Capitalism is the only social/economic system that gives us all freedom of choice because it removes the element of force, and this is why it is the only moral system. Instead of restricting human interactions through different types of force (government regulations, suffocating laws on small businesses, the tender process and corruption), as all other social systems do, capitalism is based on the fact that each one of us, in order to survive and thrive, needs to be free to use our reason as we see fit. The moment we mix freedom with elements of force, the moral argument is lost – despite the noblest of intentions.
Whether deciding where to buy our next bottle of milk, or at which bank to invest our latest paycheck, we need to have our wits about us. We need information, we need honesty from the person with whom we are interacting, and we need the freedom to exercise our own reason when choosing which option is the best one for us. If we are forced in any way into taking a particular direction, the decision is no longer ours. As human individuals, we need our free, volitional reason to survive in this world – it is up to every one of us to decide if x is better than y for us. Other animals have their own tools of survival – humans have reason, and we have to be free to use it if we are to survive.
Humans make inconsistent, unexpected and wildly different decisions, especially when it comes to money. They buy things that others might consider irrational and silly, but the fact remains that it is their choice to do with their money as they wish (provided they do not infringe upon the rights of other individuals). From the highest level of government power, to the man trying to sell fruit on the side of the road, human thinking and decision-making ought to be free from force, whether that force is intended for a noble purpose or something more sinister. No matter how good the intentions of a government minister, it does not help the small business owners if they have to struggle more and more with an ever increasing number of regulations to just make a living – realising this, the minister should do his best to get out of the way and not hinder the businessman. We need to move away from arguments based on force and instead focus on the actual results of government policy – North Korea, that boasts a 100% employment rate, is not the place people run to. Instead they escape to countries where they can enjoy more freedom.
The fact that some corporations engage in exploitation or illegal practices does not mean that all should be deemed immoral – we need to establish clear, rational laws, not make it more difficult for all businesses to operate. When an individual, corporation or government acts immorally, we should condemn and punish them. But we cannot punish people before they have acted. As Ayn Rand wrote in Capitalism: The Unknown Ideal, “In a capitalist society, all human relationships are voluntary.” If they make the wrong decisions, reality will punish them accordingly, because they will be “free to cooperate or not, to deal with one another or not, as their own individual judgements, convictions, and interests dictate.” We often talk about the right to free speech, but we do not discuss enough that the right to disagree is perhaps more crucial. To take just one example, if a business owner acts in a racist manner, we, as his customers, can refuse to buy from him, thereby resulting in the death of his business. We, as consumers, using our money votes are more powerful than any government minister using the force of legislation can ever be at eliminating racism from our society.
Capitalism is not anarchy. The government is a necessary good in our society, because its proper role is to protect individuals from the imposition of force. We should focus on restricting government to this apt role; instead of restricting people’s voluntary actions. The goal should be to free people. This is not based on the assumption that human nature is fundamentally good or evil – rather that human beings are complex and that their actions and decisions should be their own to make. When they act in a good manner, we can choose to reward them with our money. When the opposite occurs, we can punish them by not buying from them.
Author Chris Hattingh is an FMF intern.This article may be republished without prior consent but with acknowledgement to the author. The views expressed in the article are the author’s and are not necessarily shared by the members of the Free Market Foundation.