A blupete Essay

Capitalism, Part 6 to blupete's Essay
"An Essay On Economics"

There was a professor at Christ's College, Cambridge (1768-76) by the name of William Paley who had come up with what must be the all time winner for shrewd sayings: "It is much harder to make men see a difficulty than comprehend the explanation of it." It was Bagehot who added, "The key to most difficulties of most discussed and unsettled questions is commonly in their undiscussed parts."27

Capitalism is a system of markets, private property rights, decentralized power and individual responsibility for human behaviour. Versus collectivism with its bureaucracy, untraceable inefficiency, arbitrary allocation between individuals, jobbery, bribery, corruption and encouragement of underground trading. Capitalism has become, like socialism, one of those red flag words. Capitalism wears a bad rap; those who promote collectivism can be charged either with malicious defamation or with a failure to consider history, maybe both.28 Capitalism is a word that defines the spontaneous actions and choices of ordinary people as they go about employing their property to their advantage, primarily, and which, as it turns out, is to the advantage of the community in which capitalists operate. It is simply not true that capitalism is an evil impersonal force rolling on to a predetermined end, one which will do damage to all and sundry.

The fact is that it is free enterprise and the spur of competition that allow men to be productive and inventive. It is in such a free system that "nearly every economic ability sooner or later finds its niche and reward in the shuffle of talents and the natural selection of skills; and a basic democracy [voting by dollars] rules the process insofar as most of the articles to be produced, and the services to be rendered, are determined by public demand rather than by governmental decree." It is one of Will and Ariel Durant's lessons, that the "experience of the past leaves little doubt that every economic system must sooner or later rely upon some form of the profit motive to stir individuals and groups to productivity. Substitutes like slavery, police supervision, or ideological enthusiasm prove too unproductive, too expensive, or too transient. Normally and generally men are judged by their ability to produce ..."29

When pitting capitalism against socialism, best to remember to compare both systems as we have seen them function; you will choose a losing side if you support functioning capitalism versus the ideal of socialism; there can be no comparison between imperfect capitalism and perfect socialism. No doubt capitalism is imperfect and a number of the criticisms leveled at it are legitimate. Arthur Seldon:

"The long-standing criticisms of anti-market Fabians and democratic (non-Marxist) socialists were and remain four: first, capitalism is unstable - it fluctuates between extremes of high inflation and high unemployment, and sometimes combines both; second, it is inefficient because of monopoly; third; it is unjust because the market produces wide inequality in incomes and wealth; fourth, it degrades the environment because the market cannot take account of the external effects of private bargains in commercial trading. ...
The four faults of instability, inefficiency, injustice and insensitivity are common to socialism as well as capitalism. First, the extremes of fluctuations in unemployment and inflation disfigure socialist economies probably even more than capitalist economies. The difficulty in judging comparative capitalist and socialist unemployment and inflation is twofold: political and economic.30

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[Essays, First Series]
[Essays, Second Series]
[Essays, Third Series]
[Essays, Fourth Series]
[Subject Index]
Peter Landry
2011 (2019)