Recently, I posted an answer to the Quora* question, How is capitalism NOT a zero-sum game?, which is also available on my 1/14/21 blog post. I followed that up by posting a reply to Pascal Morimacil’s answer, available on my blog post of 2/3/21. I then had a conversation with Morimacil. Before I get to that, Morimacil’s answer is reposted here in full:
The basic idea is that if you consider every transaction individually, without looking at anything else, then it kinda seems like both people are better off, since they agree to the trade.
So for example, you pay rent for the right to exist somewhere, and then someone else lets you exist without evicting you. It’s said to be win-win. So, a creation of wealth.
You could analyze a mugging that way, and declare it to be a win-win wealth creating situation.
The victim is paying for the right to exist, and the mugger lets them exist without shooting them. Win-win. If the victim thinks the price is too high, they can just decide not to pay.
You kind of have to ignore the gun, or the threat of eviction
And if you also ignore a lot of other things, like pollution and so on, and rising wealth inequality, well, at some point you are just deciding that money changing hands means things are getting better for everyone.
You can read my reply here, also posted to my blog on 2/3/21. A back-and-forth ensued with Morimacil, which I will post in stages by subject. The subjects are economic, epistemological, and political philosophy. We started with the economic aspect, specifically Morimacil’s landlord/mugger analogy. My economic exchange (Part 1) is posted on 3/8/21. On political philosophy, specifically Capitalism, Morimacil answered:
And if you also ignore a lot of other things, like pollution and so on, and rising wealth inequality, well, at some point you are just deciding that money changing hands means things are getting better for everyone.
My reply:
As to the last two points touched upon, wealth inequality is a natural consequence of the varying productive abilities and personal circumstances of human beings, when left equally free to flourish by the justice, political equality, liberty rights, and constitutionalism of capitalism. Productive work and trade, to the extent it is free of aggressive force as it is under capitalism, expands the amount of wealth, as happens with the renter and the landlord. Trade doesn’t merely divide up a fixed quantity of wealth, like what happens between the mugger and his victim. Under capitalism, wealth inequality is not a proof of zero-sum economics, but a progressive consequence of the win-win nature of capitalism--that an individual’s economic success is tied not to theft but on the diversity of productive ability to create value for others. Those who create the most value for the most people tend to be more wealthy than those who produce less value for fewer people. As long as every transaction is consensual and freely judged by each to be a net gain, it is win-win, not zero-sum. Pollution is a side effect of industry and is resolvable through technological innovation and proper law. History has shown that capitalist economies are much better at alleviating pollution than centrally planned (socialist) economies because technological innovation and proper (rights-protecting) law are features of free markets, not dictatorships. The same freedom of capitalism that facilitates economic progress facilitates solutions to pollution. Today we live in the cleanest ever environment for humans, especially in the U.S., not in spite of but because of the prosperity.
Morimacil came back with:
And then you talk about how wealth inequality is because of productive ability, but a passive income is not production.
Rent seeking enables people to get income and then more wealth, based on how much wealth they own, not on how productive they are.
Then you try to say "creating value" instead, but again, not evicting people isn't "creating value".
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And then you are trying to say that laws about environmental protection are not planned, and that them being enacted at the country level isn't centralization?
Also kind of sweeping aside all the pollution and environmental issues that popped up in the last couple of centuries, and pretending that capitalism is great, because it can create problems, and then commodify people's needs?
Morimacil obviously doesn’t know the difference between government central planning and objective law. I posted this rebuttal:
Capitalism, to distill it down to its essentials, is individual political, economic, and intellectual freedom, secured by objective law. Objective law—law that is clearly defined and clearly implemented—can include rational environmental law. That is not central planning, but its opposite--the protector of the rights-respecting citizen’s freedom to plan and govern his own life without coercive interference. It is why human life has gotten so dramatically better, longer, safer, and cleaner over the past 250 years--and continues on its upward trajectory to this day (despite temporary setbacks like the Covid-19 pandemic). Central planning, in fact, is not law at all. It is the absence of law--and of individual rights. It is arbitrary rule of men over men which leaves no room for people to plan and govern their own lives.
This is Morimacil’s attempt at defining Capitalism philosophically:
Capitalism is the arbitrary rule of owners over others. With a government that is coercive, and working for the owners.
People do all sorts of things within any system, but that’s what capitalism is fundamentally about.
Here is my reply:
You’re almost right. Ownership, or private property, doesn’t give you control of others. But it is your means of controlling your own destiny. And it protects you from those who would control you. A government in a capitalist system definitely protects owners, by coercive means if necessary, from criminals who would take others’ property. And it’s not arbitrary rule, but rule of objective law. A government for securing property rights is certainly one thing that “capitalism is fundamentally about,” though it is not the most fundamental aspect of capitalism, which is more broadly to protect individual rights to life, liberty, and the pursuit of happiness equally and at all times. Ownership, or proper, rights is in large part what makes Capitalism the only moral social system.
The right to acquire, keep, and use private property is vital to human life and flourishing. It is not only materially valuable. It is spiritually vital. Your property reflects your thought, convictions, and values. It is part of your identity and self-esteem and self-ownership. Property ownership is not only a means of pursuing your happiness. It fosters mutual respect and peaceful coexistence among people by establishing boundaries. Private property fosters shared prosperity through trade. Without rights to the product of your efforts, no other rights are practicable. If you don’t have absolute ownership and control of what you earn, then someone else does. Then your life is at others’ mercy. All rights, including rights to free speech, matters of conscience, protection from unreasonable searches and seizures, et al, are meaningless.
The enemies of private property are enemies of humanity. Marx, the arch enemy of private property, ignited a trail of human devastation that even religion can’t match. Marxist regimes impoverished a billion people and killed 100 million innocents in their attempts to build propertyless societies. A government that does not “work for the owners” by protecting ownership rights is not a legitimate government. It is a criminal enterprise working for thieves and looters, including rent deadbeats.
Related Reading:
Cornerstone of Liberty: Property Rights in 21st Century America by Timothy Sandefur
The Capitalist Manifesto by Andrew Bernstein
QUORA: ‘Why has modern capitalism risen in the West?’
QUORA: 'Can certain forms of capitalism be made to work for the people instead of just the elite?'
QUORA: 'Why do people think capitalism is ethical?'
QUORA: ‘Is it fair to say capitalism has killed more people than communism?’
QUORA *: 'How is capitalism good despite the fact that it creates higher and lower classes?'
QUORA: ‘Given that I live in a capitalist society, how can I avoid having my labor exploited?’
QUORA: "Is having an 'Anarcho-capitalist' society possible?"
On ‘Capitalist Government’ and Corporate Bailouts
QUORA: ‘Is capitalism voluntary?’
QUORA: ‘Is fascism a capitalist ideology?‘
QUORA: ‘Can democracy survive capitalism?’
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