Happiness is hard to attain, harder to maintain, and hardest of all to recognize. Pick the time of your life when you know you were happiest. You didn’t know how happy you were at the time. When the kids were little and you hadn’t slept in three years. That first job in Manhattan, being groped by the assistant marketing director and sharing a one-bedroom Avenue X and Millionth Street apartment with eleven other people. Those halcyon days at college that you flunked out of.
Old people are forever reminiscing happily about all sorts of things that wouldn’t seem conducive to happiness, such as World War II. Will the forsaken recipients of largesse from bilked charities someday wax nostalgic about Bernie Madoff’s avuncular ways? The fact that we don’t know when we are happy raises the disturbing possibility that you and I are wildly happy right now. I hope my wife doesn’t find out.
What’s happiness doing in the Declaration of Independence anyway? The original phrase is “Lives, Liberties and Estates,” a brief catalog of man’s inherent rights that appears several times in John Locke’s Second Treatise of Government. Locke was one of the Enlightenment’s foremost proponents of natural law and the rights it naturally bestows, rights that are so much a part of our nature nothing can take them away, and we can’t get rid of them. There were other important natural law theorists, such as Hugo Grotius, Samuel von Pufendorf, Jean-Jacques Burlamaqui. America’s patriotic thinkers relied mostly on Locke because he argued the case for people’s right to dissolve their government. Also, he was easier to spell. When Thomas Jefferson drafted the Declaration of Independence he was referring directly to chapter IX of the Second Treatise, where Locke says that men are “willing to joyn in Society... for the mutual Preservation of their Lives, Liberties, and Estates, which I call by the general name Property.” Every educated person understood the reference (moral philosophy not yet having been replaced by civics in the educational curriculum). Many educated persons must have wondered about Jefferson’s substitution of laughs for land.
The fact that property wasn’t mentioned in the Declaration of Independence still seems odd. The French revolution’s Declaration of the Rights of Man lists property second only to liberty, and the French revolutionaries had less respect for other people’s property (and less property) than did the signers of the Declaration of Independence.
Jefferson may have been trying to convey the idea that our new nation wasn’t going to be a European kind of place. America wouldn’t be parceled into aristocratic estates kept intact by primogeniture and entail. Entail is a legal restriction on property, usually land, limiting its inheritance to linear descendants of the owner, and primogeniture is a further restriction that leaves out the girls in the family. Entail was necessary to preserve the power (formerly military, later economic) of the holders of the titles of nobility, which titles the U.S. Constitution would soon ban.
Entail was in bad odor in the late eighteenth and early nineteenth centuries. Rationalist thinkers of the day were ashamed of inherited class distinctions even (sometimes especially) if they were so distinguished. Entailed estates were considered to be the ground from which grew the twisted family tree of peerage occupied by the serpent who urged the rotten fruit of birthright upon Edenic mankind. The metaphor is overfertilized, perhaps, but, said Tom Paine in Common Sense, “Original sin and hereditary succession are parallels. Dishonorable rank! inglorious connection!”
Nowadays, when the British royal family is mostly blogfare and titled Frogs and Wops are of no interest to anyone but Vanity Fair editors, we wonder at the fuss over entail. Yet in the late 1700s Georgia went so far as to pass a law against such laws, attempting to keep the privileged few from monopolizing the broad cotton fields of Tara. Never mind that for every free household in Georgia the state had approximately thirteen thousand acres of unpopulated land. (And Scarlett O’Hara’s father was a bog Irish upstart who won the joint in a poker game.)
More than a decade after America had declared its unentailed independence and made pretensions of nobility illegal, Jefferson was still railing against transgenerational claims on property. In a letter to James Madison, he wrote “the earth belongs in usufruct to the living.”3 The italics are Jefferson’s and “usufruct” is the legal right to use and enjoy something—pursue happiness with it—during one’s lifetime. Tom Paine would make the point again in his 1791 pamphlet Rights of Man: “Man has no property in man; neither has any generation a property in the generations that are to follow.” Even Jane Austen would comment on the issue. In Pride and Prejudice she has the silly Mrs. Bennet say, of the rule that decrees precisely who inherits what, “There is no knowing how estates will go once they come to be entailed.”4 (A remark that advocates of various environmental and conservationalist entails upon land might want to ponder.)
