Thursday, March 11, 2021

Inventing True Capitalism

 THE TWIN PILLARS of american conservatism are capitalism and Christianity, in no particular order. throw in gun ownership rights unabridged, and you have your three legged stool, or, as historian author gore Vidal called them, the "Jesus, Guns, and Money crowd". this, notwithstanding the obvious fact that the essential message of Jesus is socialism, not capitalism (give unto the poor, render unto Caesar). Or, as the progressive christian joke has it; private charitable giving to the poor is Christianity, government assistance to the poor is socialism. There are a few things about capitalistic theory that conservatives ought to know, but probably don't, which were first articulated by the intellectual father of capitalism, Adam Smith, in his seminal work "The Wealth of nations", published in 1776, the Bible of capitalism, which describes how it should operate, but does not, contrary to popular notions, necessarily advocate it.smith said that the free market is the best method of allocating and distributing wealth, under two conditions. First, it requires that people behave rationally, in their own best interests. Second, the free market must be truly free, which means lacking any external factors which impede or distort its functioning, what economists call "externalities". Such conditions are akin to a vacuum; in nature they can never exist, thus they never exist. People do not always behave rationally, in their best interests. Much human behavior is self destructive, harmful to the individual. Also, no free market can ever be free of external, unpredictable factors, which can include anything from crazy weather to monopolies to pandemics. The free market, operating perfectly, would allow the abolition of government, when in fact, in this world or reality, government is necessary to stabilize and regulate the economy to some extent, no matter how much we might wish it to go away and leave the market alone, it cannot. If it did, capitalism would consume itself in its own craziness. government must protect capitalism from itself. Adan Smith said, apparently realizing that the free market would always function imperfectly and would produce a wealthy and a poor class, that 'all government action benefiting the poor is desirable, and no government action benefiting the wealthy is desirable". Definitely not the sort of message conservative Republicans want to hear. Smith  obviously believed that externalities distorting the free market would alwayd always exist to produce great economic inequality, which is essentially saying that capitalism is by its very nature a flawed economic system, although perhaps more efficient than any other kind humans might originate. And now, for the coup d'etat:. according to the intellectual godfather of capitalism, in a perfect free market, an efficient effective free market, not only would there be equality of opportunity, but also, equality of outcome, meaning economic equality between the wealthiest owner and the poorest worker. Obviously, Adam Smith did not really believe that capitalism would work this way; he envisioned a free market supported and sustained by laws and government involvement, but only insofar as might be necessary to produce something similar to the desired results; a reasonable standard of living for all, with reasonable work conditions. smith, by the way, abhorred the emerging factory system of the late eighteenth century, as he realized that it was turning people into creatures of hard labor, with boring,m repetitive, jobs of constant drudgery. Smith's purpose was to describe free market capitalism, not to venerate it. We should probably do more of the same; describe and analyze our economic systems, and seek to improve them to make them work better for everyone, rather than merely praise or condemn them, depending on one's political viewpoint.

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