Wednesday, January 10, 2007


by Rowan Patterson & Welf Herfurth*

The great Austrian political thinker and champion of free-market liberalism, F.A. von Hayek, made a famous distinction in his work between 'values' and 'merits', summed up in his famous slogan 'There is no value to society'. (Margaret Thatcher was attempting to convey the same idea when she made her famous assertion that 'There is no such thing as society'). Hayek argued that, when we assess the worth of a man's labours - in providing us with symphonies, or paintings, or glass etchings, or plumbing, or shoes, or whatever - the marketplace provides us with the only accurate assessment of their value. The market, which is made up of individual buyers and sellers, assesses the value of, say, a pair of shoes at $90. If buyers disagree with the price charged by the shoe seller, the latter must drop his price, and sell at a discount, if he wants to move his product off the shelves. If he refuses to budge on prices, or if he is underestimated the demand for his product (mistakenly believing that there is a large demand for his shoes, when there wasn't) he goes out of business.

But, says Hayek, suppose we take the socialist point of view and say that the shoe seller is a meritorious individual - that he deserves a 'better' price for his shoes than the one consumers are accustomed to paying, or that he deserves to have shoes sold in amounts large enough to make him wealthy. We are then assessing the shoe seller's labour on the basis of 'merit' and not 'value'. Hayek's point is that such an assessment is entirely subjective: the shoe seller and his friends and family may believe that he is meritorious, and deserves to make more money than he does; but the buyers in the market may have an entirely different valuation. The consequence of this is that it is impossible to get all parties to come to an agreement on 'merit'; but it is entirely possible to get all parties to come an agreement on 'value' - and such an agreement happens every day, in the market. Hayek believes that we cannot assess the 'value' of 'society' (or a something 'socially useful', 'socially beneficial') in that same impersonal (and clear-cut) way. Hence, 'there is no value to society'.

Hayek makes a similar distinction between an economy based on 'needs' and 'wants'. Joe Bloggs, an abattoir worker who lives in Cowra, needs a job in Cowra - otherwise he will be forced to move elsewhere to look for work, or take up a different career. In an economy based on 'needs', the government will ensure that Joe Bloggs is given that job. But suppose that there is not enough consumer demand for meat from Cowra: the abattoir will be forced to close down because of the impersonal pressure of the market. In an economy based on consumer 'wants', the government will allow the abattoir to close down and will do nothing for Joe Bloggs or the other abattoir workers.

Similarly, people in sparsely-populated rural areas may demand phone coverage from the national telephone companies, which are reluctant to service those areas because there will be no profit in doing so. In an economy based on 'wants', the rural population will have to go without phone coverage, or move to the city where they can obtain it; in an economy based on 'needs', the government will ensure that they are provided with phone coverage.

What relevance does this all have to nationalism? A great deal! Even the self proclaimed Neo-Nazi Bill White writes that
(at ) that:

Even race, while fundamental to the National Socialist worldview is not central to the National Socialist argument. When I talk to my organizers -- and check out our mailing list on Yahoo groups if you want confirmation -- I don't tell them to talk about race first, or immigration first, or any of these other issues first when trying to communicate the advantages of National Socialism to white people. I tell them to talk about the economy first -- in all its aspects -- and from there to point at the Jews, and then to show how Jewish connection to racial issues, and social-cultural issues, and political issues "trickles down" and reveals their poison in every aspect.

As has been written here at the New Right Australia/New Zealand site many times, National Socialism and Italian Fascism enjoyed their success first and foremost because they were social and economic doctrines first, and everything else second. The question - 'Do we want an economy based on needs, or wants?' - is as relevant today for nationalists as it was in 1933 or 1922.

The mainstream Right believes that we should have an economy based on consumer wants; the mainstream Left, one based on 'human' and 'social' needs. It is held, by a good many media commentators and intellectuals, that the Right has won the debate on the global economy; the twentieth century was the century of socialism, but, in the end, communism imploded from within, unable to compete with the Western capitalist economies. Even the West had to adopt, after the crises of the 1970s, competition and deregulation - inevitable 'market reforms' - in order to survive and prosper. America and the UK do well, it is argued, because they adopted the 'reform' path; Germany, France and other Continental countries have stagnated because of their adherence to the old welfare-state socialism.

The purpose of this article is not to revisit that old and hackneyed debate: it has received enough attention from mainstream journalists and intellectuals in the past twenty-five years. The intention of this article is to look at the place of the 'needs versus wants' and the 'merit versus value' debate within the context of the nationalist political struggle.