All these proponents of liberty versus heredity were taking their cue from Adam Smith in The Wealth of Nations, published, appropriately enough, in 1776. Smith wrote that the laws of entail “are founded upon the most absurd of all suppositions, the supposition that every successive generation of men have not an equal right to the earth, and to all that it possesses.”5
America as a place for fresh starts has illustrious intellectual credentials. Not that we’d know it by looking at America’s uncouth frontiersmen, woebegone backwoods pioneers, seedy homesteaders, giddy forty-niners, illiterate cowboys, huddled masses of immigrants, and Internet start-up wingnuts.
“Pursuit of Happiness” also may have supplanted “Property” in the Declaration of Independence because of definitional concerns. Locke died in 1704, when “Estates, which I call by the general Name Property” was still synonymous with land and land was still synonymous with riches. Until Adam Smith succeeded in improving the world’s understanding of economics (if he ever did), land was considered to be the only ultimate source of profit.
The Declaration was written by Thomas Jefferson but it was revised and edited by John Adams and Benjamin Franklin. Jefferson was a devotee of property in the sense of land and chattel (of animal and other kinds). But Adams, although a farmer, had no Jeffersonian vision of America as a pure, agrarian society. Perhaps this was because Adams, unlike Jefferson, made a living from his farm. Adams and Franklin understood that trade, manufacture, and finance would be as significant in America as “real” estate. And Franklin had a personal interest in a type of ownership different from a land title, ownership of what we would come to call intellectual property. (It was not coincidental to Franklin’s influence that the power to approve patent rights would be granted in Article I of the forthcoming Constitution, and that the first act passed by the new Congress of the United States would concern patent law.)
Jefferson was often concerned about money, but Franklin and Adams were actually thinking about it. Still, we can understand why, for reasons of popularity and taste, the rights in the Declaration of Independence aren’t listed as “Life, Liberty, and Stinking Wealth.”
Roger Pilon, chief constitutional scholar at the libertarian Cato Institute, in Washington, D.C., believes there was another reason that property rights were handled with delicacy in the Declaration of Independence. Pilon concludes that Jefferson detected a flaw in the logic of Locke’s “unalienable” rights. Property has to be alienable, in a legal sense, or you can’t sell it. If we lived in a country where property was unalienable, Steve Jobs and Steve Wozniak would still have the pocket calculator that they sold to raise the money to start Apple. Therefore when we go to work there’s nothing on the screen of the computer that doesn’t exist at the job we don’t have because we’re still farming the twenty-acre tobacco patch that our ancestors gypped the Indians out of for beads and trinkets the last time anybody was allowed to buy anything, in the reign of George III.
Property is an important aspect of the pursuit of happiness. Pilon says the founding fathers would have considered this materialistic side of happiness to be, as the founding fathers liked to say, self-evident. Try paying your mortgage with a hug. (Though that’s what the U.S. gov
ernment is helping some people do these days.)
The authors of the Declaration of Independence, the Constitution, the Federalist Papers, and the other sources of the American idea of freedom had a materialistic philosophy of independence. And they knew enough philosophy to know that they did. Jefferson, Franklin, Adams, Hamilton, Madison et al. did not believe that American independence was the same as the independence preached by the so-called cynic philosophers of ancient Greece. The cynics held that independence lay in individual “autarchy” or rigid self-sufficiency. Diogenes was said to have been elated to discover he could drink from his cupped hands and dispense with his mug. But this shows that even the most ascetic pursuit of happiness involves consideration of the material world. (And it shows that Diogenes was a dope who had to found a whole school of philosophy to figure out how to get a puddle to his face.) Diogenes lived in a barrel. “Whose barrel?” Jefferson, Franklin, and Adams would have asked. There was nothing cynical about America’s founding fathers, in any sense of the word, but nothing naive either.
