Why has capitalism lost the argument with the young?
Because they have never been allowed in. Capitalism did not fail them. They were never offered it.
A system where a young couple on decent wages cannot buy a house, cannot save against inflation, and watches asset holders grow rich on planning scarcity is not capitalism. It is a rigged market defended in capitalism’s name.
So a generation has looked at what it was told was capitalism and drew the obvious conclusion. If this is the market, the market is not for me. And of course they are right.
You do not win them back with pamphlets. You win them back with the title deed to a flat. People who own things rarely vote to abolish ownership.
Nice to see someone also making the moral argument for markets, not just the utilitarian argument.
Why has capitalism lost the argument? If you sat in a fancy restaurant and looked at the menu and you saw the chef’s special was “Patagonian toothfish covered in bee puke” or “Slime head cooked in congealed milk”, it might turn your stomach and have you reaching for the salad. However, if instead the alternative names of “Chilean Sea Bass with a honey glaze” or “Orange Roughy in a butter sauce” were used, you might be anticipating a delicious treat.
The name Capitalism is a huge problem. I have banged on about this before but I’ll say it again to maybe try to convince some of you. For most people “Capitalism” makes them think of Scrooge McDuck swimming in his basement full of gold coins or Mr. Monopoly laughing on top of his pile of moneybags. Of course neither is true, but “capitalism” means “capitalists” and “capitalists” are, in the public mind, rich, selfish assholes who want the workers in their sweatshops to pee in bottles so that they don’t need bathroom breaks.
And it is not even an accurate name. “Capitalism”, as we who understand the word know, is not all about “capital” it is a combination of capital, entrepreneurs taking risks and labor doing the work. All three are needed to create the new products and services that make us all richer. It is like it is some system people invented in the same way the communism, socialism and fascism were invented by people. By focusing on the one thing rich people bring, namely capital, it dismisses the very important part that others play in the process. And so it reeks of elitism and exclusion.
But it isn’t that at all. It is simply the process of leaving people the hell alone to make whatever arrangements between them that are most profitable to both. It is this “free market” that makes us all rich, that generates so much profit, that advances civilization. It is the natural state of men to trade between themselves for their mutual profit, but when we call it capitalism it sounds like a government policy.
So the OP is right, people care about what the economic system allows them to achieve in their life. To call this “capitalism” makes it sound like a choice the government makes when in fact exactly the opposite it true. Capitalism is when the government STOPS making choices and leaves people alone. And by giving it a government policy like name people conclude that the reason they can’t buy a house or rent an apartment or get a job is because the government policy needs tweaked, rather than recognizing that the whole problem is that there is a government policy of any kind whatsoever. It sounds like macro-economics, and as I have said before, macro-economics is mostly bullshit, mostly an excuse to justify the government interfering in the economy.
Free markets are a micro-economic policy of supply and demand, elasticity, having more than one choice and all the simple obvious things that are self evidently true from the reality of humans interacting with humans for their own personal, mutual profit. Capitalism sounds like some baffling term from economic theory but everyone knows what it means to be able to trade freely as you wish.
So I really dislike the word capitalism, let’s call it what it is: “freedom to live, work and trade as you’d like without being prevented from choosing what you judge is best by some government bureaucrat”. Or, more concisely: free markets. And when you say it, say the word “free” most loudly.
I don’t think we have had anything like classical liberalism for over a hundred years. It has been corrupted by either ‘socialism’ or ‘capitalism’. Neither cares much for the lives of the governed.
@DJ FWIW, I don’t like the terms “classical liberalism” because it is so easily confused by the modern use of “liberal” which, for some reason means everything except being liberal, or “laissez-faire” because again it sounds like a baffling, confusing term from some advanced economics class.
FREE market is the simplest and clearest.
I don’t mean to be obnoxious, but this might have been a better SQotD; with the rest as an appendix. Soundbites are usually the best quotes.
I have advocated the same view here and elsewhere.
My position is that, ideally, the term ‘capitalism’ should be reserved for a system in which the ruling class is composed mostly of owners of capital, with people outside the ruling class owning little if any capital.
Such a system is not necessarily a free market, but is likely to be much better than central planning; although that is not much to say for it.
