Capitalism

By

Machan and Chesher

Characteristics

• Private property.• Individual decision-making.• Little or no state interference.• “Invisible Hand”.• Social Cooperation• Price System.

– Prices determined by both parties.

Important Virtues

• Prudence and industriousness.

• Freedom.

• Rights.

• Wealth Creation.

Two Kinds of Freedom (& Rights)

• Negative (The right to not be violated)– Self-ownership theorem.– Non-aggression theorem.

• Positive (The right to certain goods, etc.)– Come at expense of negative rights.

• Capitalism recognizes only negative rights.– Because positive rights are contradictory.

Three Shades of Capitalism

• Anarcho-Capitalism (no government)

• Minarchism (limited government)– Difference may be illusive.

• Democratic Capitalism/Socialism– Market socialism– “Third Way”

Capitalism facilitates wealth creation.

• Promotes industry, ingenuity, responsibility, hard work, etc.

• Is this a moral virtue of capitalism?

• Is that the MAIN moral virtue of capitalism?

Capitalism’s Main Moral Virtue

• It recognizes that virtuous actions must be chosen by individuals.

• It allows the freedom that is necessary to choose virtuous actions.

Capitalism’s Main Perceived Problem

• It allows people the freedom to choose immoral actions.

– What kinds of immoral actions does it allow?

– Are these actions truly immoral?

Marxian Perspective on Capitalism

• Alienation of labor & Exploitation of workers.

• Marx saw these as leading to the eventual demise of capitalism.

• This Marxist “exploitation of workers” theory is refuted in this fine article by George Reisman:

http://www.mises.org/story/1729

Is Capitalist “Exploitation” Unfair?

• Is it coercive?• Does it use force or aggression?• Does it depend on how exploitation is defined?

– In terms of altruism or egoism?– According to rights theory?– Is exploitation possible under negative

rights?

• Example of Hurricane Pricing

Capitalism Gives Moral Space

• Using others’ property without permission is not allowed.

• Using one’s own property selfishly leads to a decrease in value.– This decrease in value will then

lead to changes in behavior.

Do Business People Favor Capitalism?

• Some parts.

• Why not all parts?

Good afternoon, good evening, and goodnight.