Non-Economic Objections to Capitalism
The Rejection of Industrialism
One of the main arguments against capitalism is in fact an argument against industrialization. It is said that the modern way of life is "unnatural" for human beings. That human beings were not meant to live in houses, work in factories, eat canned or refrigerated foods, or entertain themselves with television and film. It is proponed that mankind would be happier and better-off living under primitive conditions. One need only look to the lives of those humans in the far reaches of the unsettled world to recognize that this is not an argument, but a fantasy that is detached from reality: their lives are hardscrabble, brutal, painful, and short.
All human effort is undertaken to escape pain and misery, and all human progress is merely an amalgamation of human effort. Man did not undertake the effort to build a house to make himself less comfortable than he would be by living in a tent - nor for that matter, did he erect a tent because he thought it would be less comfortable than lying in a field or cave. Man did not invent the refrigerator, nor purchase one for his own use, because he felt he would have less food by doing so. A person who invests money and effort in acquiring something does so because he assumes possession of it will improve his situation and make him more content - and if he finds he is wrong in his assumption, he simply abandons it.
It cannot be denied that there are some men who enjoy an austere and difficult life. There are monks and hermits who reject the advances of modern civilization and live lives of intentional hardship, and who are (or claim to be) happier for the simplicity of their lives. But this is not the choice of the vast majority of mankind, who seek beyond the bare necessities, to have convenience, luxury, and leisure time.
The Demand for Equality
No less absurd is the objection to capitalism because all people do not benefit equally. The "most clever and most energetic men" benefit from the capitalist system because they keep the rewards of their own innovativeness and industrialists - those who do not undertake any effort do not get a share in the rewards. This argument is predicated on the premise that a person who does nothing to produce something should nonetheless have it.
This is obviously nonsensical: nothing can ever be created without the act of creation, and the person who undertakes the act has the product of his action. The only way that others may share in his product is if he gives it to them voluntarily, or if it is taken by force by someone who distributes it - which is what the socialists are really advocating in favor of, though it cannot be fathomed why anyone would find that situation desirable.
The demand for "equality" of material goods is attractive to those who wish to have things without undertaking the effort to produce them, and perhaps this is the attraction of socialism to the non-productive individual: it is a promise to reap the benefits of someone else's labor, which in effect is a system of slavery. One may either have political equality or material equality, not both.
Moreover, in a capitalist system all benefit from the production of the few by being consumers of their products. The entrepreneur who builds a soap factory earns wealth because people wish to have soap and would rather purchase it from him than make it for themselves. In that sense wealth is the reward of service, caused by providing benefits to others. To rob production of its benefit is to discourage production, and to deprive all of society the benefit of its most innovative and productive members.
Denouncement of Materialism
Another common criticism of capitalism is that it provides men with encouragement to pursue material goals - to be obsessed with things that are useful to everyday life - rather than encouraging men to engage in "higher and nobler pursuits." It is claimed that capitalism is contrary to religious beliefs, and drains society of the resources that might otherwise be devoted to the creation of literature and art that enriches the mind and soul of mankind.
What these critics fail to recognizes is that "higher" pursuits may only be pursued when the basic needs of mankind have been satisfied, and it is only in materially wealthy societies that the arts have historically flourished. The Renaissance, which is offered as the pinnacle of mankind's achievement in art, literature, and philosophy, was financed by the mercantile system in Florence and other cities. The Neo-Renaissance of the last century was likewise fueled by the fortunes of industrial progress. Look to any "golden age" in any society, and it will be seen that it was fueled by commercial success.
There is also the criticism that those who control wealth have the power to fund artists, but do not have the taste to recognize "good" art. This is true of those who gained wealth by means of productive endeavors, but no less true of those who gained wealth by other means. In instances where royalty and nobility sponsor artists, their choice of which artist is no better informed. And for that matter where art is sponsored by a government department or committee, the decision-makers are also no better qualified to judge what art has merit.
