The Heart of Capitalism

I was Killing Orcs the other day (*”Killing Orcs” is the euphemism my wife uses for when I am playing MMORPGs).  One of the other players posted a question in the general chat channel asking a favor.  I did the requested favor.  I felt good because I had used my talents, time, and resources to produce something of value for someone else.  This led to a larger discussion in the chat channel on Communism and Capitalism, and I wanted to get a few thoughts out.

Economic systems seek to turn raw materials into finished products to make life easier.  All economic systems do this (except Environmentalism, which, in a sense, is an anti-economic system).  If Bob has lemons, Susan has sugar, Paul has water, and Brittany has free time, then individually they don’t have much you’d want (lemons are too tart by themselves, sugar is too sweet, water is filthy and disgusting, and free time isn’t so impressive).

Together though, they have the ingredients for delicious lemonade, fit for the finest of my skull mugs as I sit atop my throne of bones surveying my vast holdings.

Finished goods don’t have to be lemonade.  Finished goods can be concrete (“lemonade”, “a gun”) or abstract (“security”, “knowledge”).  A glass tube, some chemicals, and a Bunsen burner are the raw materials that create understanding of explody things, just like two wheats and three ores will build a city in Settlers of Catan.

Both Capitalism and Communism can get finished products from raw goods.  In fact, I would venture that if you gave these four things to four pre-indoctrinated children in either political system, they would come up with lemonade, because cooperation is a natural part of the human spirit.

In fact, I think most capitalists underestimate what can be accomplished in a communist state.  Neighbors help each other, children play games, and some raw goods become finished products spontaneously, without any government intervention or force.


The rest of the time shows the difference between the two systems, when there are differences of opinions about how to use the raw materials we have access to.  Consider the lemonade example.  Arianna had the free time to mix the lemonade, but lets say she has another group of friends, interested in producing ice cream, who need some extra hands.  Arianna wants to spend her resource (time) making ice cream instead of making lemonade.

In Capitalism, each person owns his own capital.  In Arianna’s case, her capital is her time, and in a capitalist system, she is free to choose to go make ice cream instead of lemonade.  Which is to say, she is free to expend her capital as she wishes.  Tough nuts for the Lemonaders, who now face a labor shortage, but a boon for the Ice Creamers.  Unless she has broken a contract, the state need not interfere through force (i.e. the government).

But in Communism, Arianna does not own her capital (her free time)–the state does (the “res publica” in Ciceronian terms).  And if the state (which, in reality, is just Arianna’s fellow citizens) wants her to be making lemonade instead of ice cream, it can use force (i.e. the government) to get her to do what it wants her to do.  She has no right to refuse if her interests do not align with that of her state.

And so on.  If Arianna had chosen to expend her capital in charity (working for free at a pet shelter), she would be free to do that in a Capitalism system, but not a Communist one (unless the state was prioritizing shih-tzu awareness month).

Thus, at heart, the essence of Capitalism is freedom, and the essence of Communism is servitude.

The common misconception is that Capitalism can be reduced to profit-seeking in a monetary sense, when it would be better to see Capitalism explained as happiness seeking.  However, not happy in the sense of joy (Latin: “laetus”), but rather happy in the sense of luck or destiny (Latin: “felix”).

This is a crucial point, lost because of changes in the English language which have eroded this second meaning of happiness (which is the one Jefferson used in “life, liberty, and the pursuit of happiness” line from the Declaration of Independence).  Capitalism allows each man to be the author of his own fortune (be this as a blacksmith, artist, philosopher, or ploughman) as he sees fit, rather than allow the state to decide his fortune for him.

This does not mean, however, that the idea of freedom isn’t terrifying to some.  Many people are petrified by the idea of walking the economic tightrope without a net.  The idea of investing time or resources wisely but individually is far worse than an alternative wherein they sacrifice their unwelcome freedom for greater security.  History is littered with examples of people who willingly enslaved themselves to stave off poverty, hunger, or death.  Freedom is often a less cherished idea than some would have you believe.  Some, free, will always yearn for the soft embrace of the slave’s collar instead of the harsh winds of choice.