Exposing the Fallacy of the Presumed Collective

Stuart K. Hayashi

 

Individualism Vs. Collectivism, Both on the Descriptive Level and the Political (Prescriptive) Level
Individualism on the descriptive level is the recognition that each legally-competent human being is an individual with his or her own will, consciousness, and capacity for decision-making. This descriptive level is what admirers of Ayn Rand’s Objectivist philosophy call “the metaphysical level.”

Accordingly, there is also the idea of individualism as applied prescriptively to politics. Individualism, applied politically, means that every legally-competent adult human being must be recognized as an individual with a right to bodily autonomy. This entails that if I see another legally-competent adult showing eating habits that I judge will be bad for him in the coming decades, it would be wrong for me to try to use the power of government to override his choices. Recall, as I have explained before, that laws are ultimately enforced by armed men exerting their will upon the lawbreaker.

In contrast to the idea of individualism is social collectivism. To agree that collectivism is correct on the descriptive (“metaphysical”) level is to believe that the actual unit of decision-making among human beings is not the individual person. No, says collectivism, the true unit of decision-making is some larger group of which this person may be a member. Often, continues this notion, the group that makes someone’s choices is a group in which that person did not even choose to belong.

An example of such collectivism would be the belief that an entire ethnic group or race, as a whole, can make choices for all or most of its members. One application of this interpretation is as follows: I am of Japanese ancestry, and I have an interest in the sciences, technology, engineering, and math (STEM). That is consistent with stereotypes about persons of Japanese ancestry. To apply descriptive-level social collectivism to this context would be to assume that my interest in STEM has less to do with my own uniqueness as an individual than it does my membership in a collective group that is often associated with STEM.

“The descriptive level,” here, refers to judgments that are presented as truthful or factual. Descriptive is that which “is.” Also of note is the prescriptive level. That which is prescriptive refers to what ought to be done.

Social collectivism is also advocated on the prescriptive level. That is ethical collectivism, which proclaims that a supposed collective, not any one individual, should have first priority in being the main beneficiary of someone’s actions. When it comes to priorities, this usually calls for the individual to subordinate her own well-being to that of some group of people as a whole. This prescription applied to the functions of government is known as political collectivism. Political collectivism has the State enforce the prioritization of some supposed social collective above the individual. This can manifest in at least one of these two policies.

1. Sacrifice of the well-being of an individual for the ostensive benefit of a group to which she belongs. That group is usually “Society” or the political jurisdiction.
2. Sacrifice of the well-being of members of one group to that of another group.

Under political collectivism, the government treats people primarily as members of collectives. This time, the government’s guns enforce the notion that it is some group of people, as a whole, that must have first claim to being the beneficiary of any action. Such a government is in contrast to the political individualism that respects citizens as individuals who must face the consequences of their own respective choices.

Here I must make a special note. Previously it has been tempting for me to say something like the following: When it come to distinguishing governmental action from nongovernmental, the main distinction of them should be named but seldom is. Many political collectivists pronounce that the difference between the government sector and private sector is that, respectively, the former is unselfish and the latter is selfish. Here, selfish is used as a pejorative. It is true that individual freedom is selfish. It is also true that the regulatory-entitlement state, having governmental actions intrude beyond what would be done by a constitutional liberal republican Night Watchman State that defends the individual against force, is against your self-interest. However, it is best that we reject the use of selfish as a pejorative. Ayn Rand has made that point well.

But the attempt to identify the private sector with self-interest and the government sector with opposition to your self-interest can be stated more simply. It can be said that, respectively, governmental action is collective whereas nongovernmental action is what individuals do. I have stated that the attempt to draw the line here is misleading. I have stated that the true distinction is the following. Everything that can be accomplished peacefully is rightfully nongovernmental. By contrast, governmental action necessarily involves the government being at-least-tacitly-socially-authorized to threaten physical violence against parties who resist its will. Hence, I have said that the true distinction is that governmental action is the violent sector whereas nongovernmental action is the peaceful sector.

On that understanding, it seems that the attempt to say that it is of social collectivism versus individualism is, at best, secondary in importance in identifying what separates, respectively, governmental action from nongovernmental action. I stand by that. However, upon writing and re-reading this essay, I must say that when people advocate that the State initiate the use of force against peaceful individuals, social collectivism and political collectivism are usually involved. Say that Miss X advocates that the State initiate the use of force against Mr. Y. When this happens, people will usually not condone that unless Miss X bamboozles those people into believing Miss X has a proper ethical justification for doing so. And the number-one sort of argument that convinces most people is the sort that invokes the appeal of social collectivism and political collectivism. In that respect, social collectivism and political collectivism remain inseparable from tyrannical threats of violence by the State against peaceful people. They are inseparable because social collectivism and political collectivism provide the most-favored rationalizations for cruel uses of State force toward nonviolent people. And these rationalizations rely on the logical fallacy that is the topic of this essay. That fallacy is that of the Presumed Collective. In the essay below, I will provide four case studies on how that happens.

Ethnicity-based policies are one type of implementation of political collectivism. Many people observe that, for the past 150 years, a large number of white Americans have violently mistreated Americans of Asian descent. That is true. Yet some social activists would conclude from that observation that white American in general happen to impose violent mistreatment toward Asian-Americans in general. And that is a much shakier conclusion. 

This is a difference between how political individualism and political collectivism confront the issue of racial inequities. Imagine a specific white person subjected me to bodily harm. Then imagine I successfully sued that white person for damages. That would be political individualism. Here, the State would be taking individuals’ actions into consideration and accordingly holding them accountable. A specific individual harmed me, another specific individual, and therefore the individual aggressor had to recompense the individual victim.

By contrast, political collectivism does not bother to sort out individuals’ cases. Apparently, many advocates of political collectivism dismiss such specificity as being too complicated or cumbersome. Instead, in the aforementioned example, political collectivists blame white Americans in general for mistreating Asian-Americans in general. Hence, white Americans in general must pay taxes to Asian-Americans in general. 

 The ethical problem is how that imposes injustice on specific individuals. Individual white Americans who have not committed violence against Asian-Americans are vilified and punished as oppressors anyway. As a corollary, specific Asian-Americans (in this instance, me), who have not been directly brutalized by whites in general, will be paid this tax money as a reparation for something that was not actually inflicted upon them.

