Capitalism, the Perfect System

Political systems are based on ethical systems. Ethical systems are based upon our view of man as either autonomous or incompetent. If you think that man is autonomous, you celebrate his individuality and his nature as a thinking being who is essentially good and capable. You develop a system that honors that nature. If you think that man is incompetent, you question man’s ability to think and understand reality as well as his ability to choose correct action. You become a critic of man and you seek a society that is intent on ensuring that man takes those actions you (or God) deem to be correct.

These are the two choices in establishing society. Do you create a society that leaves man free to be his own moral agent; or do you create a society that uses government to ensure that man serves the collective good as prescribed by the authorities. You must select either a free society, limited government, or a dictatorship, unlimited government.

A limited government, by its nature, creates a capitalist society and the dynamism that comes from freedom. An unlimited government creates an authoritarian society and all the stagnation that comes with having a few people decide for a large number. Although it may be hard for some to accept, a capitalist society unleashes self-interest while an authoritarian society restricts people to sacrifice or altruism.

Today, in our society, there is a struggle between these two systems because we have not made up our minds about our view of man's nature. We have been flailing about, so to speak, and this has created our present situation where authoritarianism no longer needs to compromise with self-interest. It is now free to move forward to full control, full dictatorship.

For instance, we’ve seen for decades in the media and the arts a pervasive negative attitude toward business, particularly big business. Intellectuals, actors and commentators are forever sneering at the giants of industry, who, in their "ruthless" pursuit of profit, are supposedly breaking laws, cheating consumers, and generally, but successfully, making life miserable for us all. From the philosophical arena we are taught that those who seek self-interest necessarily must seek it at the expense of others. Such attitudes reach their lowest point in practice when a President of the United States scorns businessmen for not sacrificing themselves to the inflationary policies of the government and instead insist that in spite of the President's wishes they are going to make a profit. (See Kennedy vs. U.S. Steel or Obama vs. just about everybody)

The difference between those who favor authoritarianism and limited government is that authoritarians slice reality up into hundreds of out-of-context critiques of capitalism where nothing connects and anything goes. For instance, an authoritarian develops no universal principles that relate to man except that he is an economic creature. As a child of empiricism, the authoritarian believes that man is incapable of learning from his sense experience and, because so, we can only try different approaches to social organization in order to define those that work.

An empiricist might be a Marxist who sees no connection between one era of history and another. He would say that during an earlier agricultural age, private property developed out of a need to protect crops from being trampled. According to this view, the idea of property might have been valid in that context, but when industrial society took shape, the idea became obsolete in favor of collective rights. These critiques of capitalism created whole new branches of so-called social science each taking off in different directions yielding a myriad of conclusions and social engineering. The question was not how to establish a universal principle that was valid fundamentally through the ages but how to manipulate one idea in a hundred different ways. You could study thousands of books about just this one issue and learn nothing more than that man must be coerced for his own good. Imagine filling up your brain with that one idea and studying example after example. What a life that must be.

A different view might hold that property rights developed in one age to solve a particular problem but that the solution was based upon a new discovery about man. If property rights helped during an agricultural age and made for a stronger society, then the principle had application to man universally…specifically it helped him find increasingly better methods of survival. If property rights were instrumental in one age, then they would apply in all ages for all time. We might not have to study every example like the Marxists. We could get around to enjoying life.

What you have in these two views is the genesis of two basic systems of government, one that came out of European intellectual circles and the other that came out of American intellectual circles. One created dictatorship and the other the United States of America. The clash between these two views played out in two different periods; the first during the American Revolutionary War where a free society won and the other during World War I and World War II where the two sides fought to a stalemate. Although freedom won the wars during the previous century, the ideas of Europe prevailed intellectually and today European style totalitarianism is on the verge of taking over our country. We may soon experience the devastation that rocked Europe last century.

Today, once again, capitalism is under attack. The diluted forms of capitalism today; forms that are more mixed economies rather than true capitalism, are about to be wiped out and forever disappear. The reason for this is that intellectuals in our society hate the individualism and egoism that are an intricate element of capitalism. The progressives' adherence to the Marxist critique of capitalism, and their hatred of profit, has left capitalism with almost no defense. Few are willing to fight for the right of the individual to be an egoist. Yet, that is what it would take for capitalism to be defended.

In practically every philosophical discussion of egoism we hear something like this: Is it right to seek one's self-interest in disregard for the interests of others? Yet, this is a loaded question. It is based upon a Marxist critique that I call scarcity metaphysics, the idea that one man's good is another man's harm, that profit is theft. Such a view implies a total ignorance of property rights, and of the fact that what is rightfully owned by one man cannot in any way relate to the well-being of another.

The idea that egoism requires harm to someone neglects the basic principle of human interaction, the principle that makes economic coexistence possible; the principle of trade for mutual benefit. When people engage in trade they each expect to gain from the transaction. The standard of living in those countries that have free trade policies is evidence that mutual benefit does take place and that the capitalist world is not a den of thieves.

