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The Evils of Capitalism

January 14th, 2014 - 7:10 am

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“It ain’t so much the things we don’t know that get us into trouble as the things we do know that ain’t so.” – Mark Twain (attributed)

What’s the one thing everyone knows about capitalism?  Why, that it started out as a mean, nasty tool of greedy industrialists. “The Industrial Revolution,” we all learned, was a terrible Moloch that devoured children, put profits before people, and though it made great fortunes (or, perhaps, partly because it made great fortunes), was a wicked development. The Industrial Revolution, we’ve all be taught, was the original sin of capitalism, necessary, perhaps (perhaps) to prime the engine of economic progress, but lamentable nevertheless.

Ask anyone: the Industrial Revolution is a stigma that no amount of societal amelioration can remove. The “factory system,” an integral part of the Industrial Revolution, was an urban nightmare, a Dickensian melodrama in which rural innocence was mauled and blighted in those horrific, unsanitary “Satanic mills” William Blake anathematized.

Once upon a time, before the advent of the factory system, workers enjoyed:

… a passably comfortable existence, leading a righteous and peaceful life and all piety and probity; and their material condition was far better than that their successors. … They did not need to overwork; they did no more than they chose to do. and yet they earned what they needed. They had leisure for healthful work in garden or field, work which, in itself, was recreation for them, and they could take part beside in the recreation and games of their neighbours … [which] contributed to their physical health and vigour. … Their children grew up in fresh country air, and, if they could help their parents at work, it was only occasionally.

Alas, this Eden, as described by Frederick Engels in a fairytale called the condition of the working classes in England in 1844,” was destroyed by the advent of the machine. “The proletariat,” writes Engels “was called into existence by the introduction of machinery:”

The consequences of improvement in machinery under our present social conditions are, for the working-man, solely injurious, and often in the highest degree oppressive. Every new advance things with the loss of employment, want and suffering.

That’s the sad story of capitalism we all imbibed with mother’s milk, or formula. No less an authority than Bertrand Russell has assured us that “the Industrial Revolution caused unspeakable misery both in England and in America. I do not think any student of economic history can doubt that the average happiness in England and early nineteenth century was lower than it had been hundred years earlier.”

As F. A. Hayek points out in Capitalism and the Historians, an extraordinary collection of essays he edited and published in 1954, “The widespread emotional aversion to ‘capitalism’ is closely connected with this belief that the undeniable growth of wealth which the competitive order had produced was purchased at the price of depressing the standard of life the weakest elements of society.” This picture of economic depredation, notes Hayek, is “one supreme myth which more than any other has served to discredit the economic system [capitalism] to which we owe our present-day civilization.”

When we move from the realm of myth-making to historical truth, however, we see that the Engels-Russell narrative, the narrative upon which we’ve all been battened, is a tissue of exaggerations, misrepresentations, and outright lies. A “careful examination of the facts,” which is what Hayek and his colleagues provide in Capitalism and the Historians (or, to give it its full title, Capitalism and the Historians: A Defense of the Early Factory System and its Social and Economic Consequences), has led to a  “thorough refutation of this belief.”

The refutation is indeed thorough, and I heartily recommend this short bracing volume to anyone still laboring under the impression that “early capitalism” was a moral enormity. Barack Obama, for instance, might have spared himself the embarrassment of his recent speech in Kansas had he taken on board some of what Hayek, T.S. Ashton, Louis Hacker, W.H. Hutt, and Bertrand de Jouvenel have to say in this brisk and fog-dispelling volume.

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Top Rated Comments   
Capitalism is simply the word for "when people are free to trade with each other uncoerced."

That's all it is. It's not an artificial construct, like the many variations of socialism. It's simply people free to trade with each other with no outside interference.

We do not live in a capitalist society, contrary to what some might say. As soon as the government regulates the interactions, it's no longer capitalism.
48 weeks ago
48 weeks ago Link To Comment
The first thing we should do is refuse to use Engel's and Marx's pejorative term "capitalism" to describe the system that has brought so much good to the world. It all stems from Rousseau's ridiculous statement about fences. Rousseau was a fool and those that adhere to the philosophy of the noble savage are uninformed morons. Only freedom, economic and political, can free us from base savagery. Do not use your enemy's terms to describe yourself.
48 weeks ago
48 weeks ago Link To Comment
Communism, in all its ugly faces, is a disease.

It is cancer of the tongue, for it turns truth black and necrotic.

It is cancer of the heart, for it turns innocents into corpses.

It is cancer of the soul, for it turns good into evil.