I know that advocates of race-based Social Justice will scoff at the above case study. As of this writing, I know of no legal initiative conducted in the name of Social Justice has gone as far as what I have described. The purpose of the above example is not to criticize activism in favor of race-based Social Justice. That is another controversy for another essay. The proposal described would definitely be an application of political collectivism. And I think that an extreme a case study stresses the important distinction between political individualism and political collectivism.

And this is not to say that it is necessarily collectivist if someone points out an observable and disturbing pattern of some white people often targeting Asian-Americans as objects of discrimination or abuse. To the degree that such a pattern occurs, calling attention to it can be in the service of protecting the specific individuals who are in danger.

Sometimes when political collectivism contrasts one group of people with another, a person’s individual choices do play a role in which group she ends up. To the degree that people are free to make their economic choices, they often do bear a lot of responsibility in whether they become rich or poor. Yet for political collectivists to pit the rich against the poor, or vice versa, is still a form of political collectivism.

Imagine a rich woman arbitrarily accused a poor man of a crime. Then imagine that law enforcement and the courts said, “Low-income people are usually less trustworthy than rich people. Therefore, we will just convict the low-income man.” That is still political collectivism. The reason is that the government’s decision is not based on the specifics of the case, but on the players’ respective memberships in contrasting groups. And those group memberships are not pertinent to what happened.

For much of my life, I thought it was rather obvious that descriptive (“metaphysical”) individualism and political individualism are correct, whereas descriptive social-collectivism and political collectivism are wrong. But, increasingly, I see and hear Social Justice activists take it for granted that their favorite forms of descriptive social-collectivism and political collectivism are beyond challenge or reproach.

A major reason why social collectivism — both the descriptive sort and the political implementation — is taken for granted, is that many Americans fall prey to a particular cognitive distortion or fallacy. It is one I call the Fallacy of the Presumed Collective. That is what we shall discuss for this essay.

 

 
Explaining the Fallacy of the Presumed Collective 

This is the Fallacy of the Presumed Collective. Person X argues in favor of social collectivism over individualism. To argue this, Person X offers what she considers to be proof of her correctness. But her argument actually relies upon her presuming, from the outset, that social collectivism has already been validated.

This can be described in more complicated and specific terms. On the prescriptive level, Person X wants the enactment of a public policy that is in line with political collectivism. Person X thus advances some argument in favor of political collectivism. But this argument already presumes, from inception, that social collectivism on the descriptive level is indisputable or has already been vindicated. That is a fallacious presumption. As I will explain in this essay’s final section, social collectivism on the descriptive level is demonstrably false.

The Fallacy of the Presumed Collective is a combination of two other logical fallacies. The first is “Begging the Question” or “circular reasoning.” In this fallacy, an argument that purports to prove Y itself presupposes Y already being accepted as true. An example of this would be my saying that everything that Book Q says about biology is factually correct because Book Q itself says everything in Book Q about biology is factually correct. That is bunk. You would need sources of information on biology other than Book Q — the more direct the evidence, the more reliable — to corroborate Book Q’s veracity.

And there is the second fallacy that is found in the Fallacy of the Presumed Collective. That second is called the Composition Fallacy. The Composition Fallacy presumes that if a statement about part of R is true, then it follows that the statement applies to R as a whole. It is true, for instance, that automobiles have parts that are glass. It would be the Composition Fallacy, though, to conclude from this that the entire automobile consists of glass.

Pernicious stereotypes are a form of the Composition Fallacy being applied to categories of human beings. Many persons of Asian descent, for example, are violent criminals. It would be an especially hazardous form of the Composition Fallacy to conclude that this means that Asian-descended persons, in general, are violent criminals. (I thank Raymond C. Niles for introducing me to the concept of the Composition Fallacy.)

I will provide four case studies of well-known public commentators asserting influential arguments that ultimately fall prey to the Fallacy of the Presumed Collective. I think all four case studies imperil the principle of individual rights, though the last one stands out as the most noxious. These four cases are: 

1.  If I “consent” to this, everyone in my demographic group consents to it.
2. The Jean-Jacques Rousseau-influenced Social Contract argument (related to 1).
3. “You Didn’t Build That.”
4. The White Nationalists’ rationalization for imposing political collectivism based on ethnicity.

The latter two case studies rely on yet another, related logical fallacy. That fallacy is what I call “Influence or Collaboration Equals Collective.”

In the essay, I will also explain how it is that we know that individualism, not social collectivism, is valid on the descriptive level. That is, it is a fact that the unit at which human decision-making is made is the individual person, not a larger group of which the individual person can be classified.

 

 
Many Billionaires Like the Estate Tax; Ergo, the Estate Tax Is Not Imposed on Any Billionaire Against His Will
Numerous issues of individualism versus collectivism in politics pertain to economics. Insofar as political-economic individualism is in effect, the State acknowledges that the wealth you alone receive peaceably as gifts or earned payments rightfully belongs to you alone. As a matter of course, the State should largely let you as an individual keep your wealth, even protecting it from forcible confiscation by anyone.

Conversely, political-economic collectivism states that the wealth you peaceably acquired is not yours alone, but is necessarily to be treated as something that must also be accessed by a larger group of people to which you are said to belong. That larger group is usually “the public” or “Society as a whole.” This collectivist policy will be in enforced regardless of whether you sought to avail those parts of your wealth to other members of this group.

The multi-billionaire Warren Buffet, one of the world’s richest men, promotes a political-economic collectivism of this sort. He avidly touts the virtues of the estate tax and of increasing other major taxes on billionaires and the USA’s wealthiest one percent. Of note is that Buffett maintains that these taxes are not some imposition that his fellow billionaires deserve. Rather, he professes, these taxes are no imposition at all.

Buffett fondly puts forth a particular insinuation. First, Buffett reminds us he is a billionaire. Second, Buffett informs us he highly approves of the estate tax. Moreover, he gathers together swaths of other billionaires who share in that approval. The implication is usually that billionaires, in general, approve of the estate tax. Therefore, we are to conclude, the estate tax is not some coercive measure that brutally extracts anything from anyone against her will.

