From "Letters to Editor" in National Vanguard magazine, Issue No. 92, January 1983
In several articles you have written disparagingly of capitalism, lumping it in with Communism as an "alien" system and referring to capitalists as "parasites."
It occurs to me that when you and I speak of capitalism, we are, in fact, speaking of different things entirely.
To you a capitalist is someone who will do anything for money; to me a capitalist is a technician who finances trade and industry.
If renting out one's capital at interest is parasitic and unproductive, then one would imagine that industry and local government could do without the money. This is evidently not the case. What, then, is to compensate the lender for the risk of eventual total or partial loss?
Let us assume that millions of private investors -- "speculators" or "parasites," if you prefer -- are to be replaced by direct, interest-free loans from government out of taxation or with credit-entry money. How is the poor government loan officer going to know what to do? Any loan officer capable of making the correct decisions even one per cent of the time could easily become the wealthiest man in Europe through private speculation.
I am inclined to believe that if it was possible under the German National-Socialists to buy Magdeburg sugar 30 to 180 days forward -- almost certainly on 65 to 75 per cent credit -- that this type of speculation serves a useful economic purpose which cannot be abolished by any government.
There would appear to be essentially four types of socialism:
- Burn all the money and return to the Stone Age (Khmer Rouge).
- Borrow money from foreign capitalists and get them to build you factories on credit which can then be nationalized (rest of the Third World and Soviet Union).
- The government holds 51 per cent of the shares in each corporation and appoints a few directors; the other 49 per cent of the shares continue to be quoted on stock exchanges, and everything continues more or less as before (Scandinavia and France).
- The government leaves the financial system more or less alone and fiddles with labor and tax legislation instead ( National-Socialist Germany and everywhere else).
I think it is safe to say that if we are seeking to design a financial system in which money is not power and vice versa, then we should recognize that no such system has ever existed before; to ignore that fact is not science. As a scientist you can only be concerned with what has been tested and is actually possible.
I am not an economist, and perhaps I should not be writing on a subject about which I know so little. There are, however, some fundamental economic considerations on which I must comment in NATIONAL VANGUARD from time to time. The harm in capitalism is not just that "a capitalist is someone who will do anything for money," to use your words. I see two principal dangers in a system which allows the mere ownership of capital to generate income for the owner.
First, it results in the development of a rentier class: people who have managed to accumulate enough capital by one means or another -- perhaps through inheritance -- so that they can thereafter live on the interest generated by their holdings, without performing any further useful service to the community. Such people are, in effect, parasites, in that they consume without producing, and their existence lowers the overall economic efficiency of the community. Making their capital available to others, is, in one sense, performing a service, but it is not a real service, in the sense that growing food, driving a truck, raising a child, composing a symphony, repairing a typewriter, or teaching a classroom of students is, because it can be made unnecessary simply by changing the structure of the economic system.
"Such [a rentier class of] people are, in effect, parasites, in that they consume without producing, and their existence lowers the overall economic efficiency of the community."
The second danger posed by a capitalist system is far greater, and it arises from the fact that economic power is inevitably translated into political power. Furthermore, the process is inherently unstable: that is, the more capital a man has accumulated, the greater is his purely economic advantage in accumulating still more. ("It takes money to make money.")
But in a capitalist system an economic advantage, beyond a certain point, becomes equivalent to political advantage. Even if a capitalist's motives are purely capitalistic -- that is, even if his only aim is to maximize his capital -- he is bound to realize that by using a portion of his capital to influence the political process he can increase his profits or their security. Thus, slowly but surely, the state comes into the service of capital, instead of the other way around.
"[I]n a capitalist system an economic advantage, beyond a certain point, becomes equivalent to political advantage."
What this means is that men whose principal goal in life -- for many, their only goal -- is to make money, wield an increasing power over the destiny of the race. That is precisely why the race is in such jeopardy today.
We have legislators who view the immigration issue in terms of the cost of labor and the size of the domestic consumer market; who favor buying off restless minorities with doles from the public treasury in order to maintain public order and a good climate for business; who think of the foreign policy of the nation -- especially police toward the non-White "Third World" -- primarily as an implement for opening up new markets and gaining or maintaining trade advantages.
We have banks, corporations, consortiums, and enormously wealthy individual entrepreneurs using their awesome economic power today to influence governmental and social policy, with the sole aim of increasing their profits. Even such issues as war and peace are decided to a large extent on the basis of capitalist interests.
A prime example of this may be seen in the hostility of Britain toward Germany during the first half of the century. That hostility played a major role in bringing on two world wars, and it was based primarily on the determination of British capitalists to destroy their German competitors.
Capitalism is raceless, with loyalty to none but itself. The Gentile capitalist cares not whether his allies are Jews or Gentiles, or whether the labor he employes is Black or White, so long as he is convinced that he is making the maximal possible profit. If the capitalist's activities happen to bring temporary benefits to his countrymen or coracialists, that is entirely incidental and inadvertent.
I am not denigrating the profit motive or entrepreneurship or free enterprise per se, because they are the guarantors of economic efficiency, which is greatly to be desired. But I am sure that we ultimately must develop a new economic-political system, in which the profit motive is not permitted to become the principal determinant of policy.
We must have a system which makes it inherently impossible for a large rentier class to develop; which effectively counters the unstable of capital to concentrate in the hands of a very few individuals or institutions; and which, above all else, ensures that it is the race, not capital, which is served by the state.
I do not believe that these requirements are incompatible with a recognition that money is power. My concern is simply that economic power be used for the benefit of the race.
"…[O]ne begins with the goal of having a civil service which serves the race rather than itself."
If, as you say, a capitalist is merely a technician who finances trade and industry (a rather rose-colored definition, in my opinion), it seems to me that there is no insurmountable difficulty in his being a public official. A national bank can lend money as well as a private bank, and it can also charge sufficient interest to cover its risk; that is, there is no reason why a national bank loan must be interest free.
There is also no reason why a national bank loan officer cannot make loan decisions as intelligently as a private bank loan officer. What is to be guarded against are the sloth and irresponsibility which have traditionally been endemic in governmental bureaucracies. And it is certainly possible to guard against them, if one has a civil service which is properly structured and operated, without the possibility of incompetent employees keeping their positions. One can build into a civil service the same safeguards which exist in private business and industry, if one begins with the goal of having a civil service which serves the race rather than itself.
There is, of course, one great advantage that the private banker has over most national bankers: it's his money; not only is he very careful not to lose it by making bad loans, but he actively seeks ways to use it profitably. For the average person, there simply is no greater incentive to do a good job -- whether that job be lending money or anything else -- than the incentive of private gain. Even so, this principle can be applied to the national banker in the same way that the large private banker, who certainly does not make every loan decision himself, applies it to the loan officers he employs.
At this time I cannot prescribe every detail of an economic system which retains the incentives to efficiency of an entrepreneurial system and eliminates the dangers of capital becoming its own end and an idle class of rentiers developing. But I am confident that if we have the will to build such a system we will find a way. I am also confident that if we do not we will not survive.