Now that communism is part of the past, I think it would be worth while to attempt to understand why and how capitalism won.  Indeed, the cold war was replete with many that bought the party line about American imperialism and the evils of capitalism.  It was Marcuse who once blamed capitalism for the slow progress of socialism.  His view was that the success of the productive aspects of capitalism duped and blinded people to the corruption of the system and kept them wanting ever better products.  This forced socialism onto the defensive and even made it necessary for socialism to spend more and more on military machines.  Marcuse was right, but instead of realizing what it was about capitalism that kept it from collapsing, as he and his compatriots thought it would, he assumed that socialism was the better system nonetheless.

Why did capitalism win?  What was it about this system that has been reviled, criticized and hated by virtually all major intellectuals for almost three centuries that has enabled it to succeed against such ‘nobler’ systems as communism and socialism?  Wasn’t capitalism the system that would disappear and become communism?  The answer is that the intellectuals have missed something.  They were wrong in some way.  There was a major denial in their thinking that made them as obsolete as the ideas they advocated. 

What is it that they missed?  They missed the basic fact that capitalism is good for the individual.  Capitalism gives him a better life because he has chosen to work and prosper in the freedom that capitalism provides.   How is it that the individual did not miss what the intellectuals missed?  I submit that the individual knew more than all the intellectuals combined because his paycheck did not come from a university seat but from his work. 

However, the intellectuals have not found the dust heap of history that they deserved.  Capitalism has provided them with the freedom to continue advocating the next phase of their movement toward dictatorship: the welfare-state.  Our intellectual leaders and politicians are still raising before us the specter of a capitalist system that has made our lives uncertain and our souls insecure. We are criticized because we worry about jobs, prices, and a myriad of choices. We are consoled with the idea that a great many of our moral decisions are complicated by the temptations of money and advertising. We are told that man was not made to live in a society as complex as ours, and that it is time he started toning down, lowering his sights away from increasing his standard of living, protecting the environment and moving back toward a simpler way of life.

The same charges were made by the avowed enemies of capitalism during the cold war, intellectuals that fostered such systems as communism, fascism and socialism.  Communism has virtually been removed from the earth by people whose lives were certainly not simpler.  In fact, the enemy of capitalism was notorious for fear, political purges, worker exploitation, concentration camps and intellectual tyranny, none of which are characteristic of capitalism.  Indeed, the enemies of capitalism, in our time, use the rhetoric of tyranny when they describe capitalism, now that they are safe from those charges themselves; claiming that capitalism is an exploitive system that imposes itself on the lives of innocent people around the world, forces them to work for low wages and steals the product of their labor for the sake of “fat cat” high living “commissars” known as CEOs.

It is no mere coincidence that all such statements are made at a time when government, not capitalism, is subjecting our money to inflation, hence worry about jobs and prices; when government is increasingly intervening into the moral decisions of many through economic regulation and morality legislation; when government is taking large amounts of income from the productive middle class in order to provide welfare for the non-productive.  It is assumed that government is now controlled by the “fat cats” that bribe government to do their bidding, protect their markets and let them get away with just about anything they want to get away with. 

Capitalism’s enemies intend to continue to move toward a welfare-state, since capitalism, in their view, cannot and will not provide for those who have not. It will be the intention in this article to show that the above idea is foolishness that, if we continue the advance toward the welfare-state, we will eventually be led toward decline and dictatorship. We will show that the welfare-state is not a solution but a cog in the wheel of human progress, that it is not an alternative but a dead end, that it cannot exist where capitalism is not present in some degree, and that capitalism, a free laissez faire capitalism, is the only efficient welfare-system devised by man.

I must emphasize that my use of the term welfare is literal. In this usage, I am being honest, where welfare-statists are dishonest-they use the word as a euphemism for what should be called the coercive redistributive state, or anti-welfare state, since the term welfare does not apply to the consequences of the policies of welfare-statists-- nobody's welfare is being served by the so-called welfare-state.

It must also be emphasized that the justification of capitalism lies not in its efficiency or results. Capitalism is right because it is a system that allows man's nature to flourish, giving him hope for tomorrow and a desire to do well. Further, capitalism makes a truly successful and social life possible because it establishes trade and cooperation as fundamental human expectations. The purpose of this article is to spell out why capitalism is the true welfare system and to expose the antipathy of capitalism's critics and enemies for what it is: a distorted effort to have capitalism and eat it too, by ignoring the basic structure of capitalism and attaching a moral label to it that focuses a negative estimate upon the one ingredient which makes capitalism a life-giving success.