The ancient idea that those who engage in trade for a living are evil only reveals a bias by authoritarians against self-interest and effectively removes them from serious consideration. That such thinking takes place in view of the obvious evidence against its veracity is another example of the extent to which the idea of collective sacrifice has corrupted our culture.

One problem with anti-capitalists and their arguments, almost to a man (woman), is that they assume capitalism to be steeped in conflict and contradiction. Perhaps this comes from their childhoods or from their mentors, but for some reason, they project a state of conflict into the very essence of capitalism. Yet, capitalism is about, indeed requires, a high level of cooperation, good will and a synthesis between the economic demands of some people and need fillers, between those who are willing to buy and those whose jobs it is to develop the products and services to sell.

Capitalism creates the most efficient matching of need and need fulfillment. In contrast to the cooperation inherent in capitalism, we have the "command" method of the controlled economies, where bureaucrats make economic decisions, often guessing wrongly about supply and demand, then expropriating the funds from society to correct economic problems that they have created.

Capitalism is a demand system where capitalists are free to fill real and immediate demands using their own or borrowed funds and getting their reward when success is achieved - success that comes from successfully meeting the consumer's needs. Socialism, the command economy, is inefficient because it is based on bureaucratic decisions that are almost always wrong, too late, aimed at the wrong people or corrupt.

Capitalism is a perfect economic system because it allows the consumer to choose what he needs and then find the products to fill those needs, and in the process tipping off the capitalist about where to invest for future production. Everyone wins. Socialism is full of inefficiencies because the goal is not the satisfaction of requested needs but of "social" needs that a central authority deems proper, fulfilled by unwilling providers and presented in a “take it or leave it” way with little concern for the desires of the consumer. The only “satisfied” party in a socialist transaction is the central authority.

In a sense, every man is a Robinson Crusoe. And this fact is what makes every man a capitalist and every capitalist an egoist. Every man must find ever more efficient methods for improving his survival. For Robinson Crusoe, his goal was a better life on a desert island. For modern man, his goal is a higher standard of living. But like Robinson Crusoe, modern man must find a way to lighten the effort needed for bare survival. He does it through production. Production creates the profit that yields the opportunity for a higher standard of living. If a man's productive efforts yield him more than he needs for bare survival, he can then look around for those products that help in raising the quality of his life; he creates demands for such products and thereby stimulates more production; he creates a need for advertising and promotion of products so he can be made aware of what is available.

In contrast, the controlled economy is based on production only. By destroying property rights, this system thinks that it can obtain the results that derive from property rights by taking over the machines. Their critique that the principle of property rights worked in an agricultural society but are not necesarry in an industrial society is the reason why they cavalierly dismiss capitalists and expropriate the machines. What they don't understand is that machines don't run themselves, they need human intelligence and the only person willing to apply his intelligence to machines is the person who has a stake in them. Collectivist beneficiaries of stolen production don't really care about making sure the machines are run well as long as they are running. When the machines run out of oil or electricity, they stand around waiting for someone to give them a new machine.

Nature tells us that machines do not eliminate the need for property rights. In fact, property rights are a concept that recognizes an enduring trait of man; that he is a thinker who functions better when his right to keep what he creates is recognized. Property rights worked in a primitive society of two people five million years ago, in an advanced society of millions today and in a spaceship in some distant future transporting hundreds of colonists to a new planet. Property rights do not become obsolete with new machines; they become more necessary as the machines become more advanced. Better machines do not create collectivism.

This means that every man is a businessman and every businessman is a worker: in order to survive, he must produce, and in order to survive well, he must produce more than is necessary for bare subsistence. This law applies all across the economic spectrum from Robinson Crusoe to Bill Gates. To preach that profits are exploitation is not only an attack on disembodied corporations; it is an attack on every person.

Man is not merely a creature mired or chained to bare subsistence. He is also a creature of pleasure, a creature that yearns for rest, enjoyment and celebration. He needs to produce more than he consumes because he needs to experience the totality of being human. By nature, man is an egoist…and this is not a bad thing; it is a wonderful quality that makes enjoyment and higher thinking possible.

Subsistence economics, as is the economics of socialism, is nothing more than a scheme to subvert man's happiness, undertaken by those who would dictate his choices and steal the surplus that he produces. It is no accident that authoritarians take little consideration of man's ability to choose for himself, and that they preach their theories in the midst of the most technologically advanced economy in human history. They preach it, not in spite of the greatness of the productive U.S. citizen, but because of it. They have to find a way, through deception, to convince the American citizen that he has the most corrupt system ever devised…not so they can make things better but so they can take over his machines. It is a conman’s game they are playing. Like the savages they are, when the machines stop, they'll point their guns at the closest person and tell him to fix the machines, or else.