Capital, Capitalists and Capitalism (Part VI)

Mark Hendrickson teaches economics at Grove City College. He writes the "No Panaceas" blog at Forbes.com and is a contributing editor of the St. Croix Review. Hendrickson's most recent book is "God and Man on Wall Street: The Conscience of Capitalism" with Craig Columbus.


capitalEditor’s note: The following is the sixth, and final, installment of the FrontPage series “Capital, Capitalists and Capitalism” by Dr. Mark Hendrickson. Click the following for Part IPart IIPart IIIPart IV and Part V

We have already discussed how, despite overwhelming evidence to the contrary, most progressives and other advocates of more government intervention believe that Washington should have greater control over economic activity in order to increase prosperity for more people. We also have examined the glaring holes in their arguments of advocates of intervention who insist that government redistribution of property is fairer and morally superior to allowing free markets to distribute wealth. The third point they make in support of their statist agendas is the alleged problem of class divisions inherent in capitalism. Their arguments in this case are equally feeble. In fact, charges that capitalism divides people into irreconcilable classes is a hollow canard.

When one surveys the history of capitalism, starting with the onset of the Age of Capitalism in the 18th century, one can’t help but notice its revolutionary effects on social structure in addition to its pronounced positive economic effects. Pre-capitalist societies in Europe had been characterized by rigid social stratifications. A person born into a certain social stratum was doomed, barring a miracle, to die there. Royals, aristocrats, and their retinues enjoyed the privileges of a rigged Big Government system that enriched them and left the common man with such scant economic opportunities that having enough to eat was a recurring problem.

Capitalism changed all that. By virtue of its superiority in producing goods, capitalism “provided sustenance for the masses of paupers. Capitalists emptied the poor houses, the workhouses, and the prisons. They converted starving beggars into self-supporting breadwinners.”1 Capitalism liberated millions from hereditary poverty. By shifting control of economic production from the privileged few to the masses (i.e, consumer sovereignty in free markets), new fortunes were made and old fortunes were eclipsed.

In short, tremendous upward mobility supplanted social stasis as capitalism multiplied opportunities for individual advancement. Capitalism sundered pre-existing class divisions and made it possible for the talented and industrious to make the proverbial leap from rags to riches. When Karl Marx and his successors fixated on the theory of class conflict, they were like the proverbial general fighting the last war. They were obsessed with the rigid, antagonistic class divisions that characterized the politico-socio-economic orders—feudalism and mercantilism—that preceded capitalism.

Capitalism, in fact, broke up the old order, supplanting rigid social hierarchies with social mobility. Capitalism unlocked the doors of economic progress for the masses, both by lowering the cost of goods so that those once too poor to purchase various goods now could afford to do so; and also by increasing the amount of capital in society so that it became possible for citizens from poor backgrounds to become entrepreneurs and make the proverbial leap from rags to riches.

It is historically inaccurate for socialists to accuse capitalism of sowing the seeds of class conflict by dividing society into classes whose interests were implacably opposed to each other. The calumny that capitalism would keep workers in a permanent state of inferiority has been disproved millions of times throughout American history. Worse, though, than the socialists’ diagnosis is their proposed cure for the class divisions allegedly created by capitalism. Socialism commits the very sin of which it accuses capitalism: It divides society into two classes, a dominant upper class and submissive lower class—the elite government planners and the masses of people, respectively.

Whereas capitalism represented a radical departure from the class divisions inherent in mercantilism, socialism seeks to reinstitute such divisions. Socialism is, in some very fundamental ways, a neo-mercantilist system. Indeed, by deposing the sovereign consumer—the democratic economic rule of Everyman—and replacing it with a privileged ruling class, socialism is politically reactionary.

The reason why capitalistic systems like the United States never fell prey to a worker’s revolt or class warfare was because the vast majority of Americans have seen that they could advance themselves economically without bloodshed or revolution. Instead, they could take advantage of the opportunities that capitalism continually presents. Why resort to force and violence if the system offers your children a better life by peaceful means? How can anyone organize a proletarian army of oppressed, impoverished malcontents if the members of the would-be army are climbing out of poverty and rising above (sometimes considerably above) their previous social status?

In the United States, the individual liberty that accompanies and characterizes capitalism has allowed millions of Americans to rise two, three, or even four quintiles in social rankings of income and net worth. America’s perennial economic, social, and political mobility has been a healthy antidote to class conflict, since anyone with the talent and initiative was free to go up the social/economic ladder, rendering notions of rigid class distinctions untenable. A U.S. Treasury study found that “over half of taxpayers moved to a different income quintile” in the ten-year period, 1996-2005.2

It seems incredible that anyone would try to fan the flames of class conflict in the U.S. today when a middle-income American enjoys a standard of living that in many ways is more affluent than the lifestyle enjoyed by 19th-century monarchs. Today, the average poor American “has more living space than the typical non-poor person in Sweden, France, or the United Kingdom”; “80 percent of poor households have air conditioning” (as recently as 1970, only 36 percent of Americans had A/C); “31 percent have two or more cars”; “nearly two-thirds have cable or satellite TV,” etc.3 It has to be hard to organize a movement based on income when society is so fluid and large numbers of people continually move up to higher income levels.

