Rapprochement With Realpolitik

Chapter 4 (Part 3 of 4) of the book

The Discovery of First Principles, Volume 3

Edward J. Dodson

Dictatorships -- of the Proletariat, of the State,
of Agrarian and Industrial Landlords,
and of Other Assorted Despots

Armies of Chinese under communist leadership had driven Chiang Kai-shek and the remnant of his Kuomintang party off of the Asian mainland. One of Chiang Kai-shek's generals, Chen Yi, had been dispatched to the island of Formosa, where under his direction Japanese colonial rule was replaced by an equally brutal and sadly corrupt regime. Within days of the Japanese surrender, the secret police ostensibly working in service of Chiang Kai-shek arrived (accompanied by a few U.S. military aides). While Chiang's representatives investigated suspected collaborators and communists, the U.S. soldiers engaged in black market profiteering. Formosans had hoped that with the defeat of the Japanese their opportunity for sale-rule had finally arrived. They assumed the United States (and the United Nations) would firmly support their desire for status as a liberated people. That was not to be the case.

Chen Yi arrived in October to formally accept the Japanese surrender. Already there were tensions building between the Kuomintang mainlanders and Formosans. Civilians soon learned that their only protection from the Chinese military and Chen Yi's despotic reach was the presence of the U.S. military, whose primary function -- the repatriation of the Japanese internees -- was completed by the end of March, 1946. With the departure of the U.S. forces, the Chinese engaged in a systematic pillaging of Formosa and imposed a reign of terror against the Formosan people. In 1966, George H. Kerr, who served in Formosa as U.S. Assistant Naval Attache from 1945-47 detailed this step-by-step destruction of the society Formosans had built (restricted as it was by Japanese rule) in his book Formosa Betrayed. Once again, another people liberated from colonialism had fallen into the grasp of a new tyranny. What troubled Kerr was the extent to which officials in the U.S. State Department refused to acknowledge that anything ought to be done on behalf of the interests of the Formosans. And yet, the consequences of the manner in which the mainland Chinese asserted their right to govern were enormous. As Kerr concludes:

Here, on Formosa, clearly defined and well reported, was a demonstration of the fundamental reasons Chiang Kai-shek and his Nationalist Party Government and Army were unable to secure popular support on the mainland, and so lost China.[105]

Early in 1946 the details of what was taking place on Formosa began to reach the U.S. public. Journalist William H. Newton wrote a series of news articles from Formosa condemning Chen Yi and the Chinese administration. Much of this criticism was lost in the midst of the escalating civil war on the Chinese mainland. The United Nations Relief and Rehabilitation Administration (with U.S. contributions) was in the process of wasting a half billion dollars to pay for food and other materials diverted by Chiang's subordinates into the black markets. On Formosa, organized resistance began to appear. When Chiang Kai-shek visited the island late in October, 1946, the Formosan people greeted him with cool silence. Then, in February, 1947, a popular uprising spontaneously erupted. Again, the Formosan people looked to the United States to support their quest for self-rule. Again, they were rebuffed. The Kuomintang's answer was to send a large detachment of Nationalist Army units to Formosa to silence the dissident population by unleashing a program of random violence against the indigenous people. Chiang Kai-shek publicly condemned the Formosan uprising as the work of non-existent communists. U.S. agents and other foreign observers knew otherwise but said little. Refugees who made their way to the United States were also reporting the truth about the Chinese occupation. Among the Chinese who had come to Formosa with good intentions, most decided to leave (for the United States and elsewhere) rather than have to live under a Kuomintang regime.

Under pressure from the world press, Chen Yi was finally removed from office and replaced by Wei Tao-ming, whose credentials included a U.S. education and fluency in English. He and his well-connected spouse soon picked up where Chen Yi left off. As Chiang Kai-shek's mainland regime disintegrated, so did conditions on Formosa. From Australia, an UNRRA official broadcasted a strong condemnation of the Chinese government's treatment of the Formosan people. None of this mattered to Dulles and others absorbed by the larger Cold War struggle against communism. Chiang Kai-shek had to be supported regardless of how corrupt, how despotic or how anti-democratic was his regime. From the middle of December on, more than two million Chinese refugees, Nationalist Army military officers and political officials arrived on Formosa seeking sanctuary. Wei Tao-ming was replaced General Chen Cheng, and the situation for the Formosans worsened. Taipei was established as the new, temporary Chinese capital. Chiang Kai-shek, who had opportunistically stepped down as president in favor of General Li Tsung-jen, now arrived on Formosa to consolidate his power on this last remaining Kuomintang foothold.

Chiang Kai-shek, realizing at last that the Formosans might in desperation take up arms against him, appointed Wu Kuo-chen to the position of island Governor. "Wu [a graduate of Princeton University] was a genuine liberal, a man of highest personal integrity, and an accomplished administrator,"[106] as described by George Kerr. Despite Wu's appointment and other decisions announced for the sake of appearances, Chiang Kai-shek proceeded to create a deeply-corrupt police state. Anyone who was even remotely suspected of opposing his directives was arrested and executed. Even Chen Yi, the person to whom he had entrusted establishing Nationalist control over the island, suffered this fate. Eight million Formosans were now forced to turn over control of their society and their future to an oligarchy forced from the mainland because of its lust for personal wealth without regard to the well-being of the Chinese people as a whole. In the United States, Truman and his advisers, finally reconciled to Chiang's failings, were on the verge of withdrawing U.S. support from Chiang when the war in Korea intervened to attach strategic value to Formosa.

On the Asian mainland, the communists established Peking as capital of the Central People's Government. They succeeded in large measure because the Kuomintang offered the people of China little hope for a better future and virtually no hope for an end to the centuries old system of agrarian landlordism and rule by petty warlords. To the extent the principles espoused by Sun Yat-sen were embraced as the cornerstones of a new China, the small number of intellectuals to whom such things mattered were drawn to socialism and the communists because there was no hope of a democratic alternative. Rather than foster a truly social democratic and nationalist movement in China (as the Soviets fostered a communist movement), U.S. leaders had continued the policy of putting their economic and military assistance at the disposal of despots. The communist strategy was to enlist the peasants in every village and town, although only a small minority of Chinese understood or accepted communism. Most were hopeful that with defeat of the warlords by one dominant faction life might get a bit better. As a result, the Chinese people offered almost no resistance to the communists once the Kuomintang armies retreated. The stage was then set for the communists to systematically destroy the private economy. Widespread corruption and bribery was replaced by direct government controls over production and distribution of wealth. Business owners were required to pay workers even when there was no work for them to do. Government interference intensified, confiscatory taxation was imposed and many businesses were required to convert into cooperative enterprises. China's agrarian landlords were humbled and many eliminated. European and U.S. imperialists were expelled. And, the last vestiges of the old system held on by a thread on Formosa, where - even there -- civil war threatened to destroy Chiang Kai-shek once and for all. From the point of view of other revolutionaries around the globe (and particularly on the Asian continent) the time of the people seemed to have finally arrived.

