Tag Archives: Capitalism

Economic Myths #7 – Government means Harmony


One of the aspects of capitalism and the free market that the typical lay person finds difficult to comprehend is the fact that the complex structure of work, production, distribution, and trade could possibly take place without some kind of centralised, directing authority in order to co-ordinate everybody’s efforts. Wouldn’t there just be chaos and mal-coordination with everyone trying to make their own, independent plans if there is nobody at the tiller to steer the giant ship?

This fallacy stems from the belief – accentuated by holistic concepts such as aggregate, pseudo-statistics like “GDP” or “the national income” – that what we refer to as “the economy” is some kind of enormous machine that has “input”, with a single operator “processing” these “inputs” into “outputs”.

In fact, rather than being one giant, amorphous blob “the economy” is made up of millions and millions of independent, unilateral acts of production and two-way trades, many of which will never have anything to do with each other. I may sell an apple to my neighbour for 10p in London; another person may sell an orange for 20p to his neighbour in Manchester. Neither of the two pairs of people has ever met, nor need any of them have any involvement with the exchange of the other pair; and yet both exchanges would be regarded as part of “the British economy” in mainstream discourse. Read more

Economic Myths #5 – Banking is Capitalist


By both mainstream economists and the general public the cycle of “boom and bust” is believed to be a tendency inherent in any capitalist economy. The fact that the latest of such cycles, beginning in 2008 (and arguably not having ended), originated in the banking sector and that large banks and bankers ratcheted up huge earnings and bonuses only to cause disaster has implicated banking as representative of the very worst aspects of capitalism – the epitome of uncontrollable greed that ends in catastrophe.

Unfortunately this popular view of the mainstream could not be further from the truth. In fact, with its intimate ties to the state and its special, legal privileges it is hard to imagine a less capitalistic industry than banking. Part of the deception – wilfully inflamed by politicians and their lackeys – is one that engulfs other industries subject to state meddling such as utilities markets. This is the belief that, simply because the participants in the industry in question are private individuals or entities that are not officially part of the state, the enterprise must be classified as part of the free market and saddled with all of the supposed flaws of that system. Very often, however, private companies and brands are simply the public facade of what is essentially a state owned operation or state controlled cartel. Read more

Economic Myths #4 – Profits are Evil!


One of the elements of a capitalist system that induces purple-faced rage amongst statists and progressives is the existence of profit. This residual – the amount left over once an entity has deducted its costs from its revenue – is said to line the pockets of greedy shareholders while exploiting labourers and consumers.

First, it is important to understand what we mean and what we do not mean by “profit”. Here we will be discussing only profits that an entity may earn purely as a result of voluntary trade and free exchange; we do not mean those “accounting” profits that companies may rake in as a result of favourable state regulations, direct subsidy from the state, or any other kind of residual of a trade relationship based upon force. These profits – including bank bailouts and stimulus funding – are rightly to be condemned as unjust and immoral, sustaining the power base of the incompetent, wealthy elite at the expense of everyone else. But such a condemnation must not be allowed to throw out a very precious baby with repulsively filthy bathwater – for profit is one of the most vital elements that gives life to an economic system that relies upon the division of labour. Read more

Capitalism and Equality


Capitalism and Equality

By Duncan Whitmore

In several recent posts and a podcast on this blog1, Rev. Rory McClure has provided some robust and insightful assaults on the leftist quest for equality. For too long it has been widely believed in mainstream circles that equality between human beings, in one form or another, is some kind of virtue to which society ought to aspire and that rank inequality is a measure of severe injustice that needs to be corrected by state action. Even though the worst excesses of inequality – such as the rising value of assets owned by the rich as a result of worldwide money printing – are, in fact, products of a state corporatist system, the perception that some people will be wealthier than others in a free market continues to provide an almost instinctive impetus towards some kind of socialism and re-distributionism. Rev. McClure has performed an important service by not only demolishing the view that inequality is a handicap for lovers of liberty but, above and beyond that, by demonstrating how inequality is, in fact, something to be embraced and cherished.

To add to Rev. McClure’s important arguments this essay will first subject the aspiration towards some kind of perfect or immediate equality – i.e. the forced attempt to render all people absolutely equal now with today’s stock of wealth and resources – to a specifically praxeological critique. However, we will also demonstrate that even if someone desires a more approximate or gradual achievement of equality – such as the so-called “equality of opportunity” – it is, in fact, statism, socialism and any kind of redistributionism that should be abandoned while, instead, those who seek to create such equality should embrace a social order that maximises the production of wealth. That social order is, of course, free market capitalism. Thus it will be shown that, even on their own terms, advocates for greater equality should be free marketers. Read more

The beauty of entrepreneurship


The beauty of entrepreneurship
By Neil Lock

I thought it might be good to offer something a little bit up-beat for a change.