Socialists, progressives, and other opponents of capitalism are nothing if not persistent. As latter-day ideological heirs of Marx, they continue to see the world in terms of class conflict. They seem to need class conflict so badly that if they can’t find it, they will do their best to manufacture it. Whether consciously or not, government interference with free markets over the past two or three generations have managed to thwart capitalism’s natural tendency to lift people out of poverty and have produced a long-term (some sociologists even use the adjective “permanent”) underclass in American society.

Many social scientists—Charles Murray preeminent among them—have documented the secular trend toward declining poverty rates over the course of American history.4 Except when this trend was interrupted during the Great Depression of the 1930s (itself a tragic sequence caused by a succession of pernicious policy mistakes in Washington)5 free-market capitalism reduced the incidence of poverty in every decade—until the mid-1960s when the poverty rate quit declining and has remained range-bound ever since.6

What policies interrupted capitalism’s progress against poverty? One has been the devastation and even literal destruction of thriving black business communities in the name of urban renewal.7 Another was the breakdown of the black family, famously warned about by Daniel Patrick Moynihan in 1965, and then abetted by a series of government anti-poverty programs that created what Heritage Foundation analyst Robert Rector memorably dubbed “the incentive system from hell” that financially rewarded and incentivized single parenthood. Another was the strategy resulting in the Curley effect, by which interventionist politicians kept large numbers of inner-city residents in various misnamed social welfare programs in exchange for their political loyalty. This deal with the devil lured many urban residents to accept a state of permanent economic dependence on the political plantation of slick politicians who purveyed their status as defenders of the poor into permanent control of city governments. Thus, we have essentially one-party hegemony in America’s poorest, most rundown cities.8

By blaming stubborn poverty on capitalism, those advocating more government economic intervention are projecting their own faults onto others. It is government intervention that is responsible for the unnecessarily large size of the chronically poor in America. Capitalism is no panacea; people can still be poor where there is capitalism (read the book of Proverbs for numerous reasons why that is the case), but the historical record of capitalism has proven that it does more to promote upward economic mobility than any form of socialism or interventionism.

The assertion that capitalism leads to class conflict is not only historically false; it is a cynical lie. Rigid class divisions—economic, social, and political—are only possible where governments subvert free markets and impede people’s ability to advance economically. It takes a powerful government, or a strong cultural-religious caste system, to maintain rigid class distinctions. Capitalism does not erect divisions between economic classes; it demolishes them. Far from being the cause, as Marx and his followers claimed, capitalism is the antidote for class conflict.

The left talks a lot about “peace.” What could be more peaceful than free individuals choosing with whom to interact economically for mutual benefit in the noble framework known as capitalism? In such a system where voluntary action is the rule and individual rights are respected, human beings encounter allies, not enemies, and individual self-interest tends toward harmony instead of conflict. Perhaps this is the greatest and most blessed feature of capitalism, and a primary reason for why capitalism is worth defending and preserving.

Notes:

1 Ludwig von Mises, Human Action, Scholar’s Edition, p. 615.

2 “Income Mobility in the U.S. from 1996 to 2005,” Report of the Department of the Treasury, November 13, 2007.

3 Official government data cited in “Understanding Poverty in the United States…”  March 22, 2012, www.projectworldawareness.com/2012/03/understanding-poverty-in-the-united-states-surprising-facts-about-americas-poor/.

4 Charles Murray, Losing Ground: American Social Policy 1950-1980, New York: Basic Books, Inc., 1984.

5 Cf. Lawrence Reed, “Great Myths of the Great Depression,” www.mackinac.org/4013; Burton Folsom, New Deal or Raw Deal? How FDR’s Economic Legacy Has Damaged America, New York: Threshold Editions/Simon & Schuster, 2008.

6 Ezra Klein’s “Wonkblog,” “Poverty in the 50 years since ‘The Other America,’ in five charts,” The Washington Post, posted July 11, 2012, www.washingtonpost.com/blogs/ezra-klein/wp/2012/07/11/poverty-in-the-50-years-since-the-other-america-in-five-charts/.

7 Cf. Ellen Pierson, “Race and City Planning in Pittsburgh’s Hill District,” 16 May 2008, posted in “The Not-So-New Face of Urban Renewal,” documents.kenyon.edu/americanstudies/; Matt Lakin, “1960s brought end to segregation, prohibition,” July 29, 2012.www.knoxnews.com/news/2012/jul/29/1960s-brought-end-to-segregation-prohibition/?print=1; Peter Dreier, “Jane Jacobs’ Radical Legacy,” National Housing Institute Issue #146, Summer 2006, www.nhi.org/online/issues/146/janejacobslegacy.html.

8 Edward L. Glaeser & Andrei Shleifer, “The Curley Effect: The Economics of Shaping the Electorate,” Department of Economics, Harvard University,2005, www.economics.harvard.edu/facutly/shleifer/files/curley—effct.pdf.

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  • theoprinse

    Which capitalism ? Crony syndicalist or venture innovative capitalism ?

    • James Keir Baughman

      It doesn’t matter. See the above reply.

  • Freedom

    Crony Capitalism is not capitalism

    • James Keir Baughman

      Crony has always been with us. It is virtually total in Communism and Dictatorships. It changes nothing for those who will work in America.

    • objectivefactsmatter

      That was already stated in the article. Very clearly.

  • Consider

    While 50% of national wealth is owned by 1% of the wealthy ones (whose wealth as we learn from Forbes magazine comes mainly from inheritance), it is totaly irrelevant whether that 1% club occasionally changes its membership.
    It is not a sign of vertical mobility nor of betterment for the majority of the population.

