Mortimer Adler, president of the Institute for Philosophical Research, former professor of the philosophy of law at the University of Chicago, and author of The Idea of Freedom, talks to Wallace about conceptions of freedom, capitalism, socialism, and the American worker.
Guest: Mortimer Adler
WALLACE: This is Mortimer Adler, a distinguished American philosopher. He charges that the United States is selling its birthright... freedom... for an unjust, ever more socialistic form of society. We'll find out why he says that in a moment.
WALLACE: Good evening, I'm Mike Wallace. Tonight we'll discuss the nature of freedom, the nature of our society... and how they are protected, or perhaps restricted, by our government. Our guest is Mortimer Adler, former professor of the philosophy of law at the University of Chicago; now President of the Institute for Philosophical Research. After seven years of study, Dr. Adler has just published “The Idea of Freedom,” an examination of the concept and practice of freedom for the past 25 centuries.
Dr. Adler, first let me ask you this. As I've said you recently completed a 7-year study of the idea, the concept of freedom, as it's developed through history. Since our interest tonight will center around production, industry and money... I wonder if you'd tell me this: As a result of your studies, what kind of economic system, in your opinion, is most compatible with a free society?
ADLER: Well, let me begin by answering your question, Mr. Wallace, in terms of the meanings of freedom before I come to the economic substructure of a free society. In the studies we've made at the Institute for Philosophical Research in San Francisco, we have found that there are five major conceptions of freedom, only one of which is relevant to our present concern.
Two conceptions of freedom are concerned with the kind of freedom that men would have in any society, under tyranny and despotism, under the worst conditions. And two conceptions are anti-political, or unpolitical, they are notions that freedom is doing what one pleases. They are notions of freedom without government, even opposed to government.
Only one conception of freedom that of political liberty is the truly political conception, and it consists... it defines freedom as consisting in the participation in one's own government, that is, having a voice in one's own affairs, through the status of citizenship and suffrage. Now this kind of freedom, the political liberty of a citizen, which in a free society is the right of every man... every man is a citizen with political liberty...
I think can be economically sustained, supported only by the widest diffusion in the ownership of the means of production... the kind of thing that our founding fathers, Hamilton, Adams, Jefferson thought when they said that you couldn't make men citizens if they were dependent upon the arbitrary will of other men for their subsistence. They envisaged a larger and larger class of small property-owners... a large middle class... with economic leverage against the powers of government, as the essential bulwark of a republic. And I think that must be restored again today.
WALLACE: What might be called then, a "purer" capitalism than the capitalism that we have?
ADLER: I would say capitalism as it does not exist and it never existed so far.
WALLACE: Now, before you go any further, I want to clarify something... if you will permit me, this generalization... attacks on the so-called socialization of the United States usually come from the political right wing in America. This same right wing generally favors extensive congressional investigations of alleged subversives... they favor some restrictions on the right of free speech for communists... and so on. You say that we are going Socialistic... Do you identify yourself with this militant right wing that I've just described?
ADLER: Heaven Forbid! I regard that right wing as the most reactionary and subversive force of good government you could have in this country. That right wing would want to restore us to the kind of primitive, unjust laissez-faire capitalism, the kind of robber baron capitalism of each man for himself, devil take the hindmost which did not conform to the idea of political liberty in the good life... in the good society.
On the contrary, the kind of capitalism I'm talking about is, I would think, even more revolutionary than communism. It aims at all that good human results... the dignities of life... the decencies for all men, with one difference, it wants these things and freedom, too. Whereas the idealistic communists, the Utopian Communist, is looking for the conditions of the good life, but can't understand how to get them without the sacrifice of individual freedom.
WALLACE: Well, stay with our increasing socialism, if you will, for a moment. Who's leading us down the road to this socialism? You have said that our leading economists are doing it... that many of the policies of both political parties, Republican and Democrat, are increasingly socialistic. What I fail to understand is this... this is a country of big business, of huge corporations, ostensibly defenders of free private enterprise. So, on what do you base your charge that we are advancing toward a socialist state?
ADLER: Let me answer that question in two jumps. First place, in 1848, Karl Marx outlined a program for bringing about socialism progressively and peacefully, before the last violent stages of revolution. He talked about it as progressive inroads into the rights of property. He enumerated a set of steps and policies. Two or three years ago, John Strachey, the leading English Marxist said, "Marx made only one error. He didn't see that this socialistic program could be brought about by due process of law and peacefully in both England and the United States, without any violence at all."
