Saturday, September 24, 2011

Capitalists are crooks

When the Soviet Union broke up, an attempt was made to make Russia a capitalist country. For the political left, this is a classic example of how entrepreneurs are crooks and bad people. The centralized economy that had existed for decades prior to this event did not allow for entrepreneurs to excel legally, so they had been underground. A very large percentage of the Soviet economy was the black market simply because so many needs could not be met by the economic system legally. They NEEDED the black market just to meet many basic needs and to survive. In many cases, these are the same economic leaders that we have in this country. So our ‘rich’ CEO’s are really just a legalized version of the mob. Naturally, the crooks that took over the Soviet economy abused the system and created a backlash that has placed Russia pretty much back in the same situation they were before.

Where I differ in opinion is that entrepreneurs are not necessarily crooks. You can drive plenty of honest people into illegal activity for many, many reasons. And our society is moving that way for plenty of reasons, many of which are the same. Most people do attempt to be honest, at least in the culture that they grew up in. I also differ in that most people will put in an honest day’s work, if the motivation exists. And it is just too bad for those who lack that motivation. A small percentage simply can’t provide enough productivity to sustain them, but this is a more easily supported minority because in most, if not all cultures, the percentage is well under 5 % of the working population. That is low enough for any population to help sustain. The point is that it was the closed economic system that was responsible for so many in the old Soviet Union being ‘crooks’.

A certain percentage of any population will do harm to others in order to benefit themselves. Having a closed economic system with only few outlets for human expression and creativity will force many more into a life of ‘crime’ than would otherwise. After a few generations, this attitude of breaking the law will become entrenched. It will take decades to overcome at the very least. Having an open economic system with many outlets for energetic activity actually allows the most positive (And negative) human attributes to express themselves. Most people will choose not to be criminals so this system allows those who are ‘on the fence’ a legal option. Because of its openness, capitalism does give more opportunity to real criminals. However, the economic history of the United States has demonstrated that the creativity unleashed by a capitalist system more than compensates for enhanced ability to do wrong. In other words, capitalism allows for human nature better than any other economic system devised so far. This is a major reason as to why capitalism is so successful.

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