I think I should take some time to explain why I favor capitalism instead of Socialism, communism, fascism, and all other economic models that have been proposed throughout history. The challenge of the past few centuries in civilized Western society has been to determine the ultimate role of government in its own nations economy. I believe that capitalism is the best economic policy a government can take.
First of all, I must define capitalism as I see it. I do this because there are so many technical definitions out there and because the way I define it will definitely contradict some political science professor who claims to be an authority on economics. Capitalism is an economic policy where the government seeks to minimize its intrusion into the market as much as it can. Basically, the government can only do certain things, like uphold the law, protect individual’s property against other individuals, and protect its nation from a foreign power.
Given that definition, anyone with half a brain will realize that the United States is anything but a capitalist nation. Truth be told, I believe that the turning point was the Sherman Act of 1890, although the Federal government’s support of the railroad system predates this. In any case, the United States government holds a statist policy when it comes to economics, more specifically, a fascist economic policy. This is where individuals are allowed to own private property, but are not 100% able to do with the property as they see fit.
So why do I favor a system that not even my grandparents lived under?
Because capitalism is the only economic policy that works with the United States Constitution, rather than against. The United States Constitution provides for very specific functions for the three distinct branches of government. Capitalism is the only logical economic policy if one were to apply the founder’s intent with the text of the constitution to the United States government.
Capitalism recognizes that while all men are created equal, by whatever means, not all men (and women) are capable of the same things. It states that only in a free society does is a person able to meet his or her fullest potential in life. In a statist system, where government intervenes in some fashion, there are always roadblocks and government force in the way for many fields of interest. But in a capitalist system, where government only intervenes in order to preserve justice and maintain order, the individual is free to succeed or fail. In essence, capitalism provides equal opportunity to all people, regardless of class, gender, race, or ideology.
Capitalism does not, however, provide equality. Equality is an ambiguous term used by statists to advance their elitist agenda. After all, since everyone is unique, how can we be 100% equal. If humanity is a diverse species, equality cannot exist and cannot be measured. The statist generally uses things like income or personal equity to measure equality and claim that no one is equal unless we all have the same income or equity. Frankly, I would rather have my own property that uniquely defines me as I have different tastes than my fellow man.
Is this a cruel system to live under? Not really. It is, however, a hard system to live under. At the end of the day, the person who thrives the most in capitalism is the one who works above and beyond the expectations he or she is given. Those who consistently do this over a long period of time in a capitalist system may come into a significant amount of wealth, provided they attained it through honorable means.
Capitalism is also self-correcting. When a person gains wealth through dishonorable means, he will not keep it long with few exceptions. And even those exceptions end up getting caught down the line. Reputation is everything when you are trying to sell a product or service in the free market. If your reputation is that of a thief or scam artist, you will probably find yourself bankrupt in short order.
Capitalism is also self-correcting in terms of changing times. The tastes and desires of a society will shift as new technologies, trends, and acceptable cultural practices shift. The free market corrects this by either forcing the producers to shift their own business model or letting them go out of business. Losses are always painful, but they are a simple fact of life. In a capitalist system, the correction made to the market after losses occur will be swift and quick. After all, people always want to make money and the free market system that capitalism provides for will always allow producers to change focus without too much coercion from the government. Indeed, many of the dying industries in America today are largely propped up by the United States government.
Capitalism is a policy that maximizes liberty. With minimal government intrusion, individuals are free to act as they see fit, provided it is honest and peaceful. It also discourages war as a businessperson will not see a profit in war. War tends to be detrimental to profits for any industry in the long term since it destroys scarce resources that have alternative uses. And the government can only pay for so much before it starts to lose the economic infrastructure that supports war. After all, the government, by its very nature, produces nothing of value but merely maintains law and order.
Lastly, capitalism maximizes the use of scarce resources to fit the needs of a society, given any circumstance. If there is a famine in one area, food will be distributed at higher prices, but the net result is that more people will receive it. If a natural disaster destroys homes, hotels and other forms of shelter will be available at a higher price, but the end result is more people will have a roof over their heads until they can rebuild their own homes. And while the higher prices seem cruel to the individual, they actually benefit society as a whole without government coercion through planning or regulation.
Despite emergency situations, scarce resources will be diverted in other situations as well. One example might be if there was no petroleum left on the planet. In that case, the free market would allow individuals to seek out alternatives. Since the process of using up one resource would take a lot of time, the problem would be addressed long before it becomes a reality. Capitalism sees to it that innovation and invention are maximized and the maximum human potential is reached.
Capitalism is the most beneficial economic policy that a government can embrace. It allows the government to focus on matters of justice and law and minimizes its coercive influence on its citizens. As such, it maximizes liberty, innovation, and scarce resources to their fullest potential. This is why I consider capitalism to be the only moral choice for a government to take when it comes to policy matters and why I favor capitalism above all others.