“Frankly,” Buffett told a packed audience, “I think Bill [Gates] and I should have a higher tax rate on the income we get.” Gates, sitting next to him, agreed, “I go along with that wholeheartedly.”

Over the past few years, Mark Zuckerberg got into a bit of a verbal skirmish with Sen. Alexandria Ocasio-Cortez about whether his taxes should be raised. But when he sat with President Obama in 2011, Zuckerberg agreed with Buffett’s line. Obama told him he wanted a change in the tax code that “allows for people like me and, frankly, you, Mark, to pay a little more in taxes.” To that, Zuckerberg replied, “I’m cool with that.”

From 2001 to 2012, Warren Buffett and other billionaires signed petitions and sent out press releases urging higher taxes on business moguls such as themselves. One of those signers, an heiress to Walt Disney’s fortune, proclaimed, “I can afford to pay the estate tax, and I should.”

Press coverage spelled out the implication that because billionaires do not mind the estate tax, it is not some inhumane constraint being placed upon them. A CNN piece put it, “A group of wealthy Americans, a former president and two Clinton-era Cabinet members called on Congress Tuesday to pass a much stronger estate tax.” That piece’s title was “Super-Wealthy: Tax Us More, Please.” As stated in a New York Times op-ed under Buffett’s own byline, “...the mega-rich...wouldn’t mind being told to pay more in taxes as well, particularly when so many of their fellow citizens are truly suffering.”

Here is what is missing from Buffett’s insinuations and implications. Each billionaire is an individual. They do not have to all agree. Warren Buffett can proclaim that he consents to paying more money to the federal government. If that is sincere, he can simply go to the website Pay.Gov and make a donation here. By contrast, another billionaire named Charles Koch does not consent to paying more money to the federal government. When Buffett says he, as a billionaire, consents to billionaires being forced to pay more in taxes, the implication is that he speaks for billionaires in general. In truth, he does not. It is Buffett presuming to speak on behalf of other individuals.

Here is how Buffett’s argument falls prey to the Fallacy of the Presumed Collective in the more complicated manner I described. Buffett’s argument presumes that he and other billionaires are all the same unit, “billionaires in general”. Buffett conflates himself, as an individual, with other billionaires as if they are all a collective unit. That is, Buffett presumes that social collectivism is veritable on the descriptive level.

Presuming as much, Buffett and Gates and Zuckerberg then imply that because they desire higher taxes, it follows that billionaires, as a collective unit, desire higher taxes. They take the validity of social collectivism on the descriptive level as a given, In so doing, they prescribe that this social collectivism be implemented in political economy. This remains a fallacious asseveration, as Buffett has not bothered to elaborate how billionaires are a collective unit. That is just question-begging on his part.

To the extent that Buffett and his cohorts acknowledge at all that there are billionaires who disagree with them, those billionaires are quickly dismissed as lacking in any moral authority on this issue. Buffett and his cohorts are presented as the true representatives acting on behalf of the entire collective unit of billionaires.  It is as though, when it is debated back against them, Buffett and his cohorts are the only members of this group who truly have a moral say on this issue.

There is another example of this, and it is similar to Buffett’s argument. It has been one of the most popular arguments in political philosophy for over a century. It is the invocation of a Social Contract to argue for expansive government. Thomas Hobbes made this argument before Jean-Jacques Rousseau did. But many of the more complex side-arguments in defense of this wider argument can be attributed more directly to Rousseau.

 

 
Social Contracts and the Collective of Voting Citizens in a Democracy
I have written previously of the fallacies of citing a Social Contract to rationalize the expansion of government power over the peaceful activities of private individuals. But here I will specify the version of the argument that relies upon the Fallacy of the Presumed Collective.

When that Fallacy creeps into the Social Contract gambit, this is how it presents itself.

You balk at such governmental imposition made upon you in the First World. But because you are a citizen of the First World, you actually live under a democratic representative government. Under such a representative democracy, the people vote on such measures. They may do so directly by ballot initiative. They also may do so indirectly by electing representatives who craft the legislation.

Therefore, as a voter or citizen, you ultimately consent to every statute your government enacts. This applies even when you vehemently detest the statute as is interpreted or enforced. And this renders disobedience of such statutes to be puerile at best.

President Obama gladly presents a variant of this nostrum. He remarked that he was nauseated by constituents who wail, “I need a gun to protect myself from the government.” To those who voiced concern that he and likeminded politicians were making impositions on them in opposition to their will, he replied that “the government is us. These officials are elected by you. . . . I am elected by you. . . . It’s a government of and by and for the people” (emphases Obama’s) 

To translate, if elected officials craft and enforce laws that constrain your ability to access a gun for self-defense, that is not really an abrogation that defies your authorization. You remain within the true decision-making unit, which is the collective of voting citizens. The collective of voting citizens democratically resolved to install the officials currently elected. This collective of voters delegated, to these representatives, the rightful authority to issue directives that hinder your ability to access a firearm. And you are among this collective that ratified this gun control. Ergo, you ultimately ratified this gun control. This posited “collective choice” is normally labeled the general will.

Accordingly, U.S. Sen. Alexandria Ocasio-Cortez advances an assertion similar to Obama’s. “[...I]n a democracy, the government is us. ...the government is The Public, and The Public decides what is good for itself.”

Yes, we hear these platitudes offered to rationalize the sophism that the actual unit of political decision-making is some collective that is the voting majority. The fact remains that in our actual, everyday lives, we are still individuals. It is as an individual that you make your life choices. Insofar as the outcome of democratic votes can override the ability of a legally-competent adult to opt to do anything that is peaceful, these democratic votes amount to voting majorities imposing their will on voting minorities and on nonvoters.

Imagine you are childless and do not vote. Perhaps you have refrained from voting. Perhaps you are a resident alien who has not yet obtained citizenship. Suppose that, as a result of a democratic vote, your township criminalizes any inhalation of marijuana. Yet, in the privacy of your own home, you smoke a joint. Then imagine that armed police officers invade your home to arrest you, per the democratically crafted law.

Your action was not the result of some collective choice — an oxymoron — on the part of voters in the township. On the descriptive level, there is no “general will.” What contemplated and then executed the choice was the actual unit of decision-making: you, the individual. An individual decides what is good for herself. And, contrary to Sen. Ocasio-Cortez’s equivocation, a collective “Public” does not decide “what is good for itself.”

