in that respect what he had to say at times about this country was very, very good. He didn’t know how we were going to do it or how we were going to awaken to the responsibility, but he did point to... to the United States as a society where the equalitarian tendencies in some respects were best exemplified and most threatening in the future, but also where there was a counter trend as well.

[Scott] Well, Dickens, coming along in the 1870s said, “Although I admire and like the Americans, I must say that once they make up their minds on an issue, it takes a very brave man to differ.”

[Rushdoony] Yes, yes. Well our time is about up. Is there a last sentence or two you want to add?

[Scott] I think it would be a lot better if it would be more honest about the socialist nature of Liberalism in the United States.

[Rushdoony] Yes, I agree.

Well, thank you all for listening and God bless you.

[Voice] Authorized by the Chalcedon Foundation. Archived by the Mount Olive Tape Library. Digitized by ChristRules.com.