    • James Keir Baughman

      Not true in the least. Bettering oneself in America has been proven time and time again to come from one’s own efforts, not inheritance.

      • objectivefactsmatter

        But it’s all for naught if this loser can’t wake up tomorrow as one of the “top 1%.”

    • objectivefactsmatter

      Even if that’s true (and it’s not), what about the other 50% of the wealth? Concentrate on getting enough pie for yourself and stop worrying about the other guy’s pie.

      Objections to capitalism are based purely on envy and lack of confidence. Or even worse arguments.

      “It is not a sign of vertical mobility nor of betterment for the majority of the population.”

      It’s not a sign of anything but your envy.

      • Consider

        Envy, like greed, is a factor in social life.

        • objectivefactsmatter

          Sure, but I’m not the one expecting the government to rectify subjective envy-driven feelings about supposed greed from others.

          • Consider

            Well, if you are expecting the government to rectify (a situation based on) subjective fear driven feelings about, say, terorrism, you may also expect the governent to take care about the subjective feelings of injustice that result from greed.

          • objectivefactsmatter

            It should be about violating laws and objectively observable or provable offenses.

            Objecting to “greed” is not morally equivalent to objections about Islamic terror, or any other terror that actually shows up and breaks things or subverts our laws.

            Not a very good try, but you are helping us understand the leftist mind a little better each time you do.

          • Consider

            It’s not objecting to “greed” per se, but its social consequences.
            Anyhow the “upward mobility” as described in the article is a delusion on purely mathematical grounds.
            Assuming that an average American business has 100 employees (this is an arbitrary figure, I don’t know how many people an average American company employs but the conclusions are the same be it 10 or 1000), then it is obvious that one or some of them, but a clear minority, are the owners ( and rich) while the others, the majority, are dependent (and poor, relatively speaking). Therefore saying that starting your own business is the way to achieve upward mobility is as good a solution for the society as a whole as buying a lottery ticket for that purpose.

          • objectivefactsmatter

            “Assuming that an average American business has 100 employees (this is an arbitrary figure, I don’t know how many people an average American company employs but the conclusions are the same be it 10 or 1000), then it is obvious that one or some of them, but a clear minority, are the owners ( and rich) while the others, the majority, are dependent (and poor, relatively speaking).”

            Upward mobility does not imply that you must pass others in the percentile ranks (though that happens too) but it means that you can improve your own wealth and standard of living.

            If you have a well-designed compensation package for your employees, and your company is successful, everyone will “move up” in terms of their ability to afford the things they want even if their status relative to one another is not changed.

            In addition, the company will probably grow which creates opportunities for promotion based on merit. Now if you expect everyone to get “promoted” over the other person, obviously that is not going to happen and it’s not even desirable. Nobody promised that kind of delusional definition of equality but the communists.

            And you need to have this situation where there are consequences for achieving less than the other person or there is no incentive to work harder than the next guy or hard at all. That’s why socialism makes us all poor because very few people will work hard unless there are consequences for laziness and or underachievement.

            Humans will never be fungible and therefore their will always be some that outperform others. Pretending this is unjust is the kind of delusion Marx was most criticized for.

            “Therefore saying that starting your own business is the way to achieve upward mobility is as good a solution for the society as a whole as buying a lottery ticket for that purpose.”

            That’s an insane statement. It’s not at all the same. I wonder if you’ve ever even been exposed to any formal business training, or exposed at all to any instruction on how businesses operate. No wonder you’re a communist.

            And starting your own business is merely one option. For crying out loud, history already proved it. We’re just explaining it.

          • Consider

            “Upward mobility does not imply that you must pass others in the percentile ranks (though that happens too) but it means that you can improve your own wealth and standard of living.”
            If that is the measure and/or definition of ‘upward mobility’, then almost all countries and economic systems in the world have or have had experienced ‘upward mobility’.
            Even In Russia (or the former USSR) life for most was better in 1970 than in 1930.
            Another point in this series is worth mentioning; when capitalism shows its superiority ( say in the period of the breakdown of USSR and with it the communist system as a whole), it is praised by all, and in particular by the ‘free marketeers’, as a system so awesome, so superior that one had only to bow as a sign of recognition and appreciation.
            However when the depression visited the capitalist world as was the case in the recent half of a decade, we suddenly learn that up to that time we in fact (which was cleverly hidden by the ‘left’) lived in a socialist economic system, which is to blame for the woes that befell us.

          • objectivefactsmatter

            “If that is the measure and/or definition of ‘upward mobility’, then almost all countries and economic systems in the world have or have had experienced ‘upward mobility’.”

            Partly true. If you want to count “other economic systems” then you must count those who elevate themselves through political corruption. Technically that’s also upward mobility but I wouldn’t say communists are likely to brag about that.

            So you’ve actually arrived at the most salient question, which system is better, the one that rewards honest productivity or the one that rewards political corruption?

          • Consider

            We should make clear one thing: what should we call
            ‘socialism’?
            According to Marxist theory ‘socialism’ means the collective ownership of the means of production.

            In the USSR the system was called ‘socialism’ by its
            protagonists (‘communism’ being something in the same category as the second coming of Jesus Christ)

            Here (in this essay, and on this website generally) the
            label of socialism is attached to everything. From systems with extensive welfare, public services, redistribution of wealth, and of course high taxes (all of
            this found in the Scandinavian countries), to Obamacare.

