> So why do American thinkers keep pushing the tired, old, obviously by now false myth that capitalism equals progress?
Because capitalism requires productivity from its citizens, and the market organizes this labor in an efficient manner, which is why our grocery stores are always filled with food & toiletries.
American democracy is the result of the British Parliament's misuse of capitalism ("no taxation without representation"). Capitalism is not static and is always correcting and improving itself with the help of pro-capital governments, like women's suffrage and child labor protection laws.
The author says something that I think actually illustrates the main issue I would take with their argument:
> capitalism alone can’t be the engine of human progress
For one, very few people claim that capitalism alone is the solution to human progress. That being said, it very much is the engine. We don't know of a better engine than capitalism, it creates value at unprecedented rates. That doesn't mean that you can't steer its output towards objectives that benefit society in ways that markets are unlikely to address in a timely fashion.
Take Norway. It has a trillion dollar fund, started from selling oil, now continuing to make money by investing in foreign companies. In addition to this, they have a market economy. Because they have so many socialized programs, the implication seems to be that this is not a capitalist country, but this is simply not true. Capitalism, again, is the engine.
Because a state with taxpayer funding produced a notable step forward for humanity does not mean that capitalism had nothing to do with this, it means that capitalism produced the taxpayer funding.
> Because they have so many socialized programs, the implication seems to be that this is not a capitalist country, but this is simply not true. Capitalism, again, is the engine.
I'm curious how you've concluded that capitalism, alone, is "the engine"? Norway has a market economy but that doesn't exist in a vacuum. Surely their strong social safety nets provide a great deal of value or else Norwegians wouldn't spend the time and money administering them.
There are numerous variant "capitalism (is|as) the engine of (growth|wealth|progress|innovation)" quips and assertions which are trivially found.
Most seem to have emerged since the 1950s, at an increasing rate through the 60s, 70s, 80s, and onward. Largely (though not wholly) from right/libertarian propaganda mills and commentators, repeated liturgically as articles of faith.
Capitalism is simply a combination of the existence of property rights, money, and the right to freely enter into contracts except when prohibited by law.
How could this ever solve anything? It's not a solution, it's a framework.
It's like saying that Ruby on Rails is the solution to your company. We'll by definition it can't be. It can be used to do whatever your company needs but the framework can't be the company as it doesn't do anything useful in a vacuum.
However it's certainly a much better model than generating an HTTP stack in assembly to make your SAAS business. It solves a real problem that allows you to operate but it doesn't solve your higher level problem.
Capitalism is exactly the same. The lack of it can cause major problems. The existence of it cannot solve many problems but it can provide the only efficient framework in which many problems can be solved.
Rodney Stark says that the distinguishing mark of capitalism is that (at least part of) the profits are re-invested in better tools for productivity gains. In this view, "the existence of property rights, money, and the right to freely enter into contracts except when prohibited by law" are prerequisites, but they aren't capitalism. Capitalism is what you do once you have that foundation in place.
Once in a while I don't downvote a well-deserving comment (and I am not saying parent(s) are one of those) because a child comment would get buried. I think parent comment is sketchy at best, but this comment is a nice perspective that makes it worth wading to.
Just like one can use RoR to make shitty websites, and RoR is just the tool here, one can use capitalism to...oh, you know where this is going.
This is extremely ignorant of economics. The innovations and institutions he refers to, like the university, were only made possible by rising levels of productivity allowing more resources to be spent on specialized endeavors.
In the developing world, whether it's the US in 1880 or Guyana in 2019, rising productivity means people able to afford more capital and consumer goods, like insulated walls, menstrual pads, diapers and toilet paper, which collectively make an enormous impact on human health.
That entirely misses that the first universities were centuries before the first joint stock company, or consumer goods. There's a few pushing near 1,000 years old, though by the 12th century they were starting to spread across Europe. The innovation and productivity gains came after.
Yah, and could subsistence farming pay for nearly as much of the population to be resident in them? Economic development is important-- we have a greater portion of the population as academics and/or doing R&D than we had centuries ago.
And it continues...
Total R&D population is up about 60% in the United States in the past 25 years, in a time when the population as a whole has increased by less than 20%.
But universities were not made possible by rising levels of productivity, as the GP claimed. They were there long, long before.
Certainly a greater proportion go to university now than used to. Which came after.
Current levels of university attendance are far more down to pushing university as the right tertiary education, in place of apprenticeships; technical and vocational. Many governments have made policy to increase university attendance whilst closing or downplaying those other options.
I'm not talking about undergraduate university attendance, but the number of people employed in research. When we focus on higher institutions of research, it's what the author of the article was talking about, too.
The number of people in that category was miniscule before 1700, and has exploded in the past 300 years.
Yes, there were (a comparatively small number of) universities before this time, doing qualitatively different things. But capitalism paid the bills to transform them into institutions driving scientific advancement.
Capitalism predates advanced financial constructs like corporations. The trade networks of medieval and early-modern-age Europe enabled far higher levels of productivity than would otherwise be possible, which gave monarchs and churches the resources necessary to build and support the first universities.
As the economy became more advanced, societies were able to allocate even more resources to tertiary sectors like advanced education, and universities became more numerous and sophisticated.
Productivity levels are critically important to the production of public goods like universities, and secure private property rights with contract law enables more rapid gains in productivity levels.
And all this doesn't even touch on my other point: higher productivity increases consumer power, which directly enhances the standard of living. It's not enough for some technology/knowledge to just exist. It has to be deployed, and that takes resources that more productive societies are more capable of providing.
The author is correct that capitalism has brought lots of suffering. He is also correct that progress requires much more in society than capitalism alone.
However, it is definitely the case that the enormous technological advances we have seen in the last few centuries could not have happened without capitalism. The proof is that socialist countries, in spite of enormous investment in technology and science, have failed to produce any significant technological advances outside the military and space exploration realms. In the few cases where someone in a socialist country invented something important, like continuous casting or the cat scan, it languished until it was taken up by capitalist countries.
It's easy to point out the faults of the communists. Are colonialism, ponzi schemes, sweatshops, pharma human experiments and environmental disasters capitalism's dark underbelly?
Everyone seems to think their ism is the best while conveniently ignoring ills in the past.
Colonialism is much older than capitalism, so no. The Romans practiced it, as did medieval kings.
Colonialism is a crime of opportunity. You see it whenever your group has relatively advanced technology in terms of navigation, transportation, logistics, governance, and military.
Humans aren’t innately ethical. We’ve had to develop ethics through a long process of philosophical debate, with many setbacks and oversights. I think we’re doing alright.
Capitalism/communism is a false dichotomy. The most prosperous societies in history have had a strong combination of both public works and private enterprise.
> Are colonialism, ponzi schemes, pharma human experiments and environmental disasters capitalism's dark underbelly?
But we find all of these things in other -isms too. As bad as capitalism's record is on all of these things-- human experimentation, unsustainable schemes yielding false returns, colonialism and aggression, environmental abuses--- the comparable record in fascism and communism and authoritarianism does not look great either.
Because capitalism requires productivity from its citizens, and the market organizes this labor in an efficient manner, which is why our grocery stores are always filled with food & toiletries.
American democracy is the result of the British Parliament's misuse of capitalism ("no taxation without representation"). Capitalism is not static and is always correcting and improving itself with the help of pro-capital governments, like women's suffrage and child labor protection laws.