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March 13, 2021

1776 vs 1789: The Two Bloody Revolutions That Defined How We Think About Wealth in the Modern World

The American and French Revolutions were based on two fundamentally opposite ways of thinking about wealth. These two viewpoints produce two completely different societies and the conflict about which is right forms a long-running debate that goes back centuries. At its heart, it’s a debate about how wealth is created and how it should be divided between the citizens of a country.

The recent US election was just the latest chapter in this debate and modern discussions about “economic, racial, social and environmental justice” are simply restating age-old questions: Should fairness be measured by opportunity or outcome? When should the government be allowed to interfere in your life for someone else’s benefit? When does the hand of the referee become the strong arm of the tyrant?
What happened in 1776 in America and in 1789 in France laid the groundwork for the dominant political philosophies that have defined the Western world ever since. Both revolutions were motivated by the same desire to bring prosperity to the people and to free them from the tyranny of their unaccountable rulers. And both succeeded in throwing off their monarchies. But that’s where their similarities end.

The American attitude towards wealth led to the founding of a successful and long-lasting republic. The rallying cry of their Revolution - Life, Liberty, and the Pursuit of Happiness - inspired Americans to follow a path of wealth creation unlike anything the world had ever seen. The freedom America offered became a refuge from the “storied pomp of ancient lands”, a place where the “world's tired, poor, and huddled masses could breathe free” and lift themselves up by their own bootstraps. And the ideas that sparked their revolution matured into the American Dream and the American tradition of the self-made man.
Statue of Liberty in New York Harbor

Things didn’t turn out quite so well in France. Despite the fact that their rallying cry - Liberty, Fraternity, and Equality - was partly inspired by the American version, within a decade of overthrowing their monarchy public opinion in France had already turned against their new republic. Disillusioned, they turned to military dictatorship instead and Napoleon Bonaparte was crowned as emperor and was, once again, granted absolute power over his people.

Napoleon on his Imperial Throne, 1806
To understand why America ended up with a stable republic while France slid right back into dictatorship, we need to have a closer look at the attitudes that each of these countries had towards the creation and division of wealth. So, imagine for a moment a world full of oak trees and squirrels and nothing else. The oak trees produce acorns, which represent the wealth of the nation.

The default attitude throughout history has been to view wealth as a limited number of acorns, collectively shared, with laws needed to ensure that every squirrel gets a fair share of acorns so none go hungry. This attitude places government at the center of society in the role of referee in charge of dividing access to this wealth. That is why the French squirrel of 1789 cried out for Fraternity and Equality; it was a cry about the unfair division of acorns and a veiled threat to those holding the reins of power that when government fails to divvy out acorns fairly, it loses its legitimacy and heads roll. From this perspective, fairness is judged by equality of outcome.

But from the American perspective, shaped by their history of hacking a living out of the raw forests and grasslands of the American continent, this is a world with a thriving market for acorns. It’s a world where squirrels are free to take the initiative to plant more oak trees in order to produce even more acorns. Or they can become wealthy either by trading acorns for other goods and services or by trading other goods and services for more acorns. Consequently, this American worldview sees wealth as infinite, and individually owned, because it can be created from nothing and is limited only by the time and effort required to create it.

That’s why the American squirrel of 1776 cried out for the Pursuit of Happiness. It’s a cry to be released from the control of others, to do away with the confiscating hand of the referee, so that every squirrel can reap the benefits of its own planting, harvesting, and trading to achieve its own American Dream. This attitude removes government from the center of society. Its responsibility is limited to protecting you from being tread on by others, but it is not responsible for your financial condition. You, and only you, are responsible for your successes and failures. With an infinite amount of wealth that can be created, fairness is simply a measure of everyone's equal opportunity to participate in the game. 

The Gadsden Flag, an early motto flag
used during the American Revolution.

France's Fraternity and Equality, on the other hand, is an invitation to look over your neighbor's fence and count his acorns. It’s a demand for government to continuously intervene in the market through regulation, taxation, and redistribution in order to smooth out differences between individuals or groups. It’s an invitation for everyone to lobby the government to shovel more acorns in their direction in the name of social justice. And it leads to a culture of victimhood because every perceived disadvantage motivates the referee to give you greater access to someone else’s acorns while every perceived advantage is punished by the referee by confiscating some of your acorns to give to someone else. 