That ingredient is self-interest. That self-interest has had few proponents or apologists is testimony and reason for a general hatred of the only system that truly ennobles man.

Indeed, the history of philosophy has been a stampede of opinion against it. Capitalism was not the system of Oriental mystics, of Plato, of the Middle Ages, of Christianity although it makes it possible for mystics of all varieties to exist without fear of inquisition.

If we were to judge Christianity in general by reference to the Inquisitions or altruism by reference to Hitler, howls of protest would ring through the halls of America's institutions. "How unfair it is," they would say. But the stampede to judge capitalism by reference to the few “anti-capitalists” that used government influence to advance themselves or by reference to the silenced, undefended, lynched few whose crime was success, would receive few protests and no howls about unfairness.  I am here to shout “unfair.”

Yet our mystics and intellectuals continue to rely on capitalism while they revile it. They flourish with romanticized notions about their being righteous defenders of downtrodden minorities who have been victimized by capitalism, forgetting, in the blindness of fanatics, that the supposed downtrodden are not dirty, ignorant "noble" savages, but educated, clean, successful working people who have no desire to stampede against capitalism but who want a better life, already vastly improved by capitalism, yet who stand, unfortunately, confused by the anti-capitalist stampede, who don't know what they should, in conscience, believe or want.

Should we have an expanding role for government, giving ever larger welfare programs for rich and poor alike? Or should we role all this back and allow private capital and voluntary interests to predominate? How should we proceed, and why? What theory will work? What are theories? Are they important? The gap between intellectuals and people must be bridged. Let us then proceed.

We see in the media and the arts a pervasive negative attitude toward business, particularly big business. Actors and commentators are forever sneering at the giants of industry, who, in their "ruthless" pursuit of profit, are supposedly breaking laws, cheating consumers, and generally, but successfully, making life miserable for us all.  From the philosophical arena we are taught that those who seek self-interest necessarily must seek it at the expense of others, that consideration for others is always left out of an egoist's (businessperson’s) actions. Such attitudes reach their lowest point in practice when a President of the United States scorns businessmen for not sacrificing themselves to the inflationary policies of the government and instead insist that in spite of the President's wishes they are going to make a profit. (See Kennedy vs. U.S. Steel)

Aside from the fact that most businessmen are not consistent egoists, there is an inconsistency in the attack on egoism being waged in our culture. First of all, it is not in the self-interest of businessmen to disregard the wants and desires of others. Secondly, every man must make more than he produces. Thirdly, breaking laws and cheating consumers are not the practices of egoists but of altruists who are on the receiving end of that philosophy.

1) In practically every philosophical discussion of egoism we hear something like this: Is it right to seek one's self-interest in disregard for the interests of others? Yet, this is a loaded question (loaded by altruists, of course). It is based upon what I call scarcity metaphysics, the idea that one man's good is another man's harm. Such a view implies a total ignorance of property rights, and of the fact that what is rightfully owned by one man cannot in any way relate to the well-being of another.

The idea that egoism requires sacrifice by someone neglects the basic principle of human interaction, the principle that makes coexistence possible; the principle of trade for mutual benefit. When people engage in trade they each expect to gain from the transaction and this is most often what happens. The standard of living in those countries that have free trade policies is evidence that mutual benefit does take place and that the world need not be a den of thieves.

The ancient idea that those who engage in trade for a living are evil only reveals a bias by altruists against self-interest and effectively removes them from serious consideration. That such thinking takes place in view of the obvious evidence against its veracity is another example of the extent to which altruism has corrupted our culture. Any businessman who expects to sell a product or service must seek to offer the purchaser some benefit and he must do so consistently and for a number of people at a price they are willing to pay in order to remain in business. All the arguments that corporate bigness and large advertising expenditures exempt some companies from the necessity of providing a quality product or service are only altruistic cynicism. In fact, the altruist attack on egoism can only be one more attempt to corrupt the concept of justice and to deny to the man of virtue (the free trader) the moral import of his actions.

