Top Six Reasons Why I Love Capitalism

Posted By Matthew Vadum On January 23, 2011 @ 9:00 am

From the time I first started having political thoughts I always believed that people should be left alone and allowed to succeed or fail. People need liberty and a system that guards their liberty.
Naturally, I love capitalism. Capitalism is good but it has a bad name. It’s not primarily about capital and investing. It is about property. As the legal thinker William Blackstone wrote:
There is nothing which so generally strikes the imagination, and engages the affections of mankind, as the right of property; or that sole and despotic dominion which one man claims over the external things of the world, in total exclusion of the right of any other individual in the universe. [Note: By “despotic,” Blackstone means “absolute.”]

It is about ownership. You own yourself and have the right to do whatever you want with your property (with a few exceptions such as initiating the use of physical force and defrauding others). It is about living for yourself.
The philosopher-novelist Ayn Rand said it best:
Man—every man—is an end in himself, not a means to the ends of others; he must live for his own sake, neither sacrificing himself to others nor sacrificing others to himself; he must work for his rational self-interest, with the achievement of his own happiness as the highest moral purpose of his life.
So here are the top six reasons why I love capitalism…

But why is capitalism good? (The following is not an exhaustive list. Very long books have been written on the topic.)
Reason #6: Capitalism rewards success and punishes failure.
Capitalism frees up everyone to be the best they can be. Conversely, it allows people to fail. There is nothing wrong with people failing. It is part of life. It is the way of the world.
It has nothing to do with “fairness,” a concept that has become the peculiar fetish of the Left. It is not unfair that some people are wealthy and some are poor any more than that some people are smart and others are stupid. And if some people can’t get by on their own, they are free to appeal to others for charity. Beggars can’t be choosers.

Socialists hate capitalism because capitalism recognizes the beauty and necessity of material inequality in a free society. According to socialists, everyone should be equal in every way possible. But this makes no sense. People are born into different situations. Some are talented; some are not. Some are industrious and hard-working; others are not. Why wage war, as socialists do, against nature?
Next: Being selfish is a virtue.

Reason #5: Enlightened egotism.
Capitalism is selfish. It’s OK to be selfish. Like every life form everywhere, humans are selfish. If you weren’t selfish —at least to an extent—you would not survive long on this planet.
You have to take care of yourself first or you will cease to exist. Capitalism recognizes this essential human truth that can never be avoided. Even if you want to devote your life to serving others, you still have to maintain yourself.
What do flight attendants tell you to do if the cabin suddenly depressurizes? Place the oxygen mask over your own face first, not the face of your child. If you pass out, you’re not going to be much help to yourself or your child. Selfishness is a prerequisite for living.
Say it after me: take care of yourself and don’t be manipulated by people hurling the word selfish as an epithet. It is our nature to be selfish. You couldn’t fight it even if you tried.
So why bother?
Next: Creating wealth is a decidedly good thing.

Reason #4: Capitalism improves everybody’s life, including for those at the bottom of society.
Capitalism makes sense (pun not intended). It is rational and consistent with man’s self-regarding nature. Capitalism promotes the creation of wealth, which benefits society. By encouraging people to be productive, capitalism harnesses selfishness and uses it to advance the common good.
All other systems –which are mostly just variants of socialism– make no sense at all. The redistributionist state uses the threat of force (e.g. imprisonment) to steal from the productive and give to the nonproductive. This discourages the productive from creating wealth. The wealthier a society is, the better off all its inhabitants. The old saying that a rising tide lifts all boats is true.
Under capitalism, you are also free to be poor. Being poor isn’t good but being poor in a capitalist society is better than being poor in a socialist society. Socialism cannot generate the kind of wealth produces by capitalism.
In a capitalist society, the poor at least have a chance of making it. In a socialist society, not so much.
Which kind of society is better?
Next: Capitalism and liberty go hand in hand.

Reason #3: Capitalism is moral.
In fact, it is the only moral system.
The socialist state robs its citizens and discriminates against them on the basis of wealth and their wealth-creating attributes. Under capitalism such theft is forbidden and a respect for the rights of all is mandated by law.
In a socialist society theft is the law of the land. If you have more than others, it can be taken away from you. It doesn’t matter that the others don’t deserve it.
And under socialism and one of its ornaments, the “progressive” income tax, there is no incentive for you to work harder and smarter. The more money you make, the more money is taken from you. How is this fair?
The current income tax system legitimizes a culture of thievery and corruption. Stealing becomes the norm. That’s OK by socialist terrorists such as Saul Alinsky and Frances Fox Piven. Violence and misappropriation are what they’re all about.
Next: Where would be without socialism? That’s right, nowhere.

Reason #2: Capitalism increases productivity.
Capitalism produces the most stuff. Time and time again through history the countries with the freest markets have surged ahead of mixed economies.
Look at Hong Kong which despite its Communist overlords is fabulously wealthy. In terms of resources, Hong Kong has nothing going for it. Its only resource is people. Its laissez-faire approach has allowed those people to amass great wealth. I am told that in Hong Kong even janitors wear Rolex watches.
America is incredibly wealthy too despite the encroachments of the regulatory-welfare state. Imagine how much wealthier the U.S. would be if there were less government intervention in the marketplace.
Capitalism is for winners; socialism is for angry, envious losers who can’t keep their hands to themselves. Material things are important. We need them to survive. They make our lives better. We are not ghosts existing in a world without possessions and we shouldn’t try to be no matter how many socialists or hippy freaks encourage us to do so.
Mankind’s survival depends on capitalism. Literally.
Next: capitalism doesn’t care about who you are or where you are from, but about what you do with your life.

Reason #1: Capitalism promotes tranquility and mutual understanding.
The market is the sum total of the interactions of everyone. If people need a product, a producer will figure this out and produce it and reap the rewards of being a trailblazer. This is as it should be. Under capitalism, you go about your business trading your products and services with others. With every trade both parties benefit. Everyone wins. You can’t force anyone to do anything, and they can’t force you to do anything. You interact with other people, people you might otherwise seek to avoid. The shopkeeper with the religion you think is weird provides a valuable service by making goods available for you to purchase. During the transaction you learn about the shopkeeper and treat him as an equal. How can this be bad?
But capitalism cannot exist outside a proper framework. There needs to be a functioning legal system that enforces contracts and protects the rights of those in the market.
The Founding Fathers came up with such a framework. It’s called the Constitution. The Constitution incorporates the fundamental principles of capitalism and provides a setting in which those in the market, that is, everyone, can thrive.
As the principal architect of the Constitution, James Madison, wrote in a 1792 essay titled simply “Property”:
Government is instituted to protect property of every sort; as well that which lies in the various rights of individuals, as that which the term particularly expresses. This being the end of government, that alone is a just government, which impartially secures to every man, whatever is his own.
Madison was right.
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Although capitalism is under attack from the usual suspects, those who hate liberty, those who lust to control other people, those who think they know what is good for us, our Founding Fathers knew full well that a society that functioned without it was doomed. Without their wisdom and their well-placed faith in capitalism, America would not even be a shadow of what it is today.
It is time for Americans to rediscover capitalism and the Constitution that was established to protect it.