Numerous publications have recently proclaimed “Socialism is no longer a dirty word in the US.” Many of these same publications and some pundits have also at one time or another decreed “Capitalism is inherently evil.”
As much as I enjoy having an intellectual conversation on these two statements, I know most people are ill-equipped to have this conversation, and no one article will change that.
Some of you probably thought, “is Jeff saying we are too stupid to understand the historical complexities of capitalism and socialism?” That is exactly what I am saying, but as with capitalism and socialism, the word stupid is relative and in the eye of the beholder. Ask a thousand people what socialism, capitalism and stupid mean, and you would probably get a thousand variations, which helps illustrate why I often find this conversation futile. My statements so far are less of arrogance and more of an attempt in preserving my sanity.
One recent article attacking capitalism by George Monbiot pretty much sums up where a lot of self-proclaimed socialists are, which is interesting considering every tool Monbiot used to convey his thoughts are the products of “an inherent evil.”
In his article, “Dare to declare capitalism dead – before it takes us all down with it,” Monbiot stated regarding capitalism, “The economic system is incompatible with the survival of life on Earth. It is time to design a new one.” My immediate response was, “no system is perfect,” and a “new” system will be infested with its own imperfections.
Monbiot also looks at the economy from a militant environmental point of view, another common trait shared with modern socialists. Monbiot tries to distinguish between a neo-economist’s concept of “good capitalism” and “bad capitalism.”
Systems in themselves are not necessarily good or bad (at least as it pertains to a moral scale), but it is in our lesser angels, human nature, that does more to alter the intent of a system than the system itself. However, putting the matter of morality aside, a system can be good or bad by its intended functional design.
Part of the problem with this conversation is people move the goal post on what they believe capitalism and socialism really mean. It also doesn’t help that many modern economists, who are safety nestled within the confines of a classroom, speak and teach about these systems without having been actual combatants.
Both systems are described in numerous sources as “social and political” systems, which is cold and abrupt and absent of human nature. The basic understanding of each is where most people start to “ho and hum,” incapable of accepting the purity of the written word. Let me give you an example.
One of the basic definitions of socialism is “1. Any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods. 2. a system of society or group living in which there is no private property (Merriam-Webster).”
Most self-avowed socialists are likely screaming “but that is not what socialism is to me!” If you do not believe this definition, you are not a socialist. So, what are you?
Every modern definition of socialism eventually leads to the belief that socialism is a “system characterized by social ownership of the means of production and workers’ self-management, as well as the political theories and movements associated with them. Social ownership can be public, collective or cooperative ownership, or citizen ownership of equity.”
People will gravitate to the words “social ownership” and “equality,” and say, “oh, I guess I must be a socialist.” By merely adding these perceived friendly words, warm and fuzzy feelings may take hold of some people. However, you only need to look around to know some people are more equal than others, because people pervert the “social and political systems” they reside within.
Capitalism at its basic definition is “an economic and political system in which a country’s trade and industry are controlled by private owners for profit, rather than by the state.” True capitalism is guided by two simple values, the concept of “self-ownership” and the adherence to the “Harm Principle.” Simply put, each person owns their own talents and may use their talents as they choose, so long as they do not harm another individual.
Self-ownership and the Harm Principle are reciprocal between the consumer and provider. So long as all parties act ethically, and voluntarily agree to the exchange of goods and services, equality is achieved. The consumer gets what they want, and the merchant gets what they want. An ethical free market is the standard in our daily life, not the exception. That is capitalism.
Additionally, wealth is not an indicator of inequality, but sometimes how a person achieves that wealth may be an indicator of a violation of the ethics of self-ownership and the Harm Principle. It is often this part of the conversation that is lost and creates a greater confusion as to what socialism and capitalism are in actual practice.
Both systems are susceptible to corruption, yet it is capitalism that gets labeled as “crony.” To understand human nature is to understand that cronyism can be applied to both “systems,” yet you never really hear the phrase “crony socialism.”
The word capitalism has become so maligned, often only connected to individuals or corporations that are unprincipled to advance their capital (wealth and power). Yet, we almost immediately cast aside those businesses that are decent, that represent the overwhelming majority of the ethical free market that exists in our country today.
We forget more than 99 percent of the companies in our country are small, local businesses, according to the Small Business Administration. These 99 percent are our neighbors and employers. So please tell me, which one of you works for “an inherently evil” company? Which small business that you purchase from is “inherently evil?”
Yet despite knowing this, there are those willing to destroy a whole system that has lifted more people out of poverty over the last 100 years than any other system, based on envy or the improper actions of a handful of individuals than the ethical actions of most individuals. That is the truest definition of stupid.
My next few articles will discuss the differences between capitalism and socialism.