Capitalism’s role in the expansion of liberty and prosperity

Capitalism is continuing to play a major role in the global revival of liberty and prosperity around the world. Capitalism was the "camel's nose in the tent" under the "glasnost" policy in the former Soviet Union (USSR) that contributed greatly to the ultimate collapse of the Soviet regime.

Over the last couple of decades, it has been China's opening to limited capitalism that has led to increasing liberty, a rebirth of hope, and a rising standard of living among its billions of people.

Capitalism works because it nurtures the human spirit, inspires human creativity, and promotes a spirit of enterprise. By providing a powerful system of incentives that promote thrift, hard work, and efficiency, capitalism creates wealth—something that socialism has no mechanism to do.

On economics, human action and capitalism

Every individual is constantly making choices in the marketplace. This is what we mean by “human action.” With each decision, the consumer decides how to use his or her limited resources (and they are limited whether one is a pauper or millionaire).

You and I are constantly making choices such as: "Will I be better off if I spend my money for this television or that television?" (comparisons between similar products) while, at the same time, we are also considering, "Will I feel better off if I spend my money by paying off my credit cards and getting another latte instead of buying a new TV?"

Even though we sometimes may feel coerced into buying a product (say, fuel for our car), we are still making a free-will decision. We are asking and answering questions like: "Will I be better off putting gas in my car or taking the bus to work? Or maybe I could just hitch-hike to work. Then again, maybe I'd be better off just quitting my job and not putting gas in my car ever." Even the things we feel we must do when we'd rather be doing other things—like going to work when we'd rather be fishing—are free-will choices based on which decision we feel will make our situation better (either in the short-term or the long-term).

Capitalism does not favor the alert! Life, in general, favors the alert.

People who pay more attention when they drive, operate heavy equipment or cross the street are more likely to survive and prosper than those who do not. People who are more willing to respond as effectively as possible to changes in their environment that will affect their short-term or long-term welfare will generally be better off than the lazy, indolent, lethargic or foolish.

That's not because capitalism is opposed to such people, but because such people fail to seize opportunities for surviving and thriving when the opportunities present themselves.

As they say, “Opportunity only knocks once.” But even if it knocks a multitude of times, there will still be those who will miss it.

That is not capitalism’s fault.

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For more about what capitalism is or is not, read here.

Leftists, Liberals and the War on Liberty and the Economy

Edward H. Crane, president of Cato Institute, writing in “Cato Policy Report” (Nov/Dec 2011), properly characterizes the Left here in the U.S.:

Of course, the Left has pretty much given up any claim to being champions of liberty these days. Speech codes on campus and restrictions of political speech show their disdain for the First Amendment. Double-down on troops in Afghanistan? Okay if the president’s a liberal. Then there’s the Left’s profound ignorance on how wealth is created. They love to focus on how to alleviate poverty when the [real] answer is wealth creation. Poverty is the natural state of man. Prosperity requires free markets, respect for contracts, and protection of private property. No big secret, but it seems to escape the Left.

So you have the Obama administration trample centuries of business law [Common Law] by denying Chrysler bondholders their contractual right to be first in line for assets sales under bankruptcy, and instead giving those rights to the UAW [United Auto Workers union], which had no such claim [under the law]. Property rights abused; the difficulty in selling corporate debt increased. The earned income of the rich? We’ll just take it and give it to those who didn’t earn it. Property rights abused; the incentive to create wealth undermined.