Pilon maintains that “Pursuit of Happiness” replaced “Property” in the Declaration of Independence not to denigrate material wealth but to expand the idea of materialism. America was established as a way for Americans to make and do things. What sort of things Americans make and do and whether these things lead to great riches, pious satisfactions, or transitory pleasures is nobody’s business but our own. America’s political institutions are supposed to be the machinery for our making and doing. America is a tool. America is the only place on earth or in history created in order to be both free and teleological. Teleology is the idea that phenomena are guided by a purpose. America is. But—and here’s what’s new—we Americans get to individually, personally, separately decide on any purpose we want.
What’s the point of other nations? It’s something of a historical mystery. Conquering the world seems to be a purpose for some nations—fortunately not too many, and fortunately not too often, and most fortunately they always fail. Maybe nations arise to provide their citizens with mutual protection against external and internal threats. If this were the usual case, world history would read like an account of the interrelations of the cantons of Switzerland. Certain nations seem to exist strictly to torment their neighbors or their citizens or both. Other nations are simply... there. Notice how in Paris people go to cafés and just sit around all day being French. Or, if they prefer to sit around all night, they can be Spanish and not have dinner until 11 p.m. A friend of mine once said about the rural Turks that they’re so lazy they get up at four in the morning to have more time to do nothing. It gives an American the heebie-jeebies. We have to be making and doing. Albeit what we make is often a mess. And what we do is often our undoing. Lately we’ve added being to making and doing. What Americans are being is famous or infamous (there’s no longer a distinction) or fabulous or centered or self-actualized or spiritual or eco-conscious or, frequently, real fat. Anyway, we Americans are very, very busy, and we owe it all to three little words in our Declaration of Independence.
Or maybe that’s wrong. Maybe Jefferson, Franklin, and Adams were just happy. Jefferson was famously uxorious. Perhaps his wife, Martha, slipped up to Philadelphia for a dirty weekend. And Franklin landed the Declaration of Independence printing contract. And Adams was working his way through a cask of Madeira. The Declaration’s first draft might have read, “Pursuit of Nookie and Graft and I’ll drink to That.” If it had gone to press this way we’d be a different people, less busy and less happy and more inclined to say such things to each other as “Wealthy Birthday!,” “Drunken days are here again!,” and “Sexually aroused to meet you.”
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The Happy Realization That All Freedoms Are Economic Freedoms
(And Failure Is an Option)
The free market is the greatest repository of our freedoms. Economic freedom is the freedom we exercise most often and to the greatest extent. Freedom of speech is important—if you have anything to say. I’ve checked the Internet; nobody does. Freedom of belief is important—if you believe in anything. I’ve watched reality TV and I can’t believe it. Freedom of assembly is important—if you’re going to an assembly. Most people are going to the mall. And, at the mall, they exercise economic freedom.
We have the cow of economic freedom. Do we take the cow to market and trade her for the magic beans of bailout and stimulus? When we climb that beanstalk we’re going to find a giant government at the top. Are we going to be as lucky as Jack the giant killer was? I’m not sure Jack himself was that lucky with his giant killing. That’s Jack’s version. My guess is that Jack spent years being investigated by giant subcommittees and now Jack’s paying a giant tax on his beanstalk bonus.
The free market is not a creed or an ideology that political conservatives, libertarians, and Ayn Rand acolytes want Americans to take on faith. The free market is simply a measurement. The free market tells us what people are willing to pay for a given thing at a given moment. That’s all the free market does. The free market is a bathroom scale. We may not like what we see when we step on the bathroom scale, but we can’t pass a law making ourselves weigh 165. Liberals and leftists think we can.