At decade's end, well before the U.S. sank into the quagmire of war in Southeast Asia, William J. Lederer -- one of a small number of U.S. citizens who had spent most of the 1950s in Asia (Lederer as special assistant to the commander of all U.S. military forces in the Pacific) tried desperately to awaken the U.S. public to the folly of their government's foreign policies:

In a period of history when the people -- especially the young people -- in the so-called backward lands are striking for freedom (in a period of revolution against tyranny unparalleled since the eighteenth century), we are assured by our government that our support of oppressive oligarchies in South Vietnam, Laos, Indonesia, Formosa, Guatemala, Jordan, Iran, and Nicaragua is constructive and successful. Yet in each of those countries revolt has already shown its violent beginnings; and in each only the United States stands between the people and the overthrow of a corrupt, dictatorial regime. In each, as it already has come in Cuba, Iraq, North Vietnam, Turkey and Korea, the upheaval will come full-blown, and hanging happily on to its coattails will be the Communists -- almost as though by our invitation.[107]

In the seven years between 1950-1957, the U.S. Congress approved more than $2 billion in military and economic assistance for the Nationalist regime on Formosa. One aspect of the Formosan experiment received attention by remaining group of Georgists and Neo-Georgists functioning within the Remnant; namely, the introduction of a program to redistribute Formosan land and a law that limited the ground rent payments made by tenant-farmers to a maximum of 37.5% of the value of crops produced on the leased land. Ironically, the Chinese version of land reform on Formosa had much the same result as MacArthur's program of land redistribution on the Japanese. Modern methods of agriculture were prevented from being introduced because of the large number of small plots of land individually farmed. Moreover, taxes on production more than absorbed what farmers saved in ground rents no longer paid to absentee landlords. Thus, the core of the Kuomintang's land tenure program was empty and largely counter-productive, its related tax policies punitive and confiscatory. What can be said is that rural families survived even if they did not prosper.

By this time in the United States only those who looked for communists behind every tree and treason throughout government continued to sing the praises of Chiang Kai-shek. Although Truman never met with Chiang, he formed a strong, negative opinion of him, his wife and their regime. Long after his retirement, Truman recalled:

You used to hear a lot about the Communist Party Line, but the China Lobby Line ... had a lot more people going along, powerful people, too. And what they wanted, they wanted to put old Chiang back in power. And the first step in that direction was getting ... was trying to get Chiang's army into the war in Korea, which I was not about to let happen in any way. ...

Whatever they did, they'd be more trouble than they were worth, and any money spent to support them would end up ... a good deal of it would end up in the pockets of Chiang and the Madame and the Soong and Kung families.

They're all thieves, every damn one of them.[108]

Unfortunately for the Formosan people, Truman made no attempt to intervene; their fate became inextricably linked to Cold War foreign policy necessities. United States leaders did not want to risk an all-out war with the Communist Chinese. Truman ordered MacArthur to convey to Chiang Kai-shek that the United States would not assist the Nationalists in any offensive on the Asian mainland, eliminating any possibility in the near term of the Nationalists voluntarily abandoning Formosa. Nor, as Truman indicates above, was the U.S. interested in utilizing Nationalist forces in the Korean conflict. Eisenhower shared many of these same concerns but felt compelled to guarantee the integrity of Formosa by treaty, which was signed on December 2, 1953. More tragically, Cold War expediencies demanded that the Nationalist facade as an anti-communist bastion of democracy not be challenged by U.S. policy analysts. Decades would pass before meaningful improvement in the method of governance over the Formosan people would begin to arise. We have wonder that Eisenhower would in his own memoirs continue the charade by referring to Chiang Kai-shek as "one of America's staunchest personal allies" and to Formosa as "the remaining remnant of Free China."[109] George Kennan later wrote that "the Chinese had made fools of us all -- a thousand times."[110] With regard to Formosa, he thought the United States ought to press for "a properly conducted plebiscite offering to the people of the island a choice between submission to the regime on the mainland, return to Japan, or independence -- provided only that we could be assured that the island would remain demilitarized, that it would not be armed as a platform for amphibious power in the Pacific, and that, whatever solution was arrived at, those who were opposed to it would be granted an amnesty and an opportunity to emigrate if they so wished."[111] But, Kennan was now out of the government and away from the councils where foreign policy decisions were being made. In the scheme of things, the fate of eight million Formosans was of minor importance.

Elsewhere on the Asian continent there were increasing rumblings against the continued presence of Old World imperialist regimes. Onto the world stage appeared Ho Chi Minh, an ethnic nationalist strongly influenced by the socialism of France's radical dissidents and now being pulled into the communist bloc following Mao Tse-tung's stunning and total victory over Chiang Kai-shek. In 1951, the new Vietnamese Workers' Party (the Viet Nam Dang Lao Dong) was formed by Ho with the stated objectives being "to drive out the imperialist aggressors, to win independence and unify the nation, to abolish the colonial regime, to obliterate feudal and semifeudal vestiges, to give the land to the peasants, [and] to develop popular democracy as a basis for Socialism."[112] Even as Ho's troops were moving closer to victory against the French, however, he continued to look for a negotiated settlement, recognizing that behind the French could increasingly be seen the determination of the United States to do whatever was necessary to stop the spread of communism. Once again in the so-called developing world, the protective hand of U.S. economic and military power chose one form of oligarchy, dictatorship, despotism and tyranny over that promised by communism. MacArthur's experience and accomplishments in Japan, flawed as they were, could not be replicated without the presence of police powers sufficient to protect the stability and growth of democratic socio-political institutions. With the U.S. poised to come to the rescue of France in Indochina, George Kennan made very much the same point to those who sincerely wished to assist in the improvement of living conditions of the hundreds of millions of oppressed people in the world who barely survived from day to day:

Any message we may try to bring to others will be effective only if it is in accord with what we are to ourselves, and if this is something sufficiently impressive to compel the respect and confidence of a world which, despite all its material difficulties, is still more ready to recognize and respect spiritual distinction than material opulence.[113]

Kennan later wrote that during the period of negotiation over creation of the North Atlantic Treaty Organization he opposed inclusion of Greece and Turkey on the grounds that: (a) neither were in the North Atlantic; and (b) neither "qualified for membership on the standard of association with our ideas of democracy and individual liberty."[114] To be consistent, he added that Portugal failed this test as well. On the eve of massive U.S. military intervention in Southeast Asia, Kennan delivered a series of CFR-sponsored lectures at Princeton in which he called for a fresh approach to U.S. foreign policy, suggesting that all that had been gained by treating communist nationalists as parts of a monolithic whole was to "affect the terms of the argument which goes on within the Communist camp and to forego the advantage which a division of opinion there provides."[115] One example of the "rigidly unreceptive Western attitude"[116] to which Kennan pointed at this early date was the "commitment to the Nationalist Government on Taiwan, with all its far-reaching political ambitions."[117]

Others at or beyond the Establishment fringe were even less generous in their condemnation of how thoroughly far U.S. policy makers had drifted from the principles of the Democracy (or the Just Society) in their anti-communist fervor. I.F. Stone was one of those in the United States extremely troubled by the institutionalized attack on dissent that seemed remarkably similar to what, in other countries, had foreshadowed the loss of fundamental liberties:

It is true that the American, unlike the Russian, can still buy a Compass, a Nation or a New Republic, or even a Daily Worker, but the small circulation of this nonstandardized opposition press speaks for itself, and many Americans are getting as nervous about buying a radical paper or magazine as a Russian is about being seen with a foreigner. "There is no room," Justice Douglas said of Russia, "for a crusading journalist." There is also little room for a crusading journalist in America. On this, I can testify from experience. Five more years of the present trend and it will be as impossible for a dissident voice to be heard in Washington as it is in Moscow. ...

Peace abroad as at home can only be achieved by reconciling the "irreconcilable," as in practice they have been reconciled for generations. The principles of Russian czarism were also "irreconcilable" with American principles. So are the principles of Franco or for that matter those of Chiang Kai-shek, a great believer in the one-party state, the secret police, terror, and enforced conformity in the name of reaction...

History teaches us that not all changes are brought about by counting ballots. History teaches us that sometimes revolutions are necessary. There will not be peace in the world until Americans are prepared to recognize this. ...There are times when force and violence can alone end abuses. There are times when revolutionary terror and the police state are necessary to remake an old and rotten society.

I am not advocating revolution or dictatorship. I hate cruelty and I love liberty. Nor am I palliating the crimes, stupidities, and evils which inevitably accompany revolutionary transformations of society. All I am saying is that in societies like czarist Russia and Kuomintang China which leave the people no other recourse this is what happens, and that the good outweighs the evil, as I believe the good outweighed the evil in all the great revolutions of modern times, from the English to the Chinese.