When the police arrive to bust you, apologists for Rousseau’s interpretation of the Social Contract can issue their favorite rationalization. They will say that the State is simply holding you to a rule to which you voluntarily assented. They add that this applies even if you assented to this rule by the most indirect means.

What actually happened was something different. As with Warren Buffett’s apologia for raising taxes, it was this. Some individuals (Group A) used the armed force of government to enact control over other individuals (Group B). Then members of Group A deny this was an actual imposition. They do so by eliding any distinction between Groups A and B. Rather, they imply, there is no relevant distinction between Groups A and B in this context. As far as they are concerned, all members of both groups are part of a larger unit, Collective C. And Collective C is an autonomous unit that makes decisions for itself. Hence Sen. Ocasio-Cortez’s equivocation that “the government is The Public, and The Public decides what is good for itself.”

In this instance, Collective C has resolved for itself that the smoking of marijuana would be criminally punished by the State. Therefore, when the State penalizes you for consuming cannabis, it doesn’t matter that you personally object to such a decree. Your court sentence is simply an instance of the General Will holding true to its own rules that it set for itself.

In the controversy over Warren Buffett and higher taxes on the rich, Group A consists of billionaires supporting such tax hikes. Group B is of billionaires who oppose these tax hikes. Warren Buffett and the favorable press he received in this campaign have been, at best, vague about such a distinction between such groups. Rather, members of Groups A and B are lumped together in Collective C, “billionaires in general.” And Warren Buffett and his allies in the media frame the controversy as though Collective C has elected for itself that Collective C wishes to transfer more of its riches to the federal government.

And no, on the topic of Social Contracts, it is not true that a national government’s taxes and other impositions are rendered voluntary by the fact that “You can leave any time you want!” As I have written priorly, the USA and other First-World governments charge you money should you relinquish your citizenship. That is one last ransom for you to pay.

 

 
“You Didn’t Build That” 

We [beings] know no time when we were not as now: self-begot, self-raised by our own quick’ning power.

—Lucifer in Milton’s Paradise Lost, 
Bk. 5, lines 859–860

 

...the heresy which is at the root of his whole predicament — the doctrine that he is a self-existent being, not a derived being...

—C. S. Lewis, “A Preface to Paradise Lost”
(The original “You Didn’t Build That”)

President Obama and U.S. Sen. Elizabeth Warren invoked a similar version of this Presumed Collective fallacy in a more well-known controversy. Obama and Warren derided self-made entrepreneurs. These self-made entrepreneurs, it is said, believe their fortunes to be nothing more than the culmination of their own hard work and wise choices. As a result, it is said, these self-made entrepreneurs bristle at any call for higher taxes or increased governmental regulation of their business.

Such a miserly entrepreneur, is it believed, is being petulant. Who is she to yelp that because she earned her fortune, it is wrong for the State to encroach on her right to keep it and control every last penny of it?

These self-made entrepreneurs, say Obama and Warren, are deluding themselves and others. Obama and Warren proclaim that the entrepreneurs’ conviction falls apart on account of the entrepreneurs overlooking an essential consideration. That consideration is that achieving success likely would not have been possible if the entrepreneur had not received help from other people. Upon reflecting on that, we are to conclude that the entrepreneur’s success should not be attributed to her choices as an individual. On the contrary, her success was the result of a collective achievement by society as a whole. To take the Obama/Warren argument to its logical conclusion is to profess that great productive achievements should be credited to everyone in general and nobody in particular.

As Elizabeth Warren says it,

There is nobody in this country who got rich on his own — nobody. . . . Now, look, you built a factory and it turned into something terrific or a great idea. God bless — keep a big hunk of it. But part of the underlying Social Contract is you take a hunk of that and pay forward for the next kid who comes along.

And as President Obama phrased it more famously,

...if you’ve been successful, you didn’t get there on your own. . . . I’m always struck by people who think, ‘Well, it must be because I was just so smart. . . . It must be because I worked harder than everybody else. ...’ ...

If you were successful, somebody along the line gave you some help. There was a great teacher somewhere in your life. . . . If you’ve got a business — you didn’t build that. Somebody else made that happen. . . .

...there are some things we do better together. . . . We rise or fall together as one nation and as one people . . . You’re not on your own; we’re in this together. . . .

[Responsible Americans have] understood that...succeeding in America wasn't about how much money was in your bank account, but it was about whether you were doing right by your people, doing right by your family, doing right by your neighborhood, doing right by your community, doing right by your country...

  New York Times columnist Nicholas Kristoff adds,

Who built this country? Entrepreneurs, yes. But so did schoolteachers and railway construction workers. Doctors and truckers. Scientists and soldiers. You didn’t build it, . . . — we all built it.

Granted, almost every successful entrepreneur in history has received some sort of help from someone else. But the arguments of Warren and Obama are knocking down a straw man. Hardly any free-market advocate says that every successful entrepreneur or inventor built a fortune ex nihilo. Moreover, the entrepreneur is right that she should be able to keep the fruit of her work. She is right that insofar as she is nonviolent and violates no one else’s rights, she should not have her property confiscated or micromanaged by the State.

The reasons for this, which the arguments of Warren and Obama have conveniently ignored and obscured, are as follows. First, human beings are individuals. The fact has a corollary. That corollary is that, to the degree that people have cooperated peacefully on these projects, each individual’s contribution can be identified. Upon being identified, the size of each individual’s contribution can be measured, sometimes even quantified. That is the whole point behind documentation that establishes your “financial identity.” Throughout this section of the essay, we shall discuss how the recognition of your financial identity happens to undermine the political collectivism foisted in “You Didn’t Build That.”

 

 
Because People Are Individuals, the Entrepreneur Already Identified the Help She Received and Paid for It
Entrepreneurs have indeed received help from other individuals. But insofar as they have gone about matters peacefully, the entrepreneurs have already identified the help from those other individuals and compensated them for it.

For over a century, students have conventionally been taught that the three major factors of production are manual labor, factory equipment and other tools, and natural raw materials. Conventionally omitted was the fourth and most important factor of production: the management and planning of the entrepreneur. The entrepreneur, devising the plans and overseeing their execution, must provide proper instruction to the manual laborers. That instruction is on how the manual laborers are to use the factory equipment and other tools to convert the natural raw materials into the finished product.

