American Capitalism is Broken

American Capitalism is just plain broken.

Why do I say that? Because American Capitalism has in essence declared that its god is the Almighty Dollar. And in such circumstances as these, the problem identified by Pope St. John Paul II cannot be escaped.

True development cannot consist in the simple accumulation of wealth and in the greater availability of goods and services, if this is gained at the expense of the development of the masses, and without due consideration for the social, cultural and spiritual dimensions of the human being. (Sollicitudo Rei Socialis §9)

So long as development is reduced to the question of how many goodies I can collect, capitalism remains hopelessly broken and will never bear the fruit that the gift of private property ought to bear. The system must be fixed. St. John Paul II offers a remedy.

I wish to appeal with simplicity and humility to everyone, to all men and women without exception. I wish to ask them to be convinced of the seriousness of the present moment and of each one’s individual responsibility, and to implement — by the way they live as individuals and as families, by the use of their resources, by their civic activity, by contributing to economic and political decisions and by personal commitment to national and international undertakings — the measures inspired by solidarity and love of preference for the poor. (ibid., §47; emphasis added)

Why does he call upon all of us for this great task? Because, quite frankly, those with the power and the gold are not going to give up either their power or their gold for the sake of the poor. It is up to us, the Holy Father essentially says.

Once upon a time I had a discussion (perhaps I am charitably describing it) with someone who simply rejected the notion that human beings have a right to something better than the barest existence. This person may have supposed that if we start talking about rights then we start talking about the involvement of the State. But if we cannot agree at the very least that man has a right to something better than “living” in a mud heap without reference to any particular order for delivering that right — if we cannot agree on something so fundamental as this then it seems like waiting for a consensus before action is taken is the wrong answer. This is why, I think, the Holy Father calls us to the personal commitments that he does in the encyclical we are perusing. The poor have waited long enough.

What does this commitment look like? I can’t tell you. I do not think that the Holy Father would have tried to tell you. But it is something that we must think about and pray about and then act upon. With God’s help we can do what is right in our small corners of the world.

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Posted in America, Charity, John Paul II, Natural Law, Rerum Novarum
4 comments on “American Capitalism is Broken
  1. johnsbraun says:

    I agree that American Capitalism is broken, but it is fixable. The fix will be found in the decisions and actions we each take in our “small corners of the world.” The point at which the breakage began can be fixed with accuracy–the Progressivism of Teddy Roosevelt and Woodrow Wilson. And we can fix the point at which the breakage became permanent–The New Deal of Franklin Delano Roosevelt. The American people could have reversed the breakage at any point–and by electing Calvin Coolidge as President did for a time–but chose not to; we could today begin to reverse the socialistic welfare state but there is no evidence that we have the knowledge for a return to Capitalism. The essence of Capitalism is found in the free market–the voluntary transactions between individuals for their mutual self-interest. F. A. Hayek said it best as freedom within the rule of law. Without the rule of law applied universally, freedom isn’t possible. The alternative isn’t anarchy, for human beings cannot support anarchy, but tyranny either under a tyrant or an all-powerful central government (our current tyranny of choice).
    I don’t think that American Capitalism has declared its god to be the almighty dollar. On the one hand, as an economy practiced by a society, it can’t; theories of interaction and societies can’t choose anything, only individuals are free to choose. What has happened is that people have accepted the materialistic view of Man inherent in socialistic welfare theories wherein the government, the state, become the guarantor of rights and welfare (seen as a ‘standard of living’). Man, under the materialistic view of welfare socialism, is in fact the sum of the goods he possesses and producers, all of which those who gain power in the state believe themselves capable to direct and control.
    The free market is the least practiced in human history because freedom is the most fragile of all human conditions. Rather than allowing themselves to be equally bound by the rule of law, men find that they can collude with each other to establish monopolies that increase their power. As I read recently in an essay about the Common Core–the current U. S. monopoly in education–monopolies always result in a poor quality of goods which are at the same time more expensive than they otherwise would be.
    It can be, and has been, argued that the free market itself creates monopolies that the government has to break. That’s true. If the government would be restrained to the enforcement of the laws governing an economy, that would keep individual transaction free and mutually beneficial, that would be well and good. The men and women who gain power in government have never shown themselves willing to be restrained, however.
    They invariably present themselves as acting for the common good. Back in the day, John D. Rockefeller, had a seemingly oil monopoly. He was better at the oil business than just about everybody else and bought up most of the oil fields and owned the means (pipelines) of transporting the oil. He no doubt made deals with railroads as well. Let’s say that he didn’t break any laws, and I don’t think he did, he was just better at it than anybody else and his company was bigger than anybody else’s company; if fact, it was impossible for other Cheap oil for the people and jobs. There isn’t anything morally wrong about a man doing better what others are also trying to do and creating a big, bigger than anyone else’s, company. Other people may see him as a ruthless pig who has acted unfairly to the detriment of his fellow man. He may be a ruthless, immoral pig, but what should society’s elected officials do about it. In a free market, the answer would be nothing. Go, compete with him, find a better way to do it that will benefit other people; i. e., provide them with something that they will want to buy; i.e., that they will see benefits their lives. If John D. colludes with elected officials in order to pass laws or make rules that hinder, or prevent, others from competing with him, then charge him with a crime.
    Within a free market, something inevitably happens to big companies, they eventually fail.
    The free market is the one economic system, where it has been even imperfectly allowed to operate, that has lifted more people out of poverty than any other; and this recently in the Asian countries of India, South Korea, and Japan. Or, there is a simple question to ask: Why did West Germany rebuild and prosper and East Germany not?
    John Paul II continued to believe, I think, that there could be national and international institutions that could solve the problem of poverty. There isn’t. There is, on the other hand, the knowledge that institutions and government need to be restrained from interfering in voluntary transactions from which people mutually benefit, and that government officials content themselves with enforcing just laws.