The best we can do when confronted by such convulsions is to set an example from which the new societies may learn and to create an atmosphere in which they may move back without fear of war or intervention to more normal and free standards. ...

History shows us that wars against revolutionary movements in major countries only push the revolutions to greater extremism while destroying liberty at home. ...[118]

Stone reminds us that the war of independence out of which the United States of America were created failed, in the final analysis, to establish socio-political arrangements and institutions to which revolutionaries could look for guidance in their own quest for liberation from oppression. Privilege had proven more powerful than ethics in the life of the Democracy. Over the century and a half during which the socio-political teachings of Paine had been buried under the weight of a wholesale commitment to the defense of vested interests, expediency and the tendency of those acquiring power to embrace monopolies had become the dominant ethic. All but a handful of transnationals clinging to the principles of cooperative individualism had been carried away by moral relativism. In the face of the new Sino-Soviet threat to the West, those who competed for power in the United States were hardly willing to trouble themselves with the analytical process of evaluating their decisions and actions against objectively-derived moral principles. To those who today might still wonder how landless peasants or terribly paid factory workers -- to say nothing of intellectuals -- could be fooled by the hollow promises of communism, the words of Che Guevara provide one part of the answer:

Our great master who teaches us most has always been imperialism. Every time that our soul flags, or that we think of resting, imperialism shows us ... that in a Revolution one can never rest.[119]

Formosa and Korea became distinct object lessons to leaders of indigenous groups struggling to obtain independence from foreign domination or the grip of long-standing domestic oligarchies. Despite the rhetoric of U.S. politicians and the constant references to heroes past, the Democracy now stood beside rather than against reactionary forces linked to the past. Many insiders recognized the contradictions but were powerless to slow the momentum of U.S. foreign policy driven by narrowly-defined objectives and the interests of agrarian and industrial landlords. Dean Acheson, for one, worried that in a world becoming increasingly unstable, U.S. actions suffered from an inconsistent application of principle that would end up creating serious problems. Containment as a long-term objective meant keeping the Soviets out of northern and western Europe, denying them a presence in the Mediterranean, maintaining large naval and air forces in Japan and the Philippines and guaranteeing the independence of South Korea and Formosa. On the other hand, the U.S. had inherited from Roosevelt an obligation to work for the liberation of people from oppression. In some arenas, therefore, the values held by those charged with something closer to the rightful energy and spirit of the Democracy brought them into conflict with their Old World counterparts -- as well as with U.S. multi-national business interests. Only the economic and military power of the United States was sufficient, it seemed to the privileged, to prevent the wholesale loss of monopolistic control of natural resource holdings throughout the colonial and imperial enclaves of the Old World powers in Asia, Africa and the southern Americas. Once again, George Kennan was one of the first to publicly raise the moral dilemma. The immediate source of his despair was a tour of Latin American countries completed during 1950:

When I got back to Washington, I wrote a long report for the Secretary on the impressions of this trip. In it, I grappled with many aspects of the problem presented in the shaping of our relations with these countries, and found myself obliged, in doing so, to work out in my own mind and to enunciate in the report views on fundamental questions of political philosophy which I had never before tried to formulate. ...[T]he report came as a great shock to people in the operational echelons of the department, so much so that the Assistant Secretary for Latin America immediately persuaded [Dean Acheson] ... to forbid its distribution within the department and to have all copies of it locked away and hidden from innocent eyes, which was promptly done. I was never told just what passages had occasioned this drastic measure; but I have an idea they were ones in which I dwelt on what seemed to me to be the tragic nature of human civilization in all those countries to the south of us.[120]

...[I]n the very fact that I, traveling around and reacting to stimuli, could not help but write such passages, whereas the Department of State, being what it was and facing the tasks it faced, could not help but reject them and refuse to take cognizance of them, there lay an excellent example of the logic that was now bringing to an end the usefulness of my career as a Washington official and forcing me out into a life where the deeper and more painful ranges of analysis and speculation could be more easily tolerated and more safely indulged.[121]

From the excerpts reprinted in his memoirs, Kennan seems not to have made the historical connection between the highly centralized system of agrarian landlordism of sixteenth century Spain and Portugal and the conditions he found in those societies of the southern Americas where the concentrated control over locations and natural resource-laden lands remained entrenched and oligarchies ruled by force. Land hunger had sparked revolution in Russia, China, Korea and the Philippines, societies in which communists promised peasants an end to agrarian landlordism in order to pull them into their grip. Western policy analysts were beginning to recognize landlessness as a problem, but one that could be solved rather easily by incremental programs of land redistribution (with compensation paid to titleholders). This was the approach taken in Japan, which had quieted the demands of peasants but aggravated other societal problems such as under-utilization of prime locations and the stimulation of urban sprawl into the hinterland. The communists condemned the private ownership of land as one of the great evils of capitalism. They were, of course, thinking mostly in terms of agricultural and natural resource-laden lands and did not give much consideration to the locational value of building sites in towns and cities. And, their solutions consisted of either State ownership or the establishment of cooperatives. By destroying the normal flow of goods and services associated with the exchange economy, the communists removed whatever opportunities there were to collect from users what they would pay in an open market for the privilege of exploiting natural resource-laden lands, cultivating fertile agricultural land or developing sites for the conduct of commerce or providing services to consumers. In the West, political leaders simply continued to ignore the calls of Georgists from the wilderness to collect rent and leave wages and interest in the hands of producers.


By the beginning of the 1950s, the Remnant just barely held onto a place at the bottom of the marketplace for ideas. Statism was everywhere in ascendancy, and individualists - cooperative and otherwise - were forced to work in the background, waging a policy-by-policy campaign against disjointed incrementalism. Advocates of the national security state within the social democracies went on the attack against those who challenged their orthodox doctrines. At the fringes of the interventionist Establishment, recalcitrants hammered away with fulminations against the radical or reactionary tendencies each saw in the other. Ex-Marxists and ex-communists congregated in both the radical Left and the reactionary Right, armed with their tales of personal seduction and warnings of impending doom.

All of the social democracies were experiencing internal pressures to deepen government intervention into the private arrangements between of individuals and groups, for the ostensible purpose of assuring that economic well-being finally include all or most citizens. Thus, while Stalinist and Maoist successes provided a convenient justification for transition of the social democracies into national security states, order and stability required of those in control of wealth and power some level of commitment to increase participation in the political system and economic pie. In some societies more than others, this also meant a measurable redistribution of purchasing power to those traditionally denied a sufficient share. Regular employment at wages sufficient to meet basic needs would quiet the masses, particularly when supplemented by a safety net of social welfare benefits. A parallel reward system for those intellectuals, academics or public figures who supported the agenda of the national security state would assure that only a minority of the extremely brave or foolish would challenge domestic and foreign policy decisions made by the Establishment elite.