            In particular this label is attached to the state of affairs
            that precede major disruptions in capitalism.

            I would stick to the latter definition since it is fashionable and would draw the attention to the fact that, (‘socialism’in USSR & co style being historically discredited) ‘socialism’ Scandinavian style is described by the Economist of London (no friend of the ‘left’) as:… Nordic countries”are probably the best-governed in the world,” with Sweden in first place.
            Despite ‘socialism’.

          • objectivefactsmatter

            “We should make clear one thing: what should we call
            ‘socialism’?”

            http://historysage.com/jcms/images/stories/Euro_PDFs/Socialism_in_History.pdf

            http://en.wikipedia.org/wiki/History_of_socialism

            The word means many things to many people and the ideas predate Marx. Marx viewed socialism as a stepping stone to communism. It seems to me he considered communism as a kind of scientifically optimized or perfected socialism.

            Now you can’t defend socialist policies by simply showing that they have not entirely replaced our free markets. That never actually happened. The question is what direction are we going and what are the underlying principals?

            There is also the fact that some “socialist” policies are purely fraudulent. But because they are justified by or sold with socialist ideology, we tend to lump those projects together under the socialist rubric. If you want more nuanced discussions, you have to have the conversation. But certain projects under “green energy” are conjured up after being inspired by socialist ideas.

            “According to Marxist theory ‘socialism’ means the collective ownership of the means of production.”

            That’s a feature of socialism. No sovereign has ever achieved absolute socialism as far as I know.

            In any case, we don’t have to prove which sovereigns have done it “correctly” or not because our position is that these theories are false, even though technically some of the policies can be implemented. Our concern is with the actual harm of the policies and attempts or arguments for socialism and what the ideology does to expectations among the populations that think it would be good for them. We don’t need to define absolutely what “true” socialism is because our concern is the harm caused by the false ideas about it that people have.

            Socialism more or less promises “free lunch” with a nutshell game that destroys incentives for large swaths of populations to remain productive. It also destroys opportunities for even more people. It’s an oligarchy disguised as Utopia. Which is hypocritical because it promises to flatten the class structure but merely flattens productive people.

            I’d say that any time you want to do something in the name of “social justice” and you imply that disparity of results is a negative thing for society, you’ve been duped by false socialist ideas. Lunch is never free. Someone has to produce and prepare it. Always.

            “Here (in this essay, and on this website generally) the
            label of socialism is attached to everything. From systems with extensive welfare, public services, redistribution of wealth, and of course high taxes (all of
            this found in the Scandinavian countries), to Obamacare.”

            There’s a very good reason for that if you understand the history and underlying ideas. Some of the things we label as socialist could in theory be employed under different justifications. If you don’t promise that free lunch and people know honestly what to expect and what they’re paying for, we can’t rightly call that socialism. Maybe we could say it was inspired by socialist theory but as long as people pay for these things noncoercively, that’s not socialism.

            And at this point we can’t probably ever purge all socialist policies. But at least if we understand the true costs, we can come to compromises that most of us can live with.

            “In particular this label is attached to the state of affairs that precede major disruptions in capitalism.”

            If you disrupt the free market with ideas based on socialism, then that’s how we’ll call it. There are plenty of regulations related to disclosure and risk management that are not based on socialist ideology. So you’re not quite right. Other free market limits are justified by public safety. That’s probably not socialism unless you make delusional arguments about “the greater good” without objective evidence.

            “Scandinavian style is described by the Economist of London (no friend of the ‘left’) as:… Nordic countries”are probably the best-governed in the world,” with Sweden in first place.
            Despite ‘socialism’.”

            Usually socialism delivers a slow death. And I’m not at all sure I agree with their analysis. But in theory it’s possible to kill your economy slowly with socialism, and feel good about it for the early stages. But it’s also possible to implement socialist policies in a balanced way. We’re not saying that we need to be pure. We’re saying it’s generally harmful, and never more harmful than when it’s presented as some kind of self-funded solution.

            In the USA we’ve been suffering under the burden of stupid socialist policies for decades now. We could have initiated similar projects with the same initial costs, and done it with much better results if we first purged the false ideas of socialism.

            Basically socialism treats people as fungible, and takes dynamic economic factors and oversimplifies them. It breaks things that they consider unbreakable. It creates commodity value out of labor as if people will work just as hard with lower incentives. Those are just a few examples.

          • Consider

            Since we are free to define social system as we wish, let us stuck on the definition of ‘socialism’ as the system that is nowdays more or less found in the Scandinavian countries.
            However since you are inclined to expand this discussion uncontrolablly and I have neither time nor desire to follow suit, a shall limit myself to a few observations.
            About expectations; The expectation that playing by capitalist rules may secure you ‘vertical mobility’ is probably a far bigger delusion that any that ‘socialism’ could offer.
            This delusion is comparable to the delusion that ‘vertical mobility’ shall be acheived by buying a lottery ticket.
            About ‘free lunch’; most people (in ‘socialism’) are fully aware that the question is not about free lunch, but about human solidarity. This comes at a cost. A cup of coffee at an Oslo caffe costs $8.93 ($4.30 in New York) and people know why.
            This is the price that one pays for not listening about the glory of croaking for lack of means to pay for the health care.

          • Consider

            A correction:
            The price of a cup of coffee in Oslo is $9.83.

          • objectivefactsmatter

            “Since we are free to define social system as we wish, let us stuck on the definition of ‘socialism’ as the system that is nowdays more or less found in the Scandinavian countries.”

