Tao of Liberty: Dialogue in Heaven Between Laozi and Kongzi

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Tao of Liberty:
Dialogue in Heaven between Laozi and Kongzi
LIU Junning
Published in Potsdam in 2014 by

Friedrich Naumann Foundation for Freedom
Department International Politics
Karl-Marx-Strae 2
D-14482 Potsdam
email: contact@fnst.org
Author
Liu Junning
Foreword by
Dr. Rainer Adam
Copyright Friedrich Naumann Foundation for Freedom and the author. All
rights reserved. No part of this publication may be reproduced, or transmitted in
any form or by any means, electronic, mechanical, or otherwise, without the
prior permission of the publishers.
ISBN 978-3-9816609-7-5
Contents
Foreword................................................................................................................................................ 5
Authors Note ......................................................................................................................................... 6
About the Translator ............................................................................................................................... 7
About this book ...................................................................................................................................... 8
Dialogue 1: The Inferiority of the Superior ............................................................................................... 9
Dialogue 2: To Conquer and Withdraw ...................................................................................................15
Dialogue 3: The Road to Happiness .......................................................................................................22
Dialogue 4: When Government Becomes a Stationary Bandit ...................................................................29
Dialogue 5: Why must Political Institutions Comply with Human Nature? ...............................................34
Dialogue 6: Why is there no Virtue in Politics? ........................................................................................39
Dialogue 7: The Tao of War ...................................................................................................................46
Dialogue 8: Why does Forced Wealth Redistribution Lead to the Equality of Poverty? ..............................52
Dialogue 9: I and We......................................................................................................................58
Appendix ..............................................................................................................................................63
Foreword
Prof. Liu Junning can be considered to be the most
distinguished Chinese scholar in the field of liberal
thought. In several rankings of the 50 most important
public intellectuals in China, he is the only political
scientist listed. Professor Liu promotes public debate by
publishing frequently on various channels in online social
media, where he also uses different styles of publication
to attract interest and open a way to deepen
understanding of his arguments.
In his Tea Talks series an outstanding example of his work in this regard, he is
letting the leading symbols of Chinese thought through the centuries, Lao Tzu
(Laozi) and Confucius (Kongzi), discuss with each other. Through this approach
he is able to uncover liberal notions that are deeply rooted in Chinese culture and
indicate their potential contributions to contemporary Chinese development.
We as a Foundation are thankful for the possibility of publishing selected
chapters of the Tea Talk series in English, to bring this part of ongoing Chinese
debate to a broader Western audience. By addressing non-Chinese readers, we
also hope to contribute to a wider and deeper understanding of domestic
Chinese philosophical and political discussion in 21st century China. You dear
reader, will hopefully enjoy reading the Tea Talks as much as I did. Personally I
hope enough interest will be awakened to look beyond the surface of the
Peoples Republic current promotions. Younger and older thinkers have served
their country since the May 4 movement, and have never stopped searching,
developing and discussing ideas for a better China.
Dr. Rainer Adam
Authors Note
This Dialogue intends to prove that China indeed has a
long and solid spiritual heritage of freedom founded by
Lao Tzu. Like the people around the world, Chinese
people also want to be free. They also want to live in a
liberal political order and under a desirable polity that
protects individual freedom, property, and dignity, and
that limits the power of the rulers. They require a polity
that maximizes individual freedom and at the same time
minimizes state coercion and arbitrary intervention.
Through in-depth discussions and virtual debates
between Lao Tzu and Confucius, the Dialogue aims to address the most
perplexing, profound and fundamental questions of a political philosophical
nature- to re-establish the great tradition of human liberty in China, upon both
the local and the common spiritual heritage of whole mankind.
I wish to express my appreciation to Dr. Rainer Adam, the Friedrich Naumann
Foundation for Freedom's former regional director for Southeast and East Asia,
for the support while I worked on this Dialogue and for the enduring efforts in
promoting liberty and its ideas in China.
Liu Junning
About the Translator

Jude Blanchette is the assistant director of the 21st Century China Program at
UC San Diego. He lived and worked in China for more than six years, and was
the Beijing-based representative for the Atlas Economic Research Foundation.
His translations have appeared in the Wall Street Journal and the Financial Times,
among other publications. He holds degrees in economics and modern Chinese
studies from Loyola University and the University of Oxford, respectively.
About this book

The dialogue in Heaven between Laozi and Kongzi is based on the 81 chapters
of the Tao Te Ching or the Book of Tao. The Tao Te Ching is a Chinese classic
text. The received Tao Te Ching is a short text of around 5,000 Chinese characters
in 81 brief chapters or sections. The text is fundamental to both philosophical
and religious Taoism. It had strong influence other schools of thought, such as
Legalism, Confucianism and Chinese Buddhism. When these were first
introduced into China, they were usually interpreted through words and concepts
provided by Daoism.
According to tradition, it was written around 6th century BC by the sage Laozi, a
record-keeper at the Zhou dynasty court, by whose name the text is known in
China. The text's true authorship and date of composition or compilation are still
debated although the oldest excavated text dates back to the late 4th century BC.
Therefore, each dialogue in this book is based on different chapters of the Tao
Te Ching as mentioned below.
Dialogue 1: Chapter 7 in Tao Te Ching
Dialogue 1: The Inferiority of the Superior

Why should we think the government and those in power are free from
vested interests?
Kongzi: There is a question thats been nagging at me: humans clearly are
inclined towards pursuing their selfish interests, especially those in power who
use their position to pursue personal gain. As a result, I have been continuously
searching for an effective means of countering this. Would it not be the case that
if all of humanity, both the powerful and the powerless, set aside their selfish
motives, our world would be free from conflict? Unfortunately, I have yet to find
a satisfactory solution, and I would appreciate hearing your wisdom on this
matter.
Laozi: You are correct in that this is an extremely vexing dilemma for humanity.
My opinion on the matter is thus: all living creatures live within this universe, and
while the universe is everlasting, the lifespan of each organism is limited. The
universe doesnt exist for its own sake, but rather it provides room for the
existence of these organisms. The difference between the universe and the range
of life contained within in it is that organisms were created for their own sake. So
too was their sense of self-interest. Indeed, this selfishness is one of the innate
characteristics of every living creature, taking root in their base instincts. You
might say that selfishness is a prerequisite for survival.
Of course, with selfishness comes dispute, and with dispute comes conflict. The
real question is: given the immutable nature of self- interest, how do we alleviate
or solve the various types of conflict that are bound to arise. You are free to
despise humanitys selfish instincts, but there exist innumerable examples of
attempts to snuff out selfishness that have ended in disasters far worse than the
ill consequences of self-interests.
Kongzi: I see that you are discreetly criticising my esteem for the public good
over the interests of the individual. But I should admit that I have a fairly
negative opinion towards things that are done for the individual alone. I much
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prefer that which is open to the public, and I believe we must subdue our selfinterest. Of course, I am not advocating that we attempt to snuff out all that
could be called self-interest. The late-Song Dynasty Confucian philosopher Zhu
Xi (), in his extreme opposition to individual human desire, went too far.
His position and mine are quite different. Although I am not in a position to
expel him from the ranks of the Confucian scholars, I would like to emphasize
that there is a great deal of daylight between his perspective and mine.
Laozi: True, there are those who still admire the learning of Zhu Xi. However, I
believe it is disastrous for those in power to treat all types of personal desire as if
there were identical, as was done during the Cultural Revolution when anything
that smacked of private () was denounced.
There are two yardsticks for evaluating learning: one is from the perspective of
quality of the learning itself, and the other is from the perspective of political
consequences of that learning. If, for example, we were evaluating pure
knowledge, than the former yardstick would be sufficient. But if we are exploring
the effects on learning from political action, naturally the latter yardstick is more
appropriate.
Kongzi: Id like to return to the question at hand. If we take it as a given that
selfishness is a permanent condition, does that mean we are helpless in the face
of its ill consequences?
Laozi: I recommend that we once more return to the perspective of the
relationship between the universe and all living things within it. Let us suppose
that a government is the universe, and the people are the living things contained
within. Any group of people is composed of individuals, and these individuals
are in possession of the instinct of self-interest. It is in their nature to pursue
freedom and wealth. Thus the people as a whole are selfish, and nothing could
be more natural. However, the government and the rulers must be free from this
self-interest, which is to say, they must be free from vested interests. If they are
not, government officials are bound to expand their own interests at the expense
of the people, which in turn would greatly damage the relationship between the
rulers and the ruled.
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Yet we must remember that government is not the head of state, nor is a
government the exclusive domain of public officials. It is, rather, the
government of all the members of society. It is the government of the public
domain, not the private domain of a few. The regime in power is merely the
peoples chosen administrator, rather than their owner. Thus, those in a position
of power who use their influence to pursue personal gain are acting immorally
and should be restrained. No matter how unreasonable they might seem, the
people have the right to petition the government in their own interest. When
conflicts arise among the people, a government can step in at their request to
rebalance the situation. What members of the government cannot not do,
however, is to use public power for their own interests.
Kongzi: But you have yet to offer a solution to the problem of vested interests.
What method is there that could convince the rulers to limit their selfishness?
Laozi: This is the crux of the matter, as well as being the point at which my
analogy of the government and the universe falls apart. The universe is natural,
while government, the product of certain members of society, is not. Those who
control the levers of power are still human, after all. Borrowing from the
language of economics, rulers are also Homo Economicus. As they are mere
mortals, how can we expect them to be free from selfishness? The nature and
mission of government calls upon those who exercise power to be free from selfinterest, yet given that our rulers are still human, they are destined to be selfish.
Whats more, for these same rulers, the more power they control, the more their
selfish instincts will grow.
To overcome this dilemma, I propose the principle of subordination and
deference. As I have written elsewhere, The sage [in our case, the government]
puts his own person last, and yet it is found in the foremost place; he treats his
person as if it were foreign to him, and yet that person is preserved.1 In short,
the Inferiority of the Superior (). When it comes to their own
The following translation is taken from Lao Tzus Tao Te Ching, Chapter 7, translated by James Legge
(1815-1897), the first professor of Chinese at the University of Oxford.
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personal interests, the ideal government and ruler should imitate the Tao of
Heaven () by submitting to the principle of looking to their own affairs only
after seeing to the affairs of the people first. They must completely abandon their
vested interests and forsake all that runs counter to the interests of the people.
Whenever there is a contest over benefit between ruler and the ruled, the former
must give way. It is only under this state of affairs that the people will give the
ruler their whole-hearted consent.
With tyranny, however, the ruler places his own interests above all. If there is
gain to be had, it is the ruler who rushes in first to snatch it up, leaving the
masses to fight for the crumbs. Under a tyrannical system, the ruler seeks to
maximize his gains by using the machinery of State to compel the people to
become selfless. In such a competition, the people are bound to lose to the ruler.
When they have nothing more to lose, the people cast off their yoke, and the
ruler soon learns what defeat is like. When the masses are angered, even the life
of the ruler is under threat. Isnt this how all of Chinas dynasties have ended?
Kongzi: Youve given a thorough explanation of deference (), but can
you explain further the meaning of subordination ()?
Laozi: What I mean by subordination () is that a government and a
nations ruler must not look upon themselves as the North Star, nor must they
view the people as simpletons. They are not positioned up on high looking down
upon society, nor are the masses an object to be trodden underfoot. Those in
power must have respect for the people, and be willing to place themselves in a
subordinate position to the masses ().
When the legitimacy of personal selfishness is accepted, it then follows that each
individual is the best judge of his or her own self-interest. As such, they do not
require a government to conduct their personal affairs, such as commanding
farmers which crops to plant, telling factory owners which products to produce,
and telling academics which books to write. A government or a ruler is not
omniscient, nor is it the case that as the States power grows, so does its wisdom,
allowing it to understand and conduct all of lifes affairs. A government must
travel alongside the people, not pretend that it can act as their leader. It cannot
say to the people I will lead the way, and you will follow. The government
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must listen to the people, not the other way around.