  2. […] Source: American Capitalism is Broken […]

  3. johnsbraun says:

    I agree that American Capitalism is broken, but it is fixable. The fix will be found in the decisions and actions we each take in our “small corners of the world.” The point at which the breakage began can be fixed with accuracy–the Progressivism of Teddy Roosevelt and Woodrow Wilson. And we can fix the point at which the breakage became permanent–The New Deal of Franklin Delano Roosevelt. The American people could have reversed the breakage at any point–and by electing Calvin Coolidge as President did for a time–but chose not to; we could today begin to reverse the socialistic welfare state but there is no evidence that we have the knowledge for a return to Capitalism. The essence of Capitalism is found in the free market–the voluntary transactions between individuals for their mutual self-interest. F. A. Hayek said it best as freedom within the rule of law. Without the rule of law applied universally, freedom isn’t possible. The alternative isn’t anarchy, for human beings cannot support anarchy, but tyranny either under a tyrant or an all-powerful central government (our current tyranny of choice).
    I don’t think that American Capitalism has declared its god to be the almighty dollar. As an economy practiced by a society, it can’t; theories of interaction and societies can’t choose anything, only individuals are free to choose. What has happened is that people have accepted the materialistic view of Man inherent in socialistic welfare theories wherein the government, the state, become the guarantor of rights and welfare (seen as a ‘standard of living’). Man, under the materialistic view of welfare socialism, is in fact the sum of the goods he possesses and producers, all of which those who gain power in the state believe themselves capable to direct and control.
    The free market is the least practiced in human history because freedom is the most fragile of all human conditions. Rather than allowing themselves to be equally bound by the rule of law, men find that they can collude with each other to establish monopolies that increase their power. As I read recently in an essay about the Common Core–the current U. S. monopoly in education–monopolies always result in a poor quality of goods which are at the same time more expensive than they otherwise would be.
    It can be, and has been, argued that the free market itself creates monopolies that the government has to break. That’s true. If the government would be restrained to the enforcement of the laws governing an economy, that would keep individual transaction free and mutually beneficial, that would be well and good. The men and women who gain power in government have never shown themselves willing to be restrained, however. They invariably present themselves as acting for the common good.
    Back in the day, John D. Rockefeller, had a seeming oil monopoly. He was better at the oil business than just about everybody else and bought up most of the oil fields and owned the means (pipelines) of transporting the oil. He no doubt made deals with railroads as well. Let’s say that he didn’t break any laws, and I don’t think he did, he was just better at it than anybody else and his company was bigger than anybody else’s company. The result? Cheap oil for the people and jobs.
    There isn’t anything morally wrong about a man doing better what others are also trying to do and creating a big, bigger than anyone else’s, company. Other people may see him as a ruthless pig who has acted unfairly to the detriment of his fellow man, and he may be a ruthless, immoral pig, but what should society’s elected officials do about it? In a free market, the answer would be nothing. Go, compete with him, find a better way to do it that will benefit other people; i. e., provide them with something that they will want to buy; i.e., that they will see benefits their lives. If John D. colludes with elected officials in order to pass laws or make rules that hinder, or prevent, others from competing with him, then charge him with a crime.
    Within a free market, something inevitably happens to big companies, they eventually fail.
    The free market is the one economic system, where it has been even imperfectly allowed to operate, that has lifted more people out of poverty than any other; and this recently in several Asian countries. Or, there is a simple question to ask: Why did West Germany rebuild and prosper and East Germany stay poor and a wreck after WW II?
    John Paul II continued believing, I think, that there could be national and international institutions that could solve the problem of poverty. There isn’t. There is, on the other hand, the knowledge that institutions and government need to be restrained from interfering in voluntary transactions from which people mutually benefit, and that government officials content themselves with enforcing just laws.

    johnsbraun

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