Friday, August 26, 2011

Nicely said, Mr. Greg

August 2, 2011
Mises Daily

Why Capitalism Is Worth Defending
by Anthony Gregory on August 2, 2011

[, July 29, 2011]

As Obama demonizes the wealthy and pitches a dozen plans to restructure the economy, opponents of this program need a reminder of what exactly we're fighting for. We are resisting bureaucracy, central planning, and encroachments on our freedom and communities. But this does not get to the heart of the matter. We are not only an opposition movement, countering the president and his partisans' agenda. More fundamentally, we stand in defense of the greatest engine of material prosperity in human history, the fount of civilization, peace, and modernity: capitalism.

Many regard "capitalism" as a dirty word, and it is tarnished most of all by its supposed guardians. Wall Street giants fancy themselves capitalists even as they live off the taxpayer and thrive on the state's gifts of privilege, inflation, and barriers to entry. In the military-industrial complex, they champion capitalism by name as they produce devices of murder for the state. In the Republican Party and every conservative institution, they talk it up while making such vast exceptions to the principle as to swallow it whole. When many think of capitalism, they think of the corporatist status quo, leading even some who favor economic freedom to abandon the term.

But we should not abandon it. For one thing, most opponents of capitalism do not merely oppose Goldman Sachs or Halliburton or even McDonald's. Rather, they oppose free enterprise as a matter of principle. They object to employers' liberty to hire and fire whom they want, at whatever wage is mutually arranged. They protest the right of entrepreneurs to enter the market without restriction. They disapprove businesses designing infrastructure; providing energy, food, water and other necessary commodities; and running transportation without government meddling. They lament the rich getting richer, even through purely peaceful means. They oppose the freedom to engage in short selling, insider trading, hostile takeovers, and corporate mergers without the central state's blessing. They begrudge the worker who dissents from the labor establishment. It is exactly the anarchy of the free market they despise, not the consolidated state–big business nexus they most want to smash. For every liberal who hates monopoly capitalism for anything approaching the right reasons, there are ten who deplore the capitalism part of it more than the monopoly.
I only stopped quoting out of copyright concerns. The next paragraph is harder hitting. Ah, hell...:
It is simply a fact that capitalism, even hampered by the state, has dragged most of the world out of the pitiful poverty that characterized all of human existence for millennia. It was industrialization that saved the common worker from the constant tedium of primitive agriculture. It was the commodification of labor that doomed slavery, serfdom, and feudalism. Capitalism is the liberator of women and the benefactor of all children who enjoy time for study and play rather than endure uninterrupted toil on the farm. Capitalism is the great mediator between tribes and nations, which first put aside their weapons and hatreds in the prospect of benefiting from mutual exchange.
Perhaps you're not getting his point:
The socialists of all stripes argue that real socialism has never been tried, and some say we market radicals are stuck with no better a response than to say that real capitalism has never been tried, either. However, unlike "real socialism," which Mises demonstrated was impossible on a large scale, capitalism simply exists wherever it is left unmolested. It is the part of the market that is free.

Regardless of how we define it, in terms of feeding the masses and sustaining society, I will take flawed capitalism over flawed socialism any day. I will take state capitalism, crony capitalism, or corporate capitalism over state socialism, democratic socialism, or national socialism.

1 comment:

The probligo said...

There has to be a modifier to the generally accepted definition of "Gross Domestic Product".

That change needs to introduce the cost of environmental impacts of consumption; the value of the dimunition of resources; the cost of pollution.

To illustrate, let me use NZ as an instance.

Dairy farming is one of the biggest single contributors to NZ'd GDP. Turning grass into milk is easy with the addition of considerable quantities of water and a few selectively bred animals.

We have rivers that rate among the most polluted in the world; lakes which are famed for their trout fishing literally choking on weed, fed by nitrogen and phosphorus runoff from dairy farms; land that requires increasing volumes of phosphoric fertiliser to maintain the growth rates required to feed the cows that produce the milk...

So, what should be the value of the GDP contribution?

And then think back along the chain to "capitalism" - the greatest engine of material prosperity in human history, the fount of civilization, peace, and modernity...