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There’s No Third Way


If a gunman approaches you on a dark street and demands your money, you naturally prefer not to give it to him. Apparently our political leaders would consider this an unreasonable clash of extremes. The gunman wants your property. You want to keep it. Surely there’s a compromise, a “third way.”

Just ask Bill Clinton, Tony Blair, and the rest of our “allies.” At a panel discussion during the NATO 50th-anniversary celebration in Washington, these leaders sang the praises for a third way between capitalism and socialism. Italian Prime Minister Massimo D’Alema ruined things, though, by mentioning that he was really a socialist. President Clinton responded, revealingly, “I’m not sure I would have you here, Massimo, if I were running for reelection.” (This was described in E.J. Dionne’s Washington Post recent op-ed titled “A World Safe for Socialism.”)

The search for the third way is all the rage in “enlightened” political circles nowadays. But there is as much chance of finding a third way between capitalism and socialism as there is of finding one between the property owner and the gunman. Does the comparison between government and a gunman strike you as outrageous? George Washington didn’t think so. It was our first president who said, “Government is not reason, it is not eloquence-it is force! Like fire it is a dangerous servant and a fearful master.”

Washington was stating what was obvious to his contemporaries. The simple point has been lost in our allegedly more sophisticated times. Anything the government does involves force, beginning with how it gets its revenue. Government action by nature takes from Citizen A and gives to Citizen B. Citizen A is obliged to surrender his property because if he refuses it will be taken by force and he will be jailed. If he tries to defend himself, he may be killed.

Capitalism, by contrast, is based on respect for person and property. In the free market, for an action to be lawful it must eschew the initiation of force. That rules out murder, robbery, rape, and most of the rest of what people properly regard as crimes. All peaceful activities-from bedroom to boardroom-are lawful. That does not mean all peaceful acts are necessarily morally right. The purpose of law is not to enforce morality but to enforce rights. As Lysander Spooner, a 19th-century constitutional scholar, put it, “vices are not crimes.”

If capitalism is peace and government intervention is violence, what’s the third way? A “mixed economy” is possible, of course. But all that means is that the government respects rights on some occasions and violates them on others. The fact remains that in any particular encounter between government and citizen, rights will be either respected or violated. There is no third way.

Advocates of a third way like rhetorical smoke screens. One of its chief spokesmen, British Prime Minister Tony Blair says, “Our position is that enterprise and justice can live together.” What theory of justice is he using? What could be more just than an institutional respect for person and property, that is, capitalism? Blair thinks it’s just for the government to take someone’s earnings without consent and to give them to someone else. That’s the very opposite of justice.

Dionne writes, “Third Wayers accept capitalism as a given but promise to do something about its inequities and uncertainties.” What inequities? Capitalism is the system that leaves you “free to choose” (to use Milton Friedman’s title). Any true inequities would be violations of capitalism’s principles. And what does it mean to “do something about…uncertainties”? To be sure, life is uncertain. But if the government attempts to do something about it beyond protecting person and property, it produces only one certainty: institutionalized violence against its citizens.

We’ve been through a search for a third way once before. Decades ago intellectuals became enamored with what they thought was the true alternative to laissez-faire capitalism and Marxist socialism.

It was called fascism.

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    Sheldon Richman is former vice president and editor at The Future of Freedom Foundation and editor of FFF's monthly journal, Future of Freedom. For 15 years he was editor of The Freeman, published by the Foundation for Economic Education in Irvington, New York. He is the author of FFF's award-winning book Separating School & State: How to Liberate America's Families; Your Money or Your Life: Why We Must Abolish the Income Tax; and Tethered Citizens: Time to Repeal the Welfare State. Calling for the abolition, not the reform, of public schooling. Separating School & State has become a landmark book in both libertarian and educational circles. In his column in the Financial Times, Michael Prowse wrote: "I recommend a subversive tract, Separating School & State by Sheldon Richman of the Cato Institute, a Washington think tank... . I also think that Mr. Richman is right to fear that state education undermines personal responsibility..." Sheldon's articles on economic policy, education, civil liberties, American history, foreign policy, and the Middle East have appeared in the Washington Post, Wall Street Journal, American Scholar, Chicago Tribune, USA Today, Washington Times, The American Conservative, Insight, Cato Policy Report, Journal of Economic Development, The Freeman, The World & I, Reason, Washington Report on Middle East Affairs, Middle East Policy, Liberty magazine, and other publications. He is a contributor to the The Concise Encyclopedia of Economics. A former newspaper reporter and senior editor at the Cato Institute and the Institute for Humane Studies, Sheldon is a graduate of Temple University in Philadelphia. He blogs at Free Association. Send him e-mail.