And according to Strachey's calculation, we're two-thirds along the way to a completely socialized economy. And let me illustrate this another way. There was a time in the history of this country, in the history of all western republics, in which taxation was strictly for the support of government... that is, the tax levels were adjusted to the cost of government. No one would have thought of using taxation and similar devices, as a means of redistributing wealth. You and I live in a society in which taxation is largely not for the support of government but for the purposes of redistribution of wealth.
We're living in an economy in which the policy of full employment -- the policy of unemployment insurance -- all the benefits which are conferred upon people in order to give them the kind of economic security that is necessary to keep the economy running, as well as to give them some measure of political liberty. These are the good aspects of the thing.
What's wrong with it is that we are achieving, I think, by this socialization of our economy, the maintenance of still some vestiges of private property capitalism, though with increasing power on the the part of government. WALLACE: We'll come to that in just a moment. Another of your key criticisms of the present economic system is the way wages are determined which you call a 'laboristic' distribution of wealth. What do you mean and what's so bad about it?
ADLER: Let me explain that by saying... we're living in a technologically advanced, ever more advanced, industrial society. ln that society it is the capital instruments that are the major facts in the production of wealth. I would roughly say that capital is responsible for 90 percent of the wealth produced and labor for 10. Perhaps less than that, even... yet 70 percent of the total annual wealth is distributed to labor in the form of wages and 30 percent goes back to capital.
In fact, capital's... capital earnings... capital's actual earnings are much less than what capital produces. Labor's actual earnings are much more than labor actually produces. Human labor, manpower and human skill are relatively constant things... the increasing productiveness of our society is not due to the increasing productiveness of labor at all. It's due to the increasing power and productiveness of the major capital instruments.
WALLACE: Is what you're saying labor is being paid too much?
WALLACE: Who will buy the goods unless labor is paid?
ADLER: You are quite right, Mr. Wallace. That is precisely how we got into the Jam... at the time of the New Deal... at the time of the various socializing legislations. In order really to prevent Karl Marx's prediction from coming true: that a cycle of depressions would finally make capitalism collapse of its own weight ...we had to adopt measures to increase purchasing power. We did it by policies of full employment and rise in real wages of labor.
And by the way, any society, any economy that had the increasing productiveness of our industrial society must have some way of seeing that purchasing power is widely distributed because if you have purchasing power concentrated in the hands of a few wealthy persons, you simply have overproduction and underconsumption. So that the question is not... I want to say... any economist has to see... widely diffused purchasing power.
But shall it be produced, shall it be achieved... by wage levels beyond what labor earns... or by having more and more families get larger and larger shares of their incomes... not from wages... but from the dividends on equity shares of capital that they own? What I want to see is a continually improved standard of living and a widely distributed purchasing power through the diffusion of the ownership of capital, not through artificially bolstered wage levels.
WALLACE: When Walter Reuther, just a few months ago, came up with a profit sharing plan for labor, what was your reaction to it?
ADLER: I thought he didn't go far enough. Instead of asking for profit-sharing, which by the way is somewhat unjust when you ask for profit-sharing without the risk of capital, he should have asked properly for equity shares... for equity-sharing.
WALLACE: Isn't that what the Ford Motor Company offered the worker... maybe last year?
ADLER: No. It was two years ago. At the time, Reuther was negotiating for a guaranteed annual wage. Ford Motor Company offered him as alternative shares of Ford stock before Ford stock went on the public market. And Reuther turned it down. I've never been able to figure out why, but I'm sorry to say that my guess is not complimentary to Reuther. My guess is... and this, I think, is true of many labor leaders... they're afraid of increased ownership on the part of labor because it reduces the class struggle.
Eventually the kind of capitalism I'm talking about would gradually liquidate all labor unions. Labor unions were necessary only when capitalism was in its primitive condition. Labor had to fight for some conditions of life. In a good society you wouldn't have labor unions.
WALLACE: Of course, big business, in a good society...
ADLER: ...you wouldn't have labor unions. You wouldn't need labor unions. In a classless society of capitalists, you wouldn't need labor unions.
WALLACE: Is a classless society possible?
ADLER: I firmly believe it's the only free society. In any... let me say why I think so. In any society in which you have basic factions, particularly economic factions... you will have as our Federalists saw, either a tyranny of the minority or a tyranny of the majority. It is between them and it isn't much choice, they're both tyrannies. You can only avoid the tyranny of the majority or the minority in the classless society.
WALLACE: But in a dynamic society, isn't tyranny inevitable eventually?
ADLER: No, I don't think so.