Now, in 2007, we can look at the benefits, and drawbacks, of economic systems such as communism and fascism with more perspective than, for instance, the people living in the 1930s and 1940s. The general consensus, in the mainstream Western media, is that communism has failed - and it is a view I, like many other nationalists, share. Take, for example, Mao's China. The difference between Maoist Marxism and ordinary Marxism was that the former championed the peasant, the latter the blue-collar labourer: Maoism could be described accurately as Marxism for the peasant class - it sought, not a 'dictatorship of the proletariat', but a 'dictatorship of the peasants' (or, more accurately, a dictatorship of an elite group of intellectuals who would rule in the name of the peasants). That was the official Maoist party line (we know, however, that Mao cared little for the peasants, and was interested foremost in making China a great geopolitical force, capable of being a rival to both Russia and America). At any rate, Mao's economic policies were disastrous for Chinese peasantry: under the Great Leap Forward, for instance, millions of them starved to death, mainly thanks to economic bungling and neglect (which occurs too often under communism). No greater example of communist failure can be found: after all, communism, ostensibly, intends to improve the national standard of living, and one of the main arguments against capitalism is that it leads to poverty and misery. But communism - as we have seen from the example of China, North Korea, the Soviet Union, Cambodia and the African states which turned communist - led to even more poverty and misery than capitalism, and starvation on a hitherto unimagined scale.

Now, in the 2000s, China has been forced to adopt the market mechanism as an alternative to socialism; eventually it will move further and further from an economy geared towards satisfying 'needs' and to one which aims at satisfying 'wants'. Vietnam has done the same; only Cuba and North Korea remain as the last hold-outs.

Communism could have been expected to do well in Europe: after all, even the economically backward countries of Eastern Europe are far more developed than, for instance, China at the time of the communist revolution. Again, naive left-wingers in the West supported the Soviet Union in its war against Germany because they believed that the communist system was better: the fascists were tools of capitalism (so the party line went), and capitalism always leads to poverty, misery, injustice, inequality, etc. But, once the war was over, and the Red Army had conquered Germany and Eastern Europe, it turned out that communism as an economic system wasn't as good as capitalism or fascism; it was downright inferior. On a simple, day to day level, the standard of living was below that of the Western European countries: East Germany produced unreliable and inefficient state-designed cars, and built shoddy housing; and shoddy and inefficient consumer goods were the general rule throughout the whole Eastern bloc. No communist in the West would have been able to cope for long living in an Eastern bloc country, simply because of the vastly inferior standard of living. Communism in Eastern Europe, and the Soviet Union, declined for a number of reasons: but one of the main reasons is that, simply, the populations there wanted the lifestyle of the West: better cars, better clothes, better houses, reliable supplies of electricity, gas, and water...

For this reason, the communist parties in the West are, after the post-1989 collapse of Soviet communism, unpopular. That is, they do not have a mass base of support. Communist organisations may be active in student politics on university campuses; their refried Trotskyism manages to attract its share of followers (from my experience) of naive and politically uneducated youth. But it is out of the question that they will ever be able to win power in Australia or in any other Western country. The reason for that is that we all know, by now, that communism doesn't work. Or, rather, the price demanded by communism is too high for Westerners to pay; for one thing, our glitzy shopping malls will have to go (to replaced, presumably, by state-owned malls selling state-made jeans), and not even the most hardcore Leftist university student wants that. Communist activism in the West is one exercise in futility.

The reality is that, in Australia and most other Western countries, is that the Hayekian neoliberals have won for the most part. For the past 11 years, a conservative center-right government has actively striven to introduce competition. It has broken, for the most part, the trade unions' grip on the labour market, has allowed competition in various industries (including the dairy industry) and is now in the process of dismantling a price-support scheme for Australian farmers (which makes it illegal for farmers to sell their wheat overseas below a fixed price) which has existed for 67 years. It has also kept up the policy, introduced by successive Australian post-war governments, of free trade, and privatised the national telephone company.

The social democratic Labor Party, and members of the agrarian-socialist National Party (which, ironically, is in coalition with the conservatives), oppose these policies; many nationalists here in Australia oppose these policies as well. But my own reaction is: so what. The Labor Party, of course, opposes deregulation of the labour market because it is run by trade unionists who want to preserve their monopoly over the labour market. Competition in that area - where workers can work for less than minimum wage if they choose - will make the unions redundant. Likewise, the National Party is only looking after the interests of its constituency, Australian farmers - who believe (like farmers in France, America and Japan) that farming is a lifestyle, and not a business, and that the world owes them a living. The idea of putting agriculture on a market basis terrifies them, and rightfully so. Both groups - the blue-collar trade unionists, and the farmers - claim that their interests are the interests of Australia as a whole. But this is false. Non-white immigration does more damage to Australia than free trade or privatisation (in my opinion), but historically the unions and the farmers have done little to oppose it. A few trade unionists in Australia are now speaking out against immigration, simply because present government policies have loopholes which allow immigrants to work for below minimum wage. But, obviously, the concern of these unionists is based on self-interest, nothing more.

