If Not Capitalism–What, Then?

In yesterday’s column, I argued that capitalism makes “green” goals possible, such as the paperless world created by the Internet. A member of the media wrote me in response to this column and said, “This is incredibly ignorant. Everyone knows the Defense Department created the Internet, not the private sector.”

At first, I thought this was a joke. But when I saw it was a member of the media, I understood. These people actually believe that government creates wealth. It’s no wonder they stand by Obama and his policies, no matter how much worse things get. To them, the more government spends, the more wealth you generate. It’s this premise that leads one to conclude, “The Internet as we know it is the product of government.” Oh, really? Are all the operating programs which make the Internet useful, and operative, such as those created by Microsoft Corp. and others — are these the product of government agencies? The companies responsible for the functionality of the Internet are profit-driven. Companies that have made their name exclusively through the Internet — such as eBay, Amazon.com, Facebook, and others — are all profit-driven. They are not charity agencies and they are not government agencies. So what if the Internet was discovered by Defense Dept. staff? Without capitalism, profit and the ingenuity of the private marketplace, that technology would still be sitting idle in government bureaus, as it did in fact do for many years.

This reporter, and other socialist liberals like him, have no remote clue as to where wealth, prosperity, and all of life as we know it really comes from. They think a sprawling and ever-growing government can do just as good, or better, a job of creating civilization as individuals in a private marketplace of ideas and technology can. This, despite the evidence that heavily socialized and controlled economies, such as Japan and Western Europe, perform way less effectively than the United States did before it recently became significantly socialized itself. This, despite the evidence that completely socialized countries — Soviet Russia and Maoist China to name two major examples — enjoyed nothing, for decades, but long-term starvation, stagnation and despair. The same applies to North Korea, a Communist country in the present era, in contrast to the much less controlled and semi-functioning economy of South Korea. Even China, still Communist in name and in its failure to even nominally protect individual rights, has allowed enough economic activity to sustain, at least for now, significant growth in the gross national product.

How many ways can I say it? Wealth must come from somewhere. It doesn’t arise from any directive, edict or command. Wealth and prosperity are the product of thousands, or millions, of individual decisions made by individuals every day. Many of these decisions are small but cumulatively they add up to a lot of activity and growth. A few of these decisions are monumental in scope, such as key decisions entrepreneurs made in the development of the Internet. We still talk about those decisions (or take them for granted) every time we turn on a computer today. If there had been no private sector, and no profit motive, the Internet, if it existed at all, would be nothing more than a dust-ridden potential. This is kind of like human civilization for thousands of years before capitalism came along. Now capitalism is in decline, because hardly anybody will defend it. And yet, without capitalism there would be nothing worth defending.