The ideal system of government is one in which institutions allow the people to
give the government instructions through regular elections, representatives, or
the media. As government officials are public servants, it is the people who
should be saying to the rulers We will lead, and you will follow. It is only under
the rule of a despot that the people are mere subjects.
In summary, these two principles -- subordination and deference and putting
the self last, treating the self as foreign -- advocate a government free from
personal interests and overconfidence. We must always remember that a
government does not rely on its own strength to govern, but in fact owes its
strength to the abilities and power of the people. As a result, the government
must allow for the maximum amount of personal freedom and respect for their
rights. Nor should it interfere in the personal affairs of its citizens. It must
relegate itself to the sphere of public affairs, giving a wide berth to that which
does not concern it.
Kongzi: I see that you love to use the word government. But in my reading of
your Tao Te Ching (), I see that you there prefer the word sage ().
Does this mean that youve exchanged one for the other? And if that is so, does
this indicate that you are suspicious of the rule by man ()?
Laozi: Youve raised an important point. Certainly in using the word
government over sage, I am admitting a certain degree of skepticism of the
rule of man. However, at the time I wrote the Tao Te Ching2 we did not yet
possess the word government in the Chinese language. The tradition of using
an individual to stand in for an institution is old and far-reaching, such as the
concept of the legal person ( ). I use the term sage as a sort of
anthropomorphised form of ideal government, with the ruler and the
government being the incarnations of the divine order () and justice ().
The true sage must possess a thorough understanding of statesmanship, as was
2
Circa 6th century BC
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stated in an explanatory note to the Shouwen Jiezi3 (): one must first
listen before one speaks. Put another way, all opinions can be heard and all
speech can be tolerated (). The sages personality must
lend itself towards open ears and a closed mouth (), as well as an
emphasis on dealing with practical matters over propaganda. Of course I greatly
detest those who call themselves sage but do not live up to the name. We must
always use quotation marks when referring to these pretenders.
Heaven and Earth are Everlasting.

Their Ability to Endure,
Is because they Are Altruistic,
And Thus All Things Can Develop.
Therefore a government that Submits to the Tao of Heaven,
Should Let the People Seek Their Interest First,
Seeking Benefit For Itself Outside Itself, and Giving Freedom to All Living Things.
Do You Really Want Your Rulers to be without Selfishness?
Or Will Its Interests Be Realized In Protecting a Domain of Selfishness?
The Shouwen Jiezi is one of the oldest dictionary of Chinese characters, its origins dating back to late-Han
period (25-220 BC).
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Dialogue 2: To Conquer and Withdraw

Why does the greatness of a leader not redound to the people?
Kongzi: Before you arrived, I took the opportunity to give a thorough reading to
the 9th chapter of the Tao Te Ching. I was struck by the fact that you are not
only a profound political philosopher, but also an extraordinary philosopher of
everyday life. When gold and jade fill the hall, their possessor cannot keep them
safe. When wealth and honors lead to arrogance, this brings its evil on itself.4
What great truth! Too many of the rich are replete with arrogance.
Laozi: The target of my writing and my council are only those individuals in
power. It does not refer to the average person, nor to those of considerable
wealth. When I write of the gold-and-jade-filled hall, I speak not of money, but
of power. There is nothing wrong in Bill Gates amassing a fortune, nor should
we concern ourselves with the arrogance of some wealthy individuals, as this is a
matter of personal style. Fortunes are sometimes lost to this arrogance, but
again, this is not a matter of concern for the people. And so I am not overly
worried about the issue of private fortunes.
But when the President of a nation achieves great wealth, we must remain
vigilant. It is important that we investigate the source of such wealth and ask if it
was earned in a just manner. Even if it was, and even if it was earned before this
individual assumed office, we must still ask if this wealth will influence the
fairness of government policy and its administration. Therefore, we must be on
guard against this collusion of wealth and political power. Our vigilance must be
directed towards these individuals as opposed to the ordinary rich.
But I should add that even if a great amount of wealth is plundered through the
use of power, this is not the end of the story. After all, were the descendants of
4
James Legge, Tao Te Ching, Chapter 9 (1891)
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the Qing Dynasty rulers able to maintain their control of the Forbidden City?
Was [the first Emperor of a unified China] Qin Shi Huang or his descendants
able to control [the city of Xians] Epang Palace in perpetuity? Having the
unimpeded ability to plunder is not the same thing as having the ability to control
this wealth forever.
Kongzi: But what if the ruler is doing his utmost to enrich the governments
coffers, but at the same time doing so in a manner that is wholly disinterested in
personal profit. Is there anything wrong with this?
Laozi: There most certainly is something wrong. Indeed, there are even times
when an uncorrupted ruler is more harmful than a corrupt one, for if the former
strives to fill the State coffers, they do so at the expense of the peoples blood
and sweat.5 This would put the State in direct competition with the people, even
so far as expropriating their wealth. The result would be a rich State and a poor
population. If the people are too poor to survive, whats the point of a bursting
State treasury? States that are overly powerful have a tendency to become
bellicose. Ive not yet seen a rich State with a poor population that is able to
persist for very long, as its power is superficial. Moreover, the money in the State
treasury is there to be spent by government officials; avoiding corruption is
exceedingly difficult. It is because of this that I do not believe in the existence of
a so-called clean and uncorrupted ruler. While he may look simple and
unadorned, he quite often takes the entire nation to be his personal property.
Should a societys wealth reside with the people? Or should it be moved from the
streets and into the palace? The answer goes without saying.
Kongzi: I think I follow what youre saying. When it comes to the governing of
a country, good intentions are necessary, but not sufficient. More importantly,
we must see how these intentions affect the welfare of the people. Turning to a
different question, youve said elsewhere when the work is done, and one's
name is becoming distinguished, to withdraw into obscurity is the way of
Heaven. 6 Why must one withdraw into obscurity? This puzzles me. Ive
Lit. the fat or lard of the people ()

James Legge, Tao Te Ching, Chapter 9 (1891)
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always believed that a great leader should remain in office. One might say that
while there is life, the work continues and that one should bend to a task and
spare no effort unto one's dying day.7 It is these qualities that the great political
leader should possess.
Laozi: When a thing reaches its limit, it turns. When the sun sits atop the sky, it
will then descend. Upon reaching its fullest, the moon will then recede. When
the water is full, it overflows. When flowers reach full bloom, they will soon
wither. Extreme happiness cannot endure forever. This is the natural law (
), and it applies to politics as well. Whatever one does, it must be done in
moderation. One must cease action when it has reached an appropriate moment,
and one must not be concerned with the display of ones talents, or to seek
unwarranted compensation. All of these are excess behaviors, and as such, they
invite disaster. Examples abound of politicians falling for the entrapments of
material greed and complacency towards their responsibilities. Actually, the Tao
of Heaven 8 ( ) has never been concerned with claiming credit or with
revealing itself. And so if politicians claim everything as the result of their effort,
what room does this leave for the contribution of the Tao of Heaven?
Kongzi: But consider the problem of compelling a great leader to step down
only to have him replaced by someone mediocre, or even someone wildly
ambitious. Then what? If a leader has been shown to be great, does not his
permanence in office prevent someone of lesser status from taking over the
reigns of State?
Laozi: Mediocre politicians bring with them mediocre benefits, such as lowering
the expected value () of political leaders. If a politician's time in office is
restricted, then the arrival of an ambitious careerist is not a matter for great
concern, for they will be forced to leave upon completing their term. It should be
added that such an individual is also not certain to be the devil incarnate. Far
worse would be a bully in power with no limits on his term in office -- where
7
Zhu Geilaing, The Late Memorial on Dispatching the Army, written circa 228 BC.
Translators note: I have avoided the oft-repeated translation of as the way of heaven in favor of
the authors preferred translation.
8
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he would be asked to leave, but would refuse to do so. In order to avoid such a
calamity, we must require all leaders to leave office once their term is complete,
be they great leaders or not. The people must be suspicious of all politicians, and
not blindly follow even the greatest of leaders. Good political institutions allow
for the people to speak ill of their political leaders, even if these remarks are
baseless. The ideal political system provides peaceful and institutionalized means
for the removal of a scoundrel from office.
Kongzi: This reminds me, when we Confucians speak of the Doctrine of the
Mean, it also connotes the idea of pulling back before one reaches the extreme9.
All things must be stopped at their appropriate moment without pushing to the
extreme and failing to leave a margin for error.
Laozi: Its true that you Confucians place an emphasis on maintaining an
equilibrium so that all things remain in their proper place. This principle should
also be applied to politics. However, we should not leave it up to the ruler as to
whether or not they will fade into the background once they have successfully
completed their responsibilities. Instead, if must be our political institutions
which enforce this decision. While there may in fact be leaders who will
voluntarily relinquish power, they are few and far between. A constitutional
republic with enforced term limits on the ruler is the best embodiment of the
Tao of Heaven. The West long ago understood this point, but we still have a
muddled understanding about these ideas here in China. In fact, I suspect only a
few would be able to coherently explain the splendor of republicanism and
constitutional government.
Kongzi: But shouldnt the leader seek perfection in his service of the people? To
do otherwise would be to quit before the task is complete.
Laozi: Of course, if the leader abandons his position before he has fulfilled his
responsibility, this goes against the principle of the Tao of Heaven. Thus, when
faced with a given task that one is required to fulfill, it must be done with great
effort and seen through to its completion. In the same way that when one climbs
9
Translators note: The full sentence is .
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a mountain, one does not reach the summit only to remain there indefinitely. As
to what should be considered as the successful completion of a given task, this
depends upon the particular details and requires political acumen. As a result, the
politicians we frequently see without any political wisdom or willingness to give
up their office often cite the importance of their unfinished political projects as
the reason they should not be subject to any limitations.
As for the leader who claims to have reached perfection, I say that this is
impossible. In fact, perfection is not even a good thing. Things that are said to be
perfect only sound perfect. Absolute perfection indicates death, imperfection is
the stuff of life, for life thrives on imperfection. Ideologies that strive to reach
real perfection are closely followed by the stench of decaying bodies, for the true
believer will kill to reach his idea of perfection.
Kongzi: I understand your logic, but Im still slightly confused. Isnt it the case
that as a leader becomes even greater, he becomes more perfect, and thus brings
about better outcomes? Are you really saying that the benefits of a great leader
dont redound to the people?
Laozi: No, my opinion is precisely the opposite from yours. The best political
leader is one of average abilities. When such an individual is in office, anyone can
spot his errors, and no one will mistake him for the sun.10 The power of a nation
should not be viewed in any way as being mysterious or mythical, and leaders
should be viewed as public servants and mere mortals. It is only in countries that
dont look to the sun that the people can be prosperous. If the people look upon
their leader as the Sun in the Sky, as their Liberator, as the Great Helmsman,
then the people will stop flourishing, they will stop thinking, and they will lose
their direction. My view is that a great leader is not the good fortune of the
people. If each country were to possess such a leader -- especially those leaders
who consider themselves to be great -- this would most certainly be bad news.
The reason some political leaders are inadequate stems from their attempt to play
the part of a great leader.
10
Translators Note: When the author speaks of the sun, this is a reference to the Cultural Revolution-era
tendency to refer to Mao Zedong as the reddest sun.
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Kongzi: There are some so-called great leaders who would indeed do bad
things, even to the point where we Confucians wouldn't let them off the hook.
That being said, throughout history, have you ever encountered a leader who
satisfies your requirements?
Laozi: Its true that historically speaking, its quite rare to find a political leader
that I have admired. But if forced to answer, I suppose I would say the first
president of the United States of America, George Washington. His greatness is
to be found in his refusal to assume the mantle of greatness when it was his to
hold forever. He was able to glimpse the Tao of Heaven, for when his power was
at its peak, he chose to retire once [his] purpose [was] achieved.11 From that
point on, the United States was to transform from a barren land into an
incomparable super power. China, on the other hand, degenerated from one of
the worlds great civilizations into a Third World country. One of the reasons for
this is that in China, the sovereign was unwilling to relinquish power. The sun, as
it were, was never willing to set. Regardless of his accomplishments (or lack
thereof), the ruler would never voluntarily budge. Even when things had reached
their worst, the ruler will still attempt to call the shots. The only remaining
solutions are for the sovereign to die or for the people to pick up the sword.
Here the Tao of Heaven is obscured beyond all recognition.
Conversely, the United States has a republican system of government, with the
Taoist idea of retire once your purpose is achieved having been enshrined
since the countrys founding. This form of government demonstrates the efficacy
of a system of term limits, and of compelling the leader to retire once his
purpose has been achieved. The government and the people can only be
considered in a state of tranquility when there are no struggles over the correct
political line, when there is no risk of a coup detat, and when long-term stability
spares the people from unrest.
An ideal government is one that accords with the idea of the Tao of Heaven. A
government that conforms with the Tao of Heaven is a mighty government.
Throughout the history of the United States there have indeed been mediocre
11
Translators note: This is adopted from James Legges 1891 translation.
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and sub-par presidents, but there hasnt been one able to thwart the system of
term limits on office. In fact, if one is successful, they should retire, and if they
are not successful, then there is no merit in their further career advance. In order
to measure the success of a politician, we should use the measuring stick of
justice, and by this measure, I believe that most have been decidedly
unsuccessful, even criminal. We must remember that a president such as George
Washington is a rare commodity, and, so we must rely on institutions (especially
term limits) in order to force politicians to voluntarily exit the political stage. This
should occur regardless of his political merits. From this we can see that the Tao
of Heaven is a universal idea, and accommodates all varieties of individuals from
all different nations. To retire once ones purpose has been achieved is an idea
that transcends distinctions between the East and West.
More Power Is not Better Power,