Chomsky said something vaguely similarly, that in so far as there ever was anything like capitalism, it disappeared over a century ago. Which is true, if you accept my definition of ‘capitalism’ above.
Quite right, but i’ll add that i don’t much like some “classical liberals” anyway. JS Mill, for instance.
Perhaps the French liberals were better, eg Tocqueville.
And Herbert Spencer had some interesting ideas.
“You win them back with the title deed to a flat.”
Unfortunately you need to win them back (establish capitalism) in order to afford the flat.
“Why has capitalism lost the argument?”
“The name Capitalism is a huge problem.”
That’s a superficial and simplistic answer. It’s been called capitalism for decades so the name cannot explain why capitalism has become less popular over the same time period.
If you want a name which gets to the essential feature of capitalism it would be “property rightism” which unfortunately is awkward to say.
Also, Ayn Rand covered the reason why capitalism “lost the argument” in her book: The Virtue of Selfishness.
The term Capitalism is an example of naming a system for its effect, not its cause (or essential feature).
@SteveD
That’s a superficial and simplistic answer. It’s been called capitalism for decades so the name cannot explain why capitalism has become less popular over the same time period.
I did not say it was the only reason, just that it is a big problem. And I don’t agree with your assessment. First of all Capitalism has been around for a lot more than “decades”, it’s been around (the name that is) for close to two hundred years. It’s popularity has waxed and waned, here in America I has been tied to the idea of “patriotism” since the second world war, and that has rescued it, though as patriotism has waxed and waned so has it. But it is a total own goal in the present climate. It is exploited by the enemies of freedom to promote socialism as if they are just both theories of economics on the same footing rather than, what capitalism is, which is to say the natural state of man in a non violent society. And I’m afraid introducing Ayn Rand and her “Virtue of Selfishness”, much though I understand her point, does not at all advance the case, in fact is like tossing gasoline on an already raging fire. Neither does “property rightism”, which is confusing, novel and hard to say, and it isn’t at all the same thing as free markets.
Everybody loves freedom in principle, so we should focus on that. Either way, “Capitalism” is a horrible word, and an own goal giving our enemies tools to use against us.
Almost almost half the economy is government spending, the rest of the economy is strangled with endless regulations, the financial system is a Credit Bubble (not based on Real Savings – the actual sacrifice of consumption), and “money” itself is just created, from nothing, by governments and their banker-pets.
If this is “capitalism” – then it is not good.
“You are doing what socialists do – claiming that the system has never really been tried” – No I am not, as we used to be vastly closer to free enterprise than we are now.
The present system is bound to collapse – it is utterly mad, self destructive, so to call it Capitalism or Free Enterprise is a mistake – as that discredits Capitalism, Free Enterprise, by connecting these words to the present, utterly mad, self destructive, system.
There has never been outright capitalism-govts have always been involved (which is necessary sometimes) to regulate it. The problem is that this regulation has muddied what capitalism is and the LEft can claim that the current system is capitalism when it is not the case.
The bank bail outs proved this. A capitalist system would have let them go bust. This is a ley component. Now we have….what? But this case is never put forward. Ever.
The economic system in Britain was utterly different when my father was born.
Either that system was capitalism, or this system now is capitalism – they can not BOTH be capitalism, because they are utterly different – not just in details, but in basic principles.
As for the United States in February 1913 – Taft was still President, there was no Income Tax, there was no Central Bank (“Federal Reserve System”) money was still (in large part) gold and silver coin, Real Savings (the actual sacrifice of consumption) were still a vital part of finance, there were no “Entitlements” (none), and there were very few public services (total government spending, counting local and State government as well as the Federal Government) was only about 10% of the economy, and the Supreme Court still upheld private (voluntary) contracts and free economic interaction against government regulations – striking down such regulations.
It is grim to remember that the last President to remember such a (relatively) free society was Eisenhower – I am not saying he supported such a (basically) free enterprise society, but at least he could remember it.
That’s not a long time, in the grand scheme of things.
“Capitalism” was predated by “capitalist” – a term used to describe someone who was privileged and protected by the State by virtue of already owning capital, and in a significant amount of cases, that “ownership” was illegitimate, in the sense that we’d recognise it now.
