By Audrey Sightler
The Founding Fathers' economic theory gave the United States of America the capitalist foundation and prosperity that has served its citizens since the founding of this great nation. While America has strayed over time from private property, free markets, and market value economic policies, the policies still hold firm. Though there is a vast difference between the economy of early America and the 21st century, can the principles of our Founding Fathers hold constant for today's economy? The answer is yes: the founders offer us a guide for today's economic questions, a guide which can discourage us from accepting socialistic ideals.
Benjamin Franklin gave insight into the future of our nation if we do not continue the principles of our Constitution. Franklin stated, "I agree to this Constitution… and I believe, further, that this is likely to be well administered for years, and can only end in despotism, as other forms have done before it, when the people shall become so corrupted as to need despotic government, being incapable of any other." Franklin suggested that no one can remain free if society decays. The corrupt society seeps into our government; likewise, citizens will then fear for their livelihood and the rights to their property.
In the words of Edmund Burke, "A law against property is a law against the industry." A critical element of economic principles is the ownership of private property. Property rights are significant for the creation of wealth and prosperity, and successful self-government and individual liberty. On the contrary, in "The Communist Manifesto," Karl Marx declares, the theory of communism was compressed in the simple sentence: "Abolition of private property." Marx could only accomplish abolishing private property by tyranny and violence to deprive citizens of fundamental freedoms.
John Adam's forewarned us of the consequences of securing individual freedom to private property stating, "The moment the idea is admitted into society that property is not as sacred as the laws of God and that there is not a force of law and public justice to protect it, anarchy and tyranny commence. If 'Thou shalt not covet' and 'Thou shalt not steal' were not commandments of Heaven, they must be made inviolable precepts in every society before it can be civilized or made free." In a socialistic view, wealth distribution to the unemployed or disadvantaged groups is morally just.
Most of today's society agrees with this view. Advocates for "social justice" have insisted on legislative enactment for material entitlements, though the distribution of property rights could lead to greater inequality. The Founders suggested that citizens with refined skill sets were more likely to acquire wealth. Thus, no matter the discrepancy in wealth among citizens, property rights give an equal advantage that benefits all classes against exploitation and enslavement by others.
Furthermore, at the Constitutional Convention of 1787, James Madison and others listed the protection of property rights as the prime reason for establishing a government. Thus, the Constitution created the most exceptional institution of free trade in the world. The Founding Fathers viewed a free market economy as individual freedom, a right to man. The Founders knew citizens could only be truly free from concentrations of power if they had the right to acquire and own property, have access to open markets, and produce what they desired.
Adam Smith, the Founding Father of Capitalism, called this "The system of natural liberty." For an example of how well America's Constitution is constructed, one would have to view other countries in comparison, for example, Spain is currently abiding by its fourteenth Constitution, the first being formed in 1808, with the current government, the "Spanish Socialist Workers' Party" calling for the present Constitution of 1978 to be reformed. Many Spanish citizens gave their lives during the transition from dictatorship to democracy to establish a republic and the 1978 constitution.
In addition to private property and free markets, the next economic principle for the protection of property rights is money. The Founding Fathers believed there had to be a stable and reliable measure of market value. If there is no equal measure of market value, the prices of goods and services can fluctuate unexpectedly. Volatile fluctuation in prices means that debts and investments can be eliminated through inflation, and property will be taken by influencing the supply of money. James Madison made this argument in Federalist 44, "The extension of the prohibition to bills of credit must give pleasure to every citizen in proportion to his love of justice, and his knowledge of the true springs of public prosperity... Since the peace, America has suffered from the pestilent effects of paper money, on the necessary confidence between man and man, on the necessary confidence in the public councils, on the industry and morals of the people, and the character of Republican government."
Advocates for socialism suggest that capitalism leaves low-income groups behind; if this was so, then why was Venezuela once the fourth wealthiest country in the world, until it lost its free markets and private ownership, resulting in income stagnation for all Venezuelans?
The U.S. government has since drifted from the Founders' economic principles, but the principles have not completely been replaced. Several of the Founders' policies have protected property rights since the Constitution's founding is still in place. As America's society continues to shift in a less capitalist form of government, we will gradually see a change in the direction of individual freedom and more socialistic ideals.
Thomas Jefferson stated that "If we can but prevent the government from wasting the labors of the people, under the pretense of taking care of them, they must become happy." Hence, a society can never be happy if the fruits of one's labor are placed in one basket to be divided up among the rest of society to achieve an unapproachable utopia of economic equality.
Audrey Sightler is a Louisiana native, pursuing a Bachelor of Science in International Business Administration, as well as a History Minor with Liberty University. She is an active member of the International Churchill Society and the Royal Economic Society. Moreover, Audrey has achieved multiple certifications in International Business with the University of London. Audrey is a fourth-generation American descendant of an Ellis Island immigrant; her forefathers also worked alongside the Founding Fathers to establish our freedoms during America's founding.