A Theory of Socialism and Capitalism By Hans-Hermann Hoppe


You know the mainstream view of politics. Socialism is on the left. Fascism is on the right. In A Theory of Socialism and Capitalism, Hoppe wants to blow up this entire system of thinking. He wants to replace it with a continuum that has nothing to do with the conventional left-right distinction. The only relevant concern for politics is how much control the state itself exerts over society. This control exists on a continuum from piecemeal technocracy and conservatism to social democracy and communism. With this model, Hoppe offers a system for classifying all economic and political systems around the world. All the while, he explains why all forms of statism make people poor, bring about injustice, and harm human flourishing.

Hoppe makes the case throughout that no aspects of the state are necessary. Society left on its own can manage itself, and this path is most likely to maximize property values, innovation, cooperation, and community. The state adds only violence to the equation. This is the most important insight in this book. Many of his examples are drawn from the East/West Germany experience. The book was written in 1989 just before the East collapsed and Germany was reunited.

The second most important insight concerns the “socio-psychological foundations” of statism itself. This phrase refers to why people accept the violence of statism. It would never be approved by the population if the people understood it. Instead, the state seeks out tactics to convince people that it is doing good through redistribution that hurts some and helps others. It seeks to control education (to instill civic pride), communication (to control access to information), money (to raise funding for the state without taxation), and the apparatus of security (to convince people that they are being kept safe and being offered justice services).

The book instills in the reader a firm grasp of the operations of the free society in the absence of the state. Property rights are the foundation of social order and no other system is rational, logical, workable, or intellectually justifiable. Most profoundly, it shows how the state nonetheless survives. The lasting contribution, then, is to dislodge common myths about politics from readers’ minds. In this sense, it offers intellectual liberation.

It also offers a checklist for tracking the stability of every existing regime. When its control of education, communication, money, and security diminishes, so too does its power to manage the population. This is precisely what is happening in our time. Education is moving toward private provision. The communication monopoly has been utterly smashed. The money monopoly is no longer effective. Finally, masses of people have lost faith in the police and justice system, which is overextended and more openly aggressive against people than ever before.

Hans-Hermann Hoppe is one of the most important philosophers of the liberal/libertarian tradition. Most of the corpus of his innovative ideas are summarized in this one book, including his “argumentation ethics” method of showing that anyone who denies ownership must presume ownership in the course of making that argument. It even makes a strong case against all forms of empiricism and positivism in the social sciences (because there is no method for discovering causes and effects outside of pure logic).

Finally, it offers detailed and sweeping critiques of the most important “scientific” justifications for state control. The end result is to help the reader see how a purely free society is necessarily better than all forms of socialism, and that this free society will come about as the result of a general awareness of the violent reality of all forms of socialism.

The overall benefit of this book is very broad. For Americans bombarded daily by false political choice, this text reveals a completely different path forward — a totally new interpretive lens. The choice is not between left and right, but between all forms of political control and the “natural order of liberty,” in which individuals and their property are left alone. For those who are already aware of this alternative, this book offers a model and ideal of rhetorical precision. Its methods and approaches are sophisticated and advanced, an extension of a long tradition into modern times.

“Socialism does not normally pass even the first decisive test (the necessary if not sufficient condition) required of rules of human conduct which claim to be morally justified or justifiable. This test, as formulated in the so-called golden rule or, similarly, in the Kantian categorical imperative, requires that in order to be just, a rule must be a general one applicable to every single person in the same way.”

“There is a striking similarity between the socialism of conservatism and social-democratic socialism. Both forms of socialism involve a redistribution of property titles away from producers/contractors onto nonproducers/noncontractors, and both thereby separate the processes of producing and contracting from that of the actual acquisition of income and wealth.”

“Empiricism-positivism turns out to be self-contradictory, as it itself must presuppose the existence of a priori knowledge as real knowledge.”

“There can be no socialism without a state, and as long as there is a state there is socialism. The state, then, is the very institution that puts socialism into action; and as socialism rests on aggressive violence directed against innocent victims.”