The free market gives us only one piece of information, but it’s important information. We ignore it at our peril, the way the leaders of the old Soviet bloc did. They lost the cold war not just because of troops or tanks or Star Wars missile shields. Even Reagan and Thatcher couldn’t win the cold war by themselves. They needed allies. And the allies were Bulgarian blue jeans. The Soviets lost the cold war because of Bulgarian blue jeans. The free market was attempting to inform the Kremlin that Bulgarian blue jeans didn’t fit, were ugly and ill-made, and nobody wanted them at any price. People wouldn’t wear Bulgarian blue jeans—literally not to save their lives. But the Kremlin didn’t listen. And the Berlin Wall came down.
It is with some diffidence that I write about economic matters. I was an English major or, as people in business call it, stupid. The best investment I’ve made lately? I left a twenty-dollar bill in the pocket of my tweed jacket last spring and I just found it. But I do know enough to thank business for existing.
Business investment defines humanity. Animals don’t invest. If a dog has a surplus he will eat it all and vomit it up rather than give a portion of it to another dog in return for shares in car chasing or the chewing of shoes.
Business investment defines civilization. Barbarians don’t raise money through debt and equity. They raise money through stealing. (Although, during the boom in subprime mortgage lending it was sometimes difficult to tell the difference.)
Nonetheless business investment is one of the most important ideas in history. If it weren’t for business investment all the inventors, innovators, manufacturers, wholesalers, and retailers who have brought prosperity to the modern world would have to get their money the way the rest of us do, by asking their wives.
The free market is the greatest repository of our freedoms, but the free market is dead. It was killed by the Bolshevik revolution, fascist central planning, Keynesianism, the Great Depression, World War II economic controls, the British Labour Party victory of 1945, Keynesianism again, the Arab oil embargo, Bill Clinton’s and Tony Blair’s “third way” economics, and the 2008 financial crisis. The free market died at least ten times in the past century.
And every time the free market expires there is, for some reason, a flurry of renewed interest in Adam Smith. Smith preached the gospel of the free market. Economic well-being—the wealth of nations, as it were—depends solely on freedom. There is, first, the freedom to choose our method and means of economic employment, what Smith indicated by his “division of labor.” Second is the freedom to exchange the products of our labor for the products of other people’s. Smith championed the abolition of restraints and monopolies on commerce, a doctrine that came to be known as “free trade.” Third, there is the freedom to decide what it is we want to accomplish with our labors and trades.
Smith termed it people’s “regard to their own interest.” This is sometimes called “pursuit of self-interest.” Jefferson’s more felicitous phrase is, of course, “pursuit of happiness.” Anyway, when the freedom of the free market leads to screwups, people always want to know what Adam Smith would say about “market failure.” It’s a “Hello, God, how’s my atheism going?” moment.
Adam Smith would be laughing too hard to say anything. Smith spotted the exact cause of the 2008 financial meltdown not just before it happened but 232 years before, probably a record for advice to sell short. In Book II, chapter 1 of The Wealth of Nations, Smith wrote, “A dwelling-house, as such, contributes nothing to the revenue of its inhabitant... If it is to be let to a tenant for rent, as the house itself can produce nothing, the tenant must always pay the rent out of some other revenue.” Smith therefore concluded that, although a house can make money for its owner if it’s rented, “the revenue of the whole body of the people can never be in the smallest degree increased by it.” Bingo. Subprime mortgage collapse.
Smith was familiar with rampant speculation, or “overtrading,” as he politely called it. The Mississippi Scheme and the South Sea Bubble had both collapsed in 1720, three years before his birth. In 1772, while Smith was writing The Wealth of Nations, a bank run occurred in Scotland. Only three of Edinburgh’s thirty private banks survived. The reaction of the Scottish overtraders to the ensuing credit freeze sounds familiar. “The banks, they seem to have thought,” Smith said, “were in honor bound to supply the deficiency, and to supply them with all the capital which they wanted to trade with.”6
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