Let us imagine what would happen if all factors of production were present, except for the entrepreneur’s management. The manual laborers would not receive adequate instruction on what to do with the natural raw materials and the factory equipment and tools. The manual labor would go to waste. The factory equipment and tools would sit idle. The natural raw materials would not be converted into the useful products. Nothing would get done. That is part of the premise of Ayn Rand’s novel Atlas Shrugged.

“Ah,” one might ask, “But what if a manual laborer took charge to formulate plans and convey practical instruction to the other laborers?” That laborer that has taken this leadership position would now be filling the role of the entrepreneur. There is no proper leadership for manual laborers in the production process without entrepreneurship or executive management.

The manual labor, the natural raw materials, and the factory equipment are all expenses for which the entrepreneur must pay. Suppose the entrepreneur charges customers $10 per unit. For every unit sold, four of those ten dollars goes to remunerating the first line of creditors to whom she owes money: the employees. Three of the dollars go to paying for the natural raw materials. Two of the dollars go to pay for the factory equipment and other tools. What is the one-dollar profit left over for the entrepreneur herself? That is the customer’s payment directly to the entrepreneur for the service she provided. The service was the entrepreneur employing her managerial decision-making to manage the manual labor, natural raw materials, and factory equipment to produce a product useful to the customer.

To the degree that employer and employee are free to negotiate compensation rates, the employees’ compensation was the result of mutual agreement between the employer and they. Any time someone is offended by a large disparity between the wealth of the entrepreneur versus the compensation of her employees, it is stated that she is being chintzy with her employees. We hear screaming that she should “give back” to them. 

True, there are instances where employees may have underestimated their own leverage when it comes to being able to bargain for higher compensation. In those instances, they would be right to attempt a renegotiation. But insofar as the market is free, the entrepreneur has already paid her employees what their jobs are worth.

Yes, every entrepreneur did obtain assistance from others. But once that entrepreneur paid off her expenses, that entrepreneur does not continue to be indebted to those who helped her. Those who helped her directly have already been paid for their contribution. We know this because of documentation of each employee’s financial identity. The document in particular is the entrepreneur’s payroll. The profit the entrepreneur has left over is rightfully hers. That is her customer’s direct payment for her own unique, rationally identifiable and measurable contribution that came from her choices as an individual. Hence, the right of the entrepreneur to keep and control her profits is not contingent on her having done everything alone.

 

What About Taxpayer-Funded Public Goods?
Yet, continue Obama and Elizabeth Warren, entrepreneurs are also ingrates when it comes to paying taxes to fund government-controlled services. These services include road maintenance and education.

Elizabeth Warren goes on, “You built a factory out there? Good for you. But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate.”

Obama, too, says, “Somebody invested in roads and bridges.”

Though it is difficult to make a precise quantified measurement of such a benefit, it is safe to concede that entrepreneurs do benefit from such taxpayer-funded services. But the existence of such a benefit to entrepreneurs is not, as Obama-Warren-Kristof assume, an argument for more taxation on the rich and for more government control over utilities such as roads.

I have written on this topic earlier. The assumption is that if we are accustomed to receiving a particular service from a taxpayer-funded government agency, such as road maintenance, that service would never have existed if not for it having been created by a government agency.

The reality is that in the United States in the eighteenth and nineteenth centuries, it was private entrepreneurs who first provided roads. Merchants whose shops adjoined one another along the same street would pool their resources to fund the construction and upkeep of a privately-owned turnpike. The turnpike was owned and maintained by a private company, and this private company was jointly owned by the merchants whose land adjoined the road. The private turnpike company itself seldom made a profit exceeding two percent. However, everything else being equal, the presence of the roads did increase the profit margins of the merchants’ shops by a much greater degree.

These private turnpikes were so successful that they were able to connect entire cities to one another. Such a private, for-profit toll road connected Philadelphia to Lancaster. Economic historians Herman Krooss and Charles Gilbert note, “By the 1820s, all the major cities in the United States had been connected by [private] toll roads...” It was even a private entrepreneur, Carl G. Fisher, who raised funds consensually for the construction and maintenance of the USA’s first interstate highway.

Such private, for-profit roads fell into disuse when the merchants who were funding them had fallen prey to a political collectivism comparable to Obama’s and Warren’s. These merchants surmised that they could drive down their own costs further still if their local governments decided to tax everyone, in general, for the construction and maintenance of roads that led patrons to their shops.

In the same “You Didn’t Build That” speech, Obama talked about how entrepreneurs benefit from firefighting services. As with roads, Obama presumed that absent of a taxpayer-funded government agency, there would be no adequate firefighting service. He chastised, “I mean, imagine if everybody had their own fire service. That would be a hard way to organize fighting fires.”

But as I have written here, it was private entrepreneurs who first provided adequate firefighting as well.

To the degree that entrepreneurs do unfairly benefit from taxpayer-funding of government services, it is that Private Individuals A and B are being forcibly taxed to benefit Entrepreneur C. And it is unfair if Private Individuals A and B do not themselves benefit directly. But, contrary to Obama and Elizabeth Warren, that is not an argument to tax or regulate Entrepreneur C further. Rather, it is an argument that the taxes be returned to Private Individuals A and B. It is also an argument that whatever service that is funded by tax collection should be a service that is performed by the private sector.

Insofar as Entrepreneur C is advantaged from taxpayer funding of road construction or upkeep, the size of that advantage gained is difficult to measure precisely. Insofar as the roads are owned and maintained by a private owner in a free market, it is easier for Entrepreneur C to identify the specific parties whose services benefit her. She can seek out those specific parties and contract with them accordingly. Note that the result is not an increase in political-economic collectivism but in political-economic individualism.

The political-economic collectivism of government ownership of roads, firefighting, and other services does nothing better than the following. We know that some parties put more money into public coffers than they remove. That is Category 1. There are also parties that consume more resources from public coffers than they put in. That is Category 2. Political-economic collectivist government ownership of resources obscures who is in Category 1 and who is in Category 2. It all remains nebulous.

