Russell Kirk's Economics of the Permanent Things
A Free Market Serves Humane Values
APRIL 01, 1996 by JOHN ATTARIAN
Filed Under : Statism, Free Markets, Private Property, Competition
John Attarian is a freelance writer in Ann Arbor, Michigan.
While Russell Kirk (1918-1994) is properly recognized for his role in reviving American conservative thought, his ruminations on economics have received little attention. Yet he gave economics due consideration, and was a sturdy friend of economic freedom and a foe of statism. Moreover, because he drew on religion, morality, and a comprehensive view of human nature, Dr. Kirk achieved important insights in political economy that a purely economic approach would have missed.
Kirk’s starting point was belief in God and a “belief in an order that is more than human,” which rules both society and individuals. A transcendent God implies that eternal truths exist, that “human nature is a constant, and moral truths are permanent.”
This conviction that certain norms, or enduring moral standards, exist was central to Russell Kirk’s world view; upholding them was his life’s work. These “Permanent Things”—norms of courage, duty, justice, integrity, charity, and so on—owe their existence, and authority, to a higher power than social good.
For Kirk, loyalty to the Permanent Things is the standard for judging individuals, societies, and institutions. “Real progress consists in the movement of mankind toward the understanding of norms, and toward conformity to norms. Real decadence consists in the movement of mankind away from the understanding of norms, and away from obedience to norms.”
One of the central elements of Kirk’s view of human nature was his belief in the tenets of orthodox Christianity. Made in God’s image and likeness but fallen and imperfect, man is a mixture of good and evil. And as a spiritual being, man has deep needs of a spiritual nature. People are inherently restless, and need challenges and adversity to keep them and their love of life keen:
Something in human nature seems to call for the possibility of a real victory in life—and the possibility of a real defeat. Life is enjoyable only because Hope exists: hope for success of one sort or another. And hope for success cannot exist without a corresponding dread of failure. In a very real sense, life is a battle; we never could be happy were it otherwise.
A crucial corollary is that “life without obstacles is boredom, just as life without purposeful work is infinitely dreary,” and wealth “without duties or challenges” spells lifelong unhappiness. “Mankind,” Kirk warned, “can endure anything except boredom.” Without challenges, people turn to mischief and escapes.
Kirk also stressed prudence. Human nature is imperfect, society is complex and reckless, shortsighted policies may not only fail, but produce worse evils than they address. Necessary reforms should be thoughtful and judicious.
Moral Foundations of the Market
These beliefs were the foundation of Kirk’s advocacy of the free-market system. Kirk insisted that economics cannot be separated from morals and character: “material prosperity depends upon moral convictions and moral dealings”—specifically, a high degree of honesty, industry, charity, and fortitude. Intellect, initiative, shrewdness, vigor, and imagination are also crucial. He argued that a free economy is the best economic system for encouraging these characteristics and virtues:
“Ordinary integrity,” Edmund Burke wrote, “must be secured by the ordinary motives to integrity.” Men and women are industrious, thrifty, honest, and ingenious, in economic life, only when they expect to gain certain rewards for being industrious, thrifty, honest, and ingenious . . . the vast majority work principally out of self-interest, to benefit themselves and their families. There is nothing wrong with this state of affairs; it is merely a condition of ordinary human nature. Competition puts a premium on industry, thrift, honesty, and ingeniousness, for the slothful, the spendthrift, the known cheats, and the stupid fall behind in the economic contest of free enterprise.
Like Adam Smith, Kirk held that pursuing self-interest serves the public interest. Moreover, “Industry, thrift, honesty, and ingeniousness deserve concrete rewards. A competitive economy provides these rewards.” He argued that free enterprise is not only useful in rewarding these virtues, but good and just: better than other economic systems, it encourages loyalty to the Permanent Things.
Similarly, Kirk recognized that “Ability is the factor which enables men to lift themselves from savagery to civilization.” Like virtues, ability requires rewards—including material rewards. A society which doesn’t reward ability stagnates.
With keen insight, Kirk argued that free enterprise best suits our nature in another way: its competition provides the struggle against obstacles which true happiness and fulfillment require. Its freedoms and choices, e.g., of occupation, help meet “the fundamental human longing for self-reliance. They make men and women free.”