            OK, in what context? I was explaining the gamut of what you might encounter. My wish is that these fallacies never existed.

            “However since you are inclined to expand this discussion uncontrolablly and I have neither time nor desire to follow suit, a shall limit myself to a few observations.”

            You object to your inability to control the discourse. Noted.

            “About expectations; The expectation that playing by capitalist rules may secure you ‘vertical mobility’ is probably a far bigger delusion that any that ‘socialism’ could offer.”

            That’s a shocking statement in the level of ignorance required to articulate it. You evidently did not read the series of articles.

            “About ‘free lunch’; most people (in ‘socialism’) are fully aware that the question is not about free lunch, but about human solidarity.”

            Solidarity through coercion. No, that’s not delusional at all.

            “This comes at a cost. A cup of coffee at an Oslo caffe costs $8.93 ($4.30 in New York) and people know why.”

            People know why: Their politicians tax policies. They accept the greater good arguments. That doesn’t mean they could not have done it better. It just means they haven’t failed and haven’t had enough people object yet. You’re not actually refuting anything that I’ve said. It’s either done deceptively, or people have agreed to pay for certain benefits to society at large. That’s inspired by socialism. But if it’s truly noncoercive then it’s not really socialism. If that’s the kind of socialism you’re promoting then you ought to make that more clear. Don’t just point to Norway and say, “See how happy they are?”

            You only have to look at the failure of the “Great Society” to see what kind of insanity comes from following bogus theories.

            “This is the price that one pays for not listening about the glory of croaking for lack of means to pay for the health care.”

            Yes of course; if people would just be more enlightened, we’d have our Utopia, just like Norway.

            Call your representatives and have them promote a “Norway bill.” We should be “just like Norway.” That will make it clear to everyone that you’re talking about the “good socialism.”

          • Consider

            “People know why: Their politicians tax policies. They accept the greater good arguments. That doesn’t mean they could not have done it better.”
            But we have seen that the Nordic countries are the best gorverned in the world. Whom they should have coppied?
            The capitalist system based on the motto ‘no money, no health’; or better still ‘no money, no life’
            Norway, Utopia; Norway is no Utopia, it’s real.
            Coercive, non coercive; taxes are coercive by definition. So what?

          • objectivefactsmatter

            “But we have seen that the Nordic countries are the best gorverned in the world.”

            By what measure?

            “Whom they should have coppied?”

            They didn’t copy anyone directly. Marx didn’t know much about oil prospecting.

            So in any case, even if I agree that “Nordic countries” are “the best governed” you still can’t show how that would scale up. You’ve given just enough testimony to warrant a further look and yet we’ve already explained many concepts that you haven’t been able to refute or even demonstrate an understanding of.

            Let’s just reboot the USA “just like Norway” and things will be grand. You’ll have to kill everyone and start over with ethnic Norwegians and recreate every factor that they depend on. And that is also assuming we want to risk that their model will work longer than our own.

            You’ve given us no reason at all to believe in any of your theories.

            “The capitalist system based on the motto ‘no money, no health’; or better still ‘no money, no life’”

            You’re just as good at attacking capitalism as you are at attacking the Bible.

            “Norway, Utopia; Norway is no Utopia, it’s real.”

            Correct, it is no Utopia and it is not something any rational person would suggest we could “copy.” At best you might be able to cite specific policies and see what arguments you get for and against emulating that here. At best. Norway proves nothing about ideology.

            “Coercive, non coercive; taxes are coercive by definition. So what?”

            If you’re going to do something coercive, use rational justifications, not pie in the sky promises about how having socialist elites planning everything will put a chicken in every pot. Explain costs and benefits rationally and honestly, see if you can do it legally, and then move on. You make it sound like you’ve never heard of a tax you didn’t love.

            The burden of proof for creating new taxes should be very, very high. It’s not something to do casually. It’s worse when you lie or talk about how someone else has rights that they don’t in fact have to money of “greedy rich people.”

          • Consider

            It is difficult to argue with someone whose argumentation looks like a stream of consciousness novel.

            Or a Dadaist product.

            Let me make a little synthesys: we established that for you and the most of contributors to this site, ‘socialism’ means not N.Korea, Cuba or the ex-USSR & co, but systems found in places like the EU, Scandinavia, and even in the endeavours of the Democratic party in the US.

            That said, let us examine how these systems compare with what is until now been the norm in the US (and still is, and is likely to remain); In short most of them score better (prticularly the Scandinavian ones but also some other like Switzerland for example) than the US on any measure related to the quality of life.
            What the quality of life means (or is consideres to be), can be found in the web.
            Nevertheless you and co. find the intelectual courage to boast about he advantages of ‘capitalism’.
            One specific point: can we afford it?
            If Sweden was able to afford it in 1953 the US should be in 2013.

          • objectivefactsmatter

            “we established that for you and the most of contributors to this site, ‘socialism’ means not N.Korea, Cuba or the ex-USSR & co, but systems found in places like the EU, Scandinavia, and even in the endeavours of the Democratic party in the US.”

            Wrong. You don’t do very well speaking for others. You can barely manage speaking for yourself.

            “That said, let us examine how these systems compare with what is until now been the norm in the US (and still is, and is likely to remain); In short most of them score better (prticularly the Scandinavian ones but also some other like Switzerland for example) than the US on any measure related to the quality of life.”

