maybe they're asking the wrong question

Rasmussen released some new poll results this week: Just 53% Say Capitalism Better Than Socialism.  On the bright side, only 20% believe socialism is better, though it's hard be comforted by the idea that 27% can actually be undecided on the matter.

I imagine capitalism's coming down faster in the public eye than socialism is going up, and we may just be heading for the day when the consensus will be that both suck equally.  But even that is unfair to capitalism, since many of the institutions and processes associated with capitalism today -- particularly the aspects that make the most headlines -- are arguably more socialistic than capitalistic in the first place.  It's possible, from a general perception standpoint, that in the race between capitalism and socialism true capitalism is not even represented.

I recently blogged that "capitalism" is really just another word for "freedom".  When I presented this idea to a flaming liberal, I was accused of confusing the two so as to reframe politically popular criticism of capitalism as a politically incorrect attack on freedom.  I think that's ironic, since the term "capitalism" was invented by leftists specifically to provide cover for their movement to attack freedom.

I prefer to think that my reasoning unmasks the more fundamental (and absurd) complaint of those who attack capitalism: that freedom does not produce the results they want.  I say "absurd" because there's something irrational about expecting any particular result from anything that's supposedly free, and something intellectually dishonest about demanding a particular result from it.  The only thing true freedom guarantees is justice, and what socialists are expressing is their frustration and disappointment to learn that there is so much unworthiness in the world -- and among themselves in particular.  (This is a central theme of Ludwig von Mises' The Anti-Capitalistic Mentality.)

With the Rasmussen poll in mind, I wonder if Americans would respond differently if a survey asked them to choose between socialism and freedom.  Of course, it could turn into another exploration of ignorance ("Can't we have both?"), but I expect that most Americans are smart enough to choose freedom.  Even if relentless attacks on it have led some to consider scrapping capitalism, that's only because they don't equate it with freedom.  Americans universally consider themselves free, and they value that even if they don't cherish it.  Even if they don't understand it.

Capitalism and freedom begin with property ownership.  Even Marx recognized that labor creates an entitlement to one's product -- property.  Capitalism is about using one's property, not for consumption, but for the purpose of creating more products for the benefit of others, and therefore for profit.  Naturally, capital applied this way is used only for purposes that are valued enough to generate a profit. 

Socialism is about seizing property and using it for purposes that aren't profitable -- for purposes the creators of that property would not have used it for.  It could be a program that nobody wants, or it could be a politically popular program that nobody actually wants to pay for.  Either way, what's lost is the freedom of those who produce to decide how some of their property is invested or consumed.  Not because capitalism "fails" in any way, but because whatever free people value enough to work for voluntarily does not produce the outcomes socialists value enough to achieve through force.  It's exactly the same principle used by criminals, hiding behind the legitimacy of a government that was constituted to protect us from criminals.

Socialism is not an attack on capitalism -- socialists are more than happy to acquire capital and to use it for their own purposes.  It's an attack on freedom, because socialists believe their values -- beginning with coercion and elitism -- are more important than the creative values that actually produce property.  It's an attack on freedom because it begins with making workers subservient to the state.  That's a big leap from the principles that founded our country, and which were the original intent of our Constitution.

It is true that capitalism has a lexicon that we don't intuitively associate with freedom.  Stock markets, futures, options, mutual funds -- these terms all have a purely capitalistic connotation.  But these are just the arbitrary institutions and conventions of an encompassing philosophy that isn't centrally controlled.  A philosophy that doesn't guarantee equality or security, but rather justice and value.  A philosophy that can't be expected to produce any particular outcome because it is supposedly free.

And when the socialists attack capitalism, they're not attacking stock markets, futures, options or mutual funds -- they're attacking the system that doesn't yield the particular result they want.  They are admitting that free will does not produce what they will for.  They are attacking freedom, with the goal of imposing their will on those who produce, and imposing it with the threat of force.

Comments

[Bill]

Very well put, I got into an argument with fellow students in my classroom a few days ago over such an issue; they said capitalism is clearly failing and they would like to see a shift toward socialism. I told them we haven't had capitalism in this country for a while, but I think their understanding of the term was lacking.

[angulimala]

And the Marxists said that Communism didn't fail because the USSR wasn't really pure Marxism .....

For a guy who rails against "Marxists", you do a good job of imitating them.

[John Galt]

Angulimala, presumably you are talking about the subprime situation, or any part of the mess that stemmed from it.

I don't recognize the moral equivalence you seem to claim in your response.

What failed here was a policy of guaranteeing successful outcomes to encourage unreasonable risk-taking. The risk-taking became so profitable that the resulting losses were too large to be covered. The risks were real, but the guarantee was worthless. Or perhaps the profits were real, but the risks were someone else's.

Either way, if we applied such a law to a pristinely free economy, the failure would be exactly the same, and we would all understand the role of regulation in the ensuing catastrophe.

You, on the other hand, seem to think that since we applied a whole bunch of laws over time, and then incrementally repealed all but this one, that the same failure is therefore a result of deregulation. Absurd.

People will do what profits them. This is not new; "greed" is not a new invention. It was the nature of humanity before these laws went onto the books.

Government created a conduit, through which it hoped to siphon money from taxpayers, to pay for the mortgages of deadbeats with no reasonable hope of getting loans on the basis of credit.

It is that ridiculous conduit, and not the perfectly predictable response of the market, that is the problem here.

The next time you want freedom take the blame for something instead of government, show it to me a framework of laws that isn't already trying to steal from one person or another.

As far as I'm concerned, what happened here was a government plan to defraud taxpayers. Freedom didn't fail here -- government succeeded. And in a very big way.