Column
2017-12 (4/10/17)
Advocates for capitalism passionately
defend the word. Seldom do they bother to offer a coherent
definition of what they are defending. To them the definition is
obvious. The definition of capitalism is also obvious to its
opponents. Few stop to ask, Do the definitions in the minds of
the
two sides have anything in common?
What is capitalism? Even more basic,
What is capital? We work and produce to provide the things we
want
to use. The tools, equipment, materials, etc. used to produce
consumer goods are called capital. Without capital we wouldn't
be
able to produce much of anything. All we would have to work with
would be our bodies.
Try to imagine people living without
any capital. About as close as we can get would be naked
hunter-gatherers foraging with their bare hands. Life without
capital wouldn't be good. Even the most primitive tribes have at
least a few tools. How can capital be a bad thing? If capital
isn't
bad, Why is capitalism bad?
Communists, socialists, fascists and
just about everyone else seeks to accumulate capital. If we call
them all capitalists, the word "capitalists" won't mean
much of anything. What does capitalism mean?
The advocates for capitalism probably
have in mind a highly efficient, smoothly running economy based
on
freedom and voluntary cooperation. Unfortunately they assume
that
the word capitalism creates this image in everyone's mind. It
doesn't.
The advocates for capitalism commonly
imply that our existing economy is capitalism. Opponents of
capitalism can be forgiven if they look at our existing economy
and
conclude that it is what capitalism is. It is also
understandable if
they don't like the the crony capitalism they see.
Those who insist on using the
emotionally charged and nearly meaningless word “capitalism” are
largely responsible for the confusion. Or, perhaps they really
want
to defend crony capitalism, If so they are battling on behalf of
the
indefensible.
What kind of economy is worth
defending? Adam Smith answered that question more than 240 years
ago
in "An Inquiry Into The Nature and Causes of
the Wealth of Nations." After considering numerous
economies from various eras Smith concluded that the wealthiest
nations were those where government interfered the least with
the
economy. In other words, freedom is essential for prosperity.
Experience since Smith wrote further
confirms that Adam Smith was right. We ignore his wisdom at our
peril. Instead of quibbling over the meaning of vague words,
such as
"capitalism," advocates for a strong, productive economy
should focus on increasing understanding of freedom in the
marketplace and how that freedom works for everyone.
Some will complain that this is too
materialistic, we don't need to be more productive. This is
short
sighted. Those who don't want to consume more don't have to. If
we
increase our productivity we can produce what we now have with
less
effort.
If the poet can sustain himself with 20 hours
of work instead of 40 he has 20 more hours to write poems. Those
who aren't into poetry can give more to the less fortunate or
just relax. Much of the increase in productivity we now enjoy
goes
into increased leisure time. Most people no longer work 80 or
more
hours a week.
Freedom in the marketplace only
requires that we be free to produce, buy, and sell as we choose.
Individuals wouldn't need government approval to work and
produce. Government wouldn't write the specification for the
vehicles,
appliances, etc. that we make and use. I recently read that
there
are nearly 100 US government regulations on how to make furnaces
and
air conditioners.
It is absurd to even suggest that we
live in economic freedom. Unless we want to watch the US waste
away
we must bring more freedom back to the marketplace.
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Copyright
2017
Albert
D. McCallum
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