But for that matter, what individual or group of people is actually qualified to do so? What gives a person the qualifications? Taste in the arts is highly subjective: there is no arbiter, and each person believes himself to have good taste and anyone who disagrees does not "understand" - simply because their tastes disagree.
His sense is that many of the critics of materialism are themselves individuals who aspire to be recognized as great artists, writers, and thinkers but who are not capable of producing work that anyone else would recognize as having much greatness. And rather than admit their incompetence, these individuals narcissistically declare that it is merely that others do not recognize the greatness of their work.
If there is any democratic way of allowing society to recognize and reward artists, it is the capitalistic system, in which every person may choose to give (or not to give) funding to artists they believe to have merit. The self-aggrandizing incompetents declare the tastes of the public to be vulgar, but this is again bitterness because they deny their incompetence and declare instead that all of society is unfit to judge the quality of their work.
And again, there is the ability in the capitalist system for any person or group of people to patronize any artist they choose - to sponsor or purchase their work. So even if a small group of people recognize the quality of a given artist's work, they can certainly provide for the costs of its production and bestow wealth on the genius who created it. The objection again is on the part of the incompetent artist who wishes to force others to patronize his work.
In all, capitalism does far more to promote the higher pursuits than socialism by providing the wealth and leisure time. It also delivers the benefits of the arts to more of society by enabling them to meet their survival needs with less effort, to enjoy leisure time and to have the discretionary income to patronize the arts. It is utter ignorance to suggest that capitalistic countries are culturally sterile when compared to socialist ones.
Allegations of Injustice
One of the most passionate arguments against capitalism is based on the idea hat all men should share equally in nature's bounty and tat capitalism unjustly takes from some men that which they would naturally have and bestows it upon others who are not entitled to it - that the producer is one who appropriates to himself that which by rights should belong to other people, and the poor and needy are only deprived because someone has taken things away from them.
However, the premise of this argument is entirely false. "Nature is not bountiful but stingy," and provides very little that is suitable for the preservation of human life - and anyone who has spent time in the wilderness is well aware that there is more in nature that threatens human life than endeavors to preserve it. Man's very survival is secured by the actions he takes to defend and protect himself against nature, to gather that which he needs, and to take what little nature provides and render it fit for his use.
There is little food for man in the wilderness, and what can be found is of poor quality. It is by his effort that a even a primitive man gathers what can be had - and without the effort of gathering, he would have nothing. And as we advance beyond a primitive state, man builds farms and factories where he may produce for his own consumption - and without the act of production, there is nothing to be consumed.
And it is "man" in the singular that undertakes this production - one person, or a small group of people working under the direction of a single mind - who establish productive capabilities and invest the labor to render products from them. There is no instance in which all of society has created and worked a farm or a factory by mutual effort and is therefore owed a share of its product.
And yet, there is the argument that all of society should share in the productive effort of one man, and there are even arguments that suggest that it is "unjust" that members of un-industrial nations should be "denied" the benefits of machine production. The notion that those who have done nothing to produce are owners in the product defies logic, but this is the exact premise of the argument on the basis of injustice.
He goes further to suggest that the reward of effort is the incentive to undertake effort. That is, the reward of production is the incentive to be productive. A person who receives the benefits of production without the necessity of being productive remains prodigal because he has no incentive to be productive. IT cannot be contested that "hundreds of millions" in pre-industrial societies remain destitute because they cling to primitive methods of production. The solution is not to give them the product of industrial nations, but to encourage them to industrialize themselves.
And it cannot be said that industrialized nations prevent pre-industrial ones from progressing. The poverty of these backward nations can be attributed to their own public policies of expropriation, discriminatory taxation, the rejection of foreign investment, and other actions that prevent prosperity from occurring.
Loose Topics
(EN: The author tended to stray and ramble in the previous section - I've separated this content for the sake of clarity, but there's some interesting ideas worth preserving.)
