Free Trade

Philosophical Reflections XIII

From the facts that reality exists and that we exist in it, derive the ethical consequences that our life is our fundamental value and that rationality is our fundamental virtue.

The pursuit of life demands the particular values of reason, purpose and self-esteem. Rationality implies a number of particular virtues including honesty, justice, integrity, independence, productiveness and pride.

Those virtues may be divided into personal and social virtues, the former applying even in isolation, and the latter concerning relationships between people. The social virtues can usefully be summarised by a single principle, which defines the only moral relationship between people, in that it is the only relationship that enables and fulfils all the virtues. That relationship is voluntary trade.


Duality (consciousness existing in physical reality) implies three fundamental and linked requirements for our lives: thought, action and property. A rational being must be able to use its mind: because thought is the fundamental tool of survival for any being with the faculty of reason. Thought – reason – is central to our ability to understand the world and to choose the values and actions that enable us to live in the world. A rational being must be able to act on its thoughts: because reason is our fundamental tool of survival solely because it tells us how best to act in the world. Thought without action can achieve nothing in the real world. And a rational being must own, must have the right to keep, the fruits of its thoughts and actions: for thought and its resulting actions underpin our lives solely because of their effects, solely because of the values they create (or the disvalues they destroy). Thoughts and actions robbed of their results are futile.

Consider a man in a cold wilderness. If he does not think (or use the results of someone else’s thinking), he will die. If he reasons out how to build a fire yet fails to do so, still he will die. If he builds a fire but is robbed of it, again he dies. Thought – action – property: all three are inextricably linked with our lives, by the nature of Duality. We must decide what to do, and must be able to do what we decide.

All three are the product of volition. You can decide to think, or not to think. To act on your thoughts, or not to act. To use the results, or not to use them. All are aspects of the fundamental choice in the universe: to be, or not to be.

It is by these things that you are happy or unhappy, that you live or die. From this derive the fundamental good and evil for a conscious being. The power of a conscious being to live derives from volition, from free will. Without that, it is powerless to affect reality, for good or ill. This is why rationality is the fundamental virtue: because reason is the link between volition and the nature of reality; it is what guides volition to make the correct choices. And this is why the fundamental evil is force: because force is the one thing which renders volition impotent.

Your thoughts may be wrong, your actions might fail in the face of hard reality, your products might be inadequate to the task. But that is reality. That is why consciousness exists (viewed from an evolutionary perspective); that is why life is a value, not just a gift; that is why rationality is a virtue, not just a game. Reality is neither moral nor immoral: it just is. Morality pertains only to the actions of conscious beings. And the only action that can stop someone from using their mind is force; the only way to stop them acting according to their conclusions is force; and the only way to steal the values they produce is by force. And when your thoughts or actions are forbidden or controlled under threat of physical force, when your products are stolen: then your power to live is attacked at its root. You can no longer look at reality and live by your own judgment: you become the victim or slave of another.

The essence of rational consciousness is this: I can see the world; by reason I can choose what to do in the world to preserve and improve my life; I can do it. If you use force against me, you attack me at the most fundamental level. Thus is force the ultimate evil. Many things are immoral, such as injustice, dishonesty and irrationality. But the initiation of force is a higher order of evil than those, because it strikes at the very root of conscious life.

The question might arise, “So what?” If it is my own life which is my highest value, what do I care about doing evil to someone else? The answer is all the reasons why justice is a virtue. Briefly, from the nature of things people will trade: good for good, evil for evil. If you want others to respect your rights: you must respect theirs. If you trade with others, then you are a value to them, because you benefit their lives. If you do evil to them, you are a disvalue to them, a drain on their lives. Your life is best served by sustaining the sustainers of life: not by making enemies of the best of men.

Who Started It?

Note that it is the initiation of force which is evil. Force used to defend against force is perfectly moral. This is inherent in the reasons why force is evil: it attacks the fundamental power of rational life to live. If a fundamental attack on your life is evil, then it is evil to allow it. Life must be defended, and where persuasion fails the only defence against force is force. Therefore resisting force with force is moral.

It follows that pacifism as a principle is evil. Of course, whether one fights or not depends on context, and persuasion is preferable: but it is not moral to refrain from force when force is appropriate, as rationally determined. Morality consists of defending life, not standing back to let evil run unchecked.

It is important to define who is the initiator of force. It is not defined by who first raises his fist, but in the context of thought, action and property as discussed above. For example, if someone tries to come into my house to take my TV, he is the initiator of force and I am entitled to use force to stop him. On the other hand, if I left my TV unattended and someone walked off with it, then I have a moral right to enter his house and take it back: he has no right to stop me, and if he tries to stop me, he is the initiator of force.

That is, the initiation of force is defined not by possession but by ownership. Ownership is determined by the principles of justice, which is to say, by who has earned it. Earning is defined by the principle of thought-action-property: what you produce by your mind or effort you have thereby earned. This means: it is yours by right. Ownership can validly be changed only by the permission of the owner.


Fraud is an aspect of force, because in essence it is a fake trade. The victim of fraud has given a value in exchange for a supposed value: then it is revealed that the value he received (if any) is not what was represented. Therefore, the trade has not gone through. Therefore, ownership still belongs to the defrauded person. Therefore, the defrauder has no right to the item, no right to stop his victim from taking it back: and if any force ensues from restoring the item, is the initiator of that force.