 

 
How Individual Financial-Identity Identifies What and How Much One Individual Owes Another, and How Political Collectivism Obfuscates This
I fear that this nebulousness is something that advocates of government control may consider to be a plus instead of a minus. Of concern here is what I touched upon earlier, and which I have discussed in other essays: your financial identity.

Once again, your financial identity refers to documentation that identifies your creative actions in the economic sphere. Such documentation allows for parties indebted to you to identify you.  Upon doing so, they can send you the exact payment to which you both agreed when you provided your service to them. Acknowledging individualism, what one specific individual owes to another is accurately identified.

Identity theft refers to the deliberate obscuring of your financial identity. An identify thief can impersonate you and thus collect money that debtors, such as your employer, owe to you. By obscuring the distinction between you versus he, the identity thief forcibly redistributes wealth.  He takes the value that you created, and claims it for himself.

A similar obscurantism occurs with the “You Didn’t Build That” mentality. When roads are privately owned and funded, the customers who most directly benefit from a road are likewise the parties that most directly fund it. Again, what one specific individual owes to another is identified properly. The same applies to the free contracting between employer and employee.

But “You Didn’t Build That” obscures the sizes of specific contributions by specific individuals to specific creative enterprises. By pretending that individual achievement is always collective achievement, the contribution of each individual becomes murky. By nebulizing the distinction between those who are net contributors to an enterprise or coffer versus those who take more than they contribute, this political-economic collectivism redistributes wealth. It allows for net-takers to take the value that the net-givers created, and claim it for themselves.

Hence, the details identifying who-contributed-what fall under a cloak. The cloak is the idea that every productive achievement came from everyone in general and no one special person in particular.

Political-economic individualism and consistently applied privatization hold individuals accountable for their own chosen actions. They are held especially accountable for their economic choices. None of that precludes people from relieving sufferers of misfortune through consensually provided and consensually funded charity. By contrast, pretending that there are not individuals but vague collectives allows individuals to escape accountability for their own poor choices. Worse, it belittles the credit owed to individuals for their wisest commitments.

Once again, the argument that allegedly proves the case of Obama and Warren hinges on the premise that social collectivism, on the descriptive level, is already a given. The descriptive-level social collectivist premise is that we should simply accept that no great achievement can rightfully be attributed to a specific individual. Rather, every great achievement is the culmination of imprecisely defined contributions from society’s members in general.

Many commentators disgusted by the “You Didn’t Build That” speeches did not go far enough in denouncing them. These critics at least implicitly understood that the speeches had nebulized the fact that it’s possible to identify each contributor to a creative enterprise and the size of her contribution. Consequently, these critics noticed that the speeches obscured the distinction between one contribution and another. And these critics noticed that this obscurantism was done in order to rationalize the confiscation of the wealth of every creative enterprise’s leader: its entrepreneur. But it is worse than that.

Although millions or billions of people can opt for joint ownership in a single corporate asset, it goes noticed that capitalism is individualistic by its nature. The institution of private property follows from the fact that a particular quantity of economic value was created not by everyone-in-general but by the choices of a specific person. Acknowledgment of this fact is what the You-Didn’t-Built-That slogan was made to prevent.

The “financial identity” that is stolen in every Identity Theft is the identification of a person with the economic value she created. By depriving you of being properly identified with the economic value you created as an entrepreneur, “You Didn’t Build That” robs you of the rightful effects of your creative choices. And, as I shall argue later in this essay, your choices are what comprise your true personal identity. To deny you the wealth you earned — the effects of the choices that are your identity — “You Didn’t Build That” denies the identification of the personal choices of yours that were the cause of the wealth creation. “You Didn’t Build That” does not merely rob you of the wealth you produced. It robs you of being identified with the choices that produced that wealth — your financial identity. It is a sort of Identity Theft.

This is how “You Didn’t Build That” follows the formula of the Fallacy of the Presumed Collective. Obama-Warren-Kristof propound a form of political-economic collectivism. The individual entrepreneur’s right to keep and control her fortune is sacrificed to the ostensive well-being of a larger group to which she belongs, “Society.” To undermine the entrepreneur’s vocal defense of her right to keep what she earned as an individual, Obama and Warren and Kristof deny that there is an individual in this context.

They presume that because every successful entrepreneur received help along the way, the entrepreneurial production of wealth cannot happen individually but only collectively. Once again, the political collectivism being urged is supposedly justified by . . . a descriptive-level collectivism that they assume cannot be doubted.

That descriptive-level social collectivist premise relies on yet another logical fallacy. Reliance on this other logical fallacy makes “You Didn’t Build That” a more complicated and convoluted philosophic argument than the insinuation by Warren Buffett about the estate tax. The second logical fallacy that supports “You Didn’t Build That” is one that I call “Influence or Collaboration Equals Collective.”

The error in “Influence or Collaboration Equals Collective” is as follows. Mr. A inspires, influences, or assists in a creative action by Mrs. B. Therefore, conclude those who invoke this fallacy, the results of Mrs. B’s creative action must credited jointly to Mr. A and Mrs. B alike. Moreover, they should share in the spoils more equally.

What conveniently goes unmentioned by those who employ that rhetoric is that, even though Mr. A influenced Mrs. B, they still each played separate roles. These roles can be examined separately. Once the roles are examined separately, it is possible to gauge the size of each person’s contribution. And it often turns out that the contributions are not of equal size.

There is a group of people, far more dangerous than the center-Left supporters of Obama’s redistributionist agenda, that also invokes the fallacy of “Influence or Collaboration Equals Collective.” It is that of Richard Spencer and his White Nationalist following.

 

 
The Very Concept of a Person’s Identity Depends Upon Social Collectivism?
The argument of the White Nationalists is as follows. There is no individual identity. Identity, as such, comes from memberships in large groups of people. For example, when you ask a person to describe her identity, she will normally list an entire series of group affiliations.

When other people are asked to identify me, they usually list the traits that I hold in common with large numbers of my fellow human beings. I am a resident of Hawaii. So are many other people. I am of Japanese descent. So are many other people. I am an atheist. So are many other people. I advocate free-enterprise philosophy. So do many other people.

At first, say the White Nationalists, I might think that that particular combination of attributes renders me unique. It is rare to find an atheistic Japanese-American free-marketer in Hawaii. Nonetheless, continue the White Nationalists, it does not change that these markers used to identify me are all demographic affiliations. I am a member of the following groups: Hawaii residents, Japanese-Americans, atheists, and free-market supporters.