Arguments about the "unfairness" of capitalism are often born of a complete misunderstanding of capital and wealth. Wealth is spoken of as if it is "a free gift from god or nature" that should be shared out equally among all men - but that is not the nature of wealth.
The materials that exist in nature are not wealth, and are not useful in their natural state. They must be harvested and in most instances transformed by effort into something that makes them useful. Even at this point, they are simply materials, neither capital nor wealth. To have either capital or wealth, those who produce material must not consume everything they produce, but set aside some portion for future consumption (wealth) or employment as a material for further production (capital).
When capital is put to good use, it grows over time. A productive enterprise creates more than is consumed in the act of creation, and some portion of that excess is reinvested to grow the operation (increasing capital) or returned to the owners of that operation (who may consume it or add it to their wealth).
All of this seems very basic, but is either misunderstood or purposefully ignored in the argument in favor of socialism. The wealth and capital of a nation are said to merely exist, and all are said to have a right to a share even if they had nothing to do with its creation. And the result, as history has shown, is that when the means of production are given to the non-productive, they fail to make productive use of them. Factories operate at a loss until the equipment breaks down and there is no means to repair or replace it. Wealth is simply squandered until it is disappeared. And those who are capable of being productive see no point in putting their productive powers to work - if there is no reward for effort, there is no incentive to undertake the effort.
On a national scale, for a country to grow its increase in capital (wealth devoted to production) must outpace its increase in population so that there is sufficient productive capacity to sustain the growing population. Where this fails to happen, human beings are reduced to the situation of animals, who consume all their resources and then perish for want of resources to sustain the population. With effort, a communist government can slow the descent, but descent is inevitable.
There's brief mention of the marginal utility of labor, an economic concept that demonstrates that there is not an equal increase in production as more workers are added (without the addition of more equipment, materials, etc.), which is a mathematical error rather than a philosophical one, but is nonetheless unknown or ignored by those who plan centrally-managed economies.
He also touches briefly on the argument over whether capital or labor causes the increases in productivity - which generally depends on the nature of the activity and the level of technology employed by the workers. He does point to the example of China (with low capital and high population) and the United States (with high capital and relatively low population) as a general example to suggest that, in general, it is capital that creates the greater productivity.
He considers the notion that an individual worker's productivity is the source of wealth - the belief that the harder he works and the more he produces, the more he is (or should be) compensated. This seems sensible, and can be a factor where there is demand for the product - but in many instances it involves factors other than the amount of effort it requires to do the work. One farmer with a tractor exerts himself less than ten with hand tools, but he produces much more value (by virtue of the tractor, not his effort). Urban workers generally make more than rural workers (whether because of the supply and demand of labor or the supply and demand of money). In all there are many factors that influence the wages of labor other than the exertion of the worker.
So one cannot say that the disparity of wages between workers - of the same or different kinds - is evidence of injustice until all factors are considered - and those who cry "injustice" seldom ever put much effort into their analysis.
The Incompatibility of Socialism and Liberty
It is generally accepted that people are more effective working together than individually, but in any situation where people work together, there are those whose behavior prevents cooperation, and there is a necessity for some authority to react to the behavior of those that cannot seem to peacefully coexist with their fellows. In a totalitarian society, this authority is used proactively to determine roles for all people and controls the way in which they interact to ensure that conflict does not exist. In a liberal society this authority is used reactively, to leave people to choose their own course an intervene only where conflict arises.
The history of western society is an evolution between totalitarianism and liberalism, as it is found that when people are left to choose their own course they are happier and less productive, and a society is more efficient where government is smaller and less intrusive into the daily lives of citizens. Totalitarian control requires a large number of governors, monitors, and a sizable police force to exert constant control - and the labor of all these individuals is not being put to productive use.
The author is a bit meticulous in tracing the history of western civilization from barbarian dominion to the medieval system to mercantilism to capitalism, showing the increase in prosperity and happiness of the average citizen, the growth of population, and the increasing quality of life that have resulted. It is also seen that there is peace between capitalist nations - those who are capable of supporting themselves have no need or desire to raid their neighbors, and there are no military conflicts that arise from the narcissism of aristocratic leaders.