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  • Jeffrey Tucker

    A Theory of Socialism and Capitalism

    A Theory of Socialism and Capitalism Hoppe’s book slipped into the literature without much fanfare but over time it has become a classic. It’s major contribution is not just to provide a helpful taxonomy of systems; it also corrects prevailing theory in important places. For example, his theory of property rights here is more robust than the thinkers he cites (Mises and Rothbard). Hoppe’s argument over scarcity provided the foundation for later developments in IP theory. Kick off the discussion! Questions, comments, observations or elaborations? Either reply here or create a new discussion using the tag Library_a-theory-of-socialism-and-capitalism

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  • Properal

    Dominance, Sharing, and Privacy (DSP), The Three Principles of Sociality

    Dominance, Sharing, and Privacy gives us a simplified (maybe oversimplified), and intuitive way to categorize human sociality. Instead of thinking of social structures as being diverse and too complicated to be categorized, these three categories allow us to classify behaviors that address conflict as one of three types or a combination of the three.  For example, might makes right is not really a property norm but it is a dominance strategy. The ethic that the world belongs to everyone is not an alternative property norm, it is the nullification of property in favor of a sharing norm.  The violent defense of a territory is not a might makes right or dominance behavior but is the defense of privacy. The reluctance to intrude on others prior establish territory is not just a fear of retaliation but a respect for privacy.   For moe read: Dominance, Sharing, and Privacy (DSP), The Three Principles of Sociality  

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  • Mike Maman

    What If Parents Loved Strangers’ Children As Much As Their Own?

    What if Parents Loved Strangers’ Children As Much As Their Own? Last December, the author and philosopher Sam Harris invited Paul Bloom, a professor of psychology at Yale, to appear on his podcast, “Waking Up.” It was Bloom’s third stint as a guest, and, as before, the two men devoted a significant portion of their conversation to the subject of empathy. Bloom had just published a book, “Against Empathy: The Case for Rational Compassion,” in which he drew a distinction between empathy (the ability to feel other people’s pain) and compassion (desiring others’ well-being); according to Bloom, society needs less of the former and more of the latter. On the podcast, he and Harris talked about how empathy favors people you know over people you don’t, and how this favoritism leads to harmful behaviors such as tribalism and nationalism. They advocated a cooler, more rational approach to moral decision-making. Then they asked how far such an approach could be taken. Some forms of preferential treatment, Harris and Bloom noted, are considered appropriate, as when parents love their children more than they do strangers. But they wondered whether this, too, might be a behavior that requires correcting. They cited the utilitarian philosopher Peter Singer, who famously pointed out that spending money on non-essentials means valuing your comfort over the lives of people starving elsewhere in the world. Bloom admitted that he buys toys and vacations for his children, identifying this as a moral dilemma that we all face. He and Harris engaged in a thought experiment: Would the world be improved if parents cared for other people just as much as they cared for their own children…While we’ve seen some reversals of this in the past year or two—including Brexit, the election of Donald Trump, and the resurgence of the xenophobic right—it’s not unreasonable to believe that these are temporary setbacks, blips in a broader trend that obtains over centuries or millennia. If this trend continues in the future, it could end in a kind of species-wide eusociality, at which point the perfectly impartial affection that Harris and Bloom posit might no longer seem so outlandish.? At first glance, I rolled my eyes thinking this was a call for collective child-rearing and how individualism is evil (Although he does take swipes at Trump and Brexit).  However on the whole, Chiang’s piece for the New Yorker is surprisingly balanced, with the exception talking about Brexit and Trump, as he cites several examples like the Kibbutzim in Israel where collectively raising children was not a good thing.  How if we all adopted a guru mindset of impartial affection the world would not be a utopia. What are your thoughts? Reactions?