Therefore, conclude the White Nationalists, what I thought was my individual identity truly consists of nothing but my attachments to various collectives. For that reason, purport the White Nationalists, membership in various social collectives is actually the source of all identity. As the white nationalist Jean-François Gariepy expresses it, people ultimately “adhere to groups...” It is these groups that are the “important aspect of their identity.”

Hence, there is no individual; there are only collectives. Moreover, goes the White Nationalist advocacy, it is the collectives, not the individual, that makes decisions.

“[...I]ndividualism,” says Richard Spencer, the white nationalist who coined Alt Right. “ is fundamentally wrong. . . . Man is a social being. He is part of a greater family. He is part of a past and a future. He is part of an identity that is bigger than any individual.”

Because every affiliation is a group affiliation, conclude Richard Spencer and the White Nationalists, you are not a proactive shaper of your own identity. Nay, you are a passive object. Being psychologically passive, you are molded by the cultural forces around you. You are shaped by customs. And, for most of history, the customs by which a person was shaped were the customs of his ancestors. Therefore, on account of historical precedent, your identity is the product of the norms of your kinsmen. You do not proactively make choices of your own in some vacuum, they say. No, your choices are largely made for you by customs and traditions. Hence, the collective of ethnicity is the unit that contemplates various alternatives and then selects among them.

Consequently, urge Richard Spencer and the White Nationalists, it is fair game in politics for people to think of themselves as one ethnic group in eternal conflict with other ethnicities. Once again, they follow the formula of the Presumed Collective. They advocate a type of political collectivism. They would have the force of the State sacrifice the well-being of nonwhite individuals for an ostensive greater good, the welfare of whites. To argue that they are correct, they profess that one should accept that social collectivism is fundamentally human nature at the descriptive level.

But the reality is that there is a distinct individual identity. It arises through one’s choices on a much more specific, personal level. 

Here, social collectivists of all stripes can reply that any one choice that I make has been made by many other people. I can choose to brush my teeth. So have millions of other people. I can choose to go for a stroll today. So will millions of other people. I can choose to write an essay about individualism versus collectivism. So have hundreds of other people. No one choice of mine will separate me from everyone else on the planet.

Yet a person’s life consists of an entire series of choices. No one such series is identical to that of any other. To reclaim a term that collectivists have denigrated, each person’s series of life choices is as unique as a snowflake. That other people influenced you, or at least share traits in common with you, does not diminish this fact.

 

 
How We Know That Every Choice Is Made By an Individual, Not a Collective
I have said that it is entirely fallacious to reject the realization that it is the individual that is the unit that makes choices. After all, just what is “the self” — or even if there is a “self” — has vexed philosophers for over a hundred years.

Although he advocated a laissez-faire politics that can be described as a political individualism, David Hume in the eighteenth century denied individualism and the self on the descriptive level.

Hume famously wondered if there is no self, but if each person is “nothing but a bundle or collection of different perceptions...”

A similar argument arrives via Francis Crick, the scientist who co-discovered the double helix structure of DNA. As he would have it, 

“you,” your joys and your sorrows, your memories and your ambitions, your sense of personal identity and free will, are no more than the behavior of a vast assembly of neurons.

There are some science journalists who are beginning to suggest this might be a viable line of argument. A New York Times blog post mostly about the health of the stomach begins,

We may think of ourselves as just human, but we’re really a mass of microorganisms housed in a human shell. Every person alive is host to about 100 trillion bacterial cells. They outnumber human cells 10 to one and account for 99.9 percent of the unique genes in the body.

Katrina Ray, a senior editor of Nature Reviews, recently suggested that the vast number of microbes in the gut could be considered a “human microbial ‘organ’” and asked, “Are we more microbe than man?” [The link is from Jane Brody.]

A Portuguese Man o’ War may look like a single creature. Yet zoologists classify it as an entirely colony of separate organisms of the same species. Perhaps, then, a single human body is not a single unit, but is really a whole colony of cells. Accordingly, maybe there are no individuals, because the “individual” unit cannot be defined. Where does one unit begin and another end?

As the philosophic writer Roderick Fitts pointed out to me, there is indeed a proper answer to that question. We do know that the individual self exists. Its existence is validated axiomatically. The individual self is that which asks the very philosophic question that David Hume posed. One specific individual chooses to ponder this philosophic issue. Another specific individual does not.

The specific individual who poses the philosophic question does indeed have many separate body parts. This person has a heart and lungs and a liver. But the person is not a whole colony of organs that, in concert, jointly decide to pose the philosophic question that Hume does. The individual self is the consciousness that asks the question.

A brain, too, has many separate parts. But the brain’s separate parts come together to form a single unified consciousness. That single unified consciousness is an Emergent Property (1, 2).

Yes, the individual, not a collective group of individuals, is the unit of decision-making. Once we recognize that, we can come at this matter from the other end. The individual self is that which has direct physical control over both your immediate motor movements and your long-range life choices.

Men and women do influence one another, and, to some degree, exercise control over one another. Small children usually have to obey their parents. For fear of social exclusion, many adolescents conform to the majority opinions of their peer groups. But none of this is direct physical control. It is, at the most, indirect control.

Should a government official threaten force upon me if I do not obey him, that is control but not the direct physical control of which I write. The official gives me an order. For fear of my life, I comply. The control is indirect in that the official still relies upon my exercising my own motor movements to comply.

Let us go to a very extreme example. Imagine that someone, Mr. Q, is partially paralyzed. For some cruel reason, Mr. R manipulates Mr. Q’s body as he would a puppet. Even in such an instance, Mr. R’s physical control over Mr. Q’s is not direct. Direct physical control over Mr. Q would involve Mr. Q’s consciousness sending mental commands throughout Mr. Q’s body to move a body part as Mr. Q wills. When Mr. R manipulates Mr. Q’s limbs, the control is only indirect in that Mr. R can only send his mental commands directly through his own limbs. His limbs pushing against Mr. Q’s to move them is not the same as Mr. Q using his consciousness to will his own limbs to go left or right, forward or backward. The latter interface between mind and body is what I mean by direct physical control. And it only happens at the individual level.