I’ve been contemplating the so called “labour theory of value.” That is, the idea that the value of an individual’s work depends only on the amount (and, in some interpretations, also the quality) of the labour put into it.

Now I’m no economist, but even I can see that the labour theory of value is a crock. The argument I use is to adapt the well known proverb, “Beauty is in the eye of the beholder.” In my version, this becomes “Value is in the mind of the buyer.” That is to say, what matters isn’t the amount or even the quality of labour the seller has put into the product, but the value to himself which the potential buyer perceives in it. The greater this value, the more the buyer will be willing to pay.

Read more

What’s Wrong With Asking What’s Up With Russia?


Ilana Mercer

Franklin Delano Roosevelt is not the man to quote in support of the market economy. He was, after all, the president who gave America the assault on free-market capitalism known as the New Deal. He also capitulated to communism at Yalta, 70 years ago. There, in February of 1945, he and Winston Churchill met with Joseph Stalin, a genocidal butcher who dwarfed Adolf Hitler, to divvy up the world.

By the time the “Big Three” convened in the Crimean city, the region had long been subdued and decimated by the Bolsheviks. In November and December of 1920 alone, Crimea had been the site of a massacre of 50,000 souls. Kulaks, Cossacks, Ukrainians; priests, White Guards, socialists, nobles, Mensheviks and bourgeoisie: Entire groups had been branded as counterrevolutionaries-by-class, designated as sub-humans worthy of extermination. That is if the Reds’ revolutionary utopia was to come into being, which it did.

For simply being who they were or if caught talking out of turn, anyone in communist Russia could be made “a head shorter,” in Trotsky’s “delightful” turn-of-phrase.

Why, Roosevelt and Churchill had just missed the deportation, in 1944, of the Crimean Tartars. According to “The Black Book of Communism: Crimes, Terror, Repression”—that “800-page compendium of the crimes of communist regimes worldwide”— “of the 228,392 people deported from the Crimea, 44,887 had died after four years.” Still, the Anglo-American leaders saw fit to sit down with Stalin to “map out the postwar world,” ceding Eastern Europe to “Uncle Joe,” FDR’s affectionate moniker for the communist mass murderer.

In fairness, Churchill does not deserve to be lumped with FDR as an appeaser and enabler of ultimate evil. Churchill was avowedly anti-communist. He detested Stalin. For this very reason, FDR considered Churchill a “reactionary … an old incorrigible imperialist, incapable of understanding [Stalin’s] ideological idealism.” Against the wishes of Winston Churchill did Roosevelt agree to “give Stalin what was not his to give,” noted historian Paul Johnson, in his “History of The American People.” Churchill went along with FDR because he was desperate for American financial support.

Like many pseudo-intellectuals of his time, explained Johnson, Franklin Roosevelt was “grotesquely Stalinist.” Against all evidence to the contrary, he regarded the Soviet Union as Read more

Is a British Libertarian a Fabian-turned-upside-down?


David Davis

I’ve been heavily criticized from time to time by people that ought to know better, for inventing the word “GramscoFabiaNazi”. However, google seems to hit it nearly 5,000 times, an increasing proportion of which are not things I wrote.

Earlier today I came across this piece. British Libertarians like constructing “Think Tanks” and indeed it seems the Fabian Society was to be seen as one of these by its members: although a later objective was to hijack and farm the political franchise of (initially) the “Working Classes” later to be followed by everyone else.

The strategy of telling people what they ought to want, then making them want it, seems to have worked for the Fabianazis. Sometimes I have a go at, for example, shopkeepers. Often a shop till is busy with a shambling chav in pink pyjamas and with a “Fazackerley Facelift”…”yeh…and can I have 20 Embassy…..and can I have 10 rollups…..and can I have £10 on the lecky (another 40 seconds gone)…and can I have £5 on the gas….(40 more seconds)…oh and can I have a  strawberry wkd…and the Daily Star…..(then goes back and gets 2 litres of cider)….(is that it luv? Er….yeh……”) But if there’s nobody waiting I sometimes try things like:-

“YOU PEOPLE…ought to not want to be told what to sell, and to whom!” I refer here to local CouncillorNazi bullying, and legal strictures about such as tobacco and alcohol.

“IF ALL YOU SHOPS…had risen up as one, and instantly shouted “f*** off”, to the Gubblentment about “minimum pricing for alcohol units”, then you wouldn’t be forced to Read more

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