With Defenders Like These ...

... Capitalism Needs No Detractors.

Clive Crook of National Journal asks the question, "Why does capitalism get such a bum rap?" and then spends an entire column obliviously answering his own question. The executive summary would go something like this: "Capitalism gets a bum rap for two reasons: (1) Most people do not even know what capitalism is. (2) The vast majority of people are altruists, meaning that they oppose the moral basis of capitalism, namely, egoism.

To critique Crook, then, we must start off with a definition of capitalism. Ayn Rand defined this nicely in her essay, "What is Capitalism?" in Capitalism: The Unknown Ideal.

Capitalism is a social system based on the recognition of individual rights, including property rights, in which all property is privately owned.

Notice that a mere six words into the definition, we're already getting deeper into the philosophical hierarchy. Way deeper, in fact: Capitalism is based on a recognition of "individual rights," which Ayn Rand showed to be a consequence of man's very nature as a rational being. A bit further down in his essay, Crook discusses Adam Smith as a moralist, but what of Adam Smith as a metaphysician or an epistemologist? One cannot simply pull a system of morality full-blown out of a vacuum. Morality must start by asking what man is, and how that question is answered will depend on how man knows what he knows.

Ayn Rand showed that one's conclusions about ethics and politics follow from one's conclusions about metaphysics and epistemology. Take Clive Crook, who dives into his question after skipping the two most fundamental branches of philosophy, as a demonstration of how bad initial premises can completely undermine an argument.

Crook begins by bemoaning the many strands of anti-capitalism endemic to the West, which he rightly points out, has greatly benefited from having at least partly capitalist economies for the last half of the twentieth century.

There are many kinds of anti-capitalism. The most militant variety, involving street protests and kicked-in windows, has subsided a little lately. But this was never the most important kind. A broader, milder, even cordial, discontent with capitalism saturates Western culture. It has become so familiar that it barely registers at the conscious level. But the feeling is there, and it creates the climate in which public policy is framed.

I disagree with Crook that the "barbarians at the G-8" as Robert Tracinski once called them, are the most "militant variety" of anti-capitalist. That title is shared by Stalin and Mao, who each made Adolph Hitler look like a mere piker in the enterprise of mass murder, at least in terms of how many people they killed. While many anti-globalization goons are communists, many are not. Why were the crimes of Uncle Joe and the Chairman omitted? To deflect the usual criticism that these men "perverted" communism? Because they weren't really anti-capitalists? Because, somehow, academically-respectable Marxism is somehow immune from the criticism of being "militant," and that it was these men who were "militant" (read: "extreme")?

Making what I hope isn't a charitable assumption -- that Crook has heard of these men -- I hold that he had to have a reason for somehow failing to include Communist mass-murderers as "militant" anti-capitalists. And what of Pol Pot and Kim Jong "Mentally" Il? Ceausescu? Might there be something about communism -- like its complete disregard for individual rights -- that somehow causes so many communist regimes to be little more than huge concentration camps? So, right out of the gate, Crook has failed to note who the biggest enemies of capitalism are. (That his article is about the West is beside the point: There are plenty of unrepentant communists in the West to this day.) This omission is too glaring to be due to anything other than a fundamental flaw in his reasoning, as we shall see.

Setting aside the wholesale slaughter of irreplaceable human beings by the communists for a moment, let's look at one of Crook's examples of anti-capitalism.

The region whose plight is most desperate is Africa. Here it might seem to make more sense to blame [as did the archbishop of Canterbury] the "global economic system" for keeping the poor in poverty. And in a sense, it is true, because rich-world trade policies do continue to discriminate, scandalously, against exports from Africa. But the plain implication of this is that Africa needs more exposure to trade [my emphasis] with the West, not less; more capitalism, not more of some other system, whatever that may be. Increasingly, Africa's own governments are making this point themselves. They want access to Western markets. Where is the chorus of Western demands, in the name of economic justice, for rich-country markets to be thrown open to imports from the world's poor countries? You cannot hear it. It is drowned out by denunciations of sweatshop labor and "naive confidence in free trade."

This "chorus" is also being drowned out by calls for the West to sacrifice itself to the third world in the form of debt relief, free AIDS treatments, and the like. Crook notes that many in the West fail to see what African leaders evidently understand: that their countries would benefit from trade being freer. Granting that Crook is accurately assessing what these leaders mean when they ask for freer trade with the West, the interesting question becomes, "Why does no one see this 'plain implication?'"

Crook laments:

It is as though the 20th century never happened. Capitalism has delivered [my emphasis] hitherto-unimaginable advances in living standards across the developed world. And this is not just measured in dollars and cents. Broader social progress has been made too, again at historically unprecedented rates. Life expectancy, infant mortality, access to health care and education -- regardless of which of these measures you take, capitalism has achieved stunning results.

