Collectivism and America’s Inevitable Collapse
There can be no nation without rule of law. Otherwise right and rights no longer exist, a situation where only those
who control state’s repressive apparatuses can only dictate what is right or legal, legitimate or illegitimate, moral or immoral. If this basis of proper laws, tenets and canons were rooted out by a tyrant who has no authority to govern, then all powers would fall into the hands of looters-by-law and criminals-by-right at the expense of the inalienable rights of the people.
Ayn Rand, Russian-born American philosopher who conceptualized Objectivism, once said that collectivism is the subjugation of the individual to a group— whether to a race, class or state does not matter. According to her, “Collectivism holds that man must be chained to collective action and collective thought for the sake of what is called `the common good.’ Throughout history, no tyrant ever rose to power except on the claim of representing the common good.”
To explain this theory, F.A. Hayek also pointed out the flaws in collectivism. Hayek said that “any collectivist system necessarily depends on one individual (or small group) to make key social and economic decisions.” The first casualty of this collectivist trend is none other than the rule of law, because under this system the whims and caprices of the people in power form part the law of the land more than the will of the people. To wit, Hayek said: “The great aim of the struggle for liberty has been equality before the law.” That no one— the even the highest official of the land— is above the law.
But how can we attain national development with bribery as the rule of the game in both political and corporate arena?
Trading is done nowadays, not by consent and fair competition, but by compulsion and bribery. Money is now flowing to those who deal and broker, not in goods, but in favors. Men now get richer by graft and corruption and by pull than
by work, and the law is silent as to the perpetrators but harsh as to the innocent. We have a system where corruption and dishonesty were being rewarded and honesty becoming self-sacrifice— this scheme will certainly not permit a country to survive as half-property, half-loot.
In his Republic, Plato says tyranny “is not a matter of minor theft and violence, but of wholesale plunder…” He says that “when a man succeeds in robbing the whole body of citizens and reducing them to slavery, they forget these ugly names and call him happy and fortunate, as do all others who hear of his unmitigated wrongdoing.”
From the outset, the government’s portfolio of economic prosperity consists of higher taxes and their efficient collection, more dollar remittances, more foreign investment and more exports.
But what is the real wealth of nations? This query literally moved the motor of the world when answered by a group of World Bank environmental economists. In their extraordinary but widely underappreciated report, Where Is The Wealth Of Nations: Measuring Capital for the 21st Century, Kirk Hamilton and his team found that “human capital and the value of institutions (as measured by rule of law) constitute the largest share of wealth in virtually all countries.” Their study concludes that there are three kinds of capital: (1) the natural capital (e.g. cropland, pastureland, etc.); (2) the produced capital (e.g. capital, machinery, etc.); and (3) the intangible capital, which “encompasses raw labor; human capital, which includes the sum of a population’s knowledge and skills; and the level of trust in a society and the quality of its formal and informal institutions.”
Hamilton said that the shares of intangible capital across income classes go about 60 percent in low-income countries to 80 percent in high-income countries. “That accords very much with that notion that what really makes countries
wealthy is not the bits and pieces, it’s the brainpower and the institutions that harness that brainpower.” The study also found that “an economy with a very efficient judicial system, clear and enforceable property rights, and an effective and uncorrupt government will produce higher total wealth.” He opined that the rule of law is “partly a question” of efficient legal system, lack of corruption and a degree of transparency.
National development is only possible if the rule of law is observed, that is, when legislation is passed using the rule of law test; when trades, transactions and contracts are done in good faith and obtained only by consent and not by favors and bribery; when justice and education system pertain to the interest of both the nation and the people; when the government sustains free-trade and fair competition without favoring any business entity over another.
Respect for the rule of law, a philosophical foundation on which a free society is based, is the only key to national development. Poverty—the product of this disrespect— is not to be pointed only to our “heartless” politicians, but to the heartless aim of this nation as well.
(Note: This article is taken from my essay titled “Rule of Law: The True Wealth of Nations”)