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The Politically Incorrect Guide to Capitalism

The view that wealth is the result of some undifferentiated, collective process, that we all did something and it's impossible to tell who did what, therefore some sort of equalitarian "distribution" is necessary—might have been appropriate in a primordial jungle with a savage horde moving boulders by crude physical labor though even there someone had to initiate and organize the moving. To hold that view in an industrial society—where individual achievements are a matter of public record—is so crass an evasion that even to give it the benefit of the doubt is an obscenity.

Anyone who has ever been an employer or an employee, or has observed men working, or has done an honest day's work himself, knows the crucial role of ability, of intelligence, of a focused, competent mind—in any and all lines of work, from the lowest to the highest. He knows that ability or the lack of it whether the lack is actual or volitional makes a difference of life-or-death in any productive process.

The evidence is so overwhelming—theoretically and practically, logically and "empirically," in the events of history and in anyone's own daily grind—that no one can claim ignorance of it Mistakes of this size are not made innocently. When great industrialists made fortunes on a free market i. If you doubt it, take a look at the "total social product"—and the standard of living—of those countries where such men are not permitted to exist. Observe how seldom and how inadequately the issue of human intelligence is discussed in the writings of the tribal-statist-altruist theoreticians.

Observe how carefully today's advocates of a mixed economy avoid and evade any mention of intelligence or ability in their approach to politico-economic issues, in their claims, demands, and pressure-group warfare over the looting of "the total social product. It was the last and theoretically incomplete product of an Aristotelian influence.

As a resurgent tide of mysticism engulfed philosophy in the nineteenth century, capitalism was left in an intellectual vacuum, its lifeline cut. Neither its moral nature nor even its political principles had ever been fully understood or defined. Its alleged defenders regarded it as compatible with government controls i.

Thus, what existed in practice, in the nineteenth century, was not pure capitalism, but variously mixed economies.

Capitalism vs. minimum wage laws

Since controls necessitate and breed further controls, it was the statist element of the mixtures that wrecked them; it was the free, capitalist element that took the blame. Capitalism could not survive in a culture dominated by mysticism and altruism, by the soul-body dichotomy and the tribal premise. No social system and no human institution or activity of any kind can survive without a moral base.

On the basis of the altruist morality, capitalism had to be—and was—damned from the start8 For those who do not fully understand the role of philosophy in politico-economic issues, I offer—as the clearest example of today's intellectual state—some further quotations from the Encyclopaedia Britannica's article on capitalism. Few observers are inclined to find fault with capitalism as an engine of production.

Criticism usually proceeds either from moral or cultural disapproval of certain features of the capitalist system, or from the short-run vicissitudes crises and depressions with which long-run improvement is interspersed. But what was the nature of the "moral or cultural disapproval"? The article does not tell us explicitly, but gives one eloquent indication: Such as they were, however, both tendencies and realizations [of capitalism] bear the unmistakable stamp of the businessman's interests and still more the businessman's type of mind.

Capitalism, the Unknown Ideal Lesson Plans for Teachers | betlaminsiren.ml

Moreover it was not only policy but the philosophy of national and individual life, the scheme of cultural values, that bore that stamp. Its materialistic utilitarianism, its naive confidence in prog- "For a discussion of the philosophers' default in regard to capitalism, see the title essay in my book For the New Intellectual. Some such notion underlies every theory of a planned economy. It is on some such "sophisticated" belief that two generations of Russians have perished, waiting for automatic progress.

The classical economists attempted a tribal justification of capitalism on the ground that it provides the best "allocation" of a community's "resources. The criterion for allocation between the public and private sectors is formally the same as in any other resource allocation, namely that the community should receive equal satisfaction from a marginal increment of resources used in the public and private spheres. Many economists have asserted that there is substantial, perhaps overwhelming, evidence that total welfare in capitalist United States, for example, would be increased by a reallocation of resources to the public sector—more schoolrooms and fewer shopping centers, more public libraries and fewer automobiles, more hospitals and fewer bowling alleys.

This means that some men must toil all their lives without adequate transportation automobiles , without an adequate number of places to buy the goods they need shopping centers , without the pleasures of relaxation bowling alleys —in order that other men may be provided with schools, libraries, and hospitals. If you want to see the ultimate results and full meaning of the tribal view of wealth—the total obliteration of the distinction between private action and government action, between production and force, the total obliteration of the concept of "rights," of an individual human being's reality, and its replacement by a view of men as interchangeable beasts of burden or "factors of production"—study the following: Capitalism has a bias against the public sector for two reasons.

First, all products and income accrue [? Public needs are met only by sufferance of consumers in their role as taxpayers [what about producers? That people know better than governments what to do with their income is a notion more appealing than the contrary one, that people get more for their tax money than for other types of spending. By whose judgment? Second, the pressure of private business to sell leads to the formidable array of devices of modern salesmanship which influence consumer choice and bias consumer values toward private consumption.

Which wants are "fundamental," beyond a cave, a bearskin, and a chunk of raw meat? A comparison of resource allocation to the public and private sectors under capitalism and under socialist collectivism is illuminating. Private consumption is restricted to the claims that are permitted [by whom? In the Soviet Union teachers are plentiful, but automobiles are scarce, whereas the opposite condition prevails in theUnited States. Here is the conclusion of that article: Predictions concerning the survival of capitalism are, in part, a matter of definition. One sees everywhere in capitalist countries a shifting of economic activity from the private to the public sphere.

Are Liberals on the Wrong Side of History?