WALLACE: We've been talking a little bit about labor. Of course, big business depends upon certain socialistic devices, too... government regulation of various industries.
ADLER: Sure... subsidy handouts, the handouts to capital are almost as bad as the handouts to labor.
WALLACE: Well, what I can't get is this: Dr. Adler, are you simply recording history when you say what is happening or are you recording history and then reacting to what is going on? What I would like to know is: What in your estimation is bad about all of this? I think that you will agree... I would wonder how many people watching us tonight, for instance, really worry about the so-called trend toward socialization. Really? For instance, last month Congress voted a 7 percent rise in social security. Some people would call this a socialistic measure. Now, do you think that you're ever going to convince a man who's worked all his life for a small income that increased social security is a bad thing for him when he retires?
ADLER: Not unless you give him something better. I agree with you. Certainly the large mass of working people in this country are much better off in 1958 than they were in 1928... than they were in 1908 or 1898. No question about it... And since they can't see any alternative... since they can't see how their present economic security... their present economic welfare... can be achieved except by such socialistic measures... so long as that's the cases, they're going to vote this in. No question about it. The problem is one of education.
The problem is one of having them see that it is by their ceasing to be workers by the way, this will have to happen, anyway, because no matter what anyone tries to do, we can't maintain full employment very much longer without an absolutely destructive inflation... we've got to realize that labor, I'm talking particularly about mechanical labor-in the major industries has to be gradually retired. Less and less of it.
We have to have an economy in which the people's incomes are achieved from other sources, and the kind of wages and full employment industries we're talking about. Hence, I think we have to have the people of the country understand that all the good things they've fought for and gained, really gained, through the socialistic measures, the socializing of the economy during the last 35 or 40 years have to be retained and solidified by other means. And those means I would call the capitalistic means.
You know, let me say one other thing, Mr. Wallace. Madison Avenue, you know, has a big hullabaloo about people's capitalism. It's good for foreign consumption but actually, of course, we don't have people's capitalism in the United States. The idea being... the idea behind that phrases stolen from the Russian phrase "people's democracy" is a society in which, to use a slogan "every man is a capitalist." I think this is the ideal.
WALLACE: That's your ideal...
ADLER: Every man a citizen... let me say why it's my ideal. Citizenship, being a citizen and being a property owner, I think, go together. I think that we had... This has always been the case, by the way. The greatest of political theorists in the past have understood that the kind of economic independence that men have through being owners of property is an indispensable condition or qualification of their being good citizens. We're the first society to extend its suffrage way beyond the diffusion of property. And we've done it by securing the economic, the equivalents of property, all of our social security measures... all of our labor legislation...
WALLACE: ...is property in itself...
ADLER: No, it's not property. It's power. In other words, the benefits are secured by power, not by property and by right. And you say what's wrong with that? The whole problem is one of power, freedom, the whole problem of freedom is one of proper control of power.
WALLACE: What's I'm getting at is this. Let's grant that we're moving away from absolutely free capitalism. It would appear that this is being done because the majority of our citizens want it that way. Now isn't there a concept of a kind of collective freedom, a social freedom, in which all the citizens vote freely and then the majority rules? And the minority of individuals have to accept this majority rule?
ADLER: The process by which we have moved away from what you call free capitalism and what I'd rather call the wrong-minded laissez-faire capitalism, of the 19th Century... the process by which we have moved away is a perfectly legitimate process. The process of Democratic government majority rule, yes. The question is can the majority be mistaken in its own aims? Can the majority... do men ever make the mistake of, with the right goal in mind, choosing the wrong means for it? I say our country, proceeding peacefully and by due process of law, is making a wrong choice... that the people are making a wrong choice for themselves.
WALLACE: Well, what you complain about are injustices, and violations, and invasions of the rights of private property. When you attack socialistic measures, aren't you saying that these are incompatible with a free society... that they are based upon compulsion... government compulsion mainly.
ADLER: I think, although I wouldn't deny that there is some compulsion involved, freedom. I think is more endangered by the concentration of power that results. Let me use Russia as an example, for a moment. In Russia you have the greatest possible concentration of economic and political power in the same hands... the managers of the economy are also the managers of the political machinery of the state... this to my mind, is most inimical, most incompatible with individual freedom and individual right.