For it is Best to Stop Before One Goes Too Far.
Power Held Reveals Ones Ferocity,
But with Virtue, there is no End.
Even if One Can Accumulate Riches,
They Can Never Been Permanently Maintained.
Those in Power Enjoy Lives of Leisure,
Leading to their Demise.
To Fulfill their Obligation, They Must, get out of the Way.
For Only Then is One in Accord with the Tao of Heaven.
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Dialogue 3: The Road to Happiness

Why is it the Responsibility of Government to Protect the Freedom of the
Individual to Pursue Happiness?
Laozi: Kongzi!12 Congratulations! Youre in the movies again.13
Kongzi: Please dont bring this up Im tired of being commercialized. Ive
noticed that on the Internet, anything that can be said about me has been said. I
cant get any peace. I really envy that youve managed to maintain distance
between you and any artistic works.
Laozi: Its not quite as good as you make it seem. After all, its not as if anyone
has taken up my ideas of promoting governmental decentralization and
streamlining administrative functions, let alone wuwei my idea of inaction ().
Kongzi: I know that you arent fond of art, and that you detest the five colors
and the five notes14 It seems to me as if youre advocating that the masses only
concern themselves with filling their stomachs and abandoning any higher
material or spiritual aspirations. If one were to criticize you for advocating a
government of the ignorant, how would you respond?
Laozi: I know that many take my rejection of the five colors, five notes, and the
five tastes to mean that I oppose the individuals pursuit of everyday enjoyment
and the culture and arts. This is not, however, what I mean. As Ive said
repeatedly, Im speaking to the ruler, not the ruled. The transformation and
12
Translators Note: Here the author uses a courtesy name for Confucius, Zhongni ().
Translators Note: The author is referring to the 2010 film Confucius (), starring the Hong Kong
actor Chow Yun-fa in the titular role.
14
In chapter 12 of the Tao Te Ching, Lao Tzu writes Color's five hues from the eyes their sight will take;
Music's five notes the ears as deaf can make. He concludes this chapter by writing Therefore the sage
seeks to satisfy the craving of the belly, and not the insatiable longing of the eyes.
13
23
cultivation of the people is the mission of you Confucians, but it isnt mine. I
respect the individuals freedom to choose his or her own way of living, be it
simple or lavish. To once again reiterate, my political philosophy is limited to the
regulation of the ruler, and not the ordinary people. I know that you like to
watch the 8 yi dance ( ), listen to Shao music ( ), enjoy delicately
prepared food, teach archery and equestrianism, and appreciate the six arts (
). This is your own pursuit of self-cultivation, and I fully respect this choice.
Kongzi: We Confucians want to do more than merely educate the masses, we
also want to speak to their leaders. Yet if the nation and its monarch fail to
display a refined lifestyle, and instead seek out safety and comfort to the
exclusion of the arts and entertainment, wont this hinder the development of
artistic culture?
Laozi: If the people are willing to live a simple and unadorned life, it must be
their voluntary choice and not the enforced will of the ruler. I resolutely oppose
those rulers who have developed a taste for luxury, just as I oppose the
government providing entertainment for the people. We have the problem of
opulent government buildings and extravagant official banquets because the
aristocracy is able to leverage the wealth of the people to satisfy their own
desires. When individuals lose their ability to work, or when the people
encounter a disaster, the government has a responsibility to step in and provide
assistance. But is it the responsibility of the government to ensure that everyone
is able put on an impressive wedding banquet? These forms of entertainment are
the responsibility of the people themselves, not the government. A virtuous
government must only concern itself with the basic requirements of the people,
not the pleasures of its citizens.
Kongzi: I agree with your position that the government has no obligation to
provide fine foods for the people. That being said, are you really saying that there
is no role for the government to enrich their cultural lives?
Laozi: In the extreme, I believe that a government that follows the Tao of
24
Heaven should not support and patronize the arts or literature. The pursuit of
entertainment and the refined life belong to the realm of civil society rather than
government. Consider CCTVs New Year's Gala, which is widely derided by all.
Fundamentally speaking, government was not created in order to provide
entertainment for the people. A republican government which adheres to the
Tao of Heaven will refrain from forming a national theatre troupe, a national
theatre, or in any way nationalizing or dividing its actors. Furthermore, a
governments task is not to grab hold of revolution nor to promote
manufacturing, let alone to promote the arts. Both manufacturing and the arts
are to remain within the realm of the people themselves. If a government is
needed to help prop up the arts, this proves that the freedom to pursue
happiness is extremely constricted. The duty of government is to create the
proper social conditions and institutional guarantees. In a society such as this,
individuals can peacefully coexist, freely discover and realize their potential, and
pursue their own enjoyment and happiness. If they do so without violating the
law and without infringing upon the happiness of others, a government has no
authority to impede them.
Kongzi: You speak of happiness, which to me is something that is unique to
humanity, and is the pursuit of that which transcends basic necessities such as
food and shelter. Because happiness is so important, I believe that a government
must play an important role in ensuring it. Wouldnt it be great if the government
could mimic a delivery company in bringing happiness to each family and every
house? This would be a truly benevolent government, and this society would be
the Great Unity () that I yearn for.
Laozi: I agree with your prior statement that the happiness of the individual is
connected to government, but I cannot agree with your latter argument that the
government must therefore help provide happiness. This is something we must
ask of the Way of Heaven and God, not government, which is formed by mere
mortals and thus is neither all-knowing, all-capable, nor all-benevolent. If the
happiness of government officials cannot be assured, how are they to provide for
your happiness? Whereas you have some ability to assure your own happiness,
when it comes to insight into, and the ability to satisfy individual happiness, the
government and its officials are incompetent. A ruler is unable to peer into the
25
depths of an individuals mind and discover their understanding of happiness,

and thus the ruler is unable to realize happiness on the individuals behalf.
Instead what they typically do is to immorally abuse public power to satisfy their
own idea of happiness.
There is a great difference between happiness and the freedom to pursue
happiness. The former is the feeling of self-satisfaction towards ones
achievements, while the essence of the freedom to pursue happiness is liberty,
which has no direct connection with the specific content of happiness. The
unscrupulous ruler intentionally obscures the two. The ruler can thus both
infringe on the freedom to pursue happiness whilst at the same time proclaiming
that it is the happiness of the subject that they are seeking. The result is that the
subjects lose their freedom and gain only hardships. Humanity created
governments in order to protect the right to pursue happiness and not for the
purpose of supplying happiness. The right to pursue happiness belongs to each
individual, not the government. This is a self-evident, inalienable, and
unimpeachable natural right. In the US Declaration of Independence, the pursuit
of happiness is placed among the three basic freedoms, as is its justification.
Kongzi: If happiness is so important, how is it that it is unrelated to a
governments obligations?
Laozi: You have spoken correctly, in that happiness is vitally important to each
individual, and thus we must not allow political power to meddle in these affairs.
The importance of happiness stems from its centrality to all human pursuits. In
my opinion, happiness is the ultimate goal in life, and it forms the backdrop for
the pursuit of wealth, fame, honor, friendship, and faith. All other goals are
instrumental, while happiness is an end in itself, surpassing all other pursuits.
Kongzi: Is there any type of common happiness that we can all pursue together?
If such common happiness exists, this must be the most be the greatest form of
happiness in all the world (). For example, if everyone strives for a global
Great Unity (), doesnt this redound to both the individual and society?
Laozi: This collectivist idea of happiness calls for all members of society to
26
abandon their own individual pursuit of happiness and to struggle for the
collective good. This idea of a common happiness sounds beautiful, but in fact it
is quite dangerous. I remember someone who once said that the road to hell is
paved with good intentions. Dictatorships often wear the mask of the common
happiness while in reality they seek their own dictatorial ends. One must be
weary of those rulers who seek to undertake the pursuit of your happiness, for if
they do so on your behalf, what work is there left for you to do? Depriving you
of the freedom to pursue happiness whilst claiming to pursue it on your behalf is
one of the most oft used tricks by the unscrupulous ruler. Subjects are only
permitted to pursue the goals set by the ruler, which in turn are imposed upon
the whole of society and said to be for the common good.
In my opinion, the foundation of happiness is individualism. Happiness is
something we all want, but each of us requires a different type of happiness. The
goals we have as individuals are unique, and as a result, individual happiness is
unique. The time we have on this earth is spent pursuing our own desired
happiness, which has its own mysteries stemming from its highly personalized
nature. Furthermore, happiness as experienced by each individual is exclusive to
him or herself, and we would expect two individuals to share the same exact idea
of happiness only under the most extreme coincidences.
If all people of this world were to share a common nation of happiness, this
would obviate the idea of individual happiness. But even in a world where the
idea of the Great Harmony () has been realized, individuals would still need
to find a new idea of happiness to pursue. As long as you find a goal in life and
pursue it with all of your energy, you will be able to live happily. You, Confucius,
have lived a life that is a typical example of the individualistic concept of
happiness. You may feel as though serving the aristocracy is a blessing, but if the
aristocracy were to impose their concept of happiness upon you, you would
never be happy, nor able to produce all the brilliant achievements in your life.
Kongzi: According to what youve just said, even my own idea of happiness is
also individualistic? Indeed, it is. If we all had the same notion of happiness, I
would have no need to travel to all corners of this land () propagating
my ideas. Yes, my philosophy of happiness is unique. I advocate both being
27
content with poverty while striving for virtue () while also supporting
the a rich man who loves propriety15 (). That being said, Riches and
honors acquired by unrighteousness, are to me as a floating cloud."16 The highest
pursuit in my life has been that of seeking out the Tao of Heaven. The same as
you, I seek the Way (), not material comforts; I am anxious lest I should not
get truth; I am not anxious lest poverty should come upon me.17 One has not
lived in vain if he dies after he is told of the Way. These are the words I hold
dear to my heart.
Laozi: I greatly admire your spirit in seeking out the Way, and I also support
your idea of happiness. I believe that todays investigation of happiness as it
relates to political philosophy is very important, as it touches upon the questions
of what is happiness? How do we realize happiness? What is the connection
between government and happiness? From the past to the future, every
government was built upon a certain specific political science of happiness.
Unfortunately, while there are many who care about their own happiness, there
are relatively few who show concern for the larger issue.
Kongzi: Ive spent a great deal of time thinking about happiness, but
comparatively little thinking about the political philosophy of happiness. Can you
speak some more on the topic?
Laozi: Put simply, my basic view on the political philosophy of happiness is this:
happiness has moral attributes, as well as its own moral core. It is only when
happiness conforms to moral behavior that true happiness can said to have been
achieved. Happiness belongs to the realm of the private individual, and thus has
nothing to do with a government. The power of a State must be confined to the
public realm, and its obligation is to protect and refrain from interfering in the
civil liberties and private actions of the citizen. It is only with freedom that
happiness is possible. Government must act to protect the freedom to pursue
happiness, not happiness itself. Again, to define and pursue happiness is the right
15
This phrase comes from James Legges translation.