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  • Rebecca Lau

    Dating a socialist

    I mean a real socialist, not a guy that voted for Obama. A guy that is every bit socialist as I am libertarian. Background: I met a guy on online. I found out that he is an engineer in SF and a socialist. He loves seeing socialist philosophers speak, Black Lives Matter demonstrations, and Tumblr. I’m also a SF resident and more knowledgable and more sympathetic toward the far left than most libertarians. I also have a job that is stereotypically liberal (elementary school teacher) so we’re kind of the opposite. We’ve hung out twice so far and I think we are pretty cute together. I always say teasing things to him like, “Do you follow fuckyeahelizabethwarren on Tumblr?” He doesn’t know much about libertarianism but when I met him I was going to see Jeffrey Tucker speak on the same day and he was interested to hear about it. Has anyone ever gone down this dark path before? Any predictions on what will happen?

    Jump to Discussion Post 48 replies
  • Jose Benegas

    10 misconceptions that favor despotism

    People tend to think that despots are a surprise. Suddenly a society encounters a Hugo Chavez, a Hitler, a Fidel Castro, Mussolini. After that society suffers as a victim the rigors of despotism. In this book I put myself away of the the myth of the innocent society. On the contrary, the despot is the product of misconceptions that have been injected or prevail in a society. They are very specific ideas, completely incompatible with the notion of limited government, representation and rule of law. The book is now available in the Liberty.me library to download. Those misconceptions, which are not exhausted in this list are: identification of dictatorship with physical violence, absolute democracy, social democracy, egalitarianism, the class struggle, identifying legislative will of state law and the pursuit of government wise, the income tax even the notion that the press is going to keep us free. And there is an answer that we can search together: Can this happen in the USA? Just ask yourself if these misconceptions are already settled.

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  • Kym Robinson

    Edward Bellamy

    Have many of you read any or much of his works ?   And how influential do you think he is whether directly or indirectly in most Western nations? Notably the US.   Thank you all

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  • Michael R. E. Sanders

    Fascism is just another form of socialism

    Jeffrey Tucker wrote in pertinent part “You can choose the socialist who wants to wreck the world in one way, or the fascist who wants to wreck the world in another way.” Since fascism is just another form of socialism, is Mr. Tucker arguing  “you can choose the socialist who wants to wreck the world in one way, or the socialist who wants to wreck the world in another way?

    Jump to Discussion Post 36 replies
  • Martin Nicholls

    Have I Misunderstood the Difference Between Capitalism & Socialism?

    Not too long ago I decided to ask a Scottish Socialist an economic question about the socialist system he advocates on his YouTube channel: “Due to the preclusion of exchange for goods of higher order, what is the basis for state officials directing the alternative applications of the factors of production towards thousands of different and changing consumer needs and wants of different urgencies in the least-cost manner for society at large?” The answer to my own question was basically going to be that state officials cannot have a basis for directing the factors of production due to the absence of the price mechanism, but as you can see in the comments section he didn’t really answer my question. As you can see above, he has now responded to my question with a new video, but after listening to it I cannot compile a sufficient answer to reply with in order to get him to understand where he is mistaken. http://www.youtube.com/all_comments?v=yN5_YWv–WA Can you tell me what point he is still missing?

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  • Martin Nicholls

    Working-Class Confusion

    On two different occasions when Christopher Hitchens was talking about the book How Green Was My Valley by Richard Llewellyn (a book which I haven’t read), he made two similar statements about the working-class which I’m finding confusing: “You cannot be a socialist if you don’t think there is such a thing as a working class as a way of life and mind of its own.” “You cannot be a socialist if you don’t think that working-class people have lives and minds of their own.” 1. Who is saying that there is no such a thing as a working-class? 2. Is it believed by socialists that the working-class is a thinking organic entity with a mind of its own that “believes this” or “thinks that”? 3. Is it believed by socialists that the working-class is an independent and inevitable natural force/movement in which individuals don’t play any critical role? 4. Is it believed by socialists that working-class is joint-thinking? 5. Who is saying that working-class people don’t have lives and minds of their own?

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  • Jorge Trucco

    Can you have socialism without a state?

    I agree with Ayn Rand when she said that the difference between Communism and Socialism is that communism is the enslavement of man through weapons, and socialism is the enslavement of man through votes. They both are forms of collectivism. But I have noticed that some members have made a distinction between communism and socialism, and have mentioned the possibility of the existence of socialism without a state. So, can you have socialism without a state? What do you guys think?

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