Capitalism and virtue


December 29, 2011 by galudwig

About half an hour ago, I decided to use the WordPress “tag-browsing” feature to see what people had been writing on their blogs on the topic of “capitalism”.

While there were a few great posts out there, such as this one by kotzabasis on his attempts to reason with a professor of economics from the university of Athens, most were rather depressing. Capitalism is understood as something inherently evil and immoral, a kind of government policy which makes the rich richer and the poor poorer and which requires everyone to idolize greed and money. This betrays a fundamental misunderstanding of the natural processes of a free market and of what capitalism as a “system” is.

While I hesitated to single out one post to rant on and show why these ideas are wrong, I decided to so anyway, because, frankly, it’s just easier and less time-consuming to do so. I think I might do this more in the future as it gives me an outlet for my rants. For now, I chose this post by Henry Karlson on because a) it is entirely representative of the kind of ideas about virtue and capitalism, both online and in real life, with the overwhelming majority of the population, b) it writes from a more religious perspective, rather than the usual, beaten-down, socialist/revolutionary one and c) it is eloquent and well written. Apologies for any possible typos or unguided thought-processes, I’ve been writing (for work) all day and don’t really feel like rereading and editing 🙂

Karlson begins with the following statement,

One of the problems of the modern capitalistic society is that capitalism is, at best, a-moral, and at worse, immoral, and those who use capitalist ideology as a hermeneutic for life are incapable of understanding the pursuit for virtue. Money is turned into the end one must seek, so that money becomes identified with the good.

Though the first quarter of this is true (capitalism is, indeed, amoral; but it is NOT immoral), the rest is not. There is nothing in capitalism’s “rules”, or rather, the lack of them, that says that people should only desire more money, that money is “good” or that “virtue” is not worth pursuing. A free society with a free market means that individuals each have their own preferences and value scales on which they order what is important for them and what isn’t. The fact that most people desire material well-being is not a consequence of capitalism, nor is this even a bad thing. Individuals will produce on the market that which other individuals desire, and profit will flow to those who are best at predicting the future wants of the public. If tomorrow, we suddenly find ourselves in a world where people on the whole no longer desire luxury products, entertainment, cars etc.., but instead art, literature, or whatever is “virtuous” from your point of view, then the market would quickly reinvent itself and accommodate these new needs.

Money is the tool by which we engage in calculation, and determines our purchasing power, just like birth would do so in a feudalist society, and political connections in a socialist one. But in no way does it change the values we have and the products we desire. People who claim that capitalism is the cause of people not being “virtuous” should take it up with the people themselves, not with the market, which is only shorthand for the whole of voluntary relations between individuals by which goods and services are produced and distributed among the people, and nothing more.

Is it any wonder that when vices, such as lust, can be used to make money, they are embraced by a capitalistic society, while the virtues are slowly seen as outdated and worthless for the world of today?

Are social relationships not virtuous? A “capitalistic society” is one in which the government does not interfere in the spontaneous order that evolves when individuals are free to use their body, mind and property in whichever way they see fit, to make contracts and transactions with one another based on mutual benefit. Again, if, according to your own definitions of virtue, society seems to be becoming a cesspool of filth and vice, then this is a direct consequence of the individual preferences of the people, not of the system by which they may do business with one another. How could it be any more virtuous –in fact, how could it not be any less virtuous– if people were not free to live their lives, but were forced, by threat of violence, to act in a specific way?

On population growth,

The promotion of life is not the same thing as the promotion of large populations – the promotion of life is the promotion of the dignity of life, which requires the promotion for the common good and the virtues required for social harmony. When populations are low, and in need of more workers to sustain themselves, increasing population sizes can be good.

But who defines what the “common good” or “the virtues required for social harmony” are? The intellectuals? The state? Or every individual for themselves?

Also, one cannot promote large populations, one can only pass laws, outlawing individuals to have children, or threatening them with violence or taking their means of subsistence from them in order to make them behave in a certain way. The self-declared “expert” who claims to be able to not only determine the optimal size of the population or the conditions for full employment in the economy neglects to mention that the only means by which this “stabilization” can take place is by means of violence. Is this virtuous? Is this good?

We Really Need To Think Things Through Before It Is Too Late « Vox Nova.


5 thoughts on “Capitalism and virtue

  1. Free market is not the same thing as capitalism.

    • galudwig says:

      I agree that it is not the same, but are the two not used as synonyms, specifically when capitalism is considered evil, greedy or sinful?

      Or would you make the argument –one which I would make– that our society is not nearly free market enough to be called capitalist? That the crony-capitalism that exists now should be abolished, together with the governments of the world, or at the very least replaced by a minimal government, allowing no “redistribution of income”, no interference in the economy whatsoever? If yes, then I sincerely apologize for misreading your post, but I did not get this impression at all from your article.

      • No, the two are not used as synonyms. If you want, you should explore the statements of Pope John Paul II and Pope Benedict on free markets; then you should look at their criticism of capitalism. The people who try to push the two together do so for equivocation in arguments, as you have done here. That’s all I will say — if you want more, explore Catholic Social Doctrine.

  2. Canadian Performer's Money says:

    It’s funny how people who bash capitalism also seem to enjoy living in countries that benefit from it. If you want to see how socialism works look at Europe right now.

  3. Henry, I agree with you. The term capitalism is nowadays used to describe our current economic system: a mixed economy in which the government does the bidding of large corporations. That is, indeed, something quite distinct from the free market. However, your post sure seems likes its deriding capitalism as if it were not something distinct from the free market. Not a criticism, just letting you know how its coming off.

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