The task of silencing opposition proved, for a time, far easier than most had anticipated. The majority of people lined up willingly on the side of more security, worrying very little about the degree of liberty lost with every concession to the national security state. Those who ought to have understood best what was at risk were among the first to capitulate. Nowhere was this more the case than in the United States. After attending the annual convention of the American Political Science Association in January of 1950, I.F. Stone wrote of his great dismay at the proceedings:

It was curious to see how much attention was paid to the problem of setting some limit on freedom of expression as a safeguard against subversive ideas. If one looks at contemporary American politics objectively it is clear that America is suffering not from too many radical ideas but from too few. The danger lies in the tidal wave of conformity engulfing the country. Writers, teachers, and journalists who dissent from dominant attitudes have rarely been in a more precarious situation. The process of free debate grows more theoretical than real.[122]

Independent thinking was being attacked by what Stone saw as "an ultra-right point of view" coming out of establishment think tanks such as the Brookings Institution. Leo Pasvolsky, for example, who was now the director of international studies at Brookings (and a CFR member), was given an award by the "inner clique" of political scientists for his work on foreign policy issues. Pasvolsky had departed from the State Department in 1946, bringing to Brookings a small group of his close collaborators. With funding from the Rockefeller Foundation, Carnegie Corporation and the Mellon Trust, he established the International Studies Group (ISG). Pasvolsky and the ISG played a major role in working out the administrative details of the Marshall Plan; yet, Stone detected in Pasvolsky's proposals a commitment to return to a laissez-faire form of interventionism and the protection of traditional privilege. From a policy standpoint, said Stone, the result would be "to fight revolutionary movements by fighting correction of the abuses which breed them."[123] For Stone, such a policy ran in the face of common sense and against the true tradition of the Democracy. Providing advice to others that he should have himself given more consideration to, William F. Buckley, Jr. added that "[a] disregard for enduring principle delivers a society, eviscerated, over to the ideologists."[124]

From both left and right of center, truth could still occasionally emerge, although the moral sense of thoughtful individuals was less frequently translated into right action. This was equally true whether one looked at the outpourings of intellectuals published in the New Republic, the Nation, Partisan Review, Commentary or most any other opinion journal. The two things they had in common were a virulent rejection of Stalinism and a failure to understand the true meaning of liberty. Some were blinded by a socialist impulse, others by a romanticized view of the past. Powerful books appeared, such as Hanna Arendt's The Origins of Totalitarianism (1951), challenging conventional wisdoms espoused by those on the Left and Right. In Arendt's case, she traced the rise of the totalitarian instinct to ethnic nationalism and the transformation of anti-Semitism (and, by extension, an anti-foreigner attitude) into a mobilizing force. Applied to the Soviets, the rhetoric of universal communism represented little more than a shallow attempt by Stalin to legitimize his bid for global domination.

Other intellectuals followed with calls to arms against the communist menace and for a broad campaign to champion the virtues of social democracy. They joined with European intellectuals in 1950 to establish the Congress for Cultural Freedom in an effort to counter communist propaganda. This was the era during which the number of intellectuals contributing to socio-political and economic commentary mushroomed, as did the number of book titles published and articles written for scientific and professional journals and periodicals. Surrounded by improved living and working conditions for an increasing majority, most now accepted Liberalism as the cornerstone of an expanding social democracy. In their rush to defend incremental change as the only rational agenda for public policy, however, many intellectuals abandoned the quest to uncover the socio-political principles upon which the just society might emerge. As the decade closed, sociologist Daniel Bell summarized the wrenching of ideology that had occurred among American intellectuals:

In the last decade, we have witnessed an exhaustion of the nineteenth-century ideologies, particularly Marxism, as intellectual systems that could claim truth for their views of the world. In reaction to these ideologies -- and their compulsions to total commitment of intellect and feeling -- many intellectuals have begun to fear "the masses," or any form of social action. This is the basis of neo-conservatism and the new empiricism. Inevitably one shares some of these fears. But a repudiation of ideology, to be meaningful, must mean not only a criticism of the utopian order but of existing society as well. ...What is left for the critic is the hardness of alienation, the sense of otherness. The claims of doubt are prior to the claims of faith. One's commitment is to one's vocation.

Alienation is not nihilism but a positive role, a detachment, which guards one against being submerged in any cause, or accepting any particular embodiment of community as final. Nor is alienation deracination, a denial of one's roots or country. Some unofficial ideologues fear that a critical view of America would influence intellectuals in Asia and Africa to be anti-American, or to reject democratic values. This is a parochial view of the intellectual life. A society is most vigorous, and appealing, when both partisan and critic are legitimate voices in the permanent dialogue that is the testing of ideas and experience. One can be a critic of one's country without being an enemy of its promise.[125]

Many intellectuals seemed to have arrived at the same conclusion at roughly the same time. Viewed in the context of history and contemporary experience, there was no better hope for improving the human condition than that offered by the Democracy -- flawed as it might be. Roosevelt and Truman had demonstrated the potential of government to intervene on the side of progress. The natural next step was to gain control of the Establishment from within.

Real power in the United States was being distributed within the higher echelons of business, finance and government - supported by the work of economists and policy analysts associated with the research conducted on their behalf. Through their efforts, the postwar era of think tank influence over the public policy agenda was firmly established. The inter-connectedness among the major foundations, research institutes, with business and government, added to the degree of influence exerted. The Brookings Institution is a case in point. John J. McCloy, CFR member and President of the World Bank, was brought on as a Brookings trustee around the same time as Leo Pasvolsky. In 1952, economist Robert D. Calkins took over as president at Brookings. Calkins, in turn, recruited a group of young economists from Harvard that included Paul Samuelson. Samuelson's presence and that of other Harvard-educated intellectuals assured that the policies of interventionism would have an increasingly strong voice in forming the national agenda and obtain support from the center within both major U.S. political parties. To advance Liberalism as the accepted brand of interventionism, extremists of all stripes had to be discredited and pushed to the sidelines. Truman proved to be more than a willing agent of Liberalism.

The first and easiest group to subdue were openly-declared communists. Under the Smith Act, eleven leaders of the U.S. Communist Party in New York were tried and convicted for treason against the United States. Other than Robert M. Hutchins and his circle of close friends and colleagues, few within the Establishment were much concerned that the civil rights of communists were being violated. What they did care about was that the public would continue to accept their leadership and direction. Populist extremists, such as Senator Joseph McCarthy, were recognized as serious liabilities who had to be discredited and their public stage taken from them. The most celebrated informers available to the communist-hunters -- Whitaker Chambers, Elizabeth Bentley and Louis Budenz -- were also dangerous because they implicated and attacked individuals who lived and worked within the circles of power. One could see, for example, that the evidence against Alger Hiss was contradictory and circumstantial. There was the microfilm buried inside a pumpkin that contained little of importance and could have come from anywhere. Charges against Harry Dexter White seemed, to virtually everyone who knew him, outrageous, even after more thorough investigation disclosed that a number of individuals brought into the U.S. Treasury Department by White (most notably Harold Glasser) were identified by Chambers as communists. McCarthyites were also trying to implicate Roosevelt and Truman adviser Owen Lattimore.

Lattimore, viewed by many as one of the top experts on Asia, served as an adviser to the State Department under Cordell Hull and James Byrnes before moving on to Johns Hopkins University. What made him a communist in the eyes of McCarthy was that he had recognized in Chiang Kai-shek (to whom he had served as political adviser in 1941 and 1942) all of the elitist and none of the republican leadership qualities the U.S. public had been sold. Even more telling, Lattimore urged that the U.S. leave the destiny of Asians to the Asians to work out rather than risking war with the Soviets. In 1948 his reputation was sufficiently strong to be invited by the Council on Foreign Relations to chair a session on the democratization of postwar Japan. His book warning of the growing Soviet presence in Asia, The Situation in Asia, appeared early the next year. The problem he created for himself was in his criticism of how those Americans who thought much at all about the U.S.-Soviet confrontation were misreading the situation:

...Americans are inclined to insist that the ideology of Russian politics is absolute, rigid, and driven on by a conviction of fate and predestination. People in Europe and Asia, every very conservative people, are much more inclined to accept ... relativity in Russian and Communist ideology...[127]

...Russian policy, for decades to come, may be guided by the belief that it is possible for any part of Asia to break away from European or American control, but not possible to bring it either under Russian control or into a federation dominated by Russia, then it is wisest to settle for an Asia out of control.[128]

Later in 1949, Senator McCarthy named Lattimore as the most important Soviet agent in the United States, and on March 30, 1950 presented his case in the Senate. Upon objective analysis, McCarthy's speech was determined to contain over a hundred errors and fabrications. Lattimore was, at the time, ending a UN assignment in Afghanistan; he arrived back in the United States the day following McCarthy's attack. His direct response came within days in the form of testimony before the Tydings committee in the U.S. Senate. CBS and Edward R. Murrow brought the drama into millions of homes. Senator Tydings disclosed that the FBI file on Lattimore contained nothing to suggest he was a communist or communist sympathizer. Lattimore indignantly described his attackers as a "motley crew of crackpots, professional informers, hysterics, and ex-Communists who McCarthy would have [people] believe represent sound Americanism."[129] He also reminded everyone involved of that fact that McCarthy, not he, had been charged with criminal acts, with violation of professional ethics, of tax evasion, of destroying official records and using his official position to advance his own interests.

