Column on Is Capitalism Cruel?

Is Capitalism Cruel?

Tibor R. Machan

Now this issues must always be dealt with comparatively–is capitalism cruel, harsh, heartless compared to what?  

Some
folks I know have maintained that compared to socialism, capitalism is
indeed all these things but I just cannot buy it. Partly it’s because I
have lived under at least one kind of socialism, the Soviet version,
which, as only someone who has been living in a cave for a hundred years
would deny, is brutal, never mind cruel, harsh, and heartless.  

But
let’s not focus on the worst case scenario of socialism.  Let us take
socialism “with a human face,” the sort that is usually associated with
Sweden, France, Greece or some other country where the government
manages much of the society’s economic affairs but doesn’t punish
dissidents and ban freedom of speech.  Are these
bona fide socialist systems and are they gentle and kind to their population?

Again,
compared to what? A fully free market, capitalist system in which
everyone must live without resorting to extorting their support from
others, without getting bailed out by the government with other people’s
resources when they have mismanaged their financial affairs–is such a
system more cruel than, say, democratic socialism?  

Not
really, not by a long shot.  Any kind of socialism subjects the
citizenry to coercive wealth redistribution and makes it impossible to
accumulate wealth for oneself, one’s family, one’s enterprise thus
impeding investment, savings and economic development.  Instead people
in socialist systems have to contend with being slowly bled to economic
destitution unless they are savvy enough to circumvent all the damaging
socialist practices (think here of George Soros). And, yes, there are
quite a few people in socialist societies, even the harshest version of
them, who manage to game the system.  They may not openly attack their
fellow citizens but because they game the system at the expense of these
fellow citizens, those others are
in fact–although sometimes not visibly–being seriously harmed.  

These
socialist systems with human faces manage to disguise their
mistreatment of all those who are made to pay for the mistakes of many
who become used to being taken care of, who feel they are entitled to
endless help from the government, who don’t want to reach out to people
and contend with the fact that generosity and charity must be voluntary
whereas being on the dole is coercive but not easily noticed.  Who is
paying for those food stamps?  The minimum wages one receives?  The
subsidies to farmers and all the rest of the costly welfare measures?
 No one can tell because it all goes through politicians and bureaucrats
and they do not accept responsibility of how they treat the citizenry,
for depriving Peter of what belongs to Peter and hand it to Paul (not
before they skim a good deal off for themselves). (I develop this idea
in my 1970 paper, “Justice and the Welfare State,”
The Personalist.)

Moreover,
many people judge socialism by the announced intentions of those who
support the system, not by the actual consequences it produces
throughout a society.  All the unseen losses suffered because of the
public mismanagement of the economy are overlooked and, instead, people
often believe it is “the thought that counts.”  But a little serious,
disciplined thinking should soon reveal just what is going on and how
what appears on superficial sight gentle and sweet becomes, instead,
insidious and harmful.

Capitalism
is up front about placing responsibility on free men and women and for
this it gets a bad rep from those who are duped into thinking that one
can tell the full content of a book by its fancy cover.  Capitalism,
unlike the welfare state, is more like parents who impose discipline and
refuse to spoil their children however much they whine about it.  Those
who think the system is therefore a cruel one are comparable to teens
who bellyache about their parents because they are more interested in
justice than in mercy (which in exceptional cases is fine but not as a
routine).

Because
so many people have found free market capitalism too harsh, too cruel,
or too mean, the system has never been allowed to function as it had
been meant to by those who considered it best for a society’s economic
well being, the likes of Adam Smith, Herbert Spencer, Ludwig von Mises,
F. A. Hayek, Milton Friedman and Ayn Rand, among others.  (Spencer,
especially, got no end of grief because of sentiments like the
following: “Sympathy with one in suffering suppresses, for the time
being, remembrance of his transgressions….Those whose hardships are set
forth in pamphlets and proclamations in sermons and speeches which echo
throughout society, are assumed to be all worthy souls, grievously
wronged; and none of them are thought of as bearing the penalties of
their own misdeeds.” [
Man versus the State,
p.22].)  Instead they followed the lead of John Maynard Keynes and
insisted that people who mismanage their economic affairs are entitled
to endless bailouts from the government.


   
Is this actually less cruel, less mean than the alternative, once all
the results are considered?  I seriously doubt it–just think of Greece,
Portugal and, of course, the former Soviet colonies, as well of the
members of America’s and many other nations’ future generations!

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