And if we are to judge the rightness or wrongness of every economic policy by self-interest, very well then: competition and privatisation does little to hurt me as a person. For example, competition in the airline industry in Australia, for instance, has allowed cut-price airlines like Jetstar and Virgin Blue to appear, which allow me to travel to nationalist conferences at cut-rate prices - something which would be impossible a few decades ago when established monopoly-protected airlines like Quantas dominated the market.

The problem is, I think, that many nationalists in Australia are prone to adopt the farmers' and the unions' struggles as their own; likewise, nationalists in other Western countries elsewhere do the same - champion the interests of farmers, or unions, or local business, against competition, from within or without.

They do so reflexively, because, they feel that, by being nationalist, they must side with the Left on nearly every economic issue. In my own experience, every nationalist I have encountered has opposed the neoliberal agenda of free trade, privatisation, deregulation, union-busting, etc. Nationalists take a left-wing position on most economic issues. This is for a number of reasons; but I think that the main cause is that the nationalism of Europe in the 1930s and 1940s was economically on the Left, and that that period of nationalism still has a great ideological influence on Western nationalists today.

And I agree: nationalism is, and should remain, Left when it comes to the economy. But groups like local manufacturers, unions and farmers are very strong already, and do not need the support of nationalists; furthermore, they will reject any overtures we will care to make towards them, either because they do not give a damn about the issues we care about - e.g., immigration, or freedom of speech - or because they do not want to offend Jews and liberals.

Besides which, by focusing on free trade, or privatisation, or competition, we are ignoring the real issues. For instance, we are not paying attention to the problem of the massive unemployment which exists in most Western countries. We in Australia have quite a severe unemployment problem - something which may come as a surprise to foreign readers, as the official rate is only 4.6%. But other statistics belie that figure. We have, in Australia, 2.6 million Australians on welfare. (See 'Putting the benefits in doubt', The Australian, December 30, 2006, at,20867,20988424-28737,00.html ).
Of that 2.6 million, 700,000 are on the disability pension. (See: 'Labor on "backflip" on tests for the disabled', The Australian, December 28, 2006, at,20867,20980454-2702,00.html ).
We also have an epidemic of single parents, most of them women, collecting single parents' pension: 423,000 as of September 2006. (See: 'Single mums back on the job', The Australian, January 8, 2007, at,10166,21026129-462,00.html?from=public_rss ). Around 250,000 men in Australia between the ages of 25 and 44 are not looking for work. (See: 'Revealed: a nation of dropouts', The Age, April 17, 2006, at

So why is the unemployment rate only 4.6%? Firstly, because people are only counted as looking for work (and therefore being unemployed) if they are willing to take up a job in one week's time; secondly, anyone working at least two hours a week is counted as being employed full-time. These methods for counting the unemployed are set by the International Labor Organisation, an agency of the United Nations, and have been used in Australia since 1978. (Previously, the method used was to count the number of people on unemployment benefit. If that method were still in use today, the official unemployment rate would be 5.4%). Most other countries in the world use the method as well.

Understandably, that ILO method can downplay the number of unemployed quite dramatically. But hardly any mainstream political figure in Australia, whether on the Right or Left, questions its use; after all, the figures it produces are just too good. The conservative politicians, who have never been unemployed or experienced any significant economic hardship, simply assumes that the figures are correct and that the present conservative government has created a jobs cornucopia. (And indeed, deregulation of the labour market since the 1990s has created plenty of two hour a week jobs). So their welfare policy is fairly simple: the unemployed are scum, and deserve to be treated as such; the best policy is to use psychological pressure to force them off benefits and get them to look for work.

The policy has been successful insofar as that it has forced many people off unemployment benefits. It is safe to assume that many unemployed (or women, for instance, who would otherwise would have been unemployed) have jumped ship and become disabled, or single parents, simply because the requirements for those two pensions are less strict.