McCarthy backed off his initial charges of treason against Lattimore, absorbed by other targets and his own troubles. In 1951, Lattimore was called before a U.S. Senate committee investigating communist domination of the Institute of Pacific Relations, of which Lattimore had long been an officer. Lattimore provided extensive testimony to the committee on the reasons for Chiang Kai-shek's defeat and suggested the U.S. accept the reality of communist rule in China and try to prevent a Sino-Soviet alliance against the social democracies. A parade of Asian scholars testified on behalf of Lattimore's professional objectivity. Evidence eventually presented by former State Department officials further demonstrated that whatever its leanings the Institute's influence over U.S. policy was insignificant. The negative publicity nevertheless seriously affected Lattimore's career. Biographer Robert P. Newman concludes that "Lattimore did not realize at the time the extent to which geopolitics had lost ground to ideology in the United States. He had always been non-ideological, more pragmatic than crusading."[130] He was facing persons lusting for blood and vindication of their self-righteous intolerance of independent thinking. Late in 1952, a Federal grand jury initiated an investigation of Lattimore's ideas (as opposed to his actions) and the extent to which they served communist interests. He was indicted on seven counts of perjury in connection with his testimony before the Congressional committees. Lattimore was represented in all this by Abe Fortas, who warned that the government had bet so much on this case they would undoubtedly attempt to frame him, encourage witnesses to lie and create documents out of thin air and introduce them as evidence against him. With Lattimore's fate still in doubt late in 1953, Dwight Eisenhower demonstrated in a memorandum to Attorney General Herbert Brownell his grasp of what was happening to the credibility of the Federal government, writing:

The Communists are a class set apart by themselves. Indeed, I think they are such liars and cheats that even when they apparently recant and later testify against someone else for his Communist convictions, my first reaction is to believe that the accused person must be a patriot or he wouldn't have incurred the enmity of such people.[131]

In any event, after consuming huge amounts of public revenues, the government prosecutors could make none of the charges stick. They nonetheless decided to spend even more money ordering a summary of everything Lattimore had ever written or spoken about so find evidence that his views were consistent with those of Soviet or Chinese communists. In May of 1955, Lattimore journeyed to Europe for a series of well-received lectures; the indictments against him were dismissed while he was still outside the United States.

Lattimore's experience was no doubt a terrible and demoralizing experience for him and his family. His victory does point, however, to the possibility in the United States of the determined individual -- when supported by counsel willing to devote sufficient resources -- prevailing against the aggregated police powers of the State. Lattimore remained at Johns Hopkins University under less than ideal circumstances until 1962 (Milton Eisenhower, who was hardly likely to think warmly of Lattimore, became president of the university in 1957), when he was offered a professorship in Chinese studies at Leeds University in England. Although gone from the United States, Lattimore did not simply fade away into academic oblivion. As the course of events unfolded during the 1960s, the debate continued over U.S. foreign policy mistakes in dealing with communism. Lattimore remained on the attack, as evidenced by the following exchange between I.F. Stone and Lattimore in 1972, Lattimore responding to a commentary ("The New Shape of Nixon's World") by Stone appearing June 29 in The New York Review of Books:

To the Editors:

Despite my deep respect for I. F. Stone as an acute political analyst, I find myself disagreeing with his conclusions ("The New Shape of Nixon's World," NYR, June 29) that Nixon has pulled off a "successful gamble in Vietnam" and that Moscow and Peking have "acquiesced" in it.

I suggest that another interpretation is possible and preferable.

The Vietnamese patriots, Northerners and Southerners, have knocked the Nixon "Vietnamization" program to bits, and with it the infrastructure of the Thieu government. Even in America it is more and more obvious that only terrorization from the air keeps that government from collapsing. The idea that it can successfully take the offensive, except in territory where the noise of the bombs has been succeeded by the stillness of death, is hopeless. It is more and more obvious that Nixon can do nothing but kill. He cannot build a society, an economy, a state that will work.

In the meantime, there are certain problems, unconnected with Vietnam, that can be successfully negotiated, at least to a certain extent. In these circumstances, it seems to me that both the Soviet Union and China are following a sound policy. They are demonstrating that on reasonable matters they are ready to negotiate reasonably. At the same time they are letting the world see and hear that it is Nixon who relies on bombing the Vietnamese to the negotiating table (or "back to the Stone Age"), and that all the savage words of bluster and bombast come out of Washington. The Vietnamese are saying, "Let us alone, to mind our own business." Nixon is saying, "I will not let you alone. I insist on minding your business."

One of the rules of successful diplomacy is that when you are negotiating with an adversary whom you cannot convince, you should aim to convince the bystanders that it is the adversary, not you yourself, who is being unreasonable, brutal, savage, uncivilized. This diplomacy the Vietnamese, aided by the diplomacy of the Soviet Union, is pursuing with patience and heroism. The world is being convinced that the danger to civilization comes from America. The tragedy is that the American people, their senses dulled by years of slaughter and body-counting, are behind all the other peoples of the world in realizing this terrible truth.

I.F. Stone's response appeared on September 21:

These tortuous apologetics remind me of those which followed the Nazi Soviet pact in 1939. China could have responded to the mining and bombing of Hanoi by opening its ports to Soviet supply ships and closing ranks with Moscow in support of Hanoi. Moscow, by postponing the summit in protest, would have raised pressure here and abroad upon Nixon to stop a bombing and blockade so severe Hanoi terms it an escalation to a war of extermination. Neither great power cared enough to interrupt its own "business" negotiations with Nixon, for all the fresh blood on his dirty hands.[132]

Victor Navasky accurately describes (in his 1980 book, Naming Names) the foreign policy conflict of these years as a "domestic civil war," in which there was "no room ... for the neutral patriot."[133] Ex-communists were coming out of the woodwork to capitalize on the publicity and attention others were gaining on the back of the McCarthy witch hunt. Investigative committees assembled a cadre of professional witnesses whose memories of names, dates and places -- as predicted by Eisenhower -- expanded with each appearance. On the other side of the scale, many of those who abandoned communism after years or decades of adherence - as "true believers" - were well-positioned to understand the lengths to which Stalinists were willing to go to gain control over the future. In writing about the small number of ex-communists he came to know very well, Henry Regnery reminds us:

They did not play with Communism by joining front organizations, peace sit-ins, protest demonstrations, and the like; they went all the way and joined the party, not because they saw it as a path to power and influence, but because, in their youthful idealism, they believed it offered the only way out of the dilemma of modern life. When they realized that they had made a hideous mistake, their commitment to anti-Communism was also total.[134]

The brutality of Stalinism turned many others off to communism as a system but not to the egalitarian objectives they believed were to be found in the writings of Marx and Engels. What was true then and is true today is that neither the statist support of laissez-faire interventionism, imbibed with privilege, nor state socialism -- attempting to pass for some type of communitarian collectivist system -- contained the seeds of creating the just society. Among those Americans who continued to adhere to Marxist ideology, most left the Communist Party in order to distance themselves from charges of being controlled by Stalinists working as agents of the Soviet Union. Even the American Civil Liberties Union denounced communism and chose not to defend the rights of accused communists removed from government employment or otherwise denied their constitutional rights.