It can also be seen that capitalism is an economic corollary of liberty. In any society in which the productive and consumptive acts of all citizens are controlled by a central authority, liberty cannot be said to exist. Liberty is only compatible with a culture in which each person is free to choose his own direction, in his productive/consumptive behavior as in any other behavior, and interaction among people is by means of voluntary association and voluntary trade. And the results of this liberty are plain to see: the standard of living across all ranks of society is much better today than ever in history, and much better in capitalist societies than in communist ones.
Yet there are those who cling to the notion that mankind would be happier if he abandoned his freedom and yielded himself to the will of a controlling central authority to dictate to him how he should act, what kind of work he should do, what products he should consume. Whether it is presented openly as communism or covertly as a "planned economy," the idea that liberty can be had in a nation where men are controlled seems to persist in the face of all evidence to the contrary.
(EN: There follows rather a long ramble about the politics and political theorists of the author's time, which does not seem to have much evergreen value.)
Liberty and Western Culture
A distinctive element of western philosophy is that government is meant to serve the people, and that all of its power is derived by their consent. Another distinctive tenet is that government does not "make" people free, but merely refrains from interfering with the freedom they have: the bill of rights does not grant people with rights, merely indicates ways in which government ought to refrain from interfering.
Likewise the market economy is based on the idea that it is the independent behavior of the people that create the market - the supply and demand of goods. "The market" is not something that exists without the people, and as such it cannot control or be controlled, as it is merely an abstract way of describing the actions of large numbers of people. Where one seeks to control the market, they are seeking to control people. This is similar to natural rights, in that a government's proper course is to refrain from interfering in the private affairs of the people.
In terms of productive activity, capitalism grants the worker power over himself. He is not a peasant, a serf, or a slave who works at the behest of his ruler but a free individual who makes his own choices. He benefits only from his own wisdom and common sense and suffers only for his own foolishness. He approaches his employer as a supplier of labor who demands a share of the profit in exchange for his service, not as a mendicant who is trading his freedom for a wage. And he is able to choose his employer among any who would have him, or to work for himself if he finds none to his liking.
The wages of labor are paid not by the employer, but by the customer who purchases the product of labor. Where an industry produces what society demands, firms and their employees are well rewarded; where a firm does not produce what is demanded at a price society is willing to pay, then there is little or no reward for its owners, inventors, managers, or workers. The market is merely a vehicle through which individuals reward one another for the benefits they produce for one another.
(EN: This brings to mind that a significant objection to capitalism is that the owners of a company are in control of wages, in that they can pay workers according to what they will accept for their labor rather than a proportionate share of what their labor produces. The irony of this complaint is that socialism simply centralizes this control, with an authority determining the wages of all workers in all industries - and this central authority is no more fair than the management of a single firm. The difference is that when one authority controls all firms, the worker cannot seek better compensation at a different firm.)
Loose Bits
Psychologically, human beings have found comfort in stability and have attempted to establish and defend eternal patterns of behavior against change. Meanwhile, there is "never and nowhere" stability in the entirety of the universe. To reject change and to cease to evolve is a certain path to obsolescence and extinction.
It is only natural to wish to avoid change. We feel secure in patterns of behavior that have produced success in the past and believe that by repeating them we will repeat their former success. It takes far more effort to learn to do something new than to repeat the old, and to change rather than remain the same. Conservatism seems efficient and desirable, but is entirely inadvisable.
It can often be seen that those in a capitalist society resist change, but there is evolution in the market. A firm that wrongly resists change eventually fails while those that rightly embrace change prosper. The only difference offered by a socialist system is to ensure that all of society is managed as if it were one firm - and if it fails to change when change is needed, or changes when change is not needed, or makes the wrong kind of change then it is not just one group of people who suffer the consequences, but all, and there is no-one else to replace the socialist systems when they collapse.