Ibid.
17
This quote is adapted from Legges translation.
16
28
of the individual, not government. Whether a nation itself is happy is not

important, whats important is whether each individual has the freedom to
pursue happiness. It is not those countries that esteem the public good that are
happy, but rather those that allow maximum freedom for their citizens to pursue
their own individual concept of happiness that are the most content.
You Aristocracy, Who Are Blinded by Resplendence will be Ignorant of Disaster

and Unconcerned with the Plight of the People;
You Aristocracy, Who Cause Deafness with your Extravagance Cannot
Differentiate Good from Bad, and Do Not Accept the Will of the People;
You Aristocracy, Who Deprive the Mouth of Taste With Your Gluttony, Cannot
Tell Virtue from Evil, and Do Not Experience the Suffering of the People;
You Aristocracy, Who Make Your Mind Mad with Your Wild Hunting Waste;
Therefore the Wise Ruler Pursues Frugality, and Allows the People the Freedom to
Achieve Their Own Conception of Happiness.
29
Dialogue 4: When Government Becomes a Stationary Bandit

Kongzi: I was recently browsing through a copy of Dream of the Red Chamber18
when I noticed the following from chapter 105: Mrs. Jia laughed, Even being
this sick, Phoenix still has a silver tongue. No sooner had she said this when she
heard Mrs. Xing burst in and blurt out Madame! Madame! Not Not good!
Officials in brocades have overturned boxes and tipped over baskets, taking our
belongings! Upon hearing the news Mrs. Jia stared blankly ahead.
What type of bandit wears the uniform of an official? What type of bandit could
cause even Mrs. Jia to be dumbfounded and Phoenix to faint? Considering the
importance of the Jia family, what thief would have the gall to steal their
possessions? Originally, it was those wearing brocades who carried Imperial
edicts and have the power to inventory household possessions. Could Mrs. Xing
not have known this in her naivet? How did she mistake bandits for
government officials?
Laozi: Likening an imperial court official to a bandit did not begin with Mrs.
Xing. For example there is the old phrase Those who seize possessions are
thieves, while those who seize power become lords. ().
When a bandit seizes a nation, it becomes a bandit nation, and the new rulers can
now wear the official government uniform while they unabashedly and nakedly
rob the country blind. If a bandit is able to seize power, they are able to enlarge
the scope of their seizure. The bandits thus become the rulers, and the country
becomes their own personal ATM.
Kongzi: There must have been a reason for the actions the court took against
the Jia family. Cant we raise ourselves above Mrs. Xing and refrain from calling
government officials thieves? Moreover, to call the court or the government a
18
Dream of the Red Chamber () is a 17th century novel written by Cao Xueqin and widely
considered on of Chinas greatest works of literature. It follows the fortunes of the aristocratic Jia family as
they struggle to maintain their familys prestige in a changing China.
30
bandit as Mrs. Xing did is far too unreasonable.

Laozi: Have you ever read the following dialogue? Prince Wen of Lu Yang (
) had a plan to attack the Kingdom of Zheng (). Mozi ()19 heard of
this news and tried to stop the plan, saying to Prince Wen: what if we allowed the
large cities within Lu Yang to attack the small cities, and the large houses to
attack the small houses, killing the people and looting their oxen, horses, dogs
and pigs, cloth, silk, rice and valuables? What would you do in reaction to it?
Prince Wen said: The people within the boundaries of Lu Yang are all my
subjects. Whosoever has the gall to send troops into our land to plunder shall be
ceaselessly hacked down. Mozi said: "Just as you possess all that is contained
within the boundaries of your State, so too does Heaven possess all that is
beneath it. If your army heads out to attack the Kingdom of Zheng, should you
not expect Heaven to visit the same punishment upon you?"
He continued: Suppose you attack your neighboring kingdoms, kill and injure
its people and plunder their oxen, horses, crops, goods, valuables and then
record your deeds on bamboo and silk, engrave them on metal and stone, and
carve them into bells and tripods () for the purpose of passing the tale down
to later generations. You might say None can contend with me. Then another
comes along to attack the houses of his neighbors, slaughtering their people,
taking their dogs, their pigs, their food and crops, their clothing and furs. He too
records his deeds on bamboo and silk, he carves his deeds into the tables and
bowls in order to pass down his tale to future generations and he says None can
contend with me. Is this permissible?
Upon seeing that Prince Wen was basically in agreement, Mozi extended his
analogy further. We humans often know trivial matters, but are ignorant of
larger truths. For example, if an individual steals a dog or a pig, he will be
considered lacking in benevolence. Yet if this same person were to seize control
19
Mozi was philosopher from the early Warring States, and was an active opponent of Taoism and
Confucianism.
31
of a nation or a city, he would be deemed righteous. This would be like seeing a

small piece of white cloth and knowing that it was white, but when seeing a large
piece of white cloth thinking it was black.
Do you believe that white cloth can turn black just by becoming bigger? Does
anything work this way? Theft is theft, no matter who the perpetrator is.
Kongzi: Let me ask you, do foreigners hold this opinion as well?
Laozi: Human nature does not distinguish between foreign and local, and so
issues relating to the experience and knowledge of governance will all be roughly
the same. I admire St Augustine, whose perspective was similar to Mozis: when
the justice of The Way () is abandoned, what difference is there between a
kingdom and a thieves den? What is a thieves den? Is it not a miniature
kingdom? Both are comprised of individuals, and run according to the strictures
of the leader, be he a king or a bandit. By mutual agreement and in accordance
with mutually agreed upon rules, the bandits divide their spoils and booty. They
occupy territory, build their residence on it, capture towns and cities, and subdue
its civilians. And thus, a kingdom is born.
Kongzi: You are, of course, correct. And if the imperial court becomes
excessively avaricious, there is little to differentiate it from a bandit, and it must
be considered an oppressive government ().
Laozi: I would say that this is tyranny (). During his research of the Chinese
warlord Feng Yuxiang, 20 the American economist Mancur Olson found that
throughout most of human history, government has been not only the supreme
ruler, but also the primary mechanism for plunder. As opposed to roving
bandits, a government does its plundering in one place. According to this theory
of a stationary bandit, when one bandit monopolizes the plunder in a given
geographical area, that regions victims no longer need to fear the arrival of
another bandit.
20
Feng Yuxiang (1882-1948) was a warlord during the Republican era, and was strongly critical of
Chiang Kai-shek.
32
In a world where roving bandits are the norm, there is no incentive to produce
or to accumulate wealth. In order to create an environment that is conducive to
plunder, stationary bandits often use their wealth and power to preserve social
stability. Utilizing the power and the threat of the gun barrel, those roving
bandits with foresight will anoint themselves emperor, monarch, or the Son of
Heaven. They will organize the States ability to project violence and monopolize
the power to plunder. They will protect the goose that laid the golden egg, and
then keep it for themselves. This is in contrast with the roving bandit, who has
no such incentive to protect the source of future production or wealth.
Kongzi: Even if its a roving bandit, isnt it better if the government provides
safety and well-being ()?
Laozi: Im sure you know this fact: a government that has the power to give also
has the power to take. And of course, it will usually take more than it gives, as a
government must itself consume the largest portion of what is produced. A
stationary bandit thus collects a protection fee in exchange for providing the
people with safety.
The 19th century French economist Frederic Bastiat called this legal plunder.
All stationary bandits, no matter how rational at the onset, soon find that they
cannot satisfy their appetite, nor can they control the ever-inflating number of
personnel who work to keep them in power. When a hen can no longer lay eggs,
she is destined for the kitchen, and likewise, the days are numbered for a
stationary bandit that cannot produce. Throughout Chinese history, there have
been many stationary bandits who were eventually overthrown by their roving
counterparts because of this problem.
Kongzi: This theory is quite interesting. What does the future portend for the
stationary bandit?
Laozi: The status quo of the stationary bandit held up until the past 200 to 300
years, when we discovered constitutional government and the rule of law as a
means of preventing plunder by government.
33
Rulers,
Do not think of oneself as anointed, and do not use fraud to govern your kingdom,
And the people will be prosperous;
Do not speak of virtue and propriety to win over the people,
And the bonds of family will be stronger.
Do not exploit the people or plunder their wealth
And the world will be free from thieves.
Yet even if you follow this stricture, it is still not enough.
To govern a country well, you must:
Reveal your true self,
Embrace your nature,
Control your desires,
Abandon any false knowledge,
And only then can you be free from worry and suffering!
34
Dialogue 5: Why must Political Institutions Comply with Human