From within the Remnant, a small number of courageous individualists formed an emergency committee to fill the void left by what they viewed as the ACLU's surrender to political correctness. Another, rather unlikely, source of support for the right of dissent also emerged out of a Ford Foundation report prepared by attorney H. Rowan Gaither, Jr. (chairman of Rand Corporation), a key recommendation of which was that the Foundation should use its resources toward "[t]he elimination of restrictions on freedom of thought, inquiry, and expression ... and the development of policies and procedures best adapted to protect these rights in the face of persistent international tension."[135] To pursue this and other Foundation objectives, Paul Hoffman (Economic Cooperation Administrator of the Marshall Plan) was elected President of the Ford Foundation in 1951. Hoffman, in turn, recruited Robert M. Hutchins from the University of Chicago.

From the very beginning, Hoffman and Hutchins were committed to an aggressive program that was rather unsettling to Henry Ford II and those on the Foundation's board who were largely satisfied with the status quo. One of Hoffman's signal achievements before departing two years later was to nurture into existence and independence the Fund for the Republic, whose own trustees were recruited because of their well-known concerns over the state of civil liberties in the United States. Speaking at Harvard University early in 1951, Hutchins suggested what was then at stake in the nation:

I recognize that these are dangerous times and that the state must take precautions against those who would subvert it. I do not suggest that those who want to force conformity upon academic bodies do so from any but the most patriotic motives. I do say that they are misguided. The methods they have chosen can not achieve the results they seek. They will, on the contrary, imperil the liberties we are fighting for, the most important of which are freedom of thought, speech, and association.[136]

All across the United States, the challenge of McCarthyism aroused individualist instincts within otherwise very mainstream scholars, writers and teachers. At Swarthmore College outside Philadelphia, Pennsylvania, for example, guest lecturers were invited during 1951 to express their views on the state of liberty in the United States. Henry Steele Commager told his audience, "Our very politics, even our international relations, are coming to be a vulgar competition in eloquence about loyalty and rhetoric about patriotism,"[137] to which he added his fear that freedom of inquiry and the potential for discovery of truth were severely threatened by the demand for conformity. A colleague of Commager at Columbia University, Walter Gellborn, warned that the current environment of fear and obsession with security was destroying the substance of what made the United States the greatest of social democracies:

[The loyalty program] has thrown the weight of the government of the United States behind the dangerous theory that entertaining an unsound opinion or advocating an abhorrent idea is in itself an offense against society. Acceptance of that theory discourages bold speculation by making it dangerous to dissent, for in nervous times dissent is too readily mistaken for disaffection. When diversity of opinion becomes personally disastrous, most people simply avoid peril by suddenly avoiding opinions.[138]

James P. Baxter III, President of Williams College in New York, took the opportunity to defend academic freedom from the advance of statism. "There have always been large numbers of men who prefer 'thought control' to freedom," declared Baxter, "men who are eager -- as Walter Bagehot has pointed out -- to use the 'immense engine' of the State 'to crush the errors which they hate, and to replace them with the tenets they approve'."[139] With the memory of the McCarthy hearings still strong, historian Richard Hofstadter traced the long history of the struggle for intellectual and academic freedom in the nation, ending with this warning:

No one can follow the history of academic freedom in this country without wondering at the fact that any society, interested in the immediate goals of solidarity and self-preservation, should possess the vision to subsidize free criticism and inquiry, and without feeling that the academic freedom we still possess is one of the remarkable achievements of man. At the same time, one cannot but be appalled at the slender thread by which it hangs, at the wide discrepancies that exist among institutions with respect to its honoring and preservation; and one cannot but be disheartened by the cowardice and self-deception that frail men use who want to be both safe and free.[140]

Earlier, in 1949, Felix Morley (who joined with William F. Buckley, Jr. and other national security state interventionists to attack the integrity and sympathies of Owen Lattimore[141] ) had suggested that the real strength of the Democracy was neither material nor cultural; rather, many generations of people living without government to direct individual behavior or financial decisions had nurtured within a considerable minority a "deep-rooted mistrust of governmental planning."[142] More recent migrations of peoples from statist societies added another layer of complexity. Peasants, unemployed workers, aristocrats and intellectuals had come across the oceans to escape various forms of oppression. Nurtured by the memory and experience of life under extreme forms of agrarian and industrial landlordism, most political activists sought to combine the egalitarian promise of socialism with the participatory nature of democracy. Individualists within the Remnant were philosophically drawing in the sand the line beyond which they could not tolerate interventionism. At the same time, the most powerful agrarian and industrial landlords (i.e., those who enjoyed the greatest extent of economic privilege and political influence) worked systematically to prevent any substantive loss of privilege. In defending their position, they did their best to link any attack on the status quo as subversive and to uncover evidence that the reform-minded were leftists who adhered to Marxist ideology and communist control. In these tense times, those who sincerely wished to improve the living conditions of all people everywhere but who disagreed over the promise of the State as a vehicle for achieving this objective became objects of character assassination.

R.H. Tawney, at the center of Britain's postwar moves toward democratic socialism, pointed out that in virtually all of the Old World only a small portion of the people had ever enjoyed the benefits of owning the means of production. Yet, I have been able to find no socialist-oriented intellectuals or activists who advocated as a public policy option assisting workers (i.e., those receiving their currency wages in exchange for their labor) in an effort to bring them, to some limited extent, into the group of agrarian and industrial landlords. To do so would, others were now suggesting, broaden the benefits of ownership to the overwhelming majority of citizens and thereby mitigate the historical problem of wealth concentration. For Tawney and the democratic socialists, there existed only one road down which public policy had to travel:

The truth is that, at the present stage of its history, the economic system is necessarily a power system. It is a hierarchy of authority; and those who hold its levers exercise, consciously or unconsciously, a decisive influence on countless human lives. Such a power is too great to be entrusted to private persons, actuated primarily -- and, in present conditions, inevitably actuated -- by considerations of their own and their shareholders' pecuniary gain or loss. It cannot, for technical reasons, be abolished or broken up; but it can cease to be arbitrary and autocratic. It can, in short, be converted into a responsible public or semi-public function in the traditional English manner, by its submission to public control, whether in the form of regulation or ownership.[143]

The assumption, proven incorrect by events of the second half of the twentieth century, was that the State would somehow act in the interest of society as a whole, where individuals never could or would. By failing to understand the true nature of either privilege or of equality of opportunity, the solutions advanced by Tawney called upon citizens to relinquish what was left of their inherent rights to property (i.e., what they produced or legitimately acquired in exchange) in return for a vague promise of economic security. With Labour in power and many of Britain's political leaders committed to a progressive social agenda, Tawney was confident the State could undergo a permanent metamorphosis and begin to serve the broad public interest.

The inherently bureaucratic nature of government decision-making has been demonstrated all too clearly in every society that has -- even with the best of intentions -- pursued strongly interventionist policies. Democratic socialism, social democracy and Liberalism all failed in their promise to bring full employment without inflation. Within the expanding government sector, far too many managers and workers saw little reason to do more than what was minimally acceptable. Advancement has had more to do with Party loyalty and political connectedness than ability or achievement. Great risk and little reward have been attached to innovation and change. And, as had always been the case, where government programs are funded by taxation and borrowing, rather than service generated revenue and the collection of rent, the results have been widespread inefficiency, corruption, fraud, theft and other unforeseen consequences. Descriptions of conditions finding their way out of societies dominated by state socialism should have provided ample warning against aggrandizing the social and economic functions of the State. Among interventionists, however, arrogance and confidence were simultaneously expanding during a period of extraordinarily unusual market conditions. Producers based in the United States had temporarily been in the position of being able to meet much of the global demand for goods, while the U.S. government provided dollars to foreign governments to acquire what they needed. And, this occurred in an environment where nominal household incomes (for an expanding majority) were rising nearly as fast as prices.

