I’m not going to go ahead and give some defense of capitalism here and now, though of course I would wish to do so. However, I just want to scrawl off a quick note.
Last night at Socratic Society (a club that meets to discuss philosophy, essentially) there was an examination of the “morality of capitalism.” What I thought would become an issue, and was proven right, is that most people there didn’t stick to some solid definition of capitalism, and so ended up impugning capitalism with anything they thought was evil that happened in the marketplace. Immediately, before discussion on the issue headed off in earnest, I made sure to give a definition of a capitalist economy; “a society of free exchange between people where the right to life, liberty, and property is presumed [and is defended by government].” Nonetheless, and probably because economics for most people is something they know about through emotion, not intellectual examination, people ended up disregarding my definition.
An example is where it was pointed out some companies would trade with South American groups that utilized what was essentially slave labor; the workers were forced to work under gunpoint. This brought around a general agreement that clearly, therefore, unbridled capitalism would bring about evils which could be curbed by… well, that wasn’t precisely discussed afterward, and I didn’t want to sidetrack this sidetrack further by pointing out that not all problems can or even should be solved due to the huge costs they would incur.
However, what I pointed out was that slave labor is not capitalist; there is an infringement of people’s rights, there is no free exchange taking place. This is an evil, yes, but it isn’t an evil of capitalism. Regrettably, this was waived when some girl (it’s always a girl who does this, my observation) exclaimed “Well of course it’s capitalism! It’s a corporation doing it, right?” And that was the end of that.
I think my point should be made. Quite often what people impugn as being an evil of capitalism is only because they are using a faulty definition of capitalism or they aren’t using one at all. All that needs to be asked is whether free exchange is occurring. Is someone agreeing, without compulsion, to an exchange with someone else? Then it is practically impossible for that person’s rights to be violated. And this would always, by definitions, be where capitalism subsists. But if the exchange is not free, but operates under some sort of coercion (i.e. threat of violence), then it couldn’t be called capitalism.
Bryce’s defintion:
“a society of free exchange between people where the right to life, liberty, and property is presumed [and is defended by government]”
Given this definition, no macro capitalism exists on earth. They didn’t take your definition seriously, and so they disregarded their own definitions or their own feelings toward an undefined word. And I can understand the tension here.
You approach it as an idealist, a philosopher, one who uses definition and reason. Many of them are objecting to what they perceive in real life. Real life “capitalism” (which granted is not how you are defining capitalism) means big powerful corporations (perhaps buttressed by government policy) exploiting people for huge gains in resources. Since your definition does not exist anywhere, its no wonder they rejected it. Sure, Bryce, your definition sounds good in theory, but no country practices exactly that. So I can understand what they are saying.
We need another word then to describe what they are rejecting. “Expolitationism” or “Disparityism” or “Oligarchy” or “Plutocracy” or the like I think are what they are rejecting and simply labeling it – or, relative to your definition, mis-labeling it – “capitalism” – where producing capital is whats the most important, regardless of who gets used or stepped on in the process.
Bryce wrote:
“But if the exchange is not free, but operates under some sort of coercion (i.e. threat of violence), then it couldn’t be called capitalism.”
And again, this is where your purist, idealist mind meets their experience of real life. No country practices such a thing. Even the colonies/US, the “capitalist” poster child, had slavery for the majority of its history. And our government continues to use coercion to achieve its desires. As do all governments that I’m aware of. The threat of violence to achieve the government’s ends. So fine, Bryce, I can grant you your definition. But like your peers, your definition is meaningless to me because it doesn’t really exist.
Your thoughts?
REV
A second line of thought. Because your definition is not useful to me (and I’m guessing it was not useful for them), they – and I – need to be persuaded by those who lean capitalist that such a system could actually work. Again, whether we call what’s actually happening “exploitationism” or some such name, the abuses are what make the headlines. With human sin, I’m not convinced your definition could actually work in the real world. Corruption and evil lurk.
On the opposite end of the spectrum, this is where Marx failed too. Marx viewed it as a philosopher. And he thought this would lead to the abolition of money, class, inheritance, power hierarchies, religion, etc. He was wrong. Why? He didn’t account for sin. He didn’t apply evil to his system. Communism sounds wonderful in theory, if everyone loved each other and cared for each other and were benevolent. It would work great. But then, so would your definition of capitalism! Ironically, a non sinful world could have any form of economics and government structure and it would work fantastically well. The problem any pure definition faces, whether capitalism or communism or something in between, is human sin. Sinners muck up capitalism. Sinners muck up communism. And sinners muck up anything in between.
I suspect what your peers are truly rejecting is a world filled with evil. They are deeply inwardly longing for justice and moral praxis and goodness.
REV
Josh;
Yes, my definition is “idealist,” but then, in principle, if we’re going to talk theory we’re going to have to use ideal definitions. Using my definition, when I defend capitalism, I am defending that ideal where free will exchange is respected and government intervention into the market doesn’t occur. Where there is coercion, then we’re not talking the ideal capitalism, which I think is a perfectly reasonable defense (at least insofar as any organization can be defended even if it will inevitably invite corruption, because such is human nature).
You could say that I’m an indirect capitalist; what I principally defend is the right to life, liberty, and property, and the freedom to form contracts of exchange with others without coercion. What arises is a qualitatively complex network of contracts and exchanges between individuals and groups of individuals; and this is capitalism. Capitalism is spontaneous, and occurs wherever it is allowed to (and even when it isn’t technically allowed to). It is the method of interaction and exchange par excellence that allows society to be inclusive and progress beyond petty tribalisms.
Where you have corporations that are not respecting the natural rights, or they are gaining unfair favors from government, that is not capitalism but a corruption of the market. I don’t know what you’d call the former, but libertarians typically call the latter “crony capitalism,” which is not capitalism per se.
So capitalism has existed in various forms, and it exists where there is the freedom to exchange without government interference. Capitalism has never been economy-wide (and I don’t think it should be; the courts are an example of an industry that should be free of the restraints that would be placed on it by a market), but it is a reality which can be pointed to.
It is not very hard to demonstrate that capitalism works; a person who is willing to do work that people value will be able to trade with others for items that they value. The price system automatically distributes incentives that help to allocate labor/resources to products/services in the most, humanly possible, efficient manner. It is only where this system is hampered by government interference that we find industry-wide market adjustments ever occur, due to the government messing with the price system in the first place.
In fact, even as a matter of theory, only capitalism can provide the greatest benefit of wealth to society. Socialism, Communism, Marxism, and any other forms where government interference is rampant in or even the sole allocator of resources to goods are unable to know what will be valued when and by how many. This is called the problem of economic calculation. In a free market void of interference, the corrections occur as quickly as possible because there is simply no profit in not correcting. A government not only cannot tell what is a profitable means of producing and selling something, they lack the profit motive to give them incentive to undergo such corrections in the first place.
Okay, I take it David Cole or Shane Courtland weren’t present? If they were, I’m sure your question could be answered better than some undergrads who likely weren’t even prepared. As Keynes said: “Capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone.”
There were no professors present, and it wasn’t my question. When the discussion of capitalism was brought, I was mostly interested in heading off a glossing over of distinctions that I was sure would occur (i.e. that anything evil would be attributed to capitalism as if its the essential cause), and they did occur. They didn’t need to be especially prepared, only able to digest and utilize a definition.