            Which objective measures, what period etc. Sure, in some cases spending other people’s money makes more people “feel good” or “live well” if that’s how they measure “quality of life.” It just doesn’t last that long.

            If you have natural resources that are used for revenue, that always helps. If you want to call that socialism, be my guest because we know that deception is a big part of selling modern socialist ideas.

            Notice how you haven’t actually tried to sell any specific policies. You just want to make vague references to what are supposedly successful socialist projects. Worse, you offer this as evidence that capitalism is somehow evil and must be either “replaced” or managed “socially.”

            But here we are on part 6 of a series, and you haven’t demonstrated at all that you comprehend any of the arguments.

            “What the quality of life means (or is consideres to be), can be found in the web.”

            Psshh. Whatever. Many opinions can be found on the web. Should I try http://www.objectivemeasuresofqualityoflife.org?

            “Nevertheless you and co. find the intelectual courage…”

            Intellectual courage? What does that have to do with any of the arguments?

            “…to boast about he advantages of ‘capitalism’.”

            How is it boasting? Capitalism is owned and exploited by every free adult and most Western children.

            “One specific point: can we afford it?”

            Switching back to socialism I assume.

            “If Sweden was able to afford it in 1953 the US should be in 2013.”

            That makes no sense at all. It is obviously way over your head. You haven’t demonstrated at all that you even understand the essential fundamentals of producing anything of value. You think it’s all about dividing up the pie because the pie falls out of the sky or grows on trees that need no cultivation.

            Have you ever led an organization that creates anything? If you don’t know how to build things and “feed the people” then you’re arguing over distribution of “stuff” you can’t even produce yourself. If you’ve ever produced something, you hated it because you think the “rich greedy people” should just give you the things you need.

            Go and start a socialist democracy on an island somewhere and document everything so that we can learn from your expertise on how to build “the great society.” That ought to be really awesome when we hear of your successes.

            And by the way, we already do many of the same things socialist nations do. We have a lot more leeches and subversives who aren’t happy because it’s not enough. They want more. Leeches are often just as greedy as successful people if not more so.

          • Consider

            Could you, for a change, be less hysterical and avoid personal insults or what the ‘learned’ call ‘ad hominem’ argument(s), or attacks.
            My life and my career are none of your business, neither are they of any importance for the discussion.

            The quality of life rankings are aboundant on the web (the “Physical Quality of Life Index” as one of the examples) and make your choice to which one you shall trust.

            They usualy rate life expectancy, literacy, employment oportunities, earnings, education …etc. The US regularly comes behind the ‘socialist’ countries except in one category: the inequality index.
            Just a question for good bye: do I correctly understand that the Scandinavian countries together with Canada Australia, and New Zealand and maybe some else (all of which I unfairly excluded from the list of ‘socialist’ countries) are leech countries?
            Whom are they soaking?

          • objectivefactsmatter

            “My life and my career are none of your business, neither are they of any importance for the discussion.”

            It may not be my business, but I’m perfectly entitled to suggest that your ideas come only from using your imagination rather than actual experience. You’re all theory, and not balanced either. You can’t even demonstrate that you understood the article series that you’re theoretically commenting on.

            It’s just an observation that you can respond to or not. It might technically be ad hominem but it’s also relevant.

            “The quality of life rankings are aboundant on the web (the “Physical Quality of Life Index” as one of the examples) and make your choice to which one you shall trust.”

            They’re not exactly scientific. But if you want to pick one or two, be my guest. But I’m not here to go fishing for you.

            “They usualy rate life expectancy, literacy, employment oportunities, earnings, education …etc. The US regularly comes behind the ‘socialist’ countries except in one category: the inequality index.”

            That’s fine, but you need to show me before we figure out which particularly fallacies they’ve accepted. By the way, inequality in wealth is not bad. It’s actually necessary. That’s another deranged socialist fallacy that somehow having people with more stuff than you do violates your rights to not feel envious.

            Anyway, I think I said already that you can do quite a bit when you’re living off of accumulated wealth. At some point, someone has to produce it. In theory you can have “socialist” inspired policies and capitalism to pay for it. And it could last forever, in theory. But you’ve got to navigate all of the problems with promising things to people when you may in the end fail at delivering. And that will always be a risk. When socialism fails, most of the victims have no idea it was their own lazy butts and the stupidity of their leaders that led to the failure. Just look at what stupid people say about “greedy bankers” causing the recent banking crisis. It was socialist policies that caused it. Straight up.

            My point is, and just about everyone who understands capitalism agrees with me, that you are always better off making your arguments honestly. If you’re making rational arguments for balanced social policies with an otherwise free market, and you want to call it socialism, that’s fine. I won’t yell at you as long as you are very clear. But the moment someone misunderstands your misuse of the terms and they fall for the fallacies of central planning and free lunch, I’ll speak up then.

            “Just a question for good bye: do I correctly understand that the Scandinavian countries together with Canada Australia, and New Zealand and maybe some else (all of which I unfairly excluded from the list of ‘socialist’ countries) are leech countries?”

            That’s a complicated question, but the leeching I’m talking about comes from social services offered to people who don’t actually need it. That’s leeching. Technically it’s leeching even if you do need it as well, but leftist are so sensitive about word use. I must be careful.

