Thursday, October 1, 2009

Capitalism - The Real Welfare System

Statist governments use the philosophy of altruism to make war upon the individual and as a result they do not allow to each man the freedom to live his own life. Their systems are designed to control or manipulate the majority of individuals in favor of a few gangsters who have gained control of the government. In spite of pronouncements of charity and love for all, promises to help solve major problems, the sluggish growth of economies fraught with government intervention only proves that statism is the real system of exploitation.

A capitalist system is the only system that opens the door for man and human progress because it gives to each man the incentive to live and to be rewarded for that living. Capitalism makes hard work, ingenuity and genius the hallmarks of a society while socialism kills these values. Capitalism is a system where happiness is possible to the individual, where he can look forward to security and not to the drudgery of having his life squeezed out of him for the sake of some fat cat who writes the rules.

To elaborate on this issue, let us look a bit more closely at just how the individual is positively affected by capitalism. We’ll look at several factors in society and identify how capitalism affects them.

In an economic system where every citizen is free to acquire and keep property, capital savings is possible. Hence money becomes available to the businessman who would expand plants, hire more employees and improve production techniques with money borrowed from banks. In this way, increased production generates increased production and both the businessman and the average citizen benefit. A banking system geared to the capital needs of businessmen becomes the transmission belt that turns accrued human energy into an opportunity for the generation of more energy. A fully free capitalist system is the only system that leaves nothing in the way of capital savings and human progress.

On the other hand, the Obama administration will tell you that wealth is created by labor and that it is stolen from laborers by capitalists who earn nothing. They won’t give you this opinion out of scholarly disagreement, they will scream and yell at how evil capitalists are and how they are creating poor neighborhoods, poisoning people and robbing them of their wealth.

Yet, capital savings are distinctly missing in statist systems because such systems are designed for legal plunder. The first thing plundered in a statist system is surplus wealth that quickly disappears into the coffers of government officials and pork barrel spending programs. Since the plunder of surplus wealth leaves the citizen with no incentive to produce, he produces only what he requires for bare subsistence. This leaves little chance for dynamic growth and progress.

Capitalism unleashes individual genius while socialism unleashes gangsters. In order for a free society to advance it needs good ideas created by people who seek to better their own lives. Capitalism creates advanced technology and this creates more value because it increases the power of labor and human energy. The value created by technology in the form of labor, time and energy saving devices proves that labor is not the only factor in society that gives value. In fact, human intelligence is, by far, the most important factor in a free society.

Yet, radicals dismiss human intelligence because, most often that intelligence is brought forward by the factory owners and engineers in corporate management; by the capitalists. And since the capitalists are those that they need to isolate as evil, the capitalists and human intelligence are seldom praised.

In order for a socialist government to gain power it needs organizers who can convince people to work hard for the sake of others. They do this by means of selling people on the idea of service. Anti-capitalists must separate the workers in a society from the capitalists in order to take over. Technology must be denigrated as artificial, using up resources, creating pollution, deflowering the earth and exploiting the labor of people.

Technology is the application of knowledge to the problem of survival. From the use of the first stone to the flight to the moon, from the development of the Internet to cell phones and GPS systems, man has been increasing his technology in ever widening circles and, at every turn, expanding the horizons of productivity and leisure. Without technology man would never have achieved surplus production and savings.

Technology is not the monster many think it to be. In fact, as a human phenomenon, technology is indifferent; it has no mind of its own with which to direct evil upon man. Technology is merely the means by which man achieves a better standard of living. Technology makes life easier and it enables man to thrive.

The haters of technology are haters of man; people who don't want man to seek a better life. They know that technology is achieved by knowledge and that only free and self-interested men seek knowledge. They regard this as evil and attack technology as a way of inducing guilt upon men. People who can solve their own problems through technology are not easily led or ruled.

The haters of man need him to feel guilty for advancing his knowledge so they seek government programs like Cap and Trade in order to destroy progress and replace it with lowered “green” expectations and so they exhort men to slow down and turn down the temperature.