This principle applies to more than bodily movements. The contents of any one person’s mind can be very easily influenced by her peers. Mrs. M can tell Miss N some arbitrary nonsense, and Miss N might readily believe it. Small children usually trust what their parents tell them, whether what they are told is hokum or not. In these instances, though, the control over the other person’s mind remains indirect. Miss N still has the volitional ability to start to question what Mrs. M tells her. Insofar as she blindly believes everything Mrs. M tells her, this continues to be of her own volition, even if this reflects a mental laziness on her part.

To the extent that someone is able-bodied, no one exercises direct physical control over her body but her. Likewise, to the extent that some is a contractually competent adult, no one exercises direct control over her thoughts and convictions — the contents of her mind — but she herself.

To combine the use of one’s consciousness with the use of one’s body is to make a choice. When someone exercises a choice, it consists of her acting upon her mind’s contents, and the action is implemented through some bodily movement that she wills through her direct physical control. Through some introspection, a woman recognizes that she has many important thoughts that she wants to convey through a book. Then, through her direct physical control, she makes some motor movements to put that into effect. She grabs a pen and paper to scribe her thoughts, or she opens her laptop and types it.

Two separate individuals can come together to make a decision jointly. Two spouses, Lloyd and Pete, may agree to buy a house together. However, whatever their reason, each spouse had to come to that decision in the privacy of his own mind. They have discussed it together. In so doing, they conveyed their thoughts and considerations to one another. But these thoughts and considerations were not transferred directly through telepathy. When Lloyd conveys some thoughts to Pete, and Pete agrees to that, Lloyd’s influence over Pete remains indirect. No matter how quickly or easily it might have been, Pete still had to decide on his own if he agreed with Lloyd.

Moreover, at least one of the spouses might come to regret the decision. They might go their separate ways. As should be clear, if two or a hundred or a thousand individuals come together to make the same decision jointly, it does not demonstrate that a collective was the unit that made the decision. Instead, it was many individuals each making their decision — rightly or wrongly — in the privacy of their own minds, and only then uniting or reuniting to stand together in their coinciding efforts.

I have previously written of how the kin selection that occurred in the Stone Age and the majority of humanity’s history may have set a precedent for human beings having a social-collectivism-over-individualism mindset as the default. Still, that does not mitigate the reality that we have gone over. It does not mitigate the fact that, at the most basic physiological and psychological level, the evaluation of various options, and the selection of one course of action among them, occurs in the privacy of each mind on its own.

Contractually-competent adult human beings arrive at their choices and act upon them as individuals. Individualism, not social collectivism, is the genuine interpretation of human nature at the descriptive (or “metaphysical”) level. Accordingly, for a political system of law to be just, it must recognize contractually competent adults as individuals. A citizen should be punished only for wrongdoing he chose as an individual to commit. Likewise, to the degree that a person built her fortune peacefully, the fortune-building was largely a result of her own choices as an individual. As I have explained here, that principle applies even in the situation of someone inheriting a large fortune.

As we have seen, so many arguments for the implementation of political collectivism are based on the presumption that decisions involving politics and violence are decisions made by collectives, not individuals. As we recognize that decisions are considered and exercised by individuals instead, the entire edifice on which the collectivist argument stands is exposed as one that is crumbling.

We have exposed the Fallacy of the Presumed Collective. Let us renew our commitment to appreciating and rewarding people for the good they have accomplished on their own individual initiative.

On Friday, July 2, 2021, I added the quotation from Francis Crick and corrected grammatical errors. On Thursday, August 19, 2021, I added the quotation from the New York Times blog post about stomach health. On Sunday, September 19, 2021, I added the paragraph about how, although billions of people can choose to have joint ownership in a single asset, capitalism is individualistic by its nature. On Thursday, January 20, 2022, I added the sentences about U.S. Sen. Alexandria Ocasio-Cortez. On Monday, September 19, 2022, I added the quotations from C. S. Lewis and Paradise Lost about Lucifer saying that he is self-made. On Sunday, December 25, 2022, I made a clarifying edit to the second sentence mentioning the concept of  financial identity. On Sunday, February 5, 2023, I added the New York Times quotation from Warren Buffett.  On Thursday, July 18, 2024, I made two other changes. I added the word nebulize. I also added the explanation of how, before, I found it tempting to say that the difference between statism and liberty was not between, respectively, the individualism versus the collective but the of the respective difference between violence and peace.

Notes From Mom in Holiday Cards Helping Me Regain Confidence in What I Had Been Doing

Stuart K. Hayashi

 

Ever since my mother died on January 12 of this year, I have felt that so many of my aspirations and values have turned out to be pointless. I wondered if the writing and other projects I had been pursuing had been for naught. But I have found old holiday cards from Mom where the personalized notes she put inside pertain directly to the area where I have been insecure these past three months.

You may remember what I previously wrote about my parents and holiday cards. My parents — especially my father — put a lot of emphasis on members of our family purchasing greeting cards from the store and exchanging them on every holiday. On Valentine’s Day, you wouldn’t find it strange to receive such a card from your significant other. But I received such cards from my mother on February 14. In any instance where I had not gotten Mom a card for such an occasion, my father reproached that as some moral transgression, a form of negligence.

As I wrote before, I was not a fan of this custom. I said that it wasn’t as though the person giving the card was the one who wrote its contents or drew the picture. But it seems that in later years, my mother took that criticism to heart. In the later years, my mother often wrote very personalized notes inside the cards, notes pertaining directly to what had been concerning me in that time. Around March 31, I found personalized notes from Mom that particularly address the area where I now feel so vulnerable — my worry that my writing projects might not have been worthwhile after all.

For Christmas of 2017, Mom wrote,

Dec. 2017

With all our love,
Mom + Dad

You’ve accomplished a lot of difficult things (that I consider difficult) and pulled through – like getting your books published and am proud of you for all you’ve stuck through. I only wish you the best in life and happiness!

Months later, for my 2018 birthday, Mom repeated that idea.

At that time, Mom put,

With lots of love, 

Mom + Dad

You’ve accomplished some very difficult things that no one else in our family could/would do + we’re proud of you for that + being the persistent person that you are.

I cried upon reading these. I have more strength upon being reminded that I had my mother’s blessing in pursuing the course that I have.