What is capitalism?

What do you believe to be true about capitalism, beliefs that are actually untrue, false?

This weekend’s news introduced me to two recent examples of the lunacy of the virtue signaling and ignorance of those decrying capitalism, especially after their having benefited immensely from having taken every advantage that capitalism has to offer while offering meaningless gestures of guilt while living at a level of luxury that would make any monarch blush.

NOTE: A Google search of images under the word, capitalism, produces a deluge of this idiocy. Better to watch this talk from former colleague Tom DiLorenzo, where he discusses his book, “How capitalism saved America.” Or see this summary of the myths of capitalism, here.

Start with the Lululemon hypocrisy about ‘resisting capitalism.’ Here are key excerpts from one report from the very left-leaning British publication, The Guardian. And when the left questions your plan to resist capitalism, you know that there is something seriously wrong.

The aspirational athletic-wear maker Lululemon, famous for its expensive leggings sported by young urban professionals, is facing vigorous criticism for promoting a yoga workshop billed as an opportunity to “resist capitalism”.

The Canadian-headquartered international company, valued at $45bn, suggested participants will be able to learn how “gender constructs across the world have informed culture and the ways violent colonialism has erased these histories to enforce consumerism”.
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“Lululemon IS capitalism. It is literally a privately-owned corporation that raked in half a billion dollars in pure profits last year, merely by selling overpriced yoga pants to women willing and able to pay for this luxury. All this begs the question … WUT?” wrote Amy Swearer with the rightwing Heritage Foundation.

Just how hypocritical and tone deaf can Lululemon be, or greedy and out of touch? A company that charges $128 for a pair of tights that are not much better than the $15 pair from Target has a lot of nerve trying to signal their commitment to women and to “resisting capitalism.”

Then there was this review of a new book, Having and being had, by a best-selling author and creative writing professor at Northwestern, where she documents her discomfort at being so – let’s just say it – GREEDY, SELFISH, and SELF-ABSORBED. Key excerpts from the Wall Street Journal review by a former editor for The Economist follow.

Having and Being Had
Shortly after moving into a house with her husband and son in 2014, Eula Biss began keeping a special diary. Owning this brick Chicago bungalow gave her “a new sense of security, a feeling of solidity,” she writes in her new book, “Having and Being Had,” and she felt moved to chronicle her novel feelings of comfort, as well as her discomfort with that comfort. She knew it wouldn’t be long before what seemed extraordinary about her life became ordinary, and she felt she should record her uneasy observations about work and class, race and privilege, poverty and pleasure—probe them like a tongue on a canker sore—as a way to hold on to these conflicting feelings and maybe even learn from them.
 
This book is essentially an account of Ms. Biss’s contradictions, her ambivalence as a relatively well-off consumer in a rich and richly unequal country.
 
Ms. Biss spends much of the book hunting for an accurate definition of capitalism, and observes, in herself and others, the quietly corrupting power of money.
 
In brief, diaristic chapters, Ms. Biss uses personal anecdotes to consider larger ideas about the nature of work and the often-pernicious appeal of consumer goods. She secretly pines for a brand of “unbearably luminous” house paint that costs $110 a gallon, and feels a “strange sense of accomplishment” upon buying a pricey necklace at a museum gift shop after sleepwalking through much of the art. She aptly quotes the poet and scholar Lewis Hyde: “The desire to consume is a kind of lust. . . . But consumer goods merely bait this lust, they do not satisfy it.”

Per usual, the comments do a better job of offering perspective than the original article/book or the review of same. Two representative comments summarize the idiocy of the book and, for that matter, the review:

Note to Self:  If ever hunting for "an accurate definition of capitalism", do not reach out to 2 English professors from Northwestern....or anywhere for that matter.  
 
As St. Ignatius said a long time ago, ingratitude is the worst of sins.

Let me make it clear to Lululemon and to the self-absorbed professor just what they need to know about the definition and practice of capitalism. It is NOT based on greed by rather on mutual exchange and mutual satisfaction of needs. Capitalism is NOT a win-lose proposition, as socialism and communism clearly are, where the beneficiary can only benefit at the loss of the benefactor. Rather, capitalism is a true win-win situation, where voluntary, mutually beneficial exchanges benefit both parties to the transaction, transactions that occur billions of times each day around the world, regardless of the political or regulatory environment. Capitalism did NOT prosper under slavery. In fact, capitalism is the antithesis of slavery as you will see below. Equally incorrect is the idea that government programs such as Social Security are socialism when, in truth, programs such as Social Security are government-required insurance programs funded by one’s own earnings. Your Social Security benefits are directly related to the taxes you pay into the system. Low-wage workers receive less in benefits than do high-wage workers.

To understand capitalism, you need to appreciate and understand two basic principles: (1) the right to own and (2) the right to trade (what you own). The former includes the right to ownership of your labor and the latter includes the right to exchange your labor for whatever form of compensation you prefer, usually cash wages. Slavery denies both the first and second right. The role of the government is to protect these rights, including protecting and ensuring the terms of contracts freely agreed to by two or more parties.

Capitalism is the ultimate form of freedom from centralized control, be it by a monarch, a military dictator, a president, a prime minister, a politburo, a mayor and any other elected or un-elected public official or person of government authority. Instead, it places limits on what these central authorities can do and prescribes the basic thing they must do, and that is to protect these rights, primarily through public protection of property and enforcement of disputed contracts through the courts. Realize that every credit card transaction made by every person every day is a contract between buyer and seller, an agreement to pay in exchange for a product, service or information provided by the seller, and at a price agreed to at the time of transaction and recorded within nanoseconds on a private database of the billions of daily transactions, all without government intrusion or intervention.

In every class and at every admissions presentation I led, I would ask people to estimate the percent of the world population living in poverty in 1815 and today. When I would ask for estimates, estimates for 1815 often were lower than for two hundred years later. Rarely did any student, prospective student of parent come anywhere close to the correct figure, which was 94% of people living in poverty in 1815 and fewer than 15% (and declining) of people living in poverty in 2015. And the reason was simple: The widespread application of the basic rights and principles of capitalism created wealth and improved the quality and quantity of life at a rate unhear of in the previous 2,000 years. Child mortality declined from 50% to less than 2%, worldwide. Life expectancy increased from 40 to almost 80 years. And average incomes, in today’s inflation-adjusted dollars, increased from $3 a day to $30 a day around the globe.

As a final confirmation, I would ask you to look at the site, globalrichlist.com. It was a useful reminder of just how well off the typical person in America is today. I write ‘was’ because the site no longer exists. In today’s divisive, politicized, ‘cancelled’ environment, you can easily guess as to the reason.

As Churchill once quipped about democracy, "Capitalism is the worst form of economics, except for all the other systems that have been tried over time." Capitalism -- like humans -- is not perfect, but no other system is better. Getting rid of capitalism to improve economic justice is about like expecting defunding the police to lead to increased public safety, for people and property.