I was discussing the merits of capitalism the other day when my colleague asserted that economic systems—capitalism, socialism, fascism, etc.—are neither moral nor immoral. I had affirmed what I believe to be capitalism’s morality when he stated confidently, “We all know that capitalism is amoral. It’s just an economic system; it has no morality.” His point is that capitalism should simply be evaluated on it what is generates for society. I heartily disagree for three reasons.
First, capitalism is the only economic system based on a respect for individual personal property rights. It starts with the assumption that individuals control their own capital, labor, resources, and purchase decisions. Markets determine the outcomes, not governments. All other systems allow the collective (i.e., government) to exercise some type of control over what should be private property for the presumed betterment of society.
Second, the notion that an economic systems should be judged solely on what it produces for society asserts that what is supposedly good for groups of people is best for society. But who gets to decide what is best for society? For example, is it better for everyone to have universal health insurance at the expense of individual healthcare choice and medical innovation? Someone must make decisions such as these. In the absence of capitalism, this responsibility for doing so typically falls on the shoulders of the government bureaucracy.
Finally, the argument of amorality supports the idea that ends justify the means. If your neighbor has several TVs and you have none, why not steal one? Should the immorality of theft be a concern if it brings about a more “just” society? Contemporary critics of capitalism usually acknowledge that process matters, so identifying this inconsistency is paramount. To keep their argument alive, most will counter by questioning the morality of personal property rights. At this point they have openly acknowledged the right of the collective to determine how much freedom individuals should possess. Checkmate…They’ve shifted from capitalist critic to socialist.
Don’t let your “middle ground” friends try to avoid a discussion of morality when they attack capitalism. Just because many economists prefer not to deal with issues of ethics and morality doesn’t mean that economic systems are amoral. While capitalism outperforms other systems on the basis of what it produces, don’t let them frame the debate along these lines. Doing so opens the doors to the type of capitalism-socialism mix that has contributed to many of our current economic and social problems. Keep process issues and ethics central to the conversation and you can always maintain the upper hand.