            And the problem is that you’ve told them they have a rights to this. So if you have a budget problem, they’ll riot if you even suggest services must be cut even a fraction, or perhaps the cost of living increase might have to be dialed back. The occupy movement was or is driven by deranged expectations based almost entirely on the fallacies of socialist ideology, like “social justice” and supposed “rights” that are not in fact rights held by anyone.

            Look at the impasse with our own federal budget. If you go anywhere near entitlements, deranged leftists literally call conservatives murderers.

            And you have the audacity to paint us as somehow irrational or cruel just because we try to enlighten people about certain realities. But you’re like the guy who thinks he’s rich because he’s got money in his pockets and he doesn’t understand the budget forecasting…when he’s got looming payments due. Like all of those people who signed up for mortgages with massive balloon payments with no plan to deal with them. And then they blame the banks.

          • consider

            “It may not be my business, but I’m perfectly entitled to suggest that your ideas come only from…”
            Where my ideas come from is also none of your business. The only important thing is are they valid or not.
            That, and only that, was your task to demonstrate, but you failed miserably.
            I understood very well the articles that are commented, and I would bet with 99.99% chance, that I have more actual experience than you have regarding the real world, and creating new value.
            In short, the message of the article(s) is that capitalism is wonderful, the free market is self regulating, and that all pieces shall fall to place given enough time (time where those affected are stil alive).
            That this is not so is not my fault.

          • objectivefactsmatter

            “Where my ideas come from is also none of your business. The only important thing is are they valid or not.”

            That’s precisely the point. You have no evidence, nor authority.

            “That, and only that, was your task to demonstrate, but you failed miserably.”

            Your job is to demonstrate that your ideas are valid. Your judgment means nothing to any sensible person. That’s the implication of the above point. You have no evidence and no “expertise” or authority on your own. You don’t even know what you’re talking about. You manage to spew a few talking points published by people whose ideas resonate with you. That’s it.

            In short, the message of the article(s) is that capitalism is wonderful…”

            It’s more than wonderful, it’s ESSENTIAL to deliver all of the free stuff you want to redistribute. You have to make the stuff first before you steal it and hand it to lazy people. Get it? If that’s what you think is fair, make rational arguments for wealth redistribution, healthcare, roads, whatever. But do it rationally. If you have no clue how to run a business, and no clue what socialist ideology is, the discourse will confuse you. Not that you’ll admit that, as we can see you won’t.

            “…the free market is self regulating…”

            It doesn’t say that at all. It essentially claims that it is already fair because you are rewarded for creating things of value. It doesn’t talk about regulations at all except (I think it mentions) rules of law. What do you think laws do? They regulate conduct. That’s regulation. Nobody is recommending anarchy and one can argue that free market capitalism can’t exist, CAN NOT exist without rule of law.

            You don’t even understand on the most fundamental level. And since you have no humility at all, you can’t approach the subject realistically as one that has a lot to learn before he understands anything useful past parroting socialist talking points.

            “…and that all pieces shall fall to place given enough time (time where those affected are stil alive).”

            Your summary reveals the full scope of your delusion and failure to comprehend the article and the topics.

            “That this is not so is not my fault.”

            That’s right. You’re ignorant because of capitalism. Nothing is your fault because…capitalism in America.

            I love your last line. You have no clue just how much you have validated everything that we complain about. You’re a crypto-communist through indoctrination.

          • Consider

            Since this exchange has degenerated into a psychoanalysis of my person in which I have no interest to participate, I shall end the discussion at this point.
            However, before quitting I cannot resist to do some psyhoanalysis myself: your hysterical tone, your scribomania and ad hominem attacks are the result of your feeling that you got a spanking in the bible / religion dicussion of a few weeks ago.

          • objectivefactsmatter

            “I cannot resist to do some psyhoanalysis myself”

            Strike 3.

          • objectivefactsmatter

            “Coercive, non coercive; taxes are coercive by definition. So what?”

            http://www.washingtontimes.com/news/2013/aug/17/obama-uses-radio-address-describe-health-insurance/

            “Obama’s radio address describes health insurance as a ‘right’”

            What if we can’t afford it? Then whose “rights” matter more? The rights in the constitution, or the “rights” that deranged lunatics promise to people who for whatever reason, want or “need” more? What about my right to purchase the best healthcare I can afford? Except that the federal takeover of more and more policies limits what I can even find a doctor to provide.

            These “rights” may destroy our entire economy and destroy our standard of living for people who work and don’t work. They’d be much better off accepting what charity they can talk people out of rather than demanding things they have no right to demand.

          • objectivefactsmatter

            “Even In Russia (or the former USSR) life for most was better in 1970 than in 1930.”

            Upward mobility on the backs of corpses who produced the wealth. That’s a lovely image of social justice.

          • objectivefactsmatter

            “Another point in this series is worth mentioning; when capitalism shows its superiority ( say in the period of the breakdown of USSR and with it the communist system as a whole), it is praised by all, and in particular by the ‘free marketeers’, as a system so awesome, so superior that one had only to bow as a sign of recognition and appreciation.”

            You mean for the past 400 years or more? When global trade and stock markets began to emerge? That’s modern capitalism.

            “However when the depression visited the capitalist world as was the case in the recent half of a decade, we suddenly learn that up to that time we in fact (which was cleverly hidden by the ‘left’) lived in a socialist economic system, which is to blame for the woes that befell us.”

            The root problems with any recession are not caused by capitalism. They are usually caused by people who try to exploit (cannibalize) it without understanding or respecting it. Usually from the left.