We had “free trade” for centuries, indeed millennia, before “capitalism”. I’m a ferocious defender of “Free Trade”, but not of “Capitalism”, as it Actually Exists. Free Trade is just trading under whatever circumstances seemed sensible, and had little or nothing to do with “capitalism”
Capitalism has been muddied, in it’s definitions – some people (naively, but in good faith) believe it means Free Trade. If that’s their honest view, then I have no real argument with them, other than I wish they’d read up more.
But what it really means, in all practical sense, is an economic system with rules and regulations that privilege the previous owners of capital at the expense of others. The purpose of a system is what it does, and so on, and “capitalism” (as opposed to Freed Trade) is specifically “purposed” to move wealth, power, control, etc upwards, and not socialise it.
(as a starting point, if you disagree that it moves wealth upwards, then you need to be massively against IP and copyright. There’s lots more, but that’s an obvious one in today’s system)
@SteveD, 10:36pm
So, can we call socialism death and povertyism?
neonsnake – if capitalism is “an economic system with rules and regulations that privilege the previous owners of capital at the expense of others” then capitalism does-not-exist and has-never-existed. Saying that it is wrong to steal the stuff of other people is not “rules and regulations that privilege the owners of capital” – and the founders of the great business enterprises, such as Josiah Wedgwood, did not start out owning factories and so on, they established them – they did not steal them from someone else.
As for “free trade” (at least in the sense of international trade – you may mean “free trade” in a more fundamental sense) that is a tiny part of a true free market position – and it leads to such confusions as the 19th century Prime Minister Lord Russell being described as a supporter of “laissez faire” – when he actually supported crushing taxation and endless government interventions (and not just in Ireland – he pushed government interventions in England as well).
KrakowJosh – yes indeed, “death and povertyism” is a good description of the position of Collectivists, such as neonsnake, with their hostility to private property in the means-of-production.
tim – Lord Russell suspended Sir Robert Peel’s Banking Act when the ink was barely dry, Russell did that so the Bank of England could bail out the banks. True banker Credit Bubbles then were tiny by modern standards – but they still existed, and the banks still demanded bail-outs when their bubbles (inevitably) burst.
If neonsnake wants an example of something that really does “privilege” the rich “at the expense of everyone else” he need look no further than Credit Money (Cantillon Effect – it has been known for 300 years), but I doubt he supports commodity money (such as physical gold or silver) that people choose to value before-and-apart-from its use as money.
The idea that “more money” or “lower interest rates” is “good for the economy” is the classic sign of a Monetary Crank – sadly including the President of the United States who (like most politicians, and far too many businessmen) is thinking short term – not long term.
“In the long run we are all dead” is a stupid response.
Correct. Whilst international trade would come into it, I did indeed mean it in the more fundamental sense.
neonsnake – thank you for clarifying.
And free trade, in this fundamental sense, depends on private ownership (in the sense of control – not the nominal “ownership” that the National Socialists allowed) of the means of production.
Without private ownership of basic production civilization will not arise, and if private ownership of the means of production is undermined so, eventually, will civilization be undermined.
Define “private ownership”, please, in your own terms.
I *think* that you mean that one person (or a small number of persons) own the business whilst not actually working within it, but I may be misunderstanding.
(“National Socialism” is utterly irrelevant here, to be very clear, and there’s zero reason to bring it up – no-one’s thinking about Nazi Germany when we talk about the local Co-Op grocers)
neonsnake – what you say you say (claim) you think is false, about this matter – and just about everything else.
“whilst not actually working within it”.
That is your definition of private ownership?
Of course, you do not define private ownership that way – you are just messing me about and wasting my time, and my age I do not have time to waste.
As for cooperatives – they are, normally, as dumb idea – but you already know that.
Nuh uh.
That’s yours, as best as I can tell. You can tell that I was asking that by the sentence “I *think* that’s what you mean”. My post was clear.
Was I wrong?
If so – then define your position, rather than being slippery. Shouldn’t be hard.
neonsnake – you know what private ownership means.
It is certainly not me who is being slippery – it is you.
On a visit to Oxford Ludwig Wittengenstein (Cambridge philosopher – friend of Bertrand Russell, who inspired “the 100” the group that “sprung Blake” and engaged in other activities, and other political Collectivists) was asked by Harold Prichard (who was dying) – was Descartes right to his position of “I think therefore I am”.