Note that fraud involves force only in the realm of objects, where the value exchanged is a physical thing which can in principle be regained. There can be no force, therefore no initiation of force, with regard to fraud in the spiritual realm, such as regarding friendship or love. Such fraud is of course immoral, but it is not valid to respond to it by force. The correct response to non-force fraud is the same as to any immorality not involving force: the withholding of future values (e.g., refusal to trade further in anything, spiritual or material).

Those are the basic principles of a complex issue. A full analysis of what is and is not fraud, what kinds of fraud do or do not involve indirect force, and what the valid and invalid responses are, are beyond the scope of this article.


Violence is the ugliest manifestation of physical force: the use of force to cause actual injury or destruction.

It is important to note that it is force which is the fundamental evil. Violence makes force worse, but the absence of violence does not make force better. The mugger who beats you up; the hold-up man who robs you at the point of gun but does not harm you; the bureaucrat or other protection racketeer who wants your “voluntary cooperation”, when it is in fact “obey me or else”: all are equally guilty of the initiation of force, of the fundamental crime against your life.


From your life as the fundamental value follows force as the fundamental evil, and from those two it follows that the trade of value for value is the only proper relationship between people. The only alternatives are sacrifice of yourself to others, or sacrifice of others to yourself, and neither can be moral.


Since your life is your fundamental value, self-sacrifice is immoral. By self-sacrifice I mean the voluntary giving up of a value for a lesser (or no) value. Values are the things you seek to have and hold, whose priority (when rational) is determined according to the needs of your life and happiness. Rationally, then, it is not possible to engage in sacrifice, as it is inimical to your life.

It is important to note in this context that many things often regarded as “self-sacrifice” simply aren’t. It is not sacrifice to give gifts to your wife, nor to spend your hard-earned cash on your husband’s hospital treatment: not when you value them more than the money. And indeed, that is what a normal person assumes: that such gifts are a consequence of their worth to you. “You aren’t worth it, but I’ll spend the money on you anyway” is not likely to endear you to anyone worth being endeared to!

The key is your hierarchy of values. Rationality requires that this hierarchy be correct, for the sake of your life: and that hierarchy serves no purpose, makes no sense, if you do not live and trade accordingly.


There are two kinds of sacrificing others to yourself. These are the use of force, and persuading others to sacrifice themselves to you: what Ayn Rand called looting and mooching.

The looters have already been dealt with.

Mooching is morally indefensible too. As a rational morality is founded on the value of one’s own life, it is not possible validly to persuade someone to sacrifice themselves to you: since self-sacrifice is morally indefensible. So the moocher must attempt a con-job, usually using his or her need as a claim on the life of another. No such claim is valid. What each person produces by their mind and body is theirs by right: and someone else’s need, want or envy cannot take that right away.

That is the fundamental evil of mooching. Its incompatibility with virtues such as independence, justice, productiveness and pride is a natural consequence.

Value for Value

Rationally, human beings will willingly give up a value only in order to obtain a greater value. If someone has something I want, I must offer him or her something in exchange, something that I value less and he or she values more. That is the only way values can change hands, in the absence of force. That is the definition of trade: the voluntary exchange of values for mutual benefit.

The simplest expression of trade is in the production and trade of the physical necessities of life. That arises because even if everyone was capable of producing everything they wanted, it would not be in their interests to do so. This follows naturally from the fact that human beings depend on production for their quality of life. People have maximum productivity if they specialise, whether on the basis of talent, training or simply geography (access to natural resources). Since the total productivity is then much higher, everyone benefits if they do what they do best, and trade the surplus for the other requirements of their lives.

It cannot be stressed too much that the only relationships between people that can be moral are voluntary ones, and therefore all moral relationships are based on trade. Reality, rationality and virtue demand this: that you neither demand nor give unearned values, which means, you must give value to get value.

Nothing is given to life except its powers to live. All that life requires for its continuation must be acquired by activity of some sort, even at the most primitive level. The same holds for us. All that a human being needs to live must be sought or made by someone, by someone’s mind, by someone’s effort. This is fundamental to life in general, and to volitional life in particular.Therefore, all you want must be earned: by someone. It is a crime against your victim to seek an unearned value: because all values arise by effort, and the one who expends the effort owns them, or has become a slave. To take the unearned is a fundamental injustice against human life. The only way to earn a value is to create it (or at the most basic level, use the initiative and effort required to go and find it): or to create another value which you can offer in exchange. Mind for mind, creation for creation, effort for effort, value for value.

Only the currency varies. I can trade anything of value to someone else, whether it be my time, goods, skill or money: for anything they are willing to give in return, be it food, tools, money, art, music or a nice cold beer on a hot day. As another example, take cooperation. Rationally, two people will cooperate in an endeavour if it is in their interests to do so, i.e., their skills or assets are complementary or synergistic. The currency of that trade is their skills. Or consider the giving of a gift. Ignoring the trivial case where you expect one in return, this too is a trade: you give it because you value the recipient’s life and happiness.

It is equally true in the spiritual (pertaining to consciousness) realm. Rationally, you do not seek out the evil and corrupt to be your friends: you seek those whose lives reflect your values. Friendship and love, properly defined, are your response to the virtues in others, not their vices; they are what you give people in return for the good in them, and for the pleasure you gain from their company. It is especially true of love: the one you love should embody your highest values and you, theirs. To ask for unearned love is as low as you can go: to demand someone’s highest affection and deepest emotional payment, for nothing. It is quite right to want to be loved for what you are: if what you are deserves to be loved.