By Ed Feulner
Saturday, December 21, 2013
Attacking capitalism never seems to go out of style. Over
the past 100 years, few institutions of been attacked so fiercely, so falsely
and so foolishly.
Yet capitalism’s resilience continues. Governments based
on the idea that capitalism is evil, and that the state can create in
controlling entire economy, have risen and fallen during this period, but
capitalism continues to thrive.
Today, it is no longer beyond the pale to say that
capitalism has done more good for more people than any other economic
arrangement ever devised by man. Capitalist economies such as the United States
are prosperous, growing and expansive, creating opportunities and wealth for
ever-increasing numbers of people.
“I think all the world would gain by setting commerce at
perfect liberty,” Thomas Jefferson said, and our Constitution was a major step
in that direction. Capitalism is based on free markets, on the opportunities
for anyone to enter any market at any time to produce and offer products and
services that people want, need, and will purchase.
Capitalism is really savings-ism. Fixed capital consists
of real estate, factories, machinery, equipment and all other factors of
production that can be used to produce and distribute products and services to
ever more people. Capital is accumulated only when people refrain from spending
everything they earn, saving it instead, and reinvesting it to produce even
more goods and services in the future.
America is great because it offers the opportunity for
almost everyone to work, save, invest and build capital over time. This
accumulated capital can be used to start a business or can be combined with the
capital of others to help fund the creation of larger corporations.
Stock markets represent a place where people can pool
their capital, invest it in enterprises, along with the capital of others, to
produce and sell products and services and earn profits and dividends, which
are then distributed to the stockholders as the owners of the business.
Capitalism depends on a combination of productivity and
self-discipline or self-denial. It requires the ability to delay gratification
in the short term in order to enjoy greater rewards in the long term. It accepts
and helps tame human nature.
As Steve Forbes once observed in a lecture to The
Heritage Foundation, capitalism “encourages ambitious individuals to engage in
peaceful pursuit instead of plundering their neighbors. An entrepreneur offers
something -- a product or service. You do not have to accept it. It is a
voluntary transaction. It encourages cooperation.”
America is great because it provides a legal and social
framework consisting of clearly understood laws, legally sanctioned contracts,
and a stable currency that creates sufficient security for people to save,
invest and risk their capital in the anticipation of achieving greater wealth
in the future.
America is great because its capitalist system enables
the average person to start with little and build a substantial estate over the
course of a working lifetime. America has more millionaires and billionaires
than all the other countries in the world. Fully 80 percent of wealthy American
started at the bottom and earned their money in one generation as the result of
starting in building capitalistic enterprises.
Where some nations have age-old caste systems or
entrenched class systems from which escape to a better life is next to
impossible, the free-market capitalist system in the United States presents
opportunities for every individual to improve his or her life.
America is great because America is free, and should we
ever lose the economic freedom that capitalism secures, our political freedom
will also be gravely threatened.
This is why conservatives always champion smaller
government. It’s the only way to bring more innovation, more new jobs, and more
opportunities for more people.
That’s something that capitalism’s critics always seem to
overlook. But it helps explain why capitalism has outlasted all of its
challengers over the last century.
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