The problem with anti-capitalists and their arguments, almost to a man (woman), is that they assume that capitalism is steeped in conflict and contradiction.  Perhaps this comes from their childhoods or from their mentors, but for some reason, they project a state of conflict into the very essence of capitalism that is not there.  Capitalism is about, indeed requires, a level cooperation, good will and synthesis between economic demands and need fillers, between those who want and are willing to buy and those whose jobs it is to develop the products and services to fill those wants, that socialism can never and has never been able to match.  Capitalism is a form of welfare system, if we can use that term, where cooperation between the consumer and the capitalist creates the most efficient matching of need with need fulfillment ever devised.  In contrast to the "command" method of the controlled economies, where bureaucrats make economic decisions, often guessing wrongly, then expropriate the funds from the society to fill needs that they consider socially acceptable (making sure they skim a little off the top for themselves), capitalism is a demand system where capitalists are free to fill real and immediate demands using their own funds or borrowed funds and getting their reward afterward when success is achieved - success that comes from successfully meeting the consumer's needs.  Socialism is inefficient because it is based on bureaucratic decisions that are almost always wrong, too late, aimed at the wrong people of down right corrupt.  Capitalism, on the other hand, is a perfect system because it allows the consumer to choose what he needs and then find the products to fill those needs, and in the process tipping off the capitalist to the kinds of better products he needs. 

2) In a sense, every man is a Robinson Crusoe. He must find ever more efficient methods for improving his survival. For Robinson Crusoe, his goal was a better life on a desert island. For modern man, his goal is a higher standard of living. But like Robinson Crusoe, modern man must find a way to lighten the effort needed for bare survival. He does it through production. Production creates the profit that yields the opportunity for a higher standard of living. If a man's productive efforts yield him more than he needs for bare survival, he can then look around for those products that help in raising the quality of his life; he creates demands for such products and thereby stimulates more production; he creates a need for advertising and promotion of products so he can be made aware of what is available.

Every man is a businessman in this sense: in order to survive, he must produce, and in order to survive well, he must produce more than is necessary for bare subsistence. This law applies all across the economic spectrum. To preach that profits are evil is not just an attack on disembodied corporations. It is an attack on every person and life (and this includes the lives of the individuals who work for and invest in the corporations).

Man is not a creature mired or chained to bare subsistence. He is also a creature of pleasure, a creature that yearns for rest, enjoyment, and celebration. He needs to produce more than he consumes because he needs to experience the totality of being human. Subsistence economics is nothing more than a scheme to subvert man's happiness, undertaken by those who would dictate his choices and steal the surplus that he produces. It is no accident that subsistence economists take little consideration of man's ability to choose for himself, and that they preach their theories in the midst of the most technologically advanced and productive economy in human history. They preach it, not in spite of the greatness of the productive U.S. citizen, but because of it.

3) Altruism preaches and demands sacrifice. It is a doctrine that divides mankind into two camps, the givers and the takers. The givers are those who have been duped by the philosophy of altruism and believe it is their lot or duty to sacrifice for others. They have come to accept the fallacious argument that mankind could not survive without sacrifice. The takers are the beneficiaries, those who accept the racket and cash in on it. Some of them are also duped by the philosophy. Some are confused and think that sacrifice is the only possible answer to human survival, but they all believe that the property of one is the property of all.

The criminal who would presume that he has a right to take or cheat others out of their property is not so different from the altruists who ask for handouts. He is only more honest in his hatred of those who "presume" to own property that he can easily take. Both have a profound disrespect for property.

That the thief or con-man is not a businessman can be understood when we realize that the thief steals what other men produce and that the major function of a businessman is to produce.  Many businessmen are portrayed as being concerned with getting money at any cost. But few businessmen who had the attitude of a thief could get rich. They could not remain in business long since most buyers would soon find out about the deception and refuse to do business. Getting rich by means of deception, and in competition against producers, is difficult if not impossible in a free market; but it is very easy in a welfare-state where many economic decisions are made by corrupt government bureaucrats.

Certainly there are men who attempt to do business in a dishonest manner. But these men are few and not the majority. The major problem is that businessmen today are placed in a position where regulations, rules, and arbitrary standards make it difficult to be honest. These government intrusions allow men who would otherwise be criminals a chance to legitimize their plunder by controlling and manipulating government bureaucrats. But such men are not, in the strict sense, businessmen. They are welfare recipients, men kept alive by government assistance.

