Why Capitalism? Why Not Capitalism?

Reason has an interview in their November issue,  with Jason Brennan, professor of philosophy at Georgetown, and author of the recent book “Why Not Capitalism”, published here in the piece “Why Capitalism?”.

From the blurb:

Most economists believe capitalism is a compromise with selfish human nature. As Adam Smith put it, “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest.” Capitalism works better than socialism, according to this thinking, only because we are not kind and generous enough to make socialism work. If we were saints, we would be socialists.

In Why Not Capitalism?, Jason Brennan attacks this widely held belief, arguing that capitalism would remain the best system even if we were morally perfect. Even in an ideal world, private property and free markets would be the best way to promote mutual cooperation, social justice, harmony, and prosperity. Socialists seek to capture the moral high ground by showing that ideal socialism is morally superior to realistic capitalism. But, Brennan responds, ideal capitalism is superior to ideal socialism, and so capitalism beats socialism at every level.

Clearly, engagingly, and at times provocatively written, Why Not Capitalism? will cause readers of all political persuasions to re-evaluate where they stand vis-à-vis economic priorities and systems—as they exist now and as they might be improved in the future.

I am in the midst of reading the book now, and if I think it’s warranted, I’ll post a review of it later this week. However, the thesis of the piece is that capitalism works, because it is in concordance with human nature. All other economic systems are dependent on humans denying or modifying their nature.

While I agree that the basic thesis is correct; my personal belief is that it’s even more basic than that.

Why Capitalism?

Because capitalism is not a system which has to be promulgated, enacted, imposed, or enforced.

Capitalism doesn’t depend on any government,  group, or single individual, deliberately controlling or changing anything. It’s the natural result of voluntary and rational response to economic incentive and feedback. If things are left alone to work out as people will, the result is capitalism.

What capitalism ISN’T, is the gross parody promulgated by socialists and other leftists. In real world terms, this misconception of capitalism is closest to 18th-19th century imperialist mercantilism… Which isn’t surprising, given that mercantilism was in fact the dominant economic system when Marx and Engels were writing.

Capitalism is simply the end result of spontaneous self organization of autonomous rational actors, and their response to changing conditions, intelligence, incentive, and feedback; including market conditions, and pricing.

We had capitalism, tens of thousands of years before we even had governments, never mind the invention of the term.

Capitalism is the default mode of economic interaction.

It’s basically gravity.

The video interview of Professor Brennan:

I am a cynically romantic optimistic pessimist. I am neither liberal, nor conservative. I am a (somewhat disgruntled) muscular minarchist… something like a constructive anarchist.

Basically what that means, is that I believe, all things being equal, responsible adults should be able to do whatever the hell they want to do, so long as nobody’s getting hurt, who isn’t paying extra