Capitalism is the Greatest Achievement of Human History — Praise It

(Austrian) Economics
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I am grateful that we have capitalism to the extent that we in fact do have it — and although we certainly don’t have enough capitalism, I am grateful for how much we actually do have. Everything we have in the modern civilized world is only possible due to capitalism and the accumulation of capital. It is the natural expression of free markets whenever there is a sufficient level of civilization. The accumulation of capital is essential for the progress of civilization in all aspects. Technological progress alone is insufficient. While capital accumulation has occurred to various extents throughout history, the system of capitalism is a more recent development allowing for much more efficient capital accumulation and development.

It is actually quite incredible to think of how much prior civilization, technological progress, and accumulated capital are necessary to make something as simple as a screw. Even with the instructions and all relevant knowledge, primitive people wouldn’t be able to make them for at least decades, possibly centuries. When you think about the precise dimensions of something as simple as a screw, you realize it obviously required something very precise to make it (e.g., precise casting). And that thing required something precise to make it, and so-on and so-forth. It is a process of building up more and more sophisticated tools from simpler ones, which requires significant capital accumulation.

It is also doubtful that many people, if any, know the entire production process — from raw earth materials to finished product — for even something as simple as a screw. Its production requires the voluntarily cooperative interactions of numerous people. Furthermore, as my friend Juan Fernando Carpio has argued in a forthcoming paper, the human mind and body are both capital goods, which require development. The entirety of human knowledge, considered in the abstract, is akin to the accumulation of capital goods. To the extent that we have civilization, such is only possible because of the accumulation of different kinds of capital.

This is something ignored by socialists of every variety, be they anarchist or Statist socialists. (I would argue that an anarchist socialist will, when faced with the reality of how free people actually act, either have to at least tacitly endorse private property and capitalism, or will become a Statist). The various systems advocated by socialist anarchists all hinder or make impossible capital accumulation. For example, various flavors of anarchist socialism might attempt to ban — how can they do this while remaining anarchist? — absentee ownership or the separation of ownership and control (i.e., corporations). The banning of either would result in rising time-preferences and thus greatly decrease incentives for saving and capital accumulation.

Some Suggested Readings

Ludwig von Mises, 2008 [1956]. The Anti-Capitalistic Mentality. Ludwig von Mises Institute, Auburn, AL.
Reisman, George. 2002. “Some Fundamental Insights Into the Benevolent Nature of Capitalism“. Mises Daily. October 24.
Rothbard, Murray N. 2009. “Capitalism versus Statism“. Mises Daily. September 29.
Leonard E. Read, “I, Pencil,” The Freeman, December 1958.

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How wild was the “Wild West”, in fact?

Libertarian Theory, Non-Fiction Reviews, Police Statism, Private Crime, Private Security & Law
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If a small town in which property rights (the societal recognition of Lockean rules as enforceable claims) are generally respected doesn’t have one individual called “the mayor” or “the governor”, society will collapse in a blaze of lead and gunpowder, Hollywood neverendingly tells us. Movie directors show us a land of arbitrary deeds from violent types who terrorized peaceful (this is the Establishment’s code-word for “harmless”) populations all throughout the land until forcible government was established and chaos turned to order.

But as several empirical investigations have pointed out, much to the so-called “conservatives” and “liberals” (actually two branches of social democracy, dogma and fallacy based, respectively) dismay, the less government there is, the more peaceful and prosperous a territory can be with respect to its own cultural potential. Why? Because no area is better served by a monopoly than by free competition: this certainly includes the provision of personal, property defense, and conflict resolution services.

Terry Anderson has a superb academic paper entitled “An American Experiment in Anarcho- Capitalism: The Not So Wild, Wild West and a lighter yet not less revealing article on the subject that has been a must-read for Mises.org visitors interested in the real dynamics of society, the State and its allies’ propaganda notwithstanding. …

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Left-Anarchist Criminality and Incoherence

Private Crime, The Left
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Many left-anarchists are fairly civilized. But many others are not. An ex-vegan was going to give an anti-vegetarianism speech at an anarchist book  fair in San Francisco, and these criminals threw cayenne-laced pies at her. What completely indefensible behavior. These people might want to bring down state power, but I don’t know that we’d be better off being ruled by them than the current power elite.

One reason “anarchism” — the rejection of the state or, more generally, the rejection of authority—is not enough can be seen in the way left-anarchists often violate private property or even commit acts of personal violence against political enemies. Property rights and the non-aggression axiom are key. Anarchism is best seen as the logical consequence of libertarianism, grounded in property and self-ownership, rather than being an end in itself. All radical libertarians should be anarchists. But not all anarchists are truly libertarians.

Of course, even private criminality would be infinitely more tolerable than the state, and certainly this is the case in a relatively civilized culture that can handle some deviants here and there, as ours can. Indeed, the fact that America is relatively civil despite the state doing everything to undermine civil society—through war, drug prohibition, gun control, welfare, public schools, etc.—demonstrates the workability of anarchy. But culture must come first to maintain any free or even civilized society. And on the question of culture, many left-anarchists are on the wrong side. They would reduce us to tribalism, primitivism and chaos. By the way, I am not talking about the mutualists or pro-market, pro-law left-anarchists. I’m not talking about Tuckerites or followers of Proudhon. These people all have views on social order and economics than differ from mine, but at least they believe in society and tend to oppose violence against the innocent. I am talking about the social anarchists even to the “left” of these folks, who have no love of the market, no respect for property at all, no compunctions about watching the world burn.

Perhaps in a sense they are the true “anarchists”—opposed to all order, hierarchy and law, not just statism—whereas the strictly anti-statist meaning of anarchism is the actual misnomer. But on the other hand, how can one be against order and hierarchy altogether? Even to be philosophically opposed to hierarchy puts hierarchy below disorder, thus bolstering a hierarchy of ideas. The extremist anarchists oppose all social conventions and norms, and even language and technology. You can read about it on their websites. This kind of anarchism is incoherent and contradictory, even if it is more true to the etymology of the word “anarchism.” But anarcho-libertarianism, anchored in private property rights and non-aggression, is far more achievable, humane and civilized, and eschews the type of aggression we often see left-anarchists personally involved in.

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