Nature?
Kongzi: Ive always been prejudiced in my belief that people are more important
than institutions. After all, institutions are the product of human design and
require humans in order for them to operate. So while I agree that the question
of institutions is important, it is no more important than the issue of people.
Laozi: I now see that our difference of opinion begins right here. I, for one, do
not believe that institutions are the result of human planning, and further, I do
not believe that institutions require a human operator, including the operation of
a ruler. In fact its the opposite. True institutions are a part of the Tao of Heaven:
they are the institutionalization of the transcendent moral order. These
institutions may be discovered by humans but they are operated in accordance
with the prescribed preconditions of the Tao of Heaven. Bad institutions, on the
other hand, are those designed by solely by humans. If the Tao of Heaven or the
transcendent moral order is ignored when designing institutions, they are certain
to be pseudo-institutions. The same can be said for unadulterated human action.
Kongzi: What is the connection between political institutions and human nature?
There is, of course, the first line of the Three Character Classic (), In the
Beginning, Humans Were Good ()
Laozi: The Tao of Heaven, human nature, and institutions are all interwoven.
Political institutions that conform to the Tao of Heaven will respond to human
nature in two ways. First, a political system must allow the individual to do that
which he or she is incapable of doing alone. Second, a political system must not
incite the more odious instincts of human nature, such as hatred, jealousy,
violent tendencies, irrationality, and cruelty. Institutions that bring about interclass enmity or that encourage ceaseless political infighting are the worst possible
political institutions. They violate the Tao of Heaven, they violate human nature,
and thus they are unworkable. Attempting to force their operation will only lead
to severe or even disastrous consequences.
35
Kongzi: Can you unpack this last statement for me? Why are they unworkable?
Laozi: Because in transgressing human nature, these institutions are
transgressing upon what was given to humans by the Tao of Heaven. Institutions
that violate human nature and the Tao of Heaven are like sprinting on ones
tiptoes -- one simply cannot carry on for too long. When these institutions face a
crisis, they are difficult to maintain, and thus they will collapse. If these
institutions do not resort to violence, they might even fail within a single day
owing to the opposition of the people. As a result, the price for maintaining such
institutions is incalculable. If a social institution or political system can only be
maintained through coercion, this is clearly contrary to the Tao of Heaven and a
violation of human nature. The most extreme cases of such political systems are
those that leave the ruler unrestrained and his or her political power free to
expand within limit. Such a system will inevitably create tyrants.
Kongzi: Yes, of course, I too would oppose such a system. Aside from the
above, would such a system bring about any additional negative results?
Laozi: In order to compel society to accept these institutions and systems that
violate the Tao of Heaven and human nature, dictators often use a didactic or
coerced method in order to alter human nature or to ensure that the dictatorial
system remains secure. Yet using didacticism or coercion to change human
nature is a fools errand. Even if the rulers are able to incite the people through
their preaching or the most oppressive laws, human nature still cannot be
transformed. All that can be done is to expand the space for the more displeasing
elements of human nature to take flight. The starting point for the construction
of any political system or government must be compliance with human nature
rather than the alteration of human nature. All that acts contrary to this is
doomed to fail.
I remember someone once said that a bad political system can make even the
best men do wrong, while a good political system can turn the worst among us
into a better person. A reasonable political system would not try to change the
nature of self-interest, but would rather utilize this inalterable self-interest to its
advantage. The spirit of self-interest can only be extinguished with death, and
36
attempts at suppressing it only result in its expansion, its deformation, and even
the unleashing of its more dangerous capabilities. We Chinese long ago figured
out an important truth: it is easier to move mountains and rivers than to alter
one's character (). If a social ideal or political system is
created on the foundation of eradicating human self-interest -- and takes the
realization of this ideal as a precondition -- there can be no mistake more serious,
and there can be no system that does more to violate the Tao of Heaven and
human nature.
Kongzi: So what can be done to discover good political institutions? Are we able
to find those institutions that are perfect in their compliance with human nature?
Laozi: Humans are imperfect because human nature is imperfect, and thus we
can never be made perfect. What this means is that imperfect beings can only
create imperfect institutions. Only through the slow process of accumulating
knowledge are we able as humans to discover a set of institutions that comport
with our human nature.
However, good political institutions can be studied, transmitted, copied, and
altered by all of humanity. If political institutions are allowed to freely compete,
the survival of the fittest (), will lead to the best institutions rising
above inferior ones. An environment that is open, that encourages innovation,
and permits competition among political institutions will bring about better
institutional outcomes. The path to discovering better political institutions and
the path to discovering the principles of the Tao of Heaven are the same: allow
individuals to freely explore, discover, and communicate. Even without such an
environment of complete freedom, humans will not stop exploring for
institutions that best comply with the Tao of Heaven and human nature. The
difference is that the time it takes to find these institutions will be longer, and the
price paid will be higher.
Kongzi: What youre saying is that finding good institutions is hard, and that
implementing them is even harder, correct?
37
Laozi: If a political system is discovered, but not implemented, it is a political

system in name only. The greatest obstacle to the discovery and implementation
of a political system is the vested interests of the ruler. Such rulers attempt to
deify themselves, to ensure that their power is left unrestricted, and no matter
how much they might glorify themselves, they are all mere mortals who have the
same defects and limitations as the rest of us. The ups and downs that affect our
common humanity also affect them, sometimes even more so. What they lack,
however, is the common virtue of our universal humanity.
Kongzi: So what can be done to ensure that political institutions comport with
human nature?
Laozi: I believe the best possible method is to use relatively virtuous
institutions to help bring forth the more virtuous side of our human nature
and to guard against its darker side. Institutions cannot change human nature,
but they can help channel self-interest towards the betterment of society. And so
human nature must be submitted to when designing institutions rather than
attempting to force a transformation in our basic nature. It is not important
whether or not this nature is at its core good or bad, but rather we should focus
on which direction these institutions should travel. If the self-interest of the
individual can only be attained by attacking ones fellow man, then we are no
better than wild beasts. But if self-interest is obtained by aiding our fellow man,
then we are better than angels. The market economy works in the same way. If
we want to create a flourishing society, we must rely on institutions that allow for
individual self-interest to redound to the larger society. We can choose and
transform institutions, but we cannot choose and transform our human nature. A
good institution will prevent arbitrary evils, while a bad institution will be
powerless to incentivize a bad individual to do good. Rational political systems
adapt to human nature, as opposed to those that seek to compel human nature.
Kongzi: And what political ideals are compatible with human nature? What is
pragmatic, realistic, and humane?
38
Laozi: The arrangement of any political or legal institution must be premised on

some kind assumption about human nature. What opinions one holds about
human nature will directly affect how one judges the propriety of political
institutions, and the method of creation institutions will affect how one views the
legitimacy of these institutions. But in any political institution, human nature and
the dignity of the individual must be inviolable, just as the value of the individual
must not be disparaged, nor can their freedom be trampled. Political institutions
that accord with the Tao of Heaven treat human nature with respect and
prudence. They do not attempt to do surgery on human nature or conduct
experiments on it. They recognize that it is not a malleable metal that can be
shaped to ones purposes or a blank piece of paper on which anything can be
drawn. Human nature contains both positives and negatives. Good institutions
are built upon the idea of a balance of force: they promote human dignity and
rationality while restraining human evil and depravity.
Rulers:
Your Boasting Displays a Lack of Knowledge
Your Sense of Infallibility Cannot be Seen
Your Self-Flattery Displays a Lack of Accomplishments
From the Perspective of Heaven,
This Deception of Yourself and of Others Is like the Fat of a Leftover Meal
Which We All Detest,
As is Departing from the Path of the Learned and the Wise
39
Dialogue 6: Why is there no Virtue in Politics?

Kongzi: Your starting point for a discussion of politics is the Tao of Heaven,
while for me it is the ethics of everyday life. Yet when all is said and done, just
how important is politics? What is the position of politics in our everyday life
and in the order of the Tao of Heaven that youve outlined? What must we do to
accord politics its proper place?
Laozi: Although there is more to life than politics, when I speak of the Tao of
Heaven and morality, the focal point is nonetheless located in political matters.
This is because at its essence, political issues are moral issues. That is to say,
politics as well as morality unfold within the sphere of the Tao of Heaven. Ive
adopted a position of instrumentalism towards the State and the government.
Both the people and the State are subject to the moral laws of the Tao of
Heaven, and likewise must serve the Taos intentions. Politics occupies a
secondary position, and is not an end in itself, and is certainly not the ultimate
goal. The nation and the government are merely necessary means to an end, and
thus, we must never place too much hope in these two concepts. If our
expectations are too high, our disappointment will likewise be high. Constituted
as it is by mere mortals, human society will never achieve a state of perfection.
Nor should one expect a nation, its government or its politicians to achieve this
state of perfection either, no matter how great their effort. Just as individuals are
limited in their power and function, so too are political power and government.
Kongzi: Yet it seems to me that your perspective is self-contradictory. On the
one hand you say that you are primarily concerned with politics, and yet you go
on to say that political matters must always be subservient to the Tao of Heaven.
How do you square these two statements?
Laozi: Self-contradiction? Im afraid not. The Tao of Heaven is supreme, yet its
implementation does not occur in a vacuum. Rather, it is implemented in every
specific domain of human life, and in every specific problem found therein.
There is no one individual who can observe all aspects of human existence. For
me, Ive chosen to focus on the political realm, and on how the Tao of Heaven
40
comes to be implemented in public affairs. As a result, my focus is not dedicated

solely to political matters, but rather begins and ends with the Tao of Heaven.
How is this self-contradictory?
Kongzi: Why can we not treat government as if it were a type of virtue and the
State as if it were the collective ideal of all humanity? For example, we could see
politics as a means of realizing the Great Unity ().What could be better than
a nation and a government that leads all of the people towards a common goal
and assists them in pursuing a shared dream, a golden age, and the Great Unity
of the planet?
Laozi: No! No! No! Anything that can leverage power can never be considered a
virtue. This is because power must always be a threat to freedom, life, property
and human dignity. What differs between different systems of government is
not this basic fact, but rather the degree to which the threat occurs. The State is,
I believe, not something that can pursue virtue, nor is it a tool for realizing
common goals or lofty aspirations; it is a tool that uses evil to control evil. And
so the less we use the force of government the better. The State must absolutely
refrain from willingly looking for dragons to slay. Id even go so far as to say that
the greatest possible disaster is to use political means or the machinery of
government to pursue virtue. We must never place faith in the idea that
government and the State can solve all human problems, and thus, the most
effective way to reduce government coercion is to expand the autonomy of
society.
Politics is not supreme, and certainly not greater than the individual or society.
The role of politics to provide the minimum political conditions that can ensure
the maximum amount of personal freedom. It is merely a human practice that is
highly circumscribed in both function and range, and as it must never be used to
pursue virtue, it must be thought of as the art of avoiding the greater evil. It is
not the art of the most perfect, but the art of the possible; it is not about the art
of the Quixotic fantasy, but about the art of building fortifications against. It is,
in short, the art of the second best. I believe in a politics that is passive, and a
politics of passivity has no need to indicate the path to prosperity to members of
society. Nor must politics entice the people away from, or compel them to
41
deviate from, those activities or undertakings that they themselves choose. That
is to say, the State must have no mission or undertaking aside from the missions
and undertakings of its citizens.
Kongzi: And why must the State not have its own mission or its own cause?
Laozi: There is no problem with a citizen or a company having its own mission,
but a State must not. According to the perspective of active politics, because
the State is responsible for pursuing perfection and virtue, it is placed atop all
else, and thus weve seen throughout history many examples of the evil
omnipotent State.
This type of proactive politics emphasizes the abilities of the State over its
institutional restrictions. It emphasizes the coercive powers of the State over its
legitimacy. It emphasizes the wealth- extractive ability of the State more than it
does the ability for civilian oversight of the wealth distribution. According to this
perspective, it is not individual zeal and the pioneering spirit that matter, but
rather it is the demands of the State that dominate. In the economic realm, it is
held that the State sits atop all social life and it is the State that is responsible for
economic development, not the private sector or private individuals.
On this issue of the States capability, the positive political outlook has repeatedly
shown a rationalist, and even a romantic perspective: if we invest the State with
enough ability, if the individual transfers his or her rights and freedoms to the
State, if all subjects walk in unity with the State, if all actions take heed of the
States wishes, if local governments take direct orders from the central
government, if all of these are done, then there is nothing the State cant do,
including the transformation of our world into heaven.
Kongzi: My political outlook is very close to what youve outlined above. What
would a politics of inactivity and passivity look like?
Laozi: The politics of passivity holds that because the State has no mission to
pursue perfection or in any other way pursue its own ends, there is no need for
its powers and abilities to be expanded. Power, after all, is a dangerous thing, and
42
thus we must institute checks and balances against it, and use a constitution and
custom to circumscribe it. Political power must be dispersed, for the greater its
concentration, the more corrupt the politics. The unification of power inevitably
leads to corruption and decline. Politics is a specific and limited activity that
requires the economic and efficient use of the government's powers in a
restricted range of endeavors. The function of government is to enforce the rules
of the game, just as the host of a debate is there to ensure the rules, not to
participate in the debate. These rules, as constituted by the Constitution and the
law, are there to prevent the abuse of power. These rules guarantee the freedom
of the individual, and it is this freedom in turn allows the individual to choose
the appropriate means for choosing their preferred way of life.
The politics of passivity recognizes that the line between good and evil is not
always clear-cut. Nor does the passive position speak lightly of great goods and
great evils, or of the world as engulfed in a great struggle between good and evil.
The government and the State are not tasked with chasing the illusory idea of
perfection, or of the greatest happiness, or of a paradise on earth. Rather, they
must strive to tamp down on the evils that exist in this world. In the realm of
governing human affairs, evil plays a more fundamental role than does good, for
it is in the clear delineation of evil that the pursuit of good has located its
prerequisite. If one does not know what evil is, how can one even speak of
pursuing virtue? And thus, preventing evil is more moral than pursuing virtue.
By treating "perfection" as a political ideal that can feasibly be obtained, a
situation will arise where the ends (perfection) justify the means, or even where
the ends completely absolve any evil done along the way. Even if some form of
perfection is to be achieved, we should not compel people today to sacrifice
themselves for tomorrow. Whats more, we cannot say whether perfection is in
fact perfect or if it is merely a question mark. While some may hope for the
creation of heaven on earth, they should prepare for hell on earth, as this is the
inevitable outcome. Political perfection, regardless of how benevolent its ends,
will fail to bring about happiness. Indeed, what it will create is suffering under a
dictatorial government. Humanity is incapable of both discovering and realizing
perfection. Indeed, using one standard of perfection to deny the diversity of
human values would certainly create a system of moral absolutism in which all
other competing political values will be banned under a closed political
43
dictatorship. And so, as understood by the politics of passivity, political