Technology is impossible without knowledge, and the development of usable knowledge is impossible to any great degree without freedom, that is, without a government that protects the property rights of those who seek knowledge. The society that allows freedom of thought and property is a society that says, "Do what you will and keep the rewards." Under such a system, we find that men will think better and that others will utilize their discoveries in order to make and sell better goods to more people. The result is the increasing welfare of the people and the eventual elimination of poverty.

Political favoritism, friendly connections and altruistic considerations are difficult under capitalism. This is because business owners cannot afford to have un-productive people causing problems with customers or product quality. Capitalism offers a man this choice: produce and work or get out of the way. The man who performs a productive job is the foundation upon which capitalism is built, and as long as he and a great many others are productive, there is an ever increasing certainty that they will have jobs. On the other hand, un-productive people need to increase their abilities or find lower paying jobs.

A free economic system fosters a large job market where men are free to choose, to move, to invest, to buy and to consume. If a productive man decides to search for another job, he is free to do so. Because of the dynamic, growing nature of capitalism, he can move from one job to another with little or no hardship.
The ever expanding use of technology and capital provides for opportunities so abundant that the system, never stagnant, is a vital factor in the job security of every man.

An important by-product of this security is that people who have confidence in their ability to hold jobs are able to obtain credit for long-term purchases. This enables them to enjoy luxuries and premium quality necessities while they pay for them.
Welfare-state advocates have long been critics of “capitalist exploitation." And they have been open in their attacks upon the so-called uncertainties inherent in the private sector. They even think that capitalism increases the number of poor people and that gradually lowers the pay of workers. But observe that jobs associated with the government in the welfare-state are the most precarious of all (election to election) and that production is not necessarily a requirement for keeping such jobs. Further, employees of government are often serfs holding little freedom in exchange for loyalty; loyalty, not "public welfare" or productivity, being their most important contribution. They are also not exempt from rule by terror - the terror of having their agency under-financed as a result of power plays by the higher-ups.

Another by-product of the welfare-state is excessive unionism. Powerful unions are created when certain bosses obtain exclusive bargaining power from the government. The government forces employers to deal with the unions because it wants to buy the votes of the union rank and file and obtain campaign contributions from labor bosses. This solidifies the power of the union bosses and gives them the ability to call many of the shots. Powerful unions would not be possible under capitalism, because union bosses would not have the government's gun to back them up. Their oppression of the working man would be impossible.

Leisure is possible only when the problem of survival has been solved. Whether you are sitting around the fire outside a cave or around the television set in a comfortable home, the need for leisure has always been strong in man, for it is through leisure that man can contemplate his success. The division of labor, capital accumulation and technology have worked to provide a forty hour week for many. This is because no system can produce like capitalism, and no system will be able to create the amount and quality of leisure that capitalism has created.

For an indication of this, look at our society. Even though it is not complete capitalism, there is no society in history that has devoted as many industries, enterprises and products to the enhancement and enjoyment of leisure time. Not even the Greeks or Romans had the amount and quality of leisure time as do we Americans.
Given a free economy, unfettered by government regulations and government fiat inflation, this situation can only improve. Those workers who want to advance can use their saved time for more production. Those who want to enjoy their saved time are able to do so with no cost to their standard of living.

Indeed, a major consequence of the creation of leisure time is that more people are liberated to pursue self-improvement. This creates more productive people and better decision makers. They lead better, happier lives and they help to improve cultural and social institutions. They become the leaders that help mold the society on its highest levels.

Few people take time to realize the extent to which consumer goods and services affect their lives. And yet, it almost goes without saying that life would be hard indeed without the products that a capitalist system provides. The automobile is a good example. Without the automobile, few could get to work in the fifteen to twenty minutes that it usually takes. Instead, people would have to spend hours of time and energy just getting to work by other means, so much so that it would hardly be worth the effort. The automobile is probably the greatest time and energy saver since the horse. And its use by many people is possible only in a system where division of labor, capital accumulation and corporate structure are given the freedom to thrive.