That the main business of American industry is production, not theft or forgery, should have been noticed long ago. Only a philosophy like altruism, one that focuses moral worth primarily upon sacrifice, could cloud men's minds to the exacting kind of virtue required of the men who choose to be productive.  And it is this same philosophy that damns man for being too concerned with materialistic things, that tells man that he has produced too much and he should give away the fruits of his production. It tells him that to produce is so easy, but to give so hard. It is blind to man's true greatness because it refuses to regard production as an essential, necessary, and highly desirable virtue.

It is this same philosophy that advocates a welfare-state to forcibly divest men of their incomes for the sake of the nonproductive. And, finally, it is the same philosophy that refuses to consider that a capitalist society can do more good than any welfare society.  To prove this last point, we will analyze four essential characteristics of capitalism, their cause, and their consequences. They are mass production, the division of labor, capital accumulation, and corporate organization.

MASS PRODUCTION

A uniquely capitalist invention is the concept of mass production that lowers the cost of production and spreads the benefits to all parties in society.  A key characteristic of capitalism, and this is exactly the opposite of the altruist/liberal interpretation, is that capitalism is for the "masses."  The individual man, unlike in any other time in history, for the first time in history, is the beneficiary of capitalist mass production.  Liberals continuously proclaim that capitalism is for the rich and that there is a separation, in capitalism, between rich and poor, have completely missed that critical fact that capitalism makes the lives of "the lower classes" better by making products (including new products) that in past ages would have benefited only the rich classes, available at lower prices to every man.  Capitalism is truly the system that bridges the gap between rich and poor because it elevates the standard of living of every man.

Businessmen like Henry Ford and many others recognized that by making their products available to the average man, he increased the number of customers, lowered his costs of production and lowered prices within the reach of more people.  Automobiles, oil and gas, household appliances, and in our time, computers have made the lives of all people better and have made it possible for the average man today to live a life better than the kings and lords of the past.

Yet, capitalism is constantly vilified for creating a gap between rich and poor while many more people previously poor are now millionaires due to innovative ideas and ingenuity.  In the past, a person who was born poor would have been prohibited from even leaving his village, let alone accumulating enough wealth to buy a computer and start his own business.  Such things were relegated to those who enjoyed the "King's Prerogative" and were forbidden to the poor.  Capitalism is the only system that opened up production and the ability to be productive to every citizen willing to work.  Capitalism even provided, free of charge, the new machines that created the new jobs for the previously poor.

To quote from Ludwig von Mises:

"This is the fundamental principle of capitalism as it exists today in all of those countries in which there is a highly developed system of mass production: Big business, the target of the most fanatic attacks by the so-called leftists, produces almost exclusively to satisfy the wants of the masses.  Enterprises producing luxury goods solely for the well-to-do can never attain the magnitude of big businesses.  And today, it is the people who work in large factories who are the main consumers of the products made in those factories.  This is the fundamental difference between the capitalistic principles of production and the feudalistic principles of the preceding ages." (Economic Policy - Thoughts for Today and Tomorrow by Ludwig von Mises)

The reason capitalism overtook communism is because capitalism improved the lives of more people, made them happier, freer, more affluent and more productive.  Communism, mired in the separation of classes, between bureaucrats and party leaders over the working classes.  The workers, the people whom the revolution was supposed to have given power, merely toiled in poorly maintained factories and dangerous working conditions.  They refused to be productive for people who were skimming the fruits of their labor in order to have better apartments, better vodka and caviar.  Communism tried to steal the benefits of capitalism, mass production, and create a system to beat capitalism but they forgot that the essential element of capitalism was freedom.  And since the masses were not free, not adequately paid, they were seldom able to purchase the products of mass production, were perennially disappointed because the "managers" chose to produce the products they did not demand and vice versa.  The system was inefficient because it was not focused on production for the "masses" but instead was focused on mass production of unwanted inferior products and massive military programs.  The result, long lines, inferior products and cynicism.

THE DIVISION OF LABOR

At the base of any civilization is the division of labor. The complexity that this division achieves, if the divisions are based upon production, is the complexity and extent of that society's success as a civilization. A tribe whose basic division is that of chief, witch doctor, hunters, and child raisers can hardly achieve the diversity necessary for a trip to the moon, although they often find good reason to worship the moon.