Morally, too, competition surpasses other systems. If ethical and governed by conscience, competition benefits all:
As Samuel Johnson said once, “A man is seldom more innocently occupied than when he is engaged making money. . . .” Economically and morally, a competitive system is nothing to be ashamed of. On the contrary, it provides for human wants, and respects human freedom, far better than any vague scheme of reliance solely upon altruism, or any system of forced labor. In essence, it is not competition which is ruthless; rather, it is the lack of competition that makes a society ruthless; because in a competitive economy people work voluntarily for decent rewards, while in a non-competitive economy a few harsh masters employ the stick to get the world’s work done.
Private property too received Kirk’s vigorous endorsement. Besides making the argument that private property is essential to freedom, Kirk went much further. Property is a prerequisite of civilization and culture. “Unless property is secure, there can be no civilized life; for without the right to keep what is one’s own, and to add to that if possible, there can be no leisure, no material improvement, no culture worthy of the name.”
Moreover, property fosters right soulcraft; “it is one of the most powerful instruments for teaching men and women responsibility, for providing motives to integrity.”
Finally, Kirk deemed saving a bulwark of freedom, since it gives material independence and security, thereby averting servile dependence on government. In rewarding saving, the market economy promotes freedom.
In sum, Dr. Kirk saw a free economy as the economic system best suited for promoting loyalty to the Permanent Things he cherished. But Kirk’s endorsement of the market sprang not from spiritual and moral truths alone. Its other root was a firm grasp of economic realities. He never forgot Irving Babbitt’s wise admonition that imagination and theorizing should be “disciplined to the facts.”
Like his defense of the free economy, Dr. Kirk’s rejection of statism combined philosophical and economic considerations. Keenly aware of human imperfectibility and reality’s constraints, he categorically rejected all utopian economic schemes. Utopia, he reiterated, means Nowhere. Only incremental improvements in the human condition are possible—and the only real progress is within individual characters and consciences.
Prudence, too, argues powerfully against statism. “Society is not a machine,” Kirk saw, but rather “a delicate growth or essence,” with causality running between economy, society, and culture in complex ways. Prosperity makes a flourishing culture possible; but Rome’s decline shows that government economic mismanagement “may undo a high culture.” Also, “our industrial economy, of all systems man ever created, is that most delicately dependent upon public energy, private virtue, and fertility of imagination.” Hence the need for caution, lest government disrupt the economy and exact unforeseen forfeits. For example, while government cannot create ability, statism can extirpate it. “The thing has been done before.” Better that we not meddle with things we don’t understand.
Furthermore, imperfect people cannot be trusted with much power. Kirk exploded both statists’ moral pretensions and democratic ideologues’ crass error of confusing democracy with liberty:
To say that the “democratic” state would not deprive anyone of liberty is to play upon words. The democratic state, like any other, is directed by individuals, with all the failings to which humanity is heir, especially . . . the lust for power. To suppose that the mass-state would be always just and generous toward its slaves is to suppose that there would exist, upon all its levels, a class of philosopher-kings superior to human frailty, purged of lust and envy and petty ambition. But in modern America we have no such class to draw upon; indeed, often we seem to be doing what we can to abolish that sense of inherent responsibility and high honor which compensates a patriarchal or feudal society for its lack of private liberty.
A command economy is not only unfree, it stifles individual growth: providing for people’s wants and making their choices for them keeps them in “perpetual childhood,” thus discouraging “full development of mind and character.”
Desire for security inspired much of modernity’s drive to statism, but Kirk warned that swapping freedom for security is “a devil’s bargain.” Political freedom, individual rights, and economic freedom stand or fall together. And once the free market’s ordinary rewards for ordinary integrity disappear, economic performance inevitably declines. “In the modern industrial world, it really is not possible to buy economic security at the price of liberty.”
Since productive work is indispensable, and requires material rewards as both incentives and rightful “ordinary rewards for ordinary integrity,” Kirk warned especially against excessive taxation. It not only discourages work but depresses private saving below that needed to replace and increase capital, thus diminishing production. Likewise, overregulation discourages enterprise, investment, and production.
Dr. Kirk was a scathing critic of Social Security. Centralized, compulsory, wielding ever-expanding arbitrary power, it “bears nearly all the marks of a remorseless collectivism.” While acknowledging that some people wouldn’t save on their own, he maintained that it would be better “morally and economically” to let them make their own mistakes and to provide voluntary charity, than to embrace forced saving. He argued that Social Security’s stated motive, provision for the poor elderly, is disingenuous; the real reason for Social Security’s expansion is that it gives the government access to “a vast reserve of money and credit,” and is “disguised taxation,” evading opposition to new taxes. Kirk’s robust moral denunciation of Social Security, as tyrannical and mendacious, towers over today’s conservatives’ ingratiating endorsement and proposals to “save” it.