From my own experience (and the experience of anyone who is an urban commuter, or spends time in the central business districts of Australia's major cities), there is a growing, almost ubiquitous, Australian underclass. (The characteristics of an 'underclass' are, following the American author Charles Murray's definition, are: low rates of participation in the labour force, low educational attainment, a record of petty crime, chronic drug and alcohol abuse, poor diet, anti-social behaviour, and a penchant for giving birth to children out of wedlock). Comprising the underclass are a small, but growing percentage of the white population and a large percentage of the Indigenous population. Underclass people cannot find employment for two reasons: there are not enough low-wage, low-skill jobs for them, and employers find them too obnoxious and unprofessional to hire them anyway (at least at prevailing wage rates).

In Hitler's Germany, as we know, full employment prevailed. A small underclass existed (as it does in every society) which led a dissolute lifestyle and refused to work. The German government's policy was to offer a long-term unemployed person a job, and if that person refused a job offer three times in a row, they ended up in a concentration camp and wore a uniform with a black triangle - the symbol for 'asocial' prisoners.

In general, such a policy can be justified - in a situation of full employment. But Australia is not such a full-employment economy, even though the liberal democratic politicians say otherwise. The same can be said for other Western countries. (It is hard to judge the unemployment levels in other countries from a distance; but we can say for certain that unemployment in France and Germany is high, and that the same is true for most countries in Europe. Britain, which has low official unemployment figures, has a large number of people subsisting off the welfare state, as do the Scandinavian countries).

As to why we have a growing underclass, a number of complex social and economic explanations exist.

For one, most of the underclass traditionally would work in low-wage, low-skill jobs. But minimum wage laws effectively cancel out any such jobs. As well as that, most of the underclass are drop-outs from the working classes, who traditionally worked in low-skill manufacturing jobs, which are now being relocated offshore in Third World countries because of, among other things, minimum wage laws, high taxes and the simple fact that most workers in the Third World have a lower standard of living and therefore will demand lower wages than Australians.

Besides the economic, there are underlying social causes. The American author mentioned before, Charles Murray, believes that the decline of the institution of marriage is responsible for the growth of the underclass. Children in single-parent families grow up without a father who acts as a male role model. That is, the traditional husband and family man - who goes to work every day, stays monogamous, and does not engage in petty crime and anti-social behaviour - in the past acted as a role model and a stabilising influence. Nowadays, the welfare state, with its generous provision of single-parent pensions, pays women to bring up children without fathers. Furthermore, it encourages them to have more children in order to collect more money.

All of these explanations have value, I believe; even the work of a mainstream conservative like Murray has value in that it goes a long way to explaining the growth of the underclass, and what needs to be done about it. But it is essential for nationalists to recognise that nothing can be done about the underclass problem, and the unemployment problem, in a mainstream liberal democracy. Because of its inefficiencies, liberal democracy can do little to alleviate social and economic problems in the West - merely stave them off. (For instance, the German government has had 16 years to do something about Germany's unemployment problem, but has failed, and failed miserably, and will continue to fail).

But we have to draw a distinction here between the underclass and the rest: there are many people in Australia, and in the Western countries, who are down on their luck and who are not underclass scum. These people have been trampled on by successive liberal democratic governments. They have been left behind by both the mainstream Right and Left because, among other things, the unemployment statistics say they do not exist. (In Australia there is the spectacle of the person who is over fifty-five and who is without work. No employer will hire them because of their age, and, at the same time, they are too young to collect the old-age pension. There are also large numbers of over-educated university students who graduate every year and who are destined to dead-end and insecure casual work, or work as security guards, taxi drivers, etc. Also, a number of students who are still studying are forced to rely on charity thanks to, among other things, government cuts and the abolition of student services previously funded by the government).

It is my opinion that these people are potential recruits for nationalism - and good recruits at that. For one, they have some education and are (unlike the underclass) fundamentally decent people; secondly, they have the potential intelligence and perceptiveness to see that their problems will not be solved by a change in government at the ballot box. They will be receptive to the nationalist argument that the structural deficiencies in the economies of the West, and particularly the Western welfare-state countries like Australia, France and Germany, are due to the deficiencies inherent in liberal democracy.

So what are the solutions for the West's economic problems, in particular, its unemployment (and underemployment) problems? I am not arguing for complete and total socialism - as it exists in Cuba and North Korea - and I am not arguing for the complete cessation of 'free-market reform' either: only that there has to be a medium between the two. But the right direction lies towards the Left and not to the Right. We need to move towards an economy where people are treated on the basis of their 'merit', their 'social value', and not merely their market value. There are plenty of decent people who have been ground under by the economic mill, and who deserve better treatment.