Now in this country we haven't lost our freedom yet. I want to be clear about this. I'm not seeing any bug-a-boos and scareheads around the corner at the moment. We have socialized our economy and still maintained our political freedom, as has England. The only thing I want to be clear about on this is that if the socializing trend continues... if -- what one think is worse -- the built-in inflation and the inevitable overproduction in our society continues, I think you will have the end of the road. Perhaps not longer than fifty years... a much more complete socialism... a socialism that's as complete as in Russia. In which case, I think freedom will be lost.
WALLACE: Well, right here is where you would seem, possibly, to contradict yourself.
WALLACE: Well, you claim to be a champion of capitalism and free enterprise.
ADLER: Capitalism as it has never existed yet.
WALLACE: But you say in your book that the only way to achieve this free enterprise is with a series of powerful government controls.
ADLER: I agree.
WALLACE: To list a few greatly expanded, use of present corporate income taxes, government regulation of business corporations, heavy gift, and estate taxes in many cases, even a sharply progressive income tax. Now it seems to me that this is a certain kind of socialism all over again. Is it not self-defeating?
ADLER: No, I... I've thought about this particular question. You heard me say three or four times that capitalism must not be confused with laissez-faire. The capitalist society is not one in which you have no government regulation. The difference is... between... there are two points... one, the difference between government regulation of economy, like government regulation of traffic, and two, government operation of the economy.
The government should not be engaged in the production of wealth or the distribution of wealth, but should regulate in terms of principles of justice, the ownership, production and distribution of wealth. Secondly, government regulation can either produce socialism or capitalism. And I say if in the transition, see, I'm talking about revolutionary transition... if in the transition towards capitalism, towards the kind of capitalism I'm talking about.
You have government regulation, it tends to liquidate itself, because at the end of the line, when you have capitalism in existence, with a large, almost universal ownership of the means of production, you have a John Adams and Alexander Hamilton picture, Thomas Jefferson picture of a society in which you have not a large middle class but a whole middle class, a single middle class, if you will, only the middle class, of property-owners, who have extraordinary independence of government, by the very rights of property. In other words, government regulation for the sake of promoting, capitalism is government regulation for the sake of freedom.
WALLACE: All right, government regulation for the sake of promoting capitalism. Let me ask you this, then, in this context. Recently, George Romney who's the head of American Motors, called for legislation that would prohibit any corporation from capturing more than 35 percent of a given market in its particular field. This, says Mr. Romney, would encourage free enterprise and competition. Would you agree with this kind of regulation, not the 35 percent part, necessarily, but the principle?
ADLER: I would certainly agree with the principle. In fact, government regulation is absolutely necessary to maintain freely competitive markets. You remove government regulation and you get monopoly within ten years, I mean, you can't maintain free and competitive markets except by regulation, by preventions of monopolies of all kinds.
WALLACE: But what you are saying is this: a man makes a better brand of motor car, a better brand of toothpaste or a better television set and the public flocks to him of their own free will...
ADLER: Surely, surely.
WALLACE: But you’re saying if he gets too much of that market, knock the public off - don't let him get more than 35 percent... and certainly this is no freedom.
ADLER: I'll tell you why... let me leave out the 35 percent, though, because that's a figure I can't be sure I understand. I think perhaps the difference between you and me at the moment is that I don't mean by freedom, unlimited freedom. I don't mean by freedom license. I don't mean by freedom doing what you please. I mean by freedom, freedom within the framework of Justice and of rights.
That is, I do not believe a freedom should permit any one to get anything he can get or that unlimitedly for example, The Capitalist Manifesto, which Mr. Kelso and I wrote, holds very firmly to the proposition there should be some limitations on the concentrations of capital ownership.Why? Because every man has a right to earn a viable income for himself and his family by the means, the industrial means of our society.
If you have a highly concentrated ownership of capital resources, that right is infringed. Now I'm quite willing to limit the freedom of a man to become a multi-billionaire in order to see that human rights are protected, and I do not think this is really an infringement of freedom at all, unless one means by freedom the right to do anything one pleases which I think is a false meaning of freedom, or certainly a false meaning of political liberty.
WALLACE: Of course, there are some people in this country who take a much stronger viewpoint than you do. They say that government has no right to interfere with anybody's private property for any reason, that the only function of government should be to protect its citizens from aggression.
ADLER: I think the whole function of government is to do justice... you know, the lines of the Declaration "to secure these rights". The function of government, when we understand what man's natural rights are, is to secure these rights.
WALLACE: One more aspect of this problem. I think you would agree that capitalism is a competitive, aggressive system which considers material benefits and progress as important to mankind. Can any system accept capitalism which also accepts Christianity?