Wittengenstein replied “am what?, old man”.
Leaving aside “old man” (accurate – Prichard was old, he had been born in 1871) “am what?” was held by the various political Collectivists who admired Wittengenstein, to be a very witty reply – it was not witty at all, as Wittgenstein knew very well what Descartes (and Prichard) meant – they meant the human person (the “I” – the free will agent, morally responsible for their actions, because they could have chosen to do other than they did).
The very thing that the Apostles Club (Russell, Keynes and so on), and the Cambridge Five (including Cairncross – not just Burges, Maclean, Philby and Blunt) despised, and associated with the “Victorian” (really Aristotelian) morality they rebelled against.
It was certainly not Prichard who was being “slippery”.
And Professor Ross (Major Ross in another line of work) took careful note.
When someone pretends they do not understand what “private ownership” means, or pretends it is bound up with some form of stealing – they are playing the same game that Wittengenstein was playing, they are on the same team as him and the rest of his Cambridge associates. Another variation on this, is someone saying they are not a socialist because it “would not be in their class interests” to be one – someone who says this is saying, indeed shouting, what they are, and, yes, J.M. Keynes came out with this line (reading the, sickening, introduction to the German edition of the “General Theory….” is almost unnecessary after this, but I think it is still worth doing as confirmation that one is dealing with a Collectivist pretending to be a liberal).
As Commander Eric Brown said in a talk – torture is not only immoral it is also unnecessary – to find traitors (enemies) one does not need thumb screws or whatever, all one need to do is to listen to what they say, and read what they write, they always give themselves away – it is almost as if they want to get caught.
For example, “Kim” Philby – with his repeated statements about how socialism could not work because people were too “selfish”, that gave away the fact that he believed that socialism was good (not evil) – and that people would only object to it if they were bad people, in short his supposed attack on socialism – was really (if one examined it) saying, shouting, that he himself was a socialist. Just as father had been – indeed that he remained on good terms with his father (a self confessed socialist), now based in Beirut and actively engaging in operations against Western interests, should have been a giant Red Flag (hint intended) – and was a giant Red Flag to anyone who took political thought seriously.
That “Kim” turned out to be traitor surprised no one who took political thought seriously – sadly most people in the service did not take political thought seriously. They did not believe in “judging people by what they believed – by their beliefs ” – when that is the logical way to judge people, find out what they believe (what they really believe) and then what they DO (such as sending agents into traps to be captured or killed) will not be a surprise.
One thing we must be wary, very wary, of is “false friends” – thinkers who are presented as friends of “capitalism” who are nothing of the kind.
For example, in some universities J.S. Mill is presented as the alternative to Karl Marx in 19th century thought – but Mr Mill was no friend of land owners or factory owners – indeed as Charles Wicksteed (in my home town of Kettering) found out, the “land nationalization” crowd (who were influenced by the, utterly false, account of land economics to be found in David Ricardo and such followers and James and John Stuart Mill) who he had strong sympathy for, were no friends of factory owners either – they wanted government backed cooperative.
Many books present Bertrand Russell as a “liberal” alternative to Marxist philosophy – but the late Bertrand Russell lied when he called himself a liberal (or even a “Whig”) – he was opposed to the private ownership of the means of production, he was an enemy – not a friend.
And the central figure of “modern economics” (even though it is not modern – it goes back to the fallacies and absurdities of such 16th century thinkers as John Hales), J.M. Keynes – was also NOT the liberal he claimed to be.
Such writings as the introduction to the German edition of the “General Theory….” (1936) make it quite clear that J.M. Keynes hated the free market, hated the idea of such things as wages being decided by supply and demand, and hated investment being decided by the free decisions of Real Savers (people who really did sacrifice consumption) – he wanted the state to have the leading role. His “liberalism” was a disguise – and a threadbare one.
With John Stuart Mill it is not only his connection to Jeremy 13 Departments of State Bentham, and to David Ricardo (the absurd theories on land and economic value), it is also his statements about “everyone agrees” that local government should take up a whole series of function – everyone did NOT agree, Mr Mill and his associates agreed – that is not the same thing as “everyone”.
