For most in the West, the capitalism debate seems old and tired. We either love it or hate it. The haters are branded socialist, communist, fascist, etc. The lovers are called conservatives, greedy, hoarders, etc. These labels may or may not be correct as they are applied, but I want to look at it from a different angle.
Where does capitalism come from? For most they simply see it as the free market at work, but that simply isnt' the case.
Whenever someone attaches 'ism' to something - take a long hard look before you agree with them on it. Ism as a suffix almost universally means that whatever word it is attached to has now become the ultimate objective, the meaning to life. Thus communism means that the idea of the commune is the end all. Humanism refers to humanity being the ultimate. Feminism... (well you get the idea).
So let's look at capital-ism. Capital refers to money, wealth, something that can be traded for something else. Capitalism basically then puts the pursuit of wealth above all. Most people recognize this isn't really healthy, too many evils have happened because of people putting their money above people. Capitalism evolved out of free market thinking, not because it's the next natural step, but because it was allowed to dominate. The idea that we were all able to pursue our own goals without being impeded (free market thinking) of course allowed those who valued wealth above all else to pursue that end.
This is to be expected, and is not necessarily a bad thing. The mistake is to assume that the free market system is ONLY for the capitalists among us, and this is usually why it is attacked. When a modern liberal (socialist) sees the free market being used to further an individual's wealth - they assume that this must be it's only function.
To see why this isn't true we must back up and look at a larger picture. The west values political freedom above all. To us, liberty is essential. This wasn't always the case. Older societies took it for granted that a top down system of hierarchy, of some form or another, was a certainty in life. Our modern breakthrough in this regard is no longer seen as such. It has become the thing we now take for granted. (Small side trail, this is why the modern TRUE liberal has become labeled the conservative, because we are attempting to conserve an idea that USED to be the progressives goal... but now that we have it, it has become the old thing). Now that we take our liberty for granted, the progressive (labeled now as a 'liberal') has moved on. Now the big enemy to defeat has become the disparity between the millionaire and the poverty of the person out on the street, or in the developing nations.
This seems like such a noble goal, that we often lose sight of the problem with even thinking this way. The very notion that it's the little guy against big guy is the classist thinking that, through marxism, produced communism. The very method by which these caring people wish to solve the problem is the old method that we fought so very hard to overcome just a few hundred years ago - authoritarianism. How can I say that? Anytime we have a forced program of wealth distribution, there must be a structure to distribute it. This structure, by necessity, must be a top down, authoritarian model.
Of course a natural question to then ask: Why it is that moder 'democracies' in the west have often become welfare states? Aren't they still individualistic? Don't they still have their liberty? Surely I can't make the comparison between the monarchies, tyrannies and oligarchies of old and these modern examples of state compassion.
Actually I can, but not because their current governments are necessarily authoritarian (although I could go through and show how the bureaucracies of the modern welfare state are a modern version of the old top down systems, and if I get any requests, I could still do it)
No, why I can make that statement is because of what the states are not. Sure they provide a basic sustenance to the least in their population, but there are still strong inequalities (by the socialist wealth standard) within their societies. There are still the wealthy and the 'poor'. If the socialist were to put his government where his mouth was, they would have to institute a totalitarian state such as what the USSR had in order to make it happen. Seeing as how this has already been proven to only be a good idea if you like murdering millions upon millions of people - they stick with their current plan. One foot in in the free market, one foot in redistributionary socialism.
So why don't I endorse Capitalism? I mean, I just set up a pretty good picture of why it's bad to be a socialist right? I don't endorse capitalism as our goal because it isn't. The object of making as much money as I can is only one of the possibilities of a truly liberal society. I could also make my main goal to be an artist, and if I'm not supremely wealthy, at least I'll be happily doing what I like to do. My goal could be to have a family, friends, and a job I enjoy. Perhaps I do want to make a large income, but then I also want to give most of it away. Do you get the picture yet? A free market liberal society simply frees individuals, groups, and nations, to do that for which they are best gifted, what they love. Happiness. This is why Thomas Jefferson wrote that famous phrase into America's Declaration of Independence. The pursuit of happiness was his interpretation of the true value of liberty.
Once a society puts constraints on person's ability to pursue his dreams, it reduces their incentive to pursue said dream, and forces them into a captivity that can't be seen, but can be felt. Everyone who has had to take a class in school they couldn't stand, a job they hated, or a boss that couldn't understand how to work with them, will know what I mean when I say captivity. It's that feeling that you have when you know you could be doing something you want to do, but you can't - for one reason or another.
It's an unfortunate fact of life that none of us are ever going to achieve that perfect state where we only do what we want all day every day (within this mortal life that is). In a large part that may be because we may not understand what we do want. (here we drift into the theological - and my Christian beliefs shape what I think we all are ultimately pursuing, whether we understand it or not)
But the point is whether we achieve the ultimate expression of it or not, we are still more productive, happier, and in general better off when we are free to attempt the pursuit of this happiness. Once a bureaucrat gets involved, all bets are off. It is simply impossible for mere humans to ever understand each other enough to design a system that uses all of us, in our various talents, in such as way that not only society benefits, but as individuals we also feel fulfilled.
So what is government's role then? In a very short explanation (mostly because this blog is already getting too long - if you've stuck with me so far, congrats!) government's role is to prevent the hard core capitalists among us from hurting another's pursuit of their happiness. Basically this means to not make policies that lead to monopolies, government controls (wages, prices, etc) or other artificial footprints in the market place. We almost always put the blame on big corporations for monopolies and high prices, but they are usually just reacting to laws, regulations and tax codes that make it more efficient for them to act that way.
I can talk more about government's role next time. Stay tuned!