ADLER: That's an interesting and difficult question, Mr. Wallace. I would think that capitalism and socialism both, in so far as they are organizations in an industrial economy are, shall I say, inconsistent with the spirit of Christianity. Or, put it another way... Christianity... the Christian life... the good... the ideal Christian life, is more difficult to live in a modern industrial society than it was in a less affluent, less opulent, less materially well-off society.
I don't think it make much difference really, whether that modern industrial society, with an abundance of wealth, affluent in the sense in which Mr. Galbraith calls it "an affluent society" is organized in a capitalistic or a socialistic fashion... I think, Christianity is a more difficult life, a more difficult preachment in our modern world than it was in conditions of poverty and hardship.
In fact, you know, Christianity was born under conditions of poverty and hardship and prospered under them. I don't mean it's impossible, by the way. Let me say one other thing. I think capitalism, as I understand it, is quite compatible with a pagan ideal of a virtuous and good life; less compatible with a Christian ideal of a virtuous and good life, because the pagan ideal was based upon worldly goods and worldly achievements.
WALLACE: You are not suggesting that you are anti-Christian?
ADLER: No. I just think there's s problem here.
WALLACE: You pay lip service to Justice...
ADLER: Lip service? Why do you say I pay lip service to Justice? I pay service to Justice.
WALLACE: All right. Lip service and service and actual service to justice in your writing. So indeed does Christianity pay lip service and service to Justice. And yet you find yourself at odds with Christianity to some small extent...
ADLER: May I distinguish here... The basic principle of Christianity is not justice but charity. Charity is beyond, I mean real charity in the sense in which St. Paul says "Faith, Hope and Charity... and the greatest of these is Charity..." is outside the secular order. It is a theological virtue, a spiritual virtue and in my understanding of Christian theology not possessed by any one without God's grace.
This is beyond the province of political and economic organization. Justice is a rational matter, a rational principle. Justice, even if there were no God and no religion, if man were a purely natural thing with no Creator or supernatural order, there would still be principles of Justice. But there'd be no principle a of charity without God, it's only, in some sense, through God's love and man's love of his fellow-man through God, that one has charity and that's the essence of the Christian life, not Justice.
WALLACE: One final area of discussion... one final question, Dr. Adler. What do you believe is the wave of the future politically, economically?
ADLER: I have believed for many years that de Tocqueville's prophesy is right that the future belongs to the classless society of men living under conditions of equality, both, economic and political equality... the free and classless society that could be brought about by economic and political democracy. I really feel the future belongs to democracy as an ideal which will be progressively achieved in the next hundreds of thousands of years.
WALLACE: What kind of a democracy do you talk about?
ADLER: A democracy which involves constitutional government, government by law, the universal suffrage of giving each man the equal dignities of citizenship, the political liberty that goes with it and, added now, the economic independence of property.
WALLACE: How do you account, then, for this momentary aberration in the other direction?
ADLER: Well, because we have seen In the last 100 years the most extraordinary revolution in the conditions of our life through Industrialization. We haven't mastered yet... you see, neither socialism nor capitalism... and here's what I am talking about... could possibly have existed over a hundred years ego. The revolutions of our time ultimately take their origins from technological changes, the changes in the actual means and conditions of production. We are living in the first society where there is enough wealth to be distributed. We are living in the first society where it is possible to say that every man can be a capitalist.
WALLACE: And so we haven' t really learned how to use...
ADLER: We haven't... we haven't begun to solve the problem our society creates for us.
WALLACE: Mortimer Adler, I thank you for coming here from San Francisco and spending this half-hour with us.
ADLER: Thank you.
WALLACE: Mortimer Adler equates capitalism with freedom. "One is impossible without the other," he says. Yet to strengthen economic freedom and capitalism, he himself calls for some degree of government regulation. This would seem to raise a few questions. Is absolute freedom a good? Is it necessary? Is it practical? On the other hand, if you don't have absolute freedom. If we grant the principle that a man's freedom should restricted by government or by majority demand, do we really have freedom at all?
Next week we'll discuss the responsibilities of political parties, pressure groups, and of the individual citizen in a free society. Our guest, you see him behind me, will be the man who has been called "The Egghead of the Republican Party..." the man who articulated the philosophy of "Modern Republicanism." He's Arthur Larson, who just resigned from the Eisenhower Administration after four years of service.
First as Under-Secretary of Labor, later as Head of the United States Information Agency and Special Assistant to the President. That's Arthur Larson on the role of political parties and the individual citizen in a democracy next week. Till then, Mike Wallace. Good night.