But has capitalism delivered all of these great things? I disagree with this next author, but James K. Galbraith apparently believes that at least two of the items on Crook's "social progress" list were made possible in America not by capitalism, but by social security:

Once the elderly were provided the means to enjoy long retirements, their life expectancies soared, and the proportion of the population living above the retirement age necessarily rose. When the government started picking up the medical bills, the health care industry also mushroomed, creating the cornucopia of services and treatments we have today. Thus, as Social Security lightened the burden on families, the total costs of care for the elderly shot up.

Indeed, how can Crook even begin to answer this? He has failed to make clear that the West has not lived fully under capitalism and he is trying to justify capitalism on the basis of "social progress" to boot. (For all we know, Crook might well regard social security as an element of capitalism.)

Crook, though, is apparently oblivious to such objections. Why does he think capitalism gets such a "bum rap?"

My guess is that it is the failure to grasp an idea that was famously advanced more than two centuries ago by Adam Smith, the intellectual patron of this column: the idea of the invisible hand.

In other words, nobody's hip to the idea of complex, self-organizing systems. What about all those lefties who do, at least, grasp a similar concept: evolution? How come they are comfortable with the idea of natural intelligence arising ultimately from a primordial soup while the spontaneous order of a free economy gives them the heebie-jeebies? And how many well-educated, but anti-capitalist, adults out there would scoff at the idea that, under the right conditions, a huge number of atmospheric gas molecules and water molecules could self-organize into a hurricane?

That's not the problem, Clive, my boy. The problem lies within the following quote.

To acknowledge the power of Smith's insight is not to favor laissez-faire [That answers the question I had about those leftists who "get" evolution. -- ed], though this is a very common misunderstanding (on the right as well as on the left). Smith was no advocate of laissez-faire. And to recognize the inadvertent collective power of enlightened self-interest is not to believe that "greed is good," [my emphasis] which popular culture appears to have enshrined as the organizing principle of capitalist enterprise.

Smith, a moral philosopher, would have found that completely perplexing. Greed is an irrational passion [my emphasis] that blinds people and leads them to ruin. It is almost the opposite of enlightened [by what? -- ed] self-interest [my emphasis]-- which, among other things, is a socializing and civilizing influence, since it seeks opportunities for cooperation with others, makes people careful of their reputation for honesty and fair dealing, and so on.

Oh! You said that? On what basis is capitalism not laissez-faire? And how is greed not good? What, for that matter, is good? Oh? You didn't ask that question, did you? You let others decide what is "good" and "enlightened" for you? Did they bother to ask what man is that he needs such "goods," or how he knows which guidance (if any) to accept?

According to Crook and his ilk, greed is irrational and ("unenlightened") self-interest presumably excludes the following: getting along well with others, a desire to benefit from civilization, cooperation (might trade qualify as such?), concern that one have a good reputation, and even honesty! Wrong. Wrong! Wrong!

And this is what happens when one does not, as Ayn Rand did, tackle the fundamentals before attempting to address a difficult issue like, "Why is capitalism getting a bum rap?" As I stated before, most people, including Crook, are morally opposed to capitalism. An appreciation of what individual rights consist of is essential to understanding and properly advocating capitalism. One's rights are based on the fact that one's tool of survival is his mind. And to survive, one must be free from the initiation of force by others (whether or not they feel that they are more "enlightened" than he) lest the judgements of his mind and the profits he may attain by using his mind be negated or stolen. (This last concern is where the idea of property rights comes in.)

It is only when this connection is appreciated that the fact that capitalism is laissez-faire becomes apparent. (And so Crook does not, in fact, even know what capitalism is, himself.) Only then can one hope to see why, exactly, social security is incompatible with capitalism and why it is immoral. But when the connection I just outlined is not made, you get an alleged capitalist compromising himself at the outset: He starts out accepting a mixed economy as a capitalist one and then attempts to defend "capitalism" in the altruistic terms of its enemies rather than in egoistic terms as it can and should be defended.

Consequently, his "defense" of "capitalism" becomes little more than a mouthing of altruistic pieties, and an attempt to "sell" capitalism as if it is as uncontroversial as a vacuum cleaner or a bar of soap. And worse, when one accepts altruism, one is intellectually disarmed in the presence of its most consistent practicioners. Doubtless, James K. Galbraith, wrong as he is, would make mincemeat of Crook in a debate. But then, the beginning of Crook's essay also comes to mind. I have often heard people say that communism was a noble, but impractical, idea. I daresay Crook would agree with that sentiment. And in so doing, perhaps he has come to regard the countless deaths caused by communism as tragedies, rather than the atrocities they really are.

So why is capitalism getting such a bum rap? Clive Crook, in attempting to crack that chestnut has provided us with exhibit A instead.

-- CAV

Crossposted to the Egosphere