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Capitalism as Mutually Beneficial Cooperation

It is precisely capitalism that provides the way for civilization as a whole to leave behind conditions of poverty, and it is capitalism that does so in a necessarily cooperative manner.

"I endorse Austro Libertarian Magazine 100%" —Tom Woods

Capitalism as Mutually Beneficial Cooperation

It is precisely capitalism that provides the way for civilization as a whole to leave behind conditions of poverty, and it is capitalism that does so in a necessarily cooperative manner.
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The Medium writing platform, which is itself a pleasant experience, is ripe for cultural and economic leftism. Reflecting the spirit of the age, most of the suggested and featured articles are obviously anti-capitalist, anti-freedom.

I came across such a ridiculous piece, which was from the “Eudaemonia & Co” (why is it that most outlets focusing on the word Eudaemonia, are mostly leftist?) blog, called “How Social Darwinism Destroyed America from the Inside.” Yeah, you know this one is going to be a doozy.

Of course, the first thing that stands out to the reader is that there is actually nothing to show for the promise of demonstrating how— it is merely a collection of awkward assertions about how bad everything is. No cause and effect. This makes sense. After all, the author in his about section advocates “moving from an economic paradigm to a eudaimonic paradigm of human organization.” Since economics is a science that has within it the ability to explain cause and effect when it comes to social organization, to reject it is to shoot oneself in the foot in terms of the ability to explain how.

In any case, the claim is that the US “economy is a modern history’s greatest machine for survival of the fittest.”

The winners deserve extreme fame, fortune, and power —Elon Musks’ $55 billion bonus — but the losers do not even deserve to live. Forget healthcare, savings, incomes, and so on. I step over them on my way to the cafe. Now, if you are the average American, perhaps you do not see the problem with all this. “So what?”

Reject the rationality of economics and it’s amazing what the imagination can conjure up. These leftists merely assert— with no attempt at definition or demonstration— that the socio-economic system is one of winners and losers. They do this because they equate relatively wealthy and relatively poor as the first being winners at the expense of the latter. They have imbedded deep within them what Mises called the anti-capitalist mentality. Completely unaware of the economic contributions to the study of man, they do not see that capitalism is the foundation of the masses’ movement into 21st century standard of living levels.

Moreover, they extend their hatred of capitalism by imputing to people, without justification, a certain hatred of their fellow man. Such accusations are not based in reality. Our author goes on to claim that:

The problem is that Social Darwinism cannot build a healthy economy for the very people who believe in it, ever, period, full stop — even though I’d bet most Americans probably still think “survival of the fittest” is the best form of social organization in history.

Nobody thinks anything of the sort. This is pure and simple speculation, creative imagination. Not only is this wrong in the sense that the turning of public opinion is toward socialism— which is the real threat— but it is also wrong in that the caricature of capitalism as “survival of the fittest” could not be a more false analogy.

Now, consider the absurdity of the author’s claims:

So. How is American Social Darwinism eliminate annihilating [sic] the chances of the average person? Well, because American society is an arena for survival of the fittest — not, say, protection of the vulnerable — too. There are no real safety nets, social systems, or public goods — by design — while all America’s peers enjoy these things.

Clearly from this we learn that survival of the fittest is synonymous with the alleged lack of social programs. Unfettered capitalism, without the existence of welfarism and beyond, is the system of winners and losers. At least according to the author.

Not only does the United States have massive “safety nets,” but the welfare expenditures exist in the trillions of dollars per year! We have public roads and public schools, national parks and highways, mandated social security, drug subsidization, public housing, food assistance, healthcare programs, and so much more. “No real safety nets” is, quite obviously, hysteric balderdash.

Now, the real lesson in this is that, once again, we face a severely deficient understanding of the nature of capitalism. Far from being a “social darwinist” system, capitalism stands unique in the history of the world precisely because production is accomplished for the masses. The anti-capitalists see the world through a long-expired lens. They do not realize the economic shifts that took place as the Old World pre-industrial age dwindled away.

Their interpretation of things, because they reject economic science, is that there exists a handful of wealthy individuals and families that own the means of production and produce only for their own consumption— essentially closing off the opportunity for advancement and flourishing for everybody else. As George Reisman explains,

“In such a world, apart from the receipt of occasional charity from the owners, those who are not owners of means of production cannot benefit from means of production unless and until they themselves somehow become owners of means of production. They cannot benefit from other people’s means of production except by inheriting them or by seizing them.”

It is this Old World lens that leads them to believe society is necessarily survival of the fittest. And therefore it is not surprising that, in order to combat such a dystopian system, leftists are inherently revolutionary.

But capitalism, this is not. Under capitalism, production is engaged in to the extent that the entrepreneur anticipates a demand for his product. Production is therefore done for the benefit of others. The capitalist/producer does not create products for his own consumption, but believes instead that he can be made better off by producing for the world around him.

Reisman contrasts the above described social order with capitalism as follows:

Contrary to such beliefs, in the modern world in which we actually live, the wealth of the capitalists is simply not in the form of consumers’ goods to any great extent. Not only is it overwhelmingly in the form of means of production but those means of production are employed in the production of goods and services that are sold in the market. Totally unlike the conditions of self-sufficient farm families, the physical beneficiaries of the capitalists’ means of production are all the members of the general consuming public who buy the capitalists’ products.

It is ingrained in the nature of capitalism that all exchanges are mutually beneficial. Capitalism is the system of cooperation, of man displaying a willingness to work with and interact with his fellow man. No man can attain riches, as greedy and selfish as he might be, without first improving upon the condition of those around him.

The Eudaemonia author stretches the bounds of intelligibility when he concludes:

That is why the countries in which it was born, and then utilized — Britain, Germany, Italy — rejected it, and consider Social Darwinism, now a stain upon history.

What he has in mind, of course, are the actions of centralized State power run amuck– the holistic social abandonment of the peaceful and civilizing effects of free market capitalism. The United States, to avoid such tragic circumstances must reject the promises and temptations of Total Statism– it must liberalize (in the classical sense of the word) and therefore privatize society, even to the point of breaking up the Union.

It is precisely capitalism that provides the way for civilization as a whole to leave behind conditions of poverty, and it is capitalism that does so in a necessarily cooperative manner. To the extent that the rich attain their riches not from voluntary exchange, to that extent we lack capitalism. The benefits reaped on the well-connected by the State itself is an example of a repudiation of capitalism, a revolt against the market. Political power and economic interventionism stands athwart the freedom necessary for true capitalism and threatens the sustainability of the market economy.  Politics, not capitalism, is a survival of the fittest since it rests on involuntary social arrangements.

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CJay Engel

Creator and Editor of Austro Libertarian. Lives in Northern CA, runs several businesses, spends time with his family, and reads as much economics and political theory as possible.

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