perfection is absurd in theory and dangerous in practice.
Kongzi: Im completely confused. Why cant a State, a government, or a ruler
pursue perfection?
Laozi: If there is to be an official idea of perfection, it will not brook any
opposition, and thus must be singular in its conception. This type of singularity
will clash with the multivariate nature of the peoples ideals. If we want to respect
the freedom of the people, the government must rid itself of any notion of
pursuing an ideal, allowing instead for pursuit of perfection by the individual and
voluntary organizations. That there is no official conception of perfection does
not mean that there are not various private notions of perfection, and even if
they cannot all be realized, at least some of them can. A society in which not all
of the dreams of the people can become a reality is still a society in which many
of them can. Although this course of action will not bring about utopia, it will at
least refrain from adopting more wicked means. Based on this understanding of
human nature and the Tao of Heaven, the government must be strong enough to
complete those tasks that it must, but not so strong as to endanger the freedom
of the individual. I support the idea of the State and the government must be
invested with power, but I also believe that this power must be strictly limited.
Kongzi: If the State and the government are denied the pursuit of an ideal, are
they at least allowed to pursue a goal?
Laozi: If the State must possess a goal, I believe it is the same goal they should
have had at the time of their creation. The State and the government are not
ends in themselves, and according to the Tao of Heaven, their goal is to comply
with the Tao of Heaven, protect the freedom of the people, their lives, and their
property. Any government or nation that violates this duty must be considered
tyrannical.
Kongzi: Then how are we to rationally demarcate the proper scope of
government action?
44
Laozi: It is not as hard as it seems. Let us begin with the division between public
and private. The affairs of humanity can be classified into two completely
separate spheres of activity: private () and public (). Traditionally, the
difference between the public sphere and the private sphere has been the
dividing line between the State and society. Political activity occurs in the public
sphere, and should only be allowed within a strictly limited range of State and
governmental activity. The private sphere connotes the domain in which the
citizen reigns. Here, they can decide for themselves which brand of cigarette to
smoke and to whom they wish to get married. By their very nature, humans are
private (), and unlike Aristotles political animal, the focal point of human
activity is the private sphere. To admit the existence of the private sphere is to
admit the existence of human freedom. This private life is a sphere of freedom
and individual responsibility that is formed within a space of autonomous
control. Its existence not only means that the individual is free to pursue his or
her own legitimate interests in a protected space, but also to has the freedom to
cultivate the virtues that help provide these most basic of conditions. The value
of the public sphere is that it can serve the interests of the people. The public
interest is either a tool for enriching a few, or it is a tool in harmony with private
interests. The public interest can be maintained only when it is unified with the
interests of the private sphere.
Where the private sector is capable of completing a task, the government should
refrain from intervention. Where the private sector is able to complete a task at a
lower cost than the government, it should be left free to do so. In those instances
where the government is the only institution capable of completing a task, the
private sector should be there to monitor it. The primary function of
government is to protect individual freedom from the encroachment of other
individuals, groups, or governments - and to punish those who violate said
freedoms. It must also uphold justice, order, and a minimum consensus on
morality. Government also has a responsibility to preserve a stable economic
order. Only when these conditions are assured can the individual pursue their
own dreams. When the power of the State is expanded and it begins to infringe
upon what are purely private matters, tyranny is the result.
Kongzi: We Confucians have consistently advocated that the private must be
subservient to the public, yet I see that this position is mistaken: it is the public
45
that must be subservient to the private. Id still like to ask another question:
given that the idea of political passivity advocates a nation without an ideal, and a
politics that doesnt pursue perfection, is there a basis for this in the Tao of
Heaven?
Of course there is. The Tao of Heaven is by its nature passive and inactive. The
Taoist idea of wu wei () holds that while the Tao is inactive, the individual is
not. Thus, a moral system of government adopts the quietness of wu wei and
refuses to meddle in the private affairs of the people. Furthermore, the Tao of
Heaven calls for the ruler to refrain from seizing, oppressing, or otherwise
attempting to thwart the private aspirations of the people. I make a special effort
to emphasize political passivity, as we must have a nation and government that
adopts the idea of wu wei. The legal idea that no action shall be taken by a court
unless someone brings a suit falls squarely within the Tao of Heaven. Image a
world in which judges dressed in their wigs were to stand on the street,
apprehending all past, present, and future lawbreakers. In such a situation, the
people would not be able to live but one day.
Extravagance is the root of frivolity,

Stillness has mastery over agitation.
Thus, during the travels of the Ruler
He Will not Stray From His Baggage Train.
Even While Possessing Vast Riches,
They Do Not Entice Him.
As the Ruler of a Mighty Kingdom,
How Can the Tao of Heaven be Treated as a Trifle?
If the Ruler is Imprudent, the Root will be Lost;
And Restlessness will Prevail.
If Capricious, the Ability to Govern will be Lost.
Agitation Will Thwart the Ability to Contemplate the Fundamental Questions.
46
Dialogue 7: The Tao of War

Kongzi: The capture and killing of Osama bin Laden by the US military has
dominated the news as of late, and Im quite interested in how they caught him.
What I find particularly interesting is that the US military gave Bin Laden a
proper funeral burial, even doing so according to the tenets of Bin Ladens faith.
Contrast this with Chinese tradition, where if one captures their enemy, they
might hope to cut them into 10,000 pieces or even to dig up their corpse to have
it flogged. Events such as these took place even as late as the Cultural
Revolution. I myself have been on the receiving end of this type of treatment
through our history. How I have come to provoke such hatred I do not know.
You, however, are a man of prudence, and in your peripatetic wandering, were
spared any humiliation that could come after death. But let us look at the
Americans, who not only refrained from humiliating Bin Laden, but also cleaned
and prepared his body for burial in the Arabian Sea. -This reminds me of one of
your important, yet largely forgotten, sayings He who has killed multitudes of
men should weep for them with the bitterest grief; and the victor in battle has his
place (rightly) according to those rites 21 . While I do not think that the
Americans were inspired by your writings, I still want to know how you
possessed such foresight.
Laozi: This is not foresight, but rather I have apprehended what the Tao of
Heaven has told me, whereas the majority of us do not bother to listen. Even if
one is the victor, he should afford the fallen their proper burial rites, regardless
of whether they fought for the enemy or not. In the West, similar sentiments,
beginning with the famous funeral oration of Pericles in Ancient Greece on
through to Lincolns Gettysburg Address, have shown brightly through the ages.
However, I am the first in Chinese history to give prominence to treating a battle
victory as if it were a funeral. Yet, China has yet to leave future generations with
an eloquent funeral speech, especially to those unknown soldiers who died in
battle. What we have instead are those calls for maximizing humiliation upon
ones vanquished opponents, as you previously mentioned. The more war and
21
James Legge, 1895
47
victory are not properly treated, the more we will suffer at its hands. Im afraid
that no other country can be mentioned in the same sentence when it comes to
the historical suffering from war and violence.
Kongzi: Indeed, China is precisely as you have described: a country that is
permeated with hostility. I would still like to know, however, why battle victories
should be treated as funerals?
Laozi: Simply put, it is because of the following several reasons. First, it is
decided by the nature of war and military arms. Second, we are all the creations
of the Tao of Heaven, including our enemies and our friends, and their remains
must not be treated with disrespect. Third, treating those fallen in battle to
funeral rites helps to eliminate rather than incite hatred. The fourth reason is that
it can aid soldiers and even the rest of the nation to cast off the instinct and
impulse for violence and return to rationality and humanity. Thus, language that
arouses our baser and more violent instincts, such as the call to rage against a
common enemy (), is completely objectionable.
Kongzi: I understand and completely agree with points 2 and 3, but can you
further explicate the first point?
Laozi: The military has a very particular characteristic: when it was created and
provided weaponry, its goal is not to go hunting or to chop wood, but rather to
exterminate human beings. The greater ones ability to destroy life, the better one
is suited for the military. If a military is put into action in a war, both sides will
suffer as a result, both in terms the destruction of human lives and property.
Theres one point Id like to you pay special attention to: during times of war, we
tend to look with glee only upon the number of casualties we are able to inflict
upon our enemies. Yet what I see is the death of my fellow man. During Chinas
countless civil wars, casualties were treated as belonging to the enemy or to ones
own side. Yet in reality, those who died on the opposing side of the battlefield
could be ones own compatriots, neighbors, classmates, relatives, or even a
brother. The greater the number of deaths of these unknown soldiers, the greater
the likelihood that the fallen is a brother or compatriot, as all were commoners
before entering the military. Consequently, no matter the war, no matter if one
48
stands on the side of the victors or the defeated, no matter if one fights for
justice or not, humanity will always suffer a loss. The goal of the military is to
extinguish life, and so all who were destroyed are victims, and thus all are entitled
to the rites of proper burial.
The existence of military force is a paradox: the greater a militarys capability of
violence, the better the army. Yet the less this capability is utilized, the better. A
nation must possess a military, yet it must do its utmost to keep this force from
being used, both against its enemies and of course against its people. Those
countries with a predilection for the use of military force to solve problems will
find that this behavior will bring disastrous consequences to both the nation
itself, as well as its people. The price of war is always great, bringing disaster to
the people with little to no benefit at all.
Kongzi: Your idea that we should all loathe military force is unrealistic. What
about the soldiers themselves, who, as a matter of their profession, will be fond
of combat.
Laozi: I am speaking of those who are not a part of the military class. That being
said, even if we were speaking of a high-ranking military official, he or she should
not act in a warlike manner, for if they agitate for war, this will bring enormous
pressure upon the countrys politicians. If military leaders were to begin exerting
pressure on those in power to go to war, this would be a fundamental change,
similar to Japans experience during WWII. Thus, whether or not a county goes
to war should not be a matter for military officials to decide.
Just like the government itself, the military - funded by the taxes collected from
the people - must be an organization that serves the people. As a result, the
armed forces must belong to and be overseen by all the people, and military
force must never be used against them. Taking the point one step further, the
military is a special type of public service organization: it possesses enormous
weaponized force, and is a violent organization. An armed force is a countrys
most destructive power, and thus requires resolute oversight. Its exploitation by a
political party or private interests must also be prevented, otherwise disaster will
befall all other members of society.
49
Therefore, the military - this most ominous machine - must be communalized