The advanced use of the division of labor must be distinguished from the crude forms found in primitive societies. The advanced forms of division of labor represent more than an economic advance; an intellectual advance is required, an advance that is achieved by the man who realizes that specific resources can be much more efficiently handled if he devotes more time and study to them. It also requires the knowledge that, should he devote his time and skills exclusively to one type of task, he will create more valuable goods for trade with others.

In its advanced uses, the division of labor represents an intellectual achievement which realizes the potential benefit of an idea and puts it to use. The idea becomes an established asset of the society, and if the division of labor is allowed to flourish without regulation, it adds increasing benefit to the life of every individual in that society.

CAPITAL ACCUMULATION

Capital accumulation works hand in hand with the division of labor. It is also an idea based upon the advanced intellectual level of a society. The society that grasps this crucial economic principle and decides to allow capital accumulation - that is, protect property rights - is the most moral of societies.

Through capital accumulation, men are able to invest their savings in ever more ambitious projects, and by producing those goods and services they are able to create more wealth, jobs, and higher standards of living. The entire society advances when those few who are able to accumulate vast amounts are given the freedom to do so.  In fact, capital accumulation is not restricted to the rich. Anyone can save his money and invest it. In fact, it is the small investor, through his banks and savings institutions, who does most of the investing in a capitalist economy.

CORPORATE STRUCTURE

Corporate structure is the individualization of a group of people involved in a voluntary association. It involves a system of organization that maximizes productive output with the least amount of input. It organizes its resources into unique and efficient productive processes.

Corporate structure requires a genius of its own. The corporation heads must discover and integrate the tools that will help in the achievement of the organization's goals. The structure is like a mini-machine with each part performing a different function. If the heads are good mechanics, they can keep the machine running smoothly while improving, altering, and adjusting it for more output.  The corporation is the ultimate vehicle through which the division of labor and capital accumulation are brought to maximum effectiveness and benefit.

Capitalism is the only system that can make effective use of the division of labor, capital accumulation, and corporate structure. No other economic or political system can generate the inter-action between these three essentials of economic life as well as capitalism. The reason is that these essentials function effectively when individuals are allowed to make their own value choices and to keep the fruit of their labor. They function erratically or not at all when governments attempt to control, for the benefit of thieves and charlatans, various aspects of this free-flowing system.

Statist governments are governments that use the philosophy of altruism to make war upon the individual and hence do not allow to each man the freedom to live his own life. Their systems are designed to control or manipulate the majority of individuals in favor of a few gangsters called government. The sluggish growth of these systems only reflects their policies. A capitalist system is the only system that provides the open door for man and for human progress because it gives to each man the incentive to live and to be rewarded for that living. It is a system where happiness is possible to the individual, where he can look forward to security and not to the drudgery of having his life squeezed out of him for the sake of some fat cat who happens to write the rules.

To elaborate on this issue, let us look a bit more closely at just how the individual is affected by capitalism.

CAPITAL SAVINGS

In a political system where every citizen is free to acquire and keep property, capital savings is possible. When men are free to save, they produce more. Hence money becomes available to the businessman who would expand plants and improve techniques with money borrowed from banks that hold the citizens' savings. In this way, increased production generates increased production. A banking system geared to respond to the capital needs of businessmen becomes the transmission belt that turns accrued human energy into an opportunity for the generation of more energy. A capitalist system is the only system that leaves nothing in the way of capital savings and thereby makes possible more jobs and a higher standard of living.

Capital savings are distinctly missing in statist systems because such systems are designed for legal plunder. The first thing plundered is surplus wealth that quickly disappears into the private coffers of government officials.   This includes priceless art and expensive machines of leisure and production.  Since the plunder of surplus wealth leaves the citizen with no incentive to produce, he generally tries to produce only what he requires for bare subsistence. This leaves little chance for dynamic growth and progress.

TECHNOLOGY

Technology is the application of knowledge to the problem of survival. From the use of the first stone to the flight to the moon, to the development of the Internet and computer networks, man has been developing his technology in ever widening circles. The basic benefit of technology is that it saves time and effort. This releases man for increased production and leisure. Without technology man would never have achieved surplus production and savings.