In a previous article published -The radicalisation of the middle classes- ( it was argued that nationalism should aim at forming its base in the middle class, following the example of the National Socialist and fascist movements of the 1920s and 1930s. That recommendation is correct: but it is essential to point out that the middle-class followers of Italian Fascism and National Socialism - the office workers, the small business owners, the intellectuals - were, for the most part, unemployed (or underemployed). They understood, instinctively, that the fascists were acting in their interest. Hitler never said anything as blunt as, 'Vote for me, German office girls, and I'll get you a job'; but that was the underlying message in the National Socialists speeches and writings. National Socialist and Italian Fascist propaganda was pitched at a fairly high intellectual level, aimed at Germans and Italians (and other Europeans) with a degree of education. That, combined with the repeated emphasis in that propaganda on 'social' needs and 'social' justice, meant that the lower middle-classes recognised fascism for what it was: socialism in their interest, and not that of the working-classes (who were either attracted to communism or mainstream social democracy).

Circumstances today, of course, are different than from Europe and the rest of the West in the 1930s. But they are similar in that the times are ripe for social revolution - a revolution of the decent, i.e., people who are not underclass but who deserve better treatment. The likes of a Hayek may object to such 'subjective' assessments of value. But governments are always allocating resources on the basis of some perceived merit, and this is a fact of life. In Australia, for instance, immigrants from Sudan get preferential treatment; waves of Africans are brought over, either to work in low-wage, low-skill jobs, or, more likely, put on welfare with that last wave of 'refugees' we all had to feel sorry for - the Vietnamese. Whatever contribution the African, Vietnamese and Muslim immigrants make to economic life (and it is minimal, in my opinion) is overshadowed by the social cost. (But, to Hayek, we cannot assess 'social' cost).

Nationalists will have, in my view, little to no serious competition when it comes to tackling the 'social question'. The Marxists, surprisingly enough, are out of touch on social issues. In the main, this is because of their narrow-minded ideology. In their worldview, there only 'good' working-class people and 'bad' corporations (with the petit bourgeoisie existing in the middle). The Marxist fights for social justice for the working-class, but ignores the plight of the middle-class. Furthermore, the analysis of the Marxists is limited: social problems are caused by capitalism and the big corporations; the idea that Jews, for instance, could be a contributing factor to social decadence and decline is nonsense - anti-Semitism is 'the socialism of fools'. The Marxists further alienate themselves from ordinary people of Indo-European descent when they champion the rights of immigrants, and denounce any opposition to immigration as racism, fascism, etc.

As we all know, the economic depression of the 1930s brought the German National Socialists to power. Many Westerners believed that fascism was a viable alternative to liberal democracy, which, it was perceived, had failed. It is for that reason that more than a few nationalists today express a desire for some economic catastrophe, comparable on a scale to that of the 1930s, to occur. After all, that will only increase support for nationalism. (We know that, electorally, the German National Socialists did badly in the late 1920s because, among other things, of the improving economy). But I believe that this argument is fallacious. For one thing, the catastrophe, in many Western countries, is already here. Germany today, for instance, has more people on its unemployment rolls than during the Depression.

In order to attract more public support, nationalists need to bring up, again and again, the 'social question' - and persuade people that the causes of any economic deprivation go deeper than the mainstream analysis. (That is, we know that the economies of the West may be bad because of high inflation, high interest rates, high taxes; but why the high interest rates, why the high taxes? Why do we have a class of politicians who embark on policies which we all know will only hurt the economy?).

At the same time, we must not make the mistake of leaping straight into electoral politics, expecting that, once we form a new, populist party, nationalists will come to power and make everything right again. Pauline Hanson's One Nation did a good job, initially, of addressing the 'social question' and the concerns of people who had been left behind by the policies of the mainstream parties; but it failed to build up a critical mass of popular support as preparation for any electoral activity. At the federal elections of 1998, One Nation received one million votes, but failed to break through Australia's proportional voting system; the major parties triumphed.

Nationalism must, before it becomes embodied in a party, be a state of mind and a mass movement; a state of mind and a movement which exists in a large segment of the population - the 'decent' we have identified here.

*Welf Herfurth is a political activist who lives in Sydney / Australia. He was born and raised in Germany. He can be contacted on

1 comment:

nz conservative said...

I like the concept of an 'investment' economy rather than a nationalist or liberal economy.

Hence, I support measures to increase savings, scientific and industrial research, technical help for farmers, small business e.t.c.

Making short term sacrfice for future gain serves both a moral and pragmatic purpose.

Unfortunately, open immigration and liberal ideology works against an investment economy since it undermines the incentive of businesses to get by on less labour through technical improvement.

Furthermore, it undermines the potential of technology to be used to reduce waste.

Industry is getting cleaner, but thanks to liberal ideology,the benefits are chancelled out by increased immigration and unregulated production in 'developing' countries.