and neutralized. If the army falls into the hands of a dictatorial tyrant who orders
them to crush the people, the army must bravely refuse to enact such orders and
remain removed from a countrys internal political strife. A just soldier is worthy
of our respect, but military force, as a part of the political machine, is unworthy
of praise. As a result (and as Ive said before), I completely oppose the flaunting
of military victories, the triumphant return of victorious troops, or public military
parades.
Kongzi: Yes, I remember you saying before that you oppose a review of the
troops.
Laozi: Those ostentatious military parades are undesirable, as are birthday
celebrations for the armed forces. Violence is but a necessary evil, and there is
nothing glorious about it. A fondness for military parades is to celebrate the
martial spirit (), and in China this word has a positive connotation. To
celebrate the martial spirit is to revere violence and military force, and to take
might as the most effective and final means for solving problems. In my opinion,
a show of force in these military parades does not so much create a sense of
glory as it does create terror in the hearts of the people. Planes, tanks, cannons,
and the thud of jackboots on the pavement: what is evoked is not patriotic pride,
but the idea of a murderous killing machine. The signal it sends both to the
people and nations opponents is this: whoever challenges me shall receive an
answer from this killing machine. This is no different from the bared teeth of a
tiger. And if you still dont believe your gut, just remember that those regimes
that are so fond of military parades are almost without exception dictatorships.
Kongzi: But Ive heard that some democratic countries such as France also hold
military parades. Is this true?
Laozi: Yes, you are correct, and France is unconventional in this sense. Because
of its tradition of revering the military, France did not construct stable
democratic institutions until 1958, more than 100 years after England and the
US. There are two legacies of this reverence for the martial spirit that have yet to
be properly dealt with. The first is the tradition of the military parade, and the
50
second is the Arc de Triomphe. I must be honest that I am disgusted by this

symbol of the mobilization of violence. Such memorials were first built in
ancient Rome to mark the victory of the ruler in battle. As one of the four great
architectural landmarks in Paris, the Arc de Triomphe commemorates the
military victory of Napoleon at Austerlitz in 1805.
Kongzi: Are you saying that a military victory isnt a triumph?
Laozi: Even if it is a just war of self defense, the result is still the slaughter of the
many. This is not something we should celebrate, as it is in reality a funeral. What
triumph is this? Even in victory, one must not boast, for all war leads to
slaughter. A victory in military conquest is that much more deplorable. And so, I
hope that China will forever go without any such Arc de Triomphe.
Under the Tao of Heaven, the life and freedom of the individual are
unsurpassable. Each individual is his or her own master, as they are the master of
their own labor. Government is given the power of coercion precisely so that it
can protect the rights of the individual and his or her property. If the present and
future of humanity desires to live in a world free from oppression and might,
then the individual must have the sovereign right to oppose this power.
My logic for standing in opposition to war and force is identical. Seeing as I
oppose the intervention in the life of an individual, I of course also oppose the
use of force, violence, and war. In fact, all living creatures prefer an environment
of tranquility, but war brings only disaster. -Thus, in imposing upon the Tao of
Heaven, the military is violating the will of the people while simultaneously
destroying their voice of opposition. Whether a civil war or a war against an
outside power, war is waged by the voices of tyranny and terror. The only war
that can be defended is a war of justice and nothing more.
Military Force is an Inauspicious Machine of Murder,

As a Result, Life Must Loathe that Which Deprives Life.
So The Moral Leader Does Not Worship Force!
51
During Times of Peace, They Place Respect to their Left. During times of war, They
Place Respect to their Right.
He Will Not Allow Himself to be Compelled into Using Force;
He will by no Means Take Delight in Plunder
To be Victorious is Not to be Praised,
To Praise the Machinery of War is to Delight in Murder.
All under Heaven Must Forbid Such Unbridled Rampage!
On festive occasions, the left side is afforded the prized position; on occasions of
mourning, the right side.
The general of an army is afforded a position on the left; the top commanding officer
takes his place on the right.
The Use of Force Should be Treated with Great Sorrow.
Casualties are Inevitable in War, and it is with a Heavy Heart that we Should
Mourn.
Even in Victory, a Funeral Ceremony is Proper.
52
Dialogue 8: Why does Forced Wealth Redistribution Lead to the

Equality of Poverty?
Kongzi: For my entire life, there has been one issue that Ive been unable to
resolve. It is this: I do not worry about poverty, but rather inequality. I do not
worry about scarcity, but rather insecurity. If I see that there are those who are
poor while others are rich, I feel a great uneasiness. Only when wealth is evenly
distributed can I feel at peace. If we were all equally rich, would that not be a
splendid thing?
Laozi: Suppose a ruler asked you how to create a world in which everyone was
tall. Your answer would be simple: if there were no short individuals, we would
all be tall. (For the time being, I will not ask you where all of the worlds short
individuals went.) Yet even here, where weve created a world comprised only of
the tall, not everyone would be exactly the same height. Some would still be
shorter than others, correct? It would be like the shorter basketball players in
the NBA: they may be short in comparison to their fellow players, but they tower
above the rest of us. And so I ask you, what would you do with those who are
still shorter than the rest of the population?
Kongzi: I hadnt thought of this. I suppose my original idea was overly
simplistic, and absolute equality is harder to realize than Id thought.
Laozi: As with the idea of tall and short, poverty and wealth are relative rather
than absolute, and thus there is a protean nature to their measurement. The idea
of ridding the world of poverty and creating an equal society is certainly
appealing, but it can never be realized. To implement this idea, one must either
physically eliminate the poor, or otherwise destroy the rich or deprive them so
that they become poorer. Weve seen the latter all too frequently, and the result is
that in the name of equality, the rich disappear while the rest of us are cast into
poverty. There are too many instances in history for me to mention.
53
Kongzi: Please give me an opportunity to clarify. My original idea was to

admonish the nobility for merely considering whether their own wealth was
sufficient, and ignoring the larger problem of the inequality in wealth allocation.
If wealth was evenly distributed and poverty eliminated, the world would be
more secure.
Laozi: Im afraid youve failed to provide any additional clarification. Whats
more, youve suggested that the power to distribute wealth should be entrusted
to the ruler so that he may equalize wealth. Once again, your starting point is to
protect the territory of the ruler. You believe that if the property of the rich is
confiscated, the world will be at peace and the ruler firmly in power. Yet Chinese
history rebuts this claim. If we look at the issue from a different angle, we see
that up to the present, the ruler of each and every dynasty used your Confucian
idea of income equality as the guiding principle for their rule. However, income
equality failed to be realized, in fact, the poor became poorer and the ruler
became even richer.
Kongzi: Your point is taken. But are you completely unconcerned with the
problem famously described in the saying the rich have so much meat that it
rots, while the poor die cold and hungry in the streets? 22 As you know, we
Confucians advocate that every individual should show compassion for others.
While its not important if one is a little richer or a little poorer than the rest of
us, the key point is that if the disparity becomes too large, we will have chaos.
Laozi: You apprehension is correct, but your logic is off. Of course chaos is bad,
but it is only when weve accurately diagnosed the root cause of the chaos that
we can prevent it. Youve posited that chaos will stem from the income disparity,
but Id like to ask you what is the cause of the income disparity itself?
Kongzi: Im not entirely certain, but I do know that Marx and other intellectuals
traced the problem back to the market economy and the capitalist system.
22
54
Laozi: But in the years that Confucian ideas reigned, capitalism and the free
market were never predominate. In the past several thousand years, there has
never been anything approaching true capitalism or the market economy. So
where did the historical gap between the rich and poor in China come from? It
can clearly be seen that the blame for the wealth disparity should not be laid
upon capitalism or the market economy. In fact just the opposite. In those
countries today that have developed capitalist and market institutions, the
income gap is relatively small.
Income disparities are the result of power disparities, or more accurately the
result of a dictatorship in which the ruler is unrestrained. Where power is
unrestricted and government officials are free to flout the law, the rights and
freedoms of the people are suppressed and the income gap will only grow. By
unleashing the power of the State to target the rich, the main culprit is left off the
hook and the suffering of the poor will only exacerbate. Throughout Chinas
history, has the country experienced more polarization when power is
unrestrained or when there has been economic liberalization? When have the
final years of a dynasty not seen extreme corruption and polarization? The cause
of nation-wide chaos is not wealth inequality, but dictatorship. Its not the rich
who give rise to the wealth gap, but dictatorship. You Confucians only see the
threat to the ruler posed by extreme wealth and extreme poverty, but you ignore
the threat to the rich and the poor alike from the ruler. This conflict between the
ruler and the ruled has succeeded in quietly replacing the conflict between rich
and poor, and remains a significant problem.
Kongzi: Ive always believed that wealth and poverty must have their limits, and
if resources are distributed according to these limits, the nation will be at peace.
Is this wrong? For example, would it not be better for the people if resources
were redistributed by the ruler so that above, they have enough to serve their
parents and, below, they have enough to support their wives and children. In
years of prosperity they always have enough to eat; in years of dearth they are
able to escape starvation.23
23
From Irene Bloom (Trans), Mencius, Columbia University Press, 2009
55
Laozi: Confucianism supports the issuance of decrees by the ruler to adjust the
distribution of wealth and thus maintain social stability and the position of the
emperor. Yet this perspective is completely wrong. If forced wealth transfers are
so effective, why do we see so much large-scale unrest? Why does this bring
about not equality of wealth, but equality of poverty? It is because you advocate
using the power of the ruler to replace the Tao of Heaven, and so the result is
precisely the opposite of what you intended. Dictatorship is the creation of
polarization. Using dictatorial means to try to solve the problem of polarization
can only lead to yet more dictatorship. Using chaos to pursue peace is futile.
Kongzi: While I do not deny the goodness of the Tao of Heaven, I cannot see
it, nor can I touch it, and so aside from the sovereign, who else can I look to?
Laozi: Those in power do not have the ability to make us all equally rich, and at
the most all they can do is to enrich themselves. This so-called equality of wealth
is typically an act of self-enrichment wrapped in the cloth of the public good. In
attempting to force the equalization of wealth, they are not only usurping the
Tao of Heaven, but also exceeding the limits of a States abilities. Firstly, the
State lacks the ability to create a coherent standard. Second, it lacks the ability to
effectively implement the policy. Thirdly, it is incapable of ensuring there are no
unforeseen consequences.
The greatest injustice is that brought about by the use of power. Those in power
have decided to not recognize the Tao of Heavens invisible hand rather than
pretend it doesnt exist. They attempt to replace the Tao of Heaven with their
own mocked-up version of it. If the ruler were to comply with the Tao of
Heaven rather than try to supersede it by respecting its unseen regulating
function, they would be in a superior position to bring about an equality of
wealth. If the ruler was to recognize that the Tao of Heaven stood above
government, he would comply with the Tao of Heaven and refrain from using
force to bring about wealth equality. Otherwise the result is either absolute
poverty or the inequality of resources. The focal point of our dispute should not
be whether or not we help the needy, but rather which methods for alleviating
poverty are the most efficacious.
56
Kongzi: To tell you the truth, before my discussion with you today, I was quite
proud of my ideas on wealth equality. Todays society celebrates equality between
all people, and I thought my ideas on wealth were a part of this larger equality.
Laozi: Men are created equal, but that does not mean they are born with the
same level of spirituality, material possessions, opportunity, personality,
character, and achievement, nor does it imply that that everyone will share in the
same amount of wealth. The goal of equal rights is to ensure that all enjoy the
maximum degree of free choice, and the full realization of all aspects of human
potential. Equal rights also mean that one can enjoy the freedom of their
individual and fundamental inalienable rights, and thus are entitled to be free
from the encroachment of other individuals, such as the mafia and the
government. Equality does not mean that the government must rectify all
differences between members of society.
If the multifariousness of human society as created by the Tao of Heaven is to be
replaced by simplicity, it is inevitable that only with the use of brute force, mental
torture, or even the destruction of the flesh that one can achieve these goals.
Therefore, unity and uniformity inevitably suffocate vitality and freedom. Yet the
most frightening idea is that uttered by Wang Xiaobo 24 : I loathe wealth
inequality, and we fight today for the equality of our contemporaries! Robbing
the rich to give to the poor will bring about worse results than the original wealth
inequality. If true wealth equality were to be realized, the result would be the
equality of poverty, moving the masses into equal decrepitude while enriching
the minority of rulers. It is not equal wealth that I oppose, nor do I welcome
polarization, yet I do oppose absolute egalitarianism and the reliance on
government decrees to equalize wealth. What I advocate is to allow the Tao of
Heaven to work along with the natural forces of the market to bring about
wealth equalization. When we speak of wealth distribution, governments can
only aid the Tao of Heaven, and must not try to replace it!
24
Wang Xiaobo was the leader of a peasant revolt during the North Song Dynasty (960-1127 AD)
57
The Tao of Heaven is unchanging and nameless,