Technology is not the monster many think it to be. As a human phenomenon, technology is indifferent; it has no mind of its own with which to direct evil upon man. Technology is merely the means by which man achieves a better standard of living, and as such can produce no evil. The haters of technology are merely people who are also haters of man, who don't want man to presume that he is so good as to seek a better life. They know that technology is achieved by knowledge and that only free and self-interested men seek knowledge. They regard this as evil and attack technology as a way of inducing guilt upon such men.

Technology is impossible without knowledge, and the development of usable knowledge is impossible to any great degree without freedom, that is, without a government that protects the rights of those who seek knowledge. The society that allows freedom of thought and property is a society that says, "Do what you will and keep the rewards." Under such a system, we find that men will think better and that others will utilize their discoveries in order to make and sell better goods to more people. The result is the increasing welfare of the people and the eventual elimination of poverty on a scale relative to less free societies.

JOBS AND JOB SECURITY

Political favoritism, friendly connections and altruistic considerations are difficult under capitalism. Capitalism offers a man this choice: produce and work or get out of the way. The man who performs a productive job is the foundation upon which capitalism is built, and as long as he and a great many others are productive, there is an ever increasing certainty that they will have jobs.

A free system fosters a large job market because men are free to choose, to move, to invest, to buy and to consume. If a productive man decides to search for another job, he is free to do so. Because of the dynamic, growing nature of capitalism, he can move from one job to another with little or no hardship.  The ever expanding use of technology and capital provides for opportunities so abundant that the system, never stagnant, is a vital factor in the security of every man.

An important by-product of this security is that men who are secure in their ability to hold jobs are able to obtain credit for long-term purchases. This enables them to enjoy luxuries and some expensive necessities while paying for them.

Welfare-state advocates have long been critics of “capitalist exploitation." And they have been open in their attacks upon the so-called uncertainties inherent in the private sector. But observe that jobs associated with the government in the welfare-state are the most precarious of all (election to election) and that production is not necessarily a requirement for keeping such jobs. Further, employees of governments are often serfs holding little freedom in exchange for loyalty; loyalty, not "public welfare" or productivity, being their most important contribution. They are also not exempt from rule by terror - the terror of having their agency under- financed as a result of power plays by the higher-ups.

Another by-product of the welfare-state is excessive unionism. Excessive unionism is caused when certain bosses obtain exclusive bargaining power from the government. The government forces employers to deal with the union because it wants to put more pressure on businesses and keep them beholden to government. This solidifies the power of the union bosses and gives them the power to call many of the shots. Powerful unions would not be possible under capitalism, because union bosses would not have the government's gun to back them up. Their oppression of the working man would be impossible, since they would have to work with his consent, and they would have to provide positive pay-offs, not token improvements.

The most harmful aspect of the welfare-state and one that belies the “welfare” they are charged with creating is that government agencies are not responsible to a customer.  This means that they don’t have to achieve economies of scale, don’t have to be productive in order to survive and don’t have to be very efficient.  Such a situation means incredibly huge amounts of lost government revenues that go down into an abyss never to be seen again.  Look at the condition of our educational system that does not educate, our Social Security program that is on the verge of collapse, bloated expense accounts, fraud and waste on a massive scale and you can see that the huge percentage of our tax revenues that are lost could have been spent by the citizens who earned the money in the first place to much better effect.

LEISURE

Leisure is possible only when the problem of survival has been solved. Whether it is sitting around the fire or around the television set, the need for leisure has always been strong in man, for it is through leisure that man can contemplate his success. The division of labor, capital accumulation, and technology have worked to provide a forty hour week for many.  No system can produce like capitalism, and no system will be able to create the amount and quality of leisure that capitalism can. For an indication of this, look at our society. Even though it is not complete capitalism, there is no society in history that has devoted as many industries, enterprises and products for the enhancement and enjoyment of leisure time.

The more advanced the system of production, the better its use of technology, the more its workers are able to produce with less time. Given a free economy, unfettered by government regulations and government fiat inflation, this situation can only improve. Those workers who want to advance can use their saved time for more production. Those who want to enjoy their saved time are able to do so with no cost to their standard of living.  Indeed, a major consequence of the creation of leisure time is that more people are freed for self-improvement. Those who use their leisure time for self-improvement tend to be more productive and better decision makers. They lead better, happier lives, and they help to improve cultural and social institutions. They become the leaders that help mold the society on its highest levels.