What sincere social democrats always feared more than an enlarged bureaucratic State was the power of vested interest inherent in the concentrated control over the means of production. Einstein, who championed the integration of political democracy with economic socialism, described the status quo as a state of "economic anarchy" within which "[t]he worker is constantly in fear of losing his job."[144] In the quest for first principles, Einstein's scientific mind nonetheless failed him. As an individual he accomplished so much by abandoning conventional wisdom and forging his own paradigm of how the universe was structured. Where socio-political arrangements were concerned, he did, however, recognize that success under socialism involved a delicate balance between individual liberty and societal responsibility:

The achievement of socialism requires the solution of some extremely difficult socio-political problems: how is it possible, in view of the far-reaching centralization of political and economic power, to prevent bureaucracy from becoming all-powerful and overweening? How can the rights of the individual be protected and therewith a democratic counterweight to the power of bureaucracy be assured?[145]

Others within the transnational intellectual community carried on a dialogue that attempted to find the solution to the apparent enigma identified by Einstein. No subject received greater attention than the proposals for global confederation, or world government, as the only rational means by which peace could be secured. Mortimer Adler, for one, saw the internationalism of the Truman-Eisenhower era as a first stage in the subordination of the nation-state to law based on universal principles and values. He hoped and believed that after an indefinite (perhaps very long) transitional stage, the sovereignty of the individual would emerge to displace the sovereignty of the nation-state. The rights of the individual would -- ultimately -- be protected by a global federal government granted powers to enforce the rules established and enumerated constitutionally. In order to ensure that as much government as possible would be kept close to people, Adler recommended that local governments be granted charters and the responsibility for providing most public services. The adoption and effective implementation of these changes, Adler predicted, might require not decades but centuries. The political means had to be both democratic and incremental.

Tracing the first decade of debate between internationalists and world federalists, political scientist Inis Claude joined Adler in warning against committing too soon and without experiential evidence to support idealistic solutions. "The maintenance of a decent respect for the bounds of our own ignorance is compatible with the observation that it is illogical to cite the relative failure of the United Nations as evidence of the need for world government and to fail to cite it as evidence of the improbability that mankind is now capable of creating and sustaining a more ambitious institutional structure,"[146] he offered in somber reflection. To those who in their zeal for a new world order ignored much of the history of hierarchical government, Claude declared:

The most that can be said for government -- and this is saying a great deal -- is that it sometimes contributes greatly to the stability of a society and the security of its members, and that, more rarely, it may even promote order without doing violence to the values that many men place above order. Given the right social conditions and the right kind of regime, government may work reasonably well. This is a far cry from the proposition that the establishment of a government is anything like a certain means of solving the most critical problems that beset any human group, including the largest possible human group. The world might be better served by a frank exploration of the limits and difficulties of government on a global scale than by a campaign of persuasion which presents a glorified picture of government.[147]

Adler certainly agreed. Government could, under the best of circumstances and intentions, facilitate cooperative behavior between individuals who accepted such behavior as key to a more satisfying human existence. However, one had only to view the world in an objective manner to see that the overwhelming majority of people in most societies and a large minority in the remainder had few or none of the goods of a decent human existence. The struggle for day-to-day survival left most of humanity unable to contribute to the progress of civilization. Adler believed he had learned from a young attorney named Louis O. Kelso how, at least for the social democracies, the lingering problem of the underclass could be finally resolved. Kelso's study of the history and nature of capitalism (what I have described as a fusion of agrarian and industrial landlordism) convinced him that the Democracy that was the United States and social democracy elsewhere could be preserved only under conditions where virtually all citizens became recipients of rent, wages and interest. In 1958, Adler collaborated with Kelso on their first detailed presentation of a plan to accomplish this objective, published as The Capitalist Manifesto. Adler wrote the preface, explaining how he came to embrace Kelso's solution to the great problem of unjust wealth concentration. Many of Western civilization's most influential social philosophers and reformers of the last hundred years (a group he identifies as including Henry George) had articulated the case against the status quo, offering their own - non-communist -- solutions. Not until meeting Kelso, however, did Adler feel he had found "the means of giving full strength to the rights of private property in capital while at the same time harmonizing those rights with the applicable principles of economic justice."[148] Liberalism, greatly assisted by the deceptive simplicity of Neo-Keynesian economic prescriptions, was pulling the social democracies along the path toward democratic socialism and the trading of liberty for the illusion of security:

What appears to be the increasing productiveness of labor is not the increasing productiveness of labor but the increasing productiveness of capital.

What appears to be the preservation of private property in the means of production, particularly in the capital wealth of corporations, is characterized by only a fraction of the rights that would justify its being called private property.

What appears to be justice in the distribution of incomes is in fact gross injustice.

What promises to free men from unnecessary toil is of such a nature that it must unavoidably saddle them with unnecessary toil.

What seems at first glance to be an economic order consistent with the American system of separated and balanced powers, as the most dependable safeguard of human freedom, is in fact creating a centralization of power that would have brought our ancestors to arms.

Though it is fashionable today to believe that we are advancing toward a sound capitalism, an understanding of the principles of capitalism will disclose that we are retreating from it and, instead, advancing toward a socialistic state.[149]

Kelso and Adler venture into the realm of political economy in an effort to substantiate these claims. They begin, to their credit, with a recognition that "natural resources" are a factor of production separate and distinct from "human labor" and "inanimate instruments made by man."[150] Unfortunately, they accept as principle without critical analysis Locke's assertion that "a man's right to acquired property derives from the productive use of such property as he already owns, whether that is his own labor power, his land, or his stock of workable materials and working instrumentalities."[151] By conveniently sidestepping the socio-political ramifications of treating nature (i.e., what we know to be the source of all wealth) in the same realm of property as production, Adler and Kelso fall victim to the same diversion from classical political economy as those who did so deliberately in defense of the status quo. Land ceases to exist as a distinct factor of production in their analysis. From a socio-political standpoint, they abandon the ought and simply accept what is; namely, the practice of economists of that era to define capital as "all forms of acquired property in productive factors."[152] From the perspective of someone holding the same views as Henry George or a cooperative individualist, their other crucial intellectual error is a willingness to accept as principle the relativistic view that "wealth is anything that is regarded as wealth by a significant number of persons."[153] By this reasoning, any and all privileges granted by the State to individuals or groups or entities would have to be accepted as legitimate forms of private property; and, if such assets yielded an exchange value in the market place, that value must be wealth to theorists and beneficiaries alike. Adler's own deep concern for the rights of the individual is put at risk by such thinking. How can the individual be said to possess an unalienable and equal right to the opportunity for survival if denied the right of equal access to nature under laws that protect the monopolistic control over nature by some to the exclusion of others? Neither Adler nor Kelso rise to the moral and intellectual challenge on this critical question.

Kelso's efforts would eventually help to turn a respectable number of propertyless workers into owners of the corporate shares of stock. A small number of companies even have been wholly acquired by managers and employees. Those who have in this manner become joint owners of businesses controlling land or other forms of economic licenses - as well as capital goods -- have thereby shared in the unearned income previously monopolized by a smaller number. Employee ownership does, in fact, mitigate for some the problems created by agrarian and industrial landlordism. Even under the best of scenarios, however, far too many people will forever remain in positions of virtual domination by those who control nature, enjoy the privileges of monopolistic licenses and wield the bureaucratic powers of the State. Moreover, the nominal price of all types of land continues to escalate, so that landlords - whether agrarian or industrial - claim an increasingly large share of wealth being produced by others. To be fair, the measures advocated by Kelso have received only about as much experimental support as has the Georgist incremental measure of capturing the annual rental value of locations in our cities and towns. Logic suggests some improvement in the opportunity for those excluded from the rentier class to exchange their labor for a living wage under conditions of widespread employee ownership of businesses. The broader the distribution of purchasing power, the greater will be the demand for labor. What this suggests is that employee ownership has a firm place in any holistic approach to maximizing both wealth production and a just distribution thereof. What remains as the core problem to be solved is how to implement measures to capture the rent of nature and the exchange value of other forms economic license while freeing from taxation the earned income individuals derive from engaging in wealth production.