This attitude towards wealth is the perfect fuel for a never-ending cycle of jealousy, envy, and tribal conflict. It’s the sentiment at the heart of every Marxist revolution. It’s the heartstring every socialist politician pulls to deceive voters into believing that putting the "right" people in charge (and giving these referees more power) will ensure that the acorns will be divided more fairly. This attitude simply replaces old hierarchies built on royal pedigrees with new power struggles based on class, ethnicity, nationality, gender, sexual orientation, skin color, religion, political affiliation, or some other way to divide people into tribes, resulting in a new set of elites elevated to the task of refereeing between them.

Fraternity and Equality are abstract ideals that are impossible to achieve. Fairness depends on whether all the squirrels feel that the acorns were divided equally, and that never happens. When each feels threatened by someone else's abilities and when each feels more entitled according to their own needs, even the most honest and well-meaning referee will never achieve a balance to suit everyone, which means that each revolution merely plants the seeds for the next.

Furthermore, the impossible task of refereeing inevitably leads to economic stagnation. Every new innovation, every improvement in efficiency, and every idea that gives someone an advantage in the marketplace automatically disrupts the distribution of acorns, creates new inequalities, and disturbs the notion of camaraderie. And so, in the name of fairness, the long tentacles of government constantly have to stifle progress, confiscate and redistribute wealth, and try to prevent the creative destruction that occurs when old ways of doing things are replaced by new more efficient ways.

By contrast, the American Pursuit of Happiness is an invitation to look at your own two hands to see what you can create through your own hard work. There’s no guarantee of success, no promise of equal outcomes, and no insulation from competitive market forces. But with no limit to the amount of wealth that can be created, your neighbor's wealth doesn’t threaten your ability to accumulate your own pile of acorns. If anything, he’s a customer with deep pockets, a potential buyer for whatever you’re willing to sell. And your neighbor's success is something to be celebrated and emulated as a model for your own individual path to prosperity. The Pursuit of Happiness is the ultimate motto of a free market, of reinvested savings as a pathway to creating long-term wealth, of personal responsibility, of a good work ethic, and of neighbors who can live together peacefully despite having different sized piles of acorns stashed in their backyards.

So, it shouldn’t surprise anyone that France is currently on its sixteenth constitution since 1789 while America is still on its first. Clearly not all attitudes towards wealth are created equal. The only question that remains is whether there are still enough Americans left today who understand the value of the Pursuit of Happiness to prevent America from falling prey to the deceptive siren song of Fraternity and Equality.

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  1. I like your story. But what's a squirrel to do when a few bully squirrels fence off most of the land and most of the oaks?

    1. The Founding Fathers specifically recognized the risk you describe in your question. The checks and balances they created and the limits they placed on government were meant to prevent exactly this risk. They created just enough government to defend citizen's rights from the grabby hands of others, but without giving government sufficient power to allow some citizens to leverage the power of the state to get government to do the grabbing for them.

      But the Founding Fathers also recognized the vulnerability of the system they created. When Benjamin Franklin was asked what kind of government they’d created, he replied, “A republic, if you can keep it.” He was warning people that the responsibility of preserving what they’d created lies not in the hands of government, but in the hands of the citizens themselves.

      What he was referring to is that without the cultural buy-in of the vast majority of citizens, no law can withstand the appetite of the mob and no limits initially placed on government power can stop the inexorable growth of the state nor the corruption and overreach that inevitably comes with big government.

      Courts and laws merely provide a stabilizing effect to slow down how fast bad ideas take over a society, but they can only slow the process, they cannot stop it. Eventually laws will always be twisted and reinterpreted to follow broad cultural trends. Perhaps the most horrific American example of this is the 1896 court case - Plessy vs Ferguson - which "reinterpreted" the Constitution to suit the cultural mood of the time, thereby opening the door to segregation in spite of the ironclad wording of the US Bill of Rights and in spite of the principles at stake during the US Civil War fought only 30 years earlier.