But we must not neglect the foundation of error – the interpretation, by John Locke and others, that God gave the world to humanity in-common (IN COMMON) – so private ownership must be “justified” by either “as much and as good left for others” (impossible) or some form of money payments to the poor – the “Lockeian Proviso” – that, the idea that these payments are a right, leads to the welfare crises we see today.
And Mr Locke is very clear – we are told, for example, that a ship’s captain who sells his cargo for a higher price rather than a lower price at a port where there is hunger (no-contract involved – we are not dealing with breach of contract) is “no doubt guilty of murder”.
If that doctrine is accepted then no economy is possible – as there will always be someone (somewhere) poorer than the person we are dealing with, we would be forever reducing the price of various things down-to-zero.
One of the worst mistakes in recent years was made by Glenn Beck – and with the best of intentions.
Glenn Beck noted that Thomas “Tom” Paine made various free market sounding statements and started to promote this “Founding Father” (technically Mr Paine was no such thing – as he signed none of the founding documents of the United States of America, by the way the only person to sign ALL of them was Roger Sherman), the left pounced on this mistake – again a mistake made with the best of intentions.
As the left gloatingly pointed out – “Tom” Paine of “Common Sense”, “Agrarian Justice” and so on, was the founder of the American left, supporting centralized government, fiat money (as long as it was issued by a republic – in Mr Paine’s mind fiat money issued by a monarchy was bad, but fiat money issued by a republic was fine), and government benefits and services, everything from schooling to old age provision, partly to be funded by a 100% tax on large estates – and for people who claim not to know what “100%” means – it means 20 shillings in the Pound, not the one or two (five or ten percent) shillings in the Pound land tax of England in the 1700s.
Mr Paine was a master of statements that seem clever, but fall apart when one examines them – for example “hereditary legislators are as absurd as hereditary mathematicians” – leaving aside the point that there should be no such thing as “legislators” – the law should be found not “made” – applying the principles of natural justice (to each their own), why should people who, at least sometimes, owe their position to flattering the voters, and making impossible promises, be better than a group of people who owe their position to family tradition – who is likely to be better at mathematics, people from families of mathematicians, or people who have been elected as mathematicians? How does being popular mean you are good at mathematics? Although it is also true, as Aristotle pointed out against Plato – that it is not the cook who is the best judge of the meal, it is the people who eat it (which is a defense of elected government – although government by a large group of hereditary family lines is not the same, not at all, as Plato’s desire for rule by educated “experts” in a bureaucracy).
It is also the case, whatever the howls of outrage at pointing it out, that in the great clashes between the House of Commons and House of Lords in the 20th century – on the actual merits of this or that policy, the House of Commons was wrong (although it got its way) and the hereditary lords were correct.
It was Founding Father (and Chief Justice of the Supreme Court) John Jay, the Governor who got rid of slavery in New York State (oh yes it had slavery – very much so), who said “those who own the land – should rule it” – a controversial point of view, and not one that I am going to endorse, but just as worthy of consideration as the position of Mr Paine.
As for economic policy in Britain.
Gawain Towler, Kemi Badenoch, Nigel Farage, Rupert Lowe (and so on) broadly agree – not on every detail, – but on the broad outline of a smaller, and less interventionist, state – and less Credit Money subsidies for the banks and politically connected Corporations (by the way – that, the way things are, has to mean getting rid of the Bank of England – but none of the people I have named have yet come to that conclusion).
The trouble is that these people fight like cats in a sack (and sneer at former Prime Minister Liz Truss – if I had hair I would pull it out in frustration at various Conservatives, including Kemi, “apologizing for the mini budget” – thus accepting the LIE that “Liz Truss crashed the economy” by trying to reduce tax rates – it was the Bank of England that “crashed the economy” by financing 400 Billion Pounds of wild government Covid spending with funny money, and then pulling away the rug on the eve of the mini budget). – they do not work together, and the left DO work together – I have seen this many times, only one leftist party will put up a strong campaign in a particular council seat – the others will not really campaign.
Meanwhile the Conservatives and Reform cut each other’s throats – with Restore soon to join the circular firing squad.
As Mark Littlewood and David Starkey of Popular Conservatives (PopCon) point out – if the infighting on the right continues, defeat is certain.