Although it is simple and unadorned, none can subdue it.
If the ruler abides by the Tao of Heaven,
So too will the People abide by its rule.
The earth and heaven are naturally aligned,
And so government has no need to intervene,
For the Tao of Heaven will disperse its bounty to all.
When the Tao of Heaven created all living things,
they were each given a name.
Having been given a name, it must be restricted to its standard.
And to abide by this standard, danger can be avoided.
All under heaven serve the Tao of Heaven.
Just like the river in a valley flows towards the sea.
58
Dialogue 9: I and We
Kongzi: Theres one issue Ive always been unclear about. Is the source ()
of society I or we? If I is the source, then wont we all simply look after
ourselves? Society would be no more than a plate of scattered sand ().
If its we, then wont the individual be treated with disdain, even oppression?
This is truly a dilemma!
Laozi: Of course I is the basis of society, for without it, where could we
possibly get we? It is precisely because of the neglect and suppression of the
individual - of the I- that society turns into a plate of loose sand. It is only
when individual associations are equal that the Tao of Heaven can be peaceful. If
we do not allow for the peaceful existence of the individual, then society can
never itself enjoy tranquility.
Kongzi: Im reminded of what the Daoist philosopher Zhuangzi () once
said. Those societies that treat we as the foundation of society find mutual aid
and comfort in even the most humble of circumstances and are brimming with
affection and warmth, while those societies in which the "I" forms the
foundation of society often forget the existence of their fellow man or otherwise
treat them with indifference. We Confucians hope that humans can all come to
the aid of others even in unforgiving situations ().
Laozi: Mutual help in humble circumstances () is an idea replete with
aesthetic significance, but this is to take the imminent arrival of disaster as a
starting premise. Although a life in which the hardships of others are ignored
may lack luster, it is at least one in which the individual can live freely. Suppose
that you were a fish, and you found yourself in the rapidly evaporating pothole.
Would you rather live here with the mutual aid of your fellow fish? Or would you
prefer to swim anonymously in a great lake or river? Remember, the moral life is
often an uneventful life.
59
Kongzi: A dull life is rather tedious and devoid of beauty. If I see a thing of
beauty, I must always stop to examine and appreciate it. Music and dainties will
make the passing guest stop (for a time).25 When you wrote these words, it was
as if you were describing me. When I hear glorious music, such as Shao music (
), or when I see delicious food, such as dried jerky, it is quite difficult for me
to avoid stopping to linger.
Laozi: It is not that I am against the pleasures of food and music, for these
things appeal to our sensory organs, and thus are dictated by our instincts. I
know that you are dedicated to the pursuit of the Tao of Heaven, which is a
rational and spiritual quest. The pursuit of the Tao of Heaven and the pursuit of
lifes enjoyments both stem from our human nature. While each individual
pursues both of these to varying degrees, neither must be neglected.
Kongzi: However, didnt you once say the following: Individuals are flawed and
imperfect, and as such, how can these individuals be societys most important
element of survival? If individuals organize under the leadership of a wise
monarch (), they will be able to collectively offset and overcome their
mutual defects and weaknesses. A State thus formed would seem to be the most
perfect, and I believe it should be held above the individual. There are many
individuals who are lackluster, or even worse, they are malicious. If we hold aloft
the individual, do we not run the risk of holding them too high? Please help me
out: is the individual or the State more important?
Laozi: The moral conduct of each individual varies widely, but all are equal
creations of the Tao of Heaven. We must not aggravate the discriminatory
treatment of some simply because there are differences between us. If you take a
closer look, youll see that historically the worst in society are not to be found
among the common people, but rather are the leaders of nations. They esteem
themselves too highly, when in fact they are the worst among us. How many
sagacious rulers can be found in Chinas historical annals? I myself cannot locate
a single one. Leaving aside the legendary rulers of myth, in reality the list of evil
deeds perpetrated by our emperors is long indeed. How could we allow these
25
From Legge, section 35
60
same individuals to control the machinery of State power and exercise control
over the individual? The Chinese people often liken the head of state () to a
genuine leader (), but both of these words in Chinese trace their root to
articles of clothing (namely, the collar and the sleeve), and we find in reality that
these are both the portions of clothing most easily stained. Why should we
mythologize them?
The Tao of Heaven confers an extreme degree of importance upon the
individual. In all that is on this earth, the Tao of Heaven is the most important.
Next comes the individual. A social organization formed from individuals cannot
be more important than the individual, for the individual is both the minimum
that can exist, just as the individual is the maximum that can exist. It could even
be said that aside from the Tao of Heaven, the individual is the ultimate that can
exist. This is also due to the fact that the individual possesses a soul, whereas
organizations or groups comprised of individuals lack this flexibility, or possess a
soul only in the literary or fictional sense of the word.
We are all the creations of the Tao of Heaven, and so too is the freedom
bestowed upon us. To bully and humiliate our fellow man, to deprive others of
their freedom, these actions are to show contempt for the Tao of Heaven, which
will certainly not idly sit by. When we look at the course of humanity, we see that
when the individual is held aloft, the space for rights-depriving dictatorships is
that much less. Can it be denied that this is the work of the Tao of Heaven?
Kongzi: Actually, I now see that my ideas are quite confused. Ive previous said
His own approbation is the superior man's rule. The approbation of others is
the mean man's.26 If each individual serves as his or her own primary standard
and handles their own affairs with aplomb, would we not have a society replete
with gentlemen ()? Yet I fear that in such a society the concept of I would
be given too much prominence, and would lead to a loss of respect for authority,
even outright rebellion against the Emperor. If everyone sought to take his place
on the throne, would we not enter a war of all against all? Whether the root of
the nation is I or we is truly a vexing question.
26
. The
translation is taken from Legge 1895.
61
Laozi: His own approbation is the superior man's rule. The approbation of
others is the mean man's. This saying of yours is well known, and is full with the
spirit of individualism. It is only natural that he who loses his sense of self is
unlikely to become a true gentleman. His own approbation is merely the idea
that individuals are responsible for their own interests and behavior. Rather than
belonging to some higher collective, every individual belongs to him or herself.
The individual is not subservient to any group or groups within a nation, nor is it
a cog in the wheel of a political party or the nation. The relationship between I
and we is simple and free from ambiguity, for without I there can be no
we. The core of society and the State is the individual.
I dont know if youve noticed or not, but we Chinese are fonder than most in
abusing the term we. Were only willing to shout we and never I. Where
we should use I, the Chinese usually use we. Even when discussing those
tasks completed by one self, the Chinese still might say that we finished the
project. Where I is required, we still only dare to say we. In Chinas long
history of political rule by the emperor and his ministers, there was no place for
the concept of I. However, while we can never represent I, it also cannot
smother the idea of I.
Kongzi: Thank you for the vote of confidence. If I may summarize what you
just said: the idea that the individual must exist for the nation, or sacrifice for the
good of the ruler is completely mistaken?
Laozi: Yes, this idea is completely wrong. If the individual is not allowed to live
on his own terms, but rather is expected to live for the nation, for whom exactly
does the nation exist? If the State was completely independent and had no
relation to the citizen, how could we require everyone to exist for the State? If
the State exists for the good of the citizen, why not allow the people to directly
live for themselves instead of creating some State-led Rube Goldberg machine to
serve their interests? Of course, perhaps this is because the State can serve to
enrich those in power. Thus, the people must first pursue their own ends, as it is
only when the individual squarely faces his own interests that he is able to
properly interact with others. Only when we know what our own interests are
can we truly understand the interests of others. A society that seeks to eradicate
all traces of individualism is not only irrational, but also suicidal.
62
The Tao of Heaven gives life to us all, and as a result, aside from the Tao, we
must first obey the self. The Tao of Heaven places emphasis on the individual
above all, and so the actions of government will inevitably lead to restrictions on
the individual. To respect the value of oneself is also to respect the value of the
individual. When we consider the root cause of the rise and fall of civilizations,
we see that every page of history gives the same answer to the question of what
gives rise to human progress: independent and free individuals. Consequently,
government must yield to the individual. Only when a government puts into
practice the concept of government inaction () can the individual flourish.
The responsibility of government is not to pursue its own interests in place of
the individuals, but rather to act as an escort for the individual as they pursue
their own ends.
You See the Great Presence of the Tao of Heaven in all under the sky.
The whole world will convert to the Tao of Heaven.
To achieve Peace, You must travel the road of the Tao.
Music and cuisine will give pause to the traveler.
When spoken of the Tao seems insipid and flavorless
You can try to see it, but it is invisible,
You can try to hear it, but it is silent,
You can try to use it, but it is inexhaustible.
63
Appendix
Dialogue 1
(
)
64
65
66
67
Dialogue 2
(
)
68
69
70
71
Dialogue 3
(
)
72
73
74
75
76
Dialogue 4
()

!
.
77
78
79
80
Dialogue 5
()
81
82
83
84
Dialogue 6
(
)
85
86
87
88
89
90
Dialogue 7
(
)
91
92
1958
93
94
95
Dialogue 8
(
)
96
97
98
99
Dialogue 9
(
)
100
101
102

Tao of Liberty: Dialogue in Heaven Between Laozi and Kongzi

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Tao of Liberty: Dialogue in Heaven Between Laozi and Kongzi

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1

Published in Potsdam in 2014 by

Dr. Rainer Adam

About the Translator

About this book

Dialogue 1: The Inferiority of the Superior

must listen to the people, not the other way around.

Circa 6th century BC

Heaven and Earth are Everlasting.

Dialogue 2: To Conquer and Withdraw

James Legge, Tao Te Ching, Chapter 9 (1891)

Lit. the fat or lard of the people ()

Translators note: The full sentence is .

Translators note: This is adopted from James Legges 1891 translation.

More Power Is not Better Power,

Dialogue 3: The Road to Happiness

depths of an individuals mind and discover their understanding of happiness,

This phrase comes from James Legges translation.

of the individual, not government. Whether a nation itself is happy is not

You Aristocracy, Who Are Blinded by Resplendence will be Ignorant of Disaster

Dialogue 4: When Government Becomes a Stationary Bandit

bandit as Mrs. Xing did is far too unreasonable.

of a nation or a city, he would be deemed righteous. This would be like seeing a

Dialogue 5: Why must Political Institutions Comply with Human

Laozi: If a political system is discovered, but not implemented, it is a political

Laozi: The arrangement of any political or legal institution must be premised on

Dialogue 6: Why is there no Virtue in Politics?

comes to be implemented in public affairs. As a result, my focus is not dedicated

dictatorship. And so, as understood by the politics of passivity, political

Extravagance is the root of frivolity,

Dialogue 7: The Tao of War

James Legge, 1895

Therefore, the military - this most ominous machine - must be communalized

second is the Arc de Triomphe. I must be honest that I am disgusted by this

Military Force is an Inauspicious Machine of Murder,

Dialogue 8: Why does Forced Wealth Redistribution Lead to the

Kongzi: Please give me an opportunity to clarify. My original idea was to

From Irene Bloom (Trans), Mencius, Columbia University Press, 2009

The Tao of Heaven is unchanging and nameless,

From Legge, section 35

translation is taken from Legge 1895.

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