What was absent during the 1950s and continues to be missing from the intellectual and political debates is a clear and logically-consistent extension of John Locke's distinctions between liberty and license. On this important matter, the Marxist-inspired justification for transforming the social democracies into national security states blurred the thinking even of those within the Remnant. One of those who considered his beliefs to be true to conservative ideals was philosopher Peter Viereck. In 1953, he suggested to Western intellectuals that a common ground had developed upon which they could conserve the best tradition offered while ever moving toward the just society:

Civilization is an infinitely fragile bundle of accumulated habits and restraints. The necessary conservative function of any generation is not just to enjoy itself but to pass on this bundle in good condition to the next generation.

Radicalism and revolt are just as valuable as conservatism so long as they really do correct social defects. But not when their insurgency accentuates, instead of corrects, social defects. In the past, when society had too much laissez faire, the thunder from the left was a valuable corrective to social defects. Today, when the world is afflicted by too much statism, the left accentuates, rather than corrects, social defects. ...[155]

To Americans, in particular, Viereck urged patient study of the great ideas in a search for truth. "By being more contemplative than activist, by asking all those basic questions the activists ignore...," Viereck believed the nation would gradually experience "a conservative return to values..."[156] Viereck retains in his vision of society overseen by minimally interventionist government the cooperative individualist requirement that ethics displace exploitation, that human rights act as a check on the freedom of action by corporate, entrepreneurial and government decision-makers and that privilege is supplanted by equality of opportunity.

Some of the same concerns had long been on the mind of Robert Hutchins and were the driving forces behind his struggle to reorganize the University of Chicago into a model environment for return to and expansion of liberal education. Sadly, in just the same manner as the Remnant had entered its long isolation in the wilderness, so was Hutchins forced to abandon his quest and step down from the University to devote his time and energy to other projects. One of his accomplishments during the last half of the 1940s was to assist (with funds provided by Chicago industrialist Walter Paepcke) in establishing the Aspen Institute of Humanistic Studies. Then, after Paul Hoffman called on Hutchins to join him at the Ford Foundation, they distributed more than thirty million dollars in grants over the next two years for educational programs. Of this amount, nearly $1.5 million went to fund the Great Books project and another of Mortimer Adler's projects, the Institute for Philosophical Research.

Over the next few years, Hutchins became one of the strongest and most controversial defenders of the U.S. Constitution and the guarantees to civil liberties incorporated therein. Given the times, his defense of intellectual freedom is remarkably consistent and deserving of our deep respect. Although personally critical of Marxist assertions about the historical inevitability of socialism, Hutchins asserted to audiences that there was nothing wrong in having Marxists in government or as teachers -- so long as they were competent in their work and did not attempt to substitute propaganda for objective presentations of fact. Reactionary architects of the national security state responded with unrelenting attacks on Hutchins, Hoffman and the Ford Foundation. After little more than a year, Hoffman was tiring of having to defend his programs and spending decisions to Henry Ford II and the Foundation's other fearful and indecisive board members. Hoffman's future was chosen for him when Eisenhower asked for his help in running the 1952 Presidential campaign, which took Hoffman away for four months. He returned after the election but remained at the Ford Foundation for only a few months more, resigning in February 1953 to head an economic policy study committee appointed by Eisenhower. Hutchins remained at the Ford Foundation, isolated and largely stripped of influence. He worked sparingly out of the Foundation's Pasadena, California office (which Hoffman had established when the two of them first came on board). He would soon be called on to guide the Fund for the Republic through its traumatic years as guardian of the flame of individual liberty against attacks by the advancing national security state.

The role of extremists such as Senator Joseph McCarthy and journalist Fulton Lewis, Jr. in creating an atmosphere of fear was real but must be placed in the proper perspective of the times. Marxists, communists and communist sympathizers in the United States were being threatened not with imprisonment but with ostracism and the potential loss of their opportunity to earn a living. The overwhelming majority of Americans, having come through the years of economic depression and war with a renewed belief in the Democracy, discarded whatever radicalism they once might have possessed. This was increasingly true of intellectuals, as well, although their past beliefs, documented in writing, were more difficult to shed. Institutional patriotism demanded the purging of anyone who did not aggressively admit they had been taken in by communist rhetoric and denounce communism as inherently evil. The real crime is that the selling of fear turned out to be a very effective tool in the hands of those interested in preserving ancient privileges under the guise of building a strong national security state. Even within the Remnant there arose misguided defenses of McCarthy based on who his targets were. In the pages of the Freeman, now being published by Leonard Read, he and other writers lamented the socialist orientation of most intellectuals and their often long-standing and naive attraction to Marxist ideology in the face of Stalinist realities. Richard Hofstadter would later include Read, Chodorov and others within the Remnant as somewhat minor players in a broad anti-intellectualist drama, ostensibly proving his point by reminding us that "Henry George advis[ed] his son that since college would fill his head with things which would have to be unlearned, he should go directly into newspaper work to put himself in touch with the practical world."[157]

Where political economy was concerned, Henry George had been convinced that the overwhelming majority of university professors were incapable of independent investigation and objective presentation of how socio-political arrangements and institutions advanced or thwarted liberty and equality of opportunity. This accounts, in part, for the fact that although George came to have millions of admirers and thousands of dedicated followers, only a very few of that generation came from within the academic community[158] or opted to pursue the credentials of a formal education that would have enabled them to compete in the intellectual arena of the twentieth century. Fewer still managed to gain positions where they might materially influence either public policy or the overall thinking of new generations. This small group struggled to overcome the stigma of attachment to a failed political movement the remaining proponents of which were viewed as out of touch with the modern world.

In the pages of the American Journal of Economics and Sociology -- still quite activist in tone even though targeted to the audience of professional social scientists -- Francis Neilson was given considerable latitude by the editorial board to state the case of the Remnant. Neilson decried the degree to which ignorance prevailed, allowing proponents of the national security state to employ the banner of anti-communism in their quest. He urged the thoughtful to go back and read Bastiat, Proudhon, Max Hirsch and Franz Oppenheimer as primers on democracy and individualism. Stalinism could not in Neilson's view long prevail, being "nothing more or less than bureaucratic control of the workers [become] slaves of the State."[159] Although most sincere reformers had come to recognize Stalinism for what it was, even those who also rejected revolutionary Marxism continued to believe in the ideals of democratic socialism and the promise of incremental intervention by the State. Neilson warned that the more government was relied on as a service provider, the greater the danger of corruption and injustice -- with the system of taxation becoming the means by which privilege is dispensed:

All the nostrums of so-called reform, that flutter about in the minds of politicians, are tainted with the desire to perpetuate the system of taxation of wealth, so long as the people will permit them to do so. They will promise reform of it, but even the sincerest finds, once he becomes a member of a legislature, he is hedged about by a thousand and one other claims that crowd in upon his desire for the lifting of burdens. ...The demands for expenditures on the great services, as sops and doles, are so vast that reform of the system of taxation of wealth seems an impossible goal to be reached.[160]

Too few were listening. With the Remnant facing near-extinction, the only hope of survival was to commit resources to education. Chodorov wanted to target college students, those destined to become leaders in education, science, business and government. His proposals fell on deaf ears. A handful of college professors did their best to pass on the intellectual legacy of cooperative individualism to their students, but their efforts were lost in a sea of apathy. Only within the Henry George School of Social Science (in New York and the dozen or so locations where extensions existed around the country) was there hope for the survival of cooperative individualism.

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