      What we're seeing today is, at its core, a cultural problem. By failing to transmit the Founding Fathers’ principles and by failing to teach a deeper understanding of history to the next generation, it becomes inevitable that the opportunists gain the upper hand - the crowd has become like putty in their hands, a blank slate that’s easily moldable to their needs because the cultural foundation that should provide immunity to the opportunists is missing. Vacuous politicians, corrupt businesses, social media mobs, etc, are the symptom, not the cause. Opportunists are a dime a dozen in any age, but whether they gain traction or are left shouting into the wind depends on whether the people themselves either provide fertile soil or barren ground for their bad ideas.

      The seeds of the problem are planted in the family home. Experts have their place in society, but in the name of convenience we made the mistake of outsourcing everything to "experts". In a sense, the “age of the experts” would be better described as the “age of the missing parent.” Other than putting food on the table and serving as chauffeur to ferry the kids back and forth to sports events, the parent has been largely sidelined from the transmission of cultural values. The state determines the educational curriculum. Hollywood does all the storytelling. And the kids spend the bulk of their day with babysitters, in daycares, with state-appointed teachers, or glued to the TV. So, over time, we shouldn't be surprised when the cultural values they grow up with are molded to suit the needs of the state (and corporate business) rather than the needs of a free people.

      It’s going to be a steep uphill cultural battle to turn this around, although all the nonsense being imposed on us right now is likely going to work in our favor to start winning back the hearts and minds of the crowd to the importance of liberty and the responsibilities that come with it.

    2. @Julius: You never directly answered the question?

      What does the Founding Fathers principles have to do with the inevitable results of Capitalism. You response is hypocrisy! Your view of the corporations / "opportunist" (read literally as any individual who sees an opportunity) is the same view that you are espousing against in the article. Literally, you sound like a socialist.

      @Vera -- The answer is that the founding father's vision ultimately fails. The reason for this is that every form of gov't, besides self governance fails. The Golden Rule, one that you could say is written onto the heart of all men, is found in many different civilizations from the dawn of mankind, it is as close to a moral absolute as we may ever find. The idea of caring, or treating one's neighbor (anyone) as their self is apodictically true.

      Gov't cannot follow this rule. Gov't inherently breaks this rule by default. It is impossible for Gov't to treat others as itself because Gov't controls all the means to power. That is why even the form of libertarianism you see espoused by many always end up being logically incoherent.

      The only answer to your solution is Anarcho-Capitalism. That is Capitalism governed by the Golden Rule. In it a few 'bully' squirrels would never exist. It seems like an impossible dream in the world we live in, but it is the ultimate future for life. Likely will be implemented once AI life forms take over.

    3. @vera -- check out James R Redford's paper on "Jesus is an Anarchist". Great paper that examines the historical views and opinions of Jesus related to various forms of Govt.

  2. Hopefully there's more to life than acorns.

  3. It doesn't matter what the founding fathers intended, as for freedom etc. They really didn't care... For example, slavery. Also only land owners could vote originally.
    And the bill of rights (amendments) came after the many complained of being screwed by the constitution.

    The us was never a nation that respected individuality, but an economic dictatorship from the start. But people believed it was free...
    Whereas France had a lot of infighting, and ended up with a society that allows for success but also gives a basic safety net. These days neoliberalism threatens that.

  4. Hi Julius,

    I just discovered your stuff and like it quite a bit, but in this one here there's a lot that strikes me as straight up rubbish. Allow me to explain.

    "Égalité" and "Fraternité" weren't about acorns. That's dumbing it down far too much. Égalité was about equality before the law, the end to feudal rights and privileges. Fraternité -- brotherhood -- refers to the fact that France is composed of many different tribes and that, as a continental power, these tribes must stand together or be prey to their neighbours. It's political economy and geopolitics -- not economy. Yes, jealousy and envy play a big role in every revolution -- and indeed, in everyday life. The world didn't wait for Marx to be born to establish that.

    On the US-side of things, you can't ignore the fact that the "pursuit of happiness" would have looked radically different if there hadn't been a whole, mostly empty, continent to build up and civilize (and no, for the record, I don't give a shit about slavery, natives or primeval forests). The Americans are an incredibly industrious people and their enterprising spirit is a sight to behold. But you can't just ignore the context. Life isn't just about ideas. The USofA, for instance, have never had to go through an agrarian reform. That's a big deal.

    I was looking forward in this article to the treatment of a very interesting question -- the comparison between these two revolutions, so close in time and indeed in spirit, yet so different in outcomes. I was disappointed.


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