One great strength of Kirk’s viewpoint is that he spotted pernicious consequences of statism ramifying in directions which economists commonly overlook. Not only is the inheritance tax a confiscatory capital levy, it undermines the natural aristocracy of wealth and noblesse oblige that provides leadership and cultural patronage. “No social institution does more to develop decent leadership and a sense of responsibility than does the inheritance of large properties, and of the duties that accompany those properties.” Furthermore, the inheritance tax weakens the social fabric by damaging the family’s economic base, as “a capital levy discriminating against family enterprises and partnerships” and threatening “dissolution of family farms of any extent.”
Likewise, assessing real property at “speculative current market values—that is, taxing real property at what it might be worth if converted to other uses—has encouraged the destruction of farmland and of farm families in the neighborhoods of growing cities and towns.” It thus abets urban sprawl and the demise of the farm population and the farm family, a bulwark of traditional mores.
Inheritance, capital gains, and progressive income taxation make launching new small businesses out of personal savings, and maintaining existing ones, extremely difficult. Family businesses are forced to incorporate, or sell to large corporations. Such taxation encourages retail consolidation, thereby abetting loss of humane scale in retail trade, uglification of towns as old buildings are razed for less attractive modern ones, and replacement of small businessmen involved in local life with managers of large impersonal corporations.
For Russell Kirk, then, statism was both morally wrong and, in flouting the realities of economics and human nature, destructive. Moreover, its corrosive effects on culture, social life, and character promote “true decadence”—forsaking the Permanent Things.
Order and Liberty
Kirk believed that government has a valid role. Human nature being what it is, “in any tolerable society, order is the first need. Liberty and justice may be established only after order is reasonably secure.” Historically, people used government to establish order. Neither property nor markets can function without it. Property can exist “only when some form of political order ensures that a man may keep what is his own.” Markets require protection against theft and fraud; enforcement of contracts; and reliable weights and measures. “In these and other ways, markets are made possible by political authorities. Otherwise, buyers and sellers could not come together to exchange goods safely. Without political protection, even the most simple market economy would collapse.” (Kirk’s italics) Violence and crime plagued the California gold rush until orderly government was established in 1849.
Moreover, Kirk knew the limits and costs of things economic. Modern controversies, he maintained, overemphasize economics. The real conflict “is between traditional society, with its religious and moral and political inheritance, and collectivism” (Kirk’s italics). Ultimately, the clash is between “opposing concepts of human nature.”
His view that people are spiritual beings led Kirk to maintain that though a prosperous economy is good in itself, “its real importance is the contribution it makes to our justice and order and freedom, our ability to live in dignity as truly human persons. . . . Economic production is merely the means to certain ends.” Those ends are “to raise man above the savage level, to make possible the leisure which sustains civilization and to free man from the condition of being a simple drudge.” Regarding efficiency as an end in itself merely duplicates the error of Communism.
Kirk realized better than many of capitalism’s other defenders that economic activity does not occur in a vacuum; free markets require moral, cultural, and social foundations. Ideas and beliefs govern conduct, and exist in a hierarchy. Religious ideas are the most fundamental: “culture springs from the cult,” as does morality. Morality’s primary purpose is “to order the soul and to order the human community, not to produce wealth. Nevertheless, moral beliefs or disbeliefs have economic consequences.” “Political problems, at bottom, are religious and moral problems.” Thus, capitalism “is a development from certain moral assumptions of Western civilization” and “can exist and prosper only within a moral order.” Christianity condemns envy, thus helping protect the market from its enemies. But as religion wanes, envy and blaming free markets and property for one’s frustrations—and therefore statism—grows.
Dr. Kirk’s ultimate assessment of free enterprise was positive, and his outlook cheerful: “there is reason to believe that the productive market economy will be functioning well a century from now. The errors of command economies and the blunders of utopian welfare states have become obvious to a great many people, while Adam Smith continues to make economic sense.”
The free economy’s foes often argue that there is more to life than economics. Indeed there is, Dr. Kirk realized—and a free economy, provided it is operated by humane people, serves humane values and the Permanent Things best. Defenders of economic freedom would do well to steep themselves in the wisdom of Russell Kirk.
Dr. Skousen is an economist at Rollins College, Winter Park, Florida 32789, and editor of Forecast & Strategies, one of the largest investment newsletters in the country. For more information about his newsletter and books, contact Phillips Publishing, Inc., at (800) 777-5005.