PRODUCTS

Few people take time to realize the extent to which consumer goods and services affect their lives. And yet, it almost goes without saying that life would be hard indeed without the products that a capitalist system provides.  The automobile is a good example. Without the automobile few could get to work in the fifteen to twenty minutes that it usually takes. Instead, people would have to spend hours of time and energy just getting there by other means, so much so that it would hardly be worth the effort. The automobile is probably the greatest time and energy saver since the horse. And its use in great profusion is possible only in a system where division of labor, capital accumulation and corporate structure are given the freedom to thrive.

For instance, the automobile is not as common in China because capital accumulation by individuals is virtually forbidden, where a central authority dictates the use of labor, and where the state organizes capital arbitrarily.  The major industry becomes then bicycle production.

Yet the automobile is only one product among many. If we compute the advantages of electricity, electric lights, television, Microwave ovens, video, DVD, computers, radio, other time and work saving appliances and hundreds of developments in product quality, we can see that the welfare-state cannot possibly provide the benefits of a capitalist system.

But it is difficult to compute the loss when money is confiscated from the private sector of an economy and redistributed to the non-productive sector. Such a loss affects the products and developments not made, the time not saved, and the lives that would still be flourishing but are not.

HEALTH

With all the emphasis on Health programs exhibited by government and its planners, one would think that good health would be impossible under capitalism. But if we look at the life expectancy and birth-rates after the dawn of the Industrial Revolution in England we learn that freedom of enterprise fosters better health.

First of all, citizens who make a steady income are able to afford better food which in itself generates healthier, happier people. Secondly, cities are kept cleaner due to the financial feasibility of sewage systems and garbage disposal because of capital accumulation. Finally, doctors are able to improve services to people who are able to pay.

Truly improved health is possible only with increased economic freedom. Where an incentive for improving health is there, doctors will improve their services and lower their costs. The welfare-state can only cash in on past advances and lower their quality.  Increased medical costs today can be attributed to increased government medical benefits that lower the quality of services, increase the number of patients, raise prices, and attract a seedy lot of doctors who want to cash in on the bonanza. With the sophisticated testing facilities and complicated cures available today a doctor does not question whether a particular item is necessary. The government is paying for it; why worry about cost?

The benefits of a capitalist system far outshine those dreamed of by the most utopian of welfare-statists. The reason is that a welfare state can only succeed in its schemes to the extent that the free sector of the economy is healthy. This necessarily reflects a lowering of sights, since the private sector is always able to utilize resources more efficiently. In its first stages the welfare state appears to work, but as it advances it becomes the cancer which drains the substance from the free sectors of the economy.

The welfare-state represents a belief in the expendability of the individual. Far from helping the individual it considers him a slave who must provide the funds for the functioning of the state. The program and its maintenance are of prime importance, the individual is secondary. Indeed, the welfare-state shows least regard for those individuals who are most able to pay, those who do not need the state. It sometimes gives them the status of criminals. Look at the major corporations and the relentless propaganda against them and their heads for an example.

Capitalism, on the other hand, recognizes the inviolability of the individual's rights and choices. It is based upon his consent, his contractual agreement. The individual calls the shots - for himself. As a result, he and the society are better off.

Capitalism is based upon the principle of property rights. It is property that the welfare-state must expropriate in order to exist.  The degree of a society's sophistication is the degree of knowledge which it incorporates into its social institutions. It takes a great deal of knowledge and truth to recognize that man has inalienable rights, that his life is his to live, and that "hands off" is the moral requirement of human beings. The welfare-state is not an advance upon this level of knowledge. Any ignorant brute whose mind knows little more than hand-to-mouth can learn how to club someone over the head and steal the product of his labor. And it is this, with the support of laws and guns and runaway government budgets, that the welfare-state does. It takes a society of intelligence and knowledge to realize that nobody's welfare is served by a constant battle for a piece of someone else's pie.

The justification of a capitalist system is the individual and his rights. These are a matter of fact. That their recognition by society achieves the individual's welfare is a secondary consequence. Without rights human welfare is impossible.

Now that the biggest enemy of capitalism, communism and Soviet expansionism, have succumbed to the power and strength of a (somewhat) capitalist system, we know why it failed, why it lost.  It lost because it could not and would not elevate the individual to a status of freedom.  It lost because it considered the individual as property and slave.  It lost because it was not free.