At the same time [after World War II] private consumption appeared destined to increase in communist countries. Yet significant differences in the economic structures still existed. It seemed reasonable to assume that the society which invested more in people would advance more rapidly and inherit the future. In this important respect capitalism, in the eyes of some economists, labours under a fundamental but not inescapable disadvantage in competition with collectivism.

The collectivization of Soviet agriculture was achieved by means of a government-planned famine—planned and carried out deliberately to force peasants into collective farms; Soviet Russia's enemies claim that fifteen million peasants died in that famine; the Soviet government admits the death of seven million.

1.2 Measuring income and living standards

At the end of World War n, Soviet Russia's enemies claimed that thirty million people were doing forced labor in Soviet concentration camps and were dying of planned malnutrition, human lives being cheaper than food ; Soviet Russia's apologists admit to the figure of twelve million people. This is what the Encyclopaedia Britannica refers to as "investment in people. Yet every nation on earth feels, in helpless terror, that such a war might come.

The overwhelming majority of mankind—the people who die on the battlefields or starve and perish among the ruins— do not want war. They never wanted it Yet wars have kept erupting throughout the centuries, like a long trail of blood underscoring mankind's history.

Capitalism The Unknown Ideal by Ayn Rand

Men are afraid that war might come because they know, consciously or subconsciously, that they have never rejected the doctrine which causes wars, which has caused the wars of the past and can do it again—the doctrine that it is right or practical or necessary for men to achieve their goals by means of physical force by initiating the use of force against other men and that some sort of "good" can justify it It is the doctrine that force is a proper or unavoidable part of human existence and human societies.

Observe one of the ugliest characteristics of today's world: the mixture of frantic war preparations with hysterical peace propaganda, and the fact that both come from the same source—from the same political philosophy. The bankrupt, yet still dominant, political philosophy of our age is stat-isnu Observe the nature of today's alleged peace movements. Professing love and concern for the survival of mankind, they keep screaming that the nuclear-weapons race should be stopped, that armed force should be abolished as a means of settling disputes among nations, and that war should be outlawed in the name of humanity.

Yet these same peace movements do not oppose dictatorships; the political views of their members range through all shades of the statist spectrum, from welfare statism to socialism to fascism to communism. This means that they are opposed to the use of The ObjectMsi, June Consider the plunder, the destruction, the starvation, the brutality, the slave-labor camps, the torture chambers, the wholesale slaughter perpetrated by dictatorships.

Yet this is what today's alleged peace-lovers are willing to advocate or tolerate—in the name of love for humanity. It is obvious that the ideological root of statism or collectivism is the tribal premise of primordial savages who, unable to conceive of individual rights, believed that the tribe is a supreme, omnipotent ruler, that it owns the lives of its members and may sacrifice mem whenever it pleases to whatever it deems to be its own "good.

The history of all primitive peoples is a succession of tribal wars and intertribal slaughter. That this savage ideology now rules nations armed with nuclear weapons, should give pause to anyone concerned with mankind's survival. Statism is a system of institutionalized violence and perpetual civil war. It leaves men no choice but to fight to seize political power—to rob or be robbed, to kill or be killed.

The political economy of low-wage labor

When brute force is the only criterion of social conduct, and unresisting surrender to destruction is the only alternative, even the lowest of men, even an animal—even a cornered rat—will fight There can be no peace within an enslaved nation. The bloodiest conflicts of history were not wars between nations, but civil wars between men of the same nation, who could find no peaceful recourse to law, principle, or justice.

Observe that the history of all absolute states is punctuated by bloody uprisings—by violent eruptions of blind despair, without ideology, program, or goals—which were usually put down by ruthless extermination. In a mixed economy, it takes the form of pressure-group warfare, each group fighting for legislation to extort its own advantages by force from all other groups.

The degree of statism in a country's political system, is the degree to which it breaks up the country into rival gangs and sets men against one another. When individual rights are abrogated, there is no way to determine who is entitled to what; there is no way to determine the justice of anyone's claims, desires, or interests. The criterion, therefore, reverts to the tribal concept of: one's wishes are limited only by the power of one's gang. In order to survive under such a system, men have no choice but to fear, hate, and destroy one another; it is a system of underground plotting, of secret conspiracies, of deals, favors, betrayals, and sudden, bloody coups.


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It is not a system conducive to brotherhood, security, cooperation, and peace. Statism—in fact and in principle—is nothing more than gang rule. A dictatorship is a gang devoted to looting the effort of the productive citizens of its own country. When a statist ruler exhausts his own country's economy, he attacks his neighbors. It is bis only means of postponing internal collapse and prolonging his rule.

A country that violates the rights of its own citizens, will not respect the rights of its neighbors. Those who do not recognize individual rights, will not recognize the rights of nations: a nation is only a number of individuals. Statism needs war; a free country does not. Statism survives by looting; a free country survives by production. Observe that the major wars of history were started by the more controlled economies of the time against the freer ones. Observe that in World War n, bothGermany andRussia seized and dismantled entire factories in conquered countries, to ship them home—while the freest of the mixed economies, the semi-capitalisticUnited States , sent billions worth of lend-lease equipment, including entire factories, to its allies.

In fact, theUnited States lost, economically, even though it won the war: it was left with an enormous national debt, augmented by the grotesquely futile policy of supporting former allies and enemies to this day.

Yet it is capitalism that today's peace-lovers oppose and statism that they advocate—in the name of peace. Putnam's Sons, Laissez-faire capitalism is the only social system based on the recognition of individual rights and, therefore, the only system that bans force from social relationships.