Droopy wrote:1. The idea that free-market capitalism can be just when the D&C states that the reason the earth lies in sin is that it is not given for one to possess more then another.
If the interpretation of the above verse is accurate, and it really implies a criticism of a free market economic order, then anyone positing this view would be required, I think, to explain or harmonize that interpretation with the following:
The foundation of a prosperous society is the ability to create wealth; that is, to acquire and store capital that can then be utilized in the creation of further capital. If individuals ("acting man" to use Von Mises' term) are not free to generate and accumulate capital, then economic development beyond a certain level is simply impossible. Prosperity brings many virtues, as well as problems. Higher living standards, longer and healthier lives, economic security, far greater opportunities to develop talents and interests, greater opportunities for education etc.
The truly great thing about economic liberty, or "capitalism", as it is wrongly understood is the following:
1. In a free market, capitalist economic order under the rule of law mediated by democratic institutions, there is no possible way (we are speaking here of honorable, gainful employment) of achieving any substantial degree of wealth without serving one's fellow beings. Wealth is generated and attained by producing goods or services which other free individuals, in an uncoerced, contractual market, can acquire in an environment in which if one supplier cannot or will not provide the quality and kind of goods or services desired, he will be economically marginalized, while those who will will prosper.
Self interest then - the desire for the economic well being of ourselves and our families, forces us to serve the needs of others in order to attain it. Do you need a widget? Then someone will provide it, in exchange for a sprocket. Both will need wing dings, which will be provided by another. At the end of the day, all parties will have exchanged something they wanted less, according to the use of their own agency, for something they wanted more. As countless examples of such transactions occur, wealth is generated, economic opportunity is expanded, the economy grows, jobs are created, and the entire economy experiences growth.
This is really all "capitalism" is about. Some differences with socialism need to be made explicit, at this point, and much of whether or not one prefers the one to the other is going to depend upon fundamental values that may differ from those of others.
For example. Socialism has, by its critics, long been held forth as morally superior to capitalism because of its egalitarian nature. Yet, which is really the more egalitarian? Empirically and historically, we know that free market economics have raised the livings standards of humanity where it has been implemented, from the poor to the very rich, beyond anything conceivable in generations past. As technology and living standards increase, and as vigorous competition and innovation lower prices, the living standards even of those understood to be very poor increase dramatically over time relative to the surrounding society and relative to past measures of poverty.
More people, across more income levels, have more, live better, and have access to more economic potential and opportunity in a capitalist society than in any other form known to history.
This is egalitarianism but, unlike socialism, it is indirect and surreptitious. Capitalism spreads wealth and prosperity, at relative levels, among all classes of society but does not do so either by force or as a form of charity in the name of a moral directive. Capitalism is moral, indeed, the most moral form of economic order known to history precisely because in serving oneself, one must, regardless of one's personal intentions, serve others. This system generates enormous quantities of wealth, in both capital and capital goods, that then, over time, raise the living standards of the great mass of a nation's citizens beyond any system that seeks, not to generate wealth at the individual level, and remove barriers from its citizens to this can be accomplished with the least amount of artificial difficulty possible, but to redistribute the wealth that is created (keep in mind here that governments cannot create wealth, only productive economic activity can do that).
Now, we ask a question: which is more moral, to redistribute an ever shrinking quantity of an economic pie (which shrinks as the removal of the quantities of wealth necessary to equalize incomes removes the incentive to risk, invest, and produce) with the concomitant lowering of living standards and economic opportunity, or to all individual citizens to prosper by producing things others want to buy in an ever widening pie that spreads economic opportunity across an entire society equally and spreads wealth unequally
but in every greater quantity across all income levels.This is why poverty, in capitalist societies, is, to a great degree, a relative concept. Many of the "poor" in America have amenities that, just a few decades ago, were still primarily the province of the middle and upper classes. Some two thirds of those classified as poor by our own government own there own homes. They own multiple TVs, VCRs, DVD players, and even large screen TVs. Yes, it may be an Emerson, Sanyo, or Philips, and not a JVC, Mitsubishi, Hitachi, or Sony, but its essentially the same thing, and provides a similar rise in living standards.