Romanticized Libel...or the communists distortion of history...is a cell dividing slander uncontrolled and virulent. It finds the weakest immune system, the most immature, the most decrepit, the most impressionable and mutates moral decency into a lesion of lies, a tumor of treason, a sepsis of sedition.

Romanticized Libel seeks and destroys healthy debate. It does not permit a varying point of view, for fear that truth may seep in.

So, it seizes academia, it devours mass media, it infects Hollywood.

In every corner where free men gather to inform each other, the virulent disease spreads itself to choke off the oxygen of honor, loyalty, human decency, moral constraint.

Some persist in calling the carriers of this disease "liberal", "elite", "progressives". And to call the uncontrolled cell division cancer "liberalism", "socialism", "collectivism".

Those are hiding places where the cancer appears to be dormant and benign, rather than lying in wait.

Romanticized Libel is the Cancer Historians' way of playing the game of faux victims vs faux oppressors. This is what Communism feeds on as it devours its host. One must create a dank and dark environment, free of light...in order to create V vs O conditions.

Race is the favorite. Class is second. Then ethnicity. Religion. Gender. Sexual preference. Age.

In the most virulent spread of the disease, the malignant cells can mutate healthy ones and trick them into turning on themselves and doing the work of the malignant cells for them.

There is nothing "elite" about spreading lies. There is nothing "liberal" about shutting off the body's communication between the brain and its organs. And the only thing "progressive"...is the disease...which is not the intended use of the word...which is used as a compliment to its nuanced nature, rather than its truth killing infestation.

Capitalism is the host. More specifically, Free Market; Constitutional; Self-Governing; Judeo-Christian; Democracies...are the hosts.

Unless and until we decide to stop giving this disease a dark and dank place to hide, unless and until we decide to combat the spread of this disease, unless and until we pass the shock and horror of being told we have widespread cancer of our national body....we might as well just roll over and die.

WE have...The Big C. And, Bill Ayers may call it small c communism, because it doesn't march into Town Square in formation with jackboots...it comes dressed as Pajama Boy. And Obama. And Hillalinsky. In footie pajamas, meticulously creased pants and pantsuits.

And, they just took away your healthcare...bitter clingers.

48 weeks ago
48 weeks ago Link To Comment
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All Comments   (74)
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I wonder, why the author argues with Engels out of all people? Who cares about Marks and Engels now? Who dares to say publicly that they believe in Marxism, besides people who want to show their originality?
48 weeks ago
48 weeks ago Link To Comment
Happily, Marks has prospered since he ditched Engels and teamed up with a new chap, forming Marks and Spencer.
47 weeks ago
47 weeks ago Link To Comment
Marxism is pre-Freudian, pre-Darwinian, and in effect pre-industrial. Marx understood that value came from the doings of muscle, wind, gravity, and mind work since the start of civilization. Then with the rise of machines and factories, he missed the part that more wealth was coming from the work of the machines. The work done by the machines was stolen by people. Note to the future, always have self-aware computers dependent on a power plug operated by humans.

Capitalism was invented by early human females. When they eliminated estrus from ovulation and declined to do unlimited sex like the Bonobos, then ovulation became secret. This transformed the males into individuals wearing signs saying, "Will work for long walks on the beach."
48 weeks ago
48 weeks ago Link To Comment
--Capitalism is simply the word for "when people are free to trade with each other uncoerced."--

Yes, and as such it is the only moral economic system. Who can defend slavery which is all other economic systems?

The problem is when the word is perverted and becomes associated with getting rich as an end without regard for ethics. Living to get rich without regard for ethics is bad.

It's like "liberalism".

Liberalism as per the dictionary means "a political or social philosophy advocating the freedom of the individual, parliamentary systems of government, nonviolent modification of political, social, or economic institutions to assure unrestricted development in all spheres of human endeavor, and governmental guarantees of individual rights and civil liberties."

The word has now become entirely perverted to mean supporting the regulation of capitalism and moral supremacy of government authorities. These things actually contradicts the original definition.

Or it's like "science" now basically synonymous with natural science. Natural science once was simply the pursuit of finding the consistencies of nature. Now it has become perverted into giving incestuously credentialed persons final authority over the answer to all questions.
48 weeks ago
48 weeks ago Link To Comment
Adam Smith's own term was "the system of natural liberty", a more longwinded version of the name Catholic scholastic schoolmen of the late medieval period named it, "natural liberty".