            If you read the article (and understood the whole series) you’ll see that it’s not a question of capitalism or not, but who has sovereignty. Capitalism itself is essential for ANY sense of equal opportunity. Capitalism is the means in which “wealthy” people (or anyone who can manage to preserve valuables that can be invested in any project, large or small) use their assets to produce goods or services such that they can be sold or shared.

            If I’m a billionaire and I swear off capitalism, I’ll put all my funds in to gold or other commodities. Then what? I hand that out to the poor? They can’t eat it. They can only trade for something else. If they do that, they’re participating in the fruits of capitalism.

            Without capitalism you have virtually no upward mobility other than by winning wars to seize lands. And then you’ve demoted someone else. That’s a zero sum game. With capitalism you create synergistic projects.

            Can you at least understand the theory before you try to break it?

            The debate about capitalism vs. socialism is a false one. Socialists want control, not a “new economic system.” It’s not actually new. It just uses BS justifications to change who controls industry and assets. And economies are far too complex for this to occur without cronyism and corruption. There are no rational ways to balance productivity incentives with socialist perceptions of “social justice.” You can’t have socialism without proportional increases in corruption.

            You might get some productivity, but it pales in comparison to what free markets deliver.

            If you want to balance free markets with safety nets to address social concerns, that’s fine in and of itself if you make the case rationally. But when you call the most productive people “greedy” just because they produce the most, and when you tell people that in essence they have rights to feel life is fair even in their own ignorance, that’s a recipe for disaster. Which is what you always get when you indoctrinate people with that kind of insanity.

          • objectivefactsmatter

            “It’s not objecting to “greed” per se, but its social consequences.”

            From reading your other positions it seems like the greed that you object to exists only in your mind.

            Greed with “social consequences” would be greed of consumption that denies means of sustenance to others. Got any examples of that? If I’m worth a trillion dollars, in your mind I’m bathing in it when in reality most rich people got that way because they know how to produce things using capital. I’m creating food shortages by buying up all of the corn and eating it myself. That’s what you imagine “the rich” do with their money.

            Being wealthy makes you sovereign over those funds. It doesn’t make you the sole beneficiary.

    • nimbii

      But the hereditarily wealthy dislike capitalismism churning market place where a better idea may supersedes their own. They like big government’s rule making that the weathy pay for as hurdles preventing smaller players from getting into the game.
      The beneficial economic effects to the wealthy are the same regardless of the party affiliation or ideology of the wealthy. Remember Obama attended $35,000 per plate fund raisers. Wealthy Dems may have spent that money on social justice for the MSM cameras, but it was really to make sure all the favorable marketplace hurdles and filters remained in place and maybe a few more for good measure to assure their place as Federal contractors and consultants.

  • nimbii

    I’m gonna read the other sections but hey, in plain English that anyone can understand. What a refreshing article.
    I do have one question: Marx grew up in Europe when the ruling classes still controlled the benefits of the emerging capitalist economy and maybe that’s why he still was focused on class struggle. Captialism’s benefits were still primarily retained in the ruling classes and the free market break-outs were not visible to the average European in those days. So, what if Marx were instead to have grown up in Chicago or Detroit when people were emerging from poverty to affluence and in some cases in one or two generations?
    Economist Thomas Sowell recounts that it took 3 generations to raise black families from poverty to the middle classes and that pattern stood until Federal programs adversely affected their lives and our capitalist economy. I think that was pretty much the standard for all other racial groups also.

    • objectivefactsmatter

      Marx was a product among other things of the time and place he lived, without question.

      • nimbii

        We are all aware of the great differences between rich and poor. Considering the merits of this series, how do Communists and Socialists refute?
        Even if you look at Obama giving some speech, everything each person in the audience owns they owe to a capitalist system that brings them a marketplace to them full of choices for virtually everything they own.
        The ony thing capitalism did not bring were the deceitful words on the teleprompter. Those come from communism and socialism.

        • objectivefactsmatter

          That’s the beauty of being a crypto-communist; all you have to do is use weasel words that play to the hopes and expectations of the dupes and their notions about “social” justice and so forth. They don’t actually have to attack capitalism directly. It’s the activists and radicals that do that, but our main problem is that many dupes have been indoctrinated to the point that appeals for “social justice” resonate powerfully with so many of them. Getting them to “resonate” in agreement is all it takes to get their support.

          It’s our job to refute the misconceptions if we want to preserve our free enterprise system in anything resembling an ideal condition.

          • Consider

            Oh, you are on a job here! How much do they pay youi?

          • objectivefactsmatter

            Are your feelings hurt again?

  • pfbonney

    “The left talks a lot about “peace.” ”

    True. And then they conveniently “forget” to mention how many millions of people have been killed by communist revolutions, and by trying to maintain communism.

    Not to mention damage done by the Occupy Wall Street crowds and other leftist agitators.

  • nimbii

    This also plays into the recent zip code determinant canard. This Federal initiative to profile zip codes does not take into consideration the human effort and capitalist market forces that move participants into the 90210′s et al of the world or out of them.
    As usual, the social justice crowd presumes all humans to be passive agents as bobbing corks in the primordial storm of capitalism because that’s what works for their agenda.

    • objectivefactsmatter

      “This Federal initiative to profile zip codes does not take into consideration the human effort and capitalist market forces that move participants into the 90210′s et al of the world or out of them.”

      Determinism is a strong feature (fallacy) of socialism.