For instance, the automobile is not as common in many parts of China because capital accumulation by individuals is virtually forbidden, where a central authority dictates the use of labor, and where the state organizes capital arbitrarily. As a result, the major industry is bicycle production.

Yet the automobile is only one product among many. If we compute the advantages of electricity, electric lights, television, Microwave ovens, video, DVD, computers, radios, cell phones, other time and work saving appliances and hundreds of developments in product quality, we can see that the welfare-state cannot possibly provide the benefits that are found in a capitalist system.

And it is difficult to compute the loss when money is confiscated from the private sector of an economy and redistributed to non-productive sectors. Such a loss affects the products and developments not made, the time not saved, and the lives that would still be flourishing but are not. For instance, when the government takes $5Billion to fund a program that engages in questionable activities, it removes 100,000 jobs paying people an average salary of $50,000 per year. That’s almost 100,000 families that are put out of work by that expenditure.

With all the emphasis on health programs exhibited by government and its planners, one would think that good health would be impossible under capitalism. But if we look at the life expectancy and birth-rates after the dawn of the Industrial Revolution in England we learn that freedom of enterprise fosters better health.
First of all, citizens who make a steady income are able to afford better food which generates healthier people. Secondly, cities are kept cleaner due to the financial feasibility of sewage systems and efficient garbage disposal. Finally, doctors are able to improve services to people who are able to pay.

Truly improved health is possible only with increased economic freedom. Where an incentive for improving health is there, doctors will improve their services and lower their costs. Government schemes can only cash in on past advances and lower their quality. In fact, most of the problems advanced by the proponents of government health care plans were caused by the government. Increased medical costs today can be attributed to increased government regulation of doctors and insurance companies that lower the quality of services, increase the number of patients, raise prices, ration care and attract a seedy lot of doctors who want to cash in on the bonanza – while at the same time driving out of business real doctors who care for their patients.

To summarize, the benefits of a capitalist system far outshine those dreamed of by the most utopian of welfare-statists. The welfare state reflects a lowering of sights, since the private sector is always able to utilize resources more efficiently. In its first stages the welfare state appears to work, but as it advances it becomes the cancer which drains the substance from the free sectors of the economy and lowers the standards of living of all.

The most harmful aspect of the welfare-state and one that belies the “welfare” they pretend to create is that government agencies are not responsible to a customer in the same way that private companies must satisfy customers. This means that they don’t have to achieve economies of scale, don’t have to be productive or efficient. Such a situation means incredibly huge amounts of wasted government revenues. Look at the condition of our educational system that does not educate, our Social Security program that is on the verge of collapse, bloated government expense accounts, fraud and waste on a massive scale and you can see that the huge percentage of our tax revenues that are lost to the government could have been spent more efficiently by the citizens who earned the money.

The welfare-state represents a belief in the expendability of the individual. Rather than helping the individual it considers him a slave who must provide the funds for the functioning of the state. The program and its maintenance are of prime importance, the individual is secondary. Indeed, the welfare-state shows least regard for those individuals who are most able to pay.

Capitalism, on the other hand, recognizes the inviolability of the individual's rights and choices. It is based upon his consent, his contractual agreement and businesses must provide the individual with real benefits in order to stay in business. The individual calls the shots - for himself. As a result, he and society are better off.

The degree of a society's sophistication is the degree of knowledge which it incorporates into its social institutions. It takes a great deal of knowledge and truth to recognize that man has inalienable rights, that his life is his to live, and that "hands off" is the moral requirement of human beings. The welfare-state is not an advance upon this level of knowledge. Any ignorant brute who knows little more than hand-to-mouth can learn how to club someone over the head and steal the product of his labor. And it is this, with the support of laws and guns, that the welfare-state does. It takes a society of intelligence and knowledge to realize that nobody's welfare is served by a constant battle for a piece of someone else's pie.

The justification of a capitalist system is the individual and his rights. These are a matter of fact. That their recognition by society achieves the individual's welfare is a secondary consequence. Capitalism is based upon the principle of property rights. It is property that the welfare-state must expropriate in order to exist. Without property rights human welfare is impossible.

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