Consumption Rules

[In Defense of Capitalism.pdf]

Because the organization of a capitalist economic system necessitates self interest pitted against self interest, many antagonists believe it, therefore, breeds selfishness and the love of money, as well as neglect for the needy. In other words, it creates a self-centeredness rather than charity, as Christ taught. While it’s hard to dispute the fact that those elements exist in a capitalist economy, I would argue that these are not results of capitalism, but merely unfortunate by-products produced only at the point where pure capitalism fails due to the natural shortcomings, or imperfections, of the constituents of such a system. I would challenge anyone to suggest a system of allocating resources that works better and is more powerful or efficient in bringing about good for the entire society in which it operates. Among a society with imperfect people, capitalism is the best system we have, and its history shows that.

First of all, capitalism is a form of freedom. Consumers are free to choose to a large extent where they work, how much they make, and what they spend their money on, whether savings or consumption. This freedom, along with ownership, which both are integral parts of capitalism, are, ironically, what allow people to have charity. It would not be possible to have charity if the government took whatever it needed to give to the poor and the hungry and the sick. We wouldn’t have the choice; we would all be charitable by default. We’d also be lazier by default, because we wouldn’t have any incentive to innovate, or work hard, or achieve. While there are many who use that freedom for their own selfish ambitions, while completely neglecting those less fortunate, there are also many who use that freedom for the good of all of society. (Read More Here) Capitalism also does a better job than most systems of discriminating between those who are less fortunate (i.e. do not have the physical means of advancing their position) and those who are lazy (i.e. those who have the means, but not the will)

It is argued that businesses are breeding grounds for greed because of the underlying purpose of a business: to make money. A business is a tool for making money the same way a car is a tool for transportation. But really, what does that mean? What it means is that the market will naturally find the areas of highest productivity to put these tools of business to work to turn our natural resources into useful things. Money simply acts as the incentive to fill these voids. Because of business, we are a much more productive nation (as measured by total output, or GDP). There are wasteful side effects, of course, but we also enjoy, by far, the highest standard of living. As the standard of living increases and the economy does better the people who benefit most are the middle and lower class. These groups see the most dramatic difference between a stagnant economy and a thriving one. An economy that encourages business innovation and competition will produce higher employment, higher standards of living, and greater satisfaction and happiness than any system based on compulsion or complete equality of resources.

Even those who are participants in the economy not by expense of labor, but by provision of resources provide a great deal for the benefit of society. Say you have a young, imaginative, innovative, hard-working individual who has everything to create a good business but the money. Where does he get the money? He gets it either by getting his friends and family to pay in, applying for a loan through the bank, by venture capitalist buy-in, or by selling stocks or bonds (good luck with that). Either way, he’s getting his money from someone other than his own pocket. When you have your money in the bank, in the stock market or other securities, this is where your money is going. It’s moving from you to an area of the economy where it will be put to better use, and be more productive. This innovative entrepreneur is filling a void in the economy that will raise everyone’s standard of living. If not, he won’t make money and he’ll need to find something else to do with his time.

My challenge is for anyone to explain a better way of allocating resources. How do you use what the earth has given us, and convert it into useful goods for the benefit of everyone? If it is by complete compulsion, where everyone is forced to work at an assigned job, for an assigned period of time, explain to me how that is beneficial and how that promotes happiness. If it is a system of choice, explain to me how you will allow people to choose and still ensure everyone is fed, and clothed, and healthy. While it has its obvious downfalls because of the imperfection of all of us that are participating, Capitalism does a better job than any other system at ensuring these common rights are attended to. The paper “In Defense of Capitalism” by Phil Bryson, does a good job of summarizing the viewpoints of LDS church leaders on the prosequences of such a system.

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