Asking those who style themselves anti-capitalist what they have against natural liberty gets their hidden assumptions into the open. Gives 'em headaches too, always a good thing.
47 weeks ago
47 weeks ago Link To Comment
Actually it's a nexus between the three of them that did the deed...
48 weeks ago
48 weeks ago Link To Comment
Y'know...the "progressives" sure hate "capitalism" but they sure do love all the money it makes and the gadgets it discovers. This is so very simple...it's the envy of the "talking class". Professors and writers and the rest who say "I'm so much smarter than that industrialist, why am I not rich? People don't value me as much so people must be stupid."

It's illustrated no better than Nancy Pelosi demanding the very kind if jet she and other Dems sought to deny to the GM executives on their way to be harangued by congress. Not that I have much good to say about GM execs, but they fly because their time is more expensive than the plane ride.
48 weeks ago
48 weeks ago Link To Comment
Over at Insty, the link here is just above an article about Branson's space plane achieving new goals. Branson is a limo-socialist, except he sure does love the freedom to develop his space business.
48 weeks ago
48 weeks ago Link To Comment
That hundreds of millions of people can be re-written, on the state's books, from assets to liabilities by an inauguration ceremony in a middle-sized city on the eastern coast of the north american continent, is a most confounding element of our times.
48 weeks ago
48 weeks ago Link To Comment
Capitalism: In the lazy air of tropical Trinidad the hapless idlers relax over lime and rum listening to soca, meditating over the next Mass Camp, and trying to convince the wealthy European tourists that capitalism is the bane of mankind and communism, properly directed, will at least forestall the increasing slavery. Nonetheless, they all want to emigrate to the US. The year is 2013.

Trinis know that the sweat shops in SE Asia pay pennies to children to make inferior products, but they also know the workers leave their farms and families to make enough money to survive and to send home to their families. Jobs nonetheless are scare and the few who are employed count themselves lucky.

None want to return to the idyllic life in the mountains.

We in the US buy our clothes, shoes, furniture and i-phones from such factories and scream against the hapless corporate owners who bring wealth, such as it is, to far-away lands.

Perhaps we should demand that foreign factories pay a minimum wage equal to ours. Then our own workers could be employed and in control of their lives again: unions would rise again; retirements would be paid again; cadillac insurance will be given to all again; and the price of the hot air popcorn popper, the counter-top low-fat burger grill, the house-full of furniture that once took a lifetime to accumulate will be back again. Detroit will bustle again. And a stereo will cost $4,000 (adjusted for inflation) again.

Be gone, capitalism! Send the Pakistani poppy-growers back to their fields. Send the Cambodian farm children back to their parents to struggle again. Keep our money at home. We printed it; we should keep it.

48 weeks ago
48 weeks ago Link To Comment
"The early nineteenth century, according to the conventional wisdom, was a time of great economic oppression. In fact it was the debut of an era of progress and wealth creation the likes of which the world had never seen...Was there squalor and misery and poverty in the early nineteenth century? You betcha. And a lot of it was abetted by poor government policy."

Indeed.

"Never mind the low wages and the harsh living conditions of the early years of capitalism. They were all that the national economies of the time could afford. Capitalism DID NOT CREATE poverty—IT INHERITED IT. Compared to the centuries of precapitalist starvation, the living conditions of the poor in the early years of capitalism were the first chance the poor had ever had to survive. As proof—the enormous growth of the European population during the nineteenth century, a growth of over 300 per cent, as compared to the previous growth of something like 3 per cent per century." -- Ayn Rand
48 weeks ago
48 weeks ago Link To Comment
I read a column many years ago, I believe in the Wall Street Journal, about how just the ability to produce nails by machine revolutionized and greatly cheapened the cost of building a home. Prior to mechanization, all nails were individually made by a blacksmith. A house was either held together by these expensive items or joined with intricate woodwork. Just this item, and doubtlessly hundred of similar items, all give away the lie of declining standard of living in the 1800's.
48 weeks ago
48 weeks ago Link To Comment

I remember reading that in the 'olden days' when people who lived on the Plains moved, they burned down the old house to take the nails with them, so valuable and hard to get were those nails!

Capitalisms has indeed made our lives better in more ways that we can measure. I fear that we've become soft, unappreciative and foolish after a lifetime of such ease.
48 weeks ago
48 weeks ago Link To Comment
OK, we've gotten this far without mentioning "the goddess of the market", so please just have a look:

http://www.amazon.com/Capitalism-Unknown-Ideal-Ayn-Rand/dp/0451147952

And please read the 1-star reviews. They're perfectly delicious.
48 weeks ago
48 weeks ago Link To Comment
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