Day By Day

Friday, August 01, 2008

Four Cheers for Capitalism

Jonah Goldberg cuts loose on critics of capitalism. He writes:
People ask, “Why is there poverty in the world?” It’s a silly question. Poverty is the default human condition. It is the factory preset of this mortal coil. As individuals and as a species, we are born naked and penniless, bereft of skills or possessions. Likewise, in his civilizational infancy man was poor, in every sense. He lived in ignorance, filth, hunger, and pain, and he died very young, either by violence or disease.

The interesting question isn’t “Why is there poverty?” It’s “Why is there wealth?” Or: “Why is there prosperity here but not there?”

At the end of the day, the first answer is capitalism, rightly understood. That is to say: free markets, private property, the spirit of entrepreneurialism and the conviction that the fruits of your labors are your own.
Read it here.

He's absolutely right and Ann Althouse agrees. She writes:
Why aren't there hordes of economists studying meaningful alternatives to market capitalism? Because we've been experimenting with various other systems--both localism and extreme centralization--for over a century, and the experiment produces the same damn result every single time: human lives that are nasty, brutish, and short. And... we haven't discovered any alternative to neoliberal policies, other than "be sitting on commodities during a boom", which is good luck, but not really good advice. The problem with neoliberal policies was not that they drove people into poverty, but that they weren't nearly as effective at driving people out again as we once hoped. Yet they are still more effective than anything else we've tried.
Read her here.

I would add only that, while capitalism is the greatest boon visited upon mankind in its long history, corporate capitalism has been responsible for the dramatic upsurge in global prosperity over the past century and a half. The perversity of anti-capitalist and anti-corporate ideologues is, quite simply, beyond belief. It directly contradicts experience. Jonah takes a not-very-persuasuve stab at trying to explain the insanity of the left:
[C]apitalism... is not zero-sum, but it feels like it is. Capitalism coordinates humanity toward peaceful, productive cooperation, but it feels alienating. Collectivism does the opposite, at least when dreamed up on paper.
But these feelings are contradicted by every instance in which leftist theories have been put into practice. Not only the vast terror states erected by socialists in Germany, the Soviet Union, China, Cambodia and elsewhere stand as monuments to the failure of socialism, but so do the small-scale experiments in communitarian organization.
The communes and collectives imploded in inefficiency, drowned in blood. The kibbutz lives on only as a tourist attraction, a baseball fantasy camp for nostalgic socialists. Meanwhile, billions have ridden capitalism out of poverty.
The lesson of history is clear -- capitalism produces prosperity, socialism in all its various formulations does not, and often significantly increases the misery of the populations unfortunate enough to fall under its purview. Yet the attacks on capitalism continue.