There is a choice to make. One may have socialism, in which a limited and only marginally growing quantity of wealth is circulated through the society in stationary or diminishing amounts (as the population grows but business and entrepreneurship stagnate or even recess), or one can have capitalism, in which wealth (and relative prosperity) is spread in an ever increasing economic pie among the population.
Both are egalitarian in the sense that all share in the wealth generated. Socialism, however, spreads a single modest or low standard of living among a population through the use of coercive force and seeks conditions of material equality among a population. Capitalism creates
relative rising living standards at all levels of a society in a environment of expanding wealth and economic opportunity (greater possibility of entry in economic activity that will generate higher relative living standards).
Both are egalitarian, but in a free market, there is no central plan, no organized system of wealth creation or distribution, and no moral weight attached to the manner, form, or way in which we serve each other by producing the goods or services free individuals choose to by based upon there own perceived needs and desires (unless those activities, like prostitution or drug dealing, are indeed harmful to the community). The vast variety of the same goods that we see here is a function of a free market, in which different versions of the same things, at different price ranges, with different styles and designs, and with slightly different features, make it possible for people from the poor to the rich enjoy similar amenities (a rich person may have a $5,000 Bulova. The janitor who sweeps the floors at the local elementary school may have a Casio from Wal-Mart. And while the Bulova may by made of gold and contain diamonds or sapphires, the Casio does the same thing (tell time) and probably, depending upon the model, much more, featue wise, than the Bulova).
The paradox here is that, if all productive activity were a collective exercise in charity, very little of it would take place and a society would stagnate in relative poverty. This would not be because many people are not moral, but because if most of the profit generated by that productive activity went was simply 'distributed" to the poor, including the non-productive poor, then the entire engine of economic activity would grind slowly and the net wealth of that society would never rise above a certain limited level.
In this system, there aren't very many rich or middle class people because those levels of prosperity are not possible. The wealth cannot be generated to sustain them. However, most of the poor in this society, must remain permanently poor because of the severe limitations upon the creation of new economic opportunity. Is this moral?
We return here to the old canard about the fisherman. You can give him fish (which we are commanded to do), but, you can also teach him to fish; to become self sufficient himself. Why? Well, this frees up capital that might have gone to him as charity to be used in productive economic activity. Mayby the extra fish is used to produce cat food. An industry grows up around the cat food plant. Jobs and opportunity are created. The fisherman, in time, quits fishing and gets a job at the cat food plant. In time, he earns good wages, benefits, and has a 401K plan.
In a socialist society, this kind of thing is well nigh impossible because a socialist state eats much of the wealth the private sector creates in bureaucratic overhead and redistributing wealth to others who might otherwise be engaging in productive activity themselves, either as employees or employers generating greater net wealth.
Every penny of wealth used in this kind of "charity" or "welfare" is a penny lost to productive economic activity, which is the only means of raising the livings standards of a people over time.
Again, the tension, or choice presents itself: we can redistribute wealth through coercive state control, and thus limit the productive activity that creates it, or we can allow unfettered (within a rule of law and with protections against fraud and business dishonesty though courts of law) economic activity that generates far greater net wealth, creates far vaster job opportunities for the poor, and leaves charity and welfare to the individual and private groups of individuals (such as churches) where, according to the New Testament, is the only place it actually belongs.
In the 80s, when the size of the economy almost doubled, charitable giving doubled as well, tracking the general rise in economic prosperity.
If socialism is more compatible with the gospel than capitalism, then one is going to have to explain a regime that spreads poverty or economic mediocrity evenly as over against a system that spreads wealth unevenly but raises relative living standards across all income groups as the net prosperity across the society increases.
One would also have to harmonize with the Gospel the amount and nature of the state coercion and loss of freedom required in such a system to force conformity to a single, overarching societal plan, and the leveling of individuality necessary to stifle the natural creative and entrepreneurial aspects of human nature.