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     CAPITALISM AND HUMAN RIGHTS

By:   Luis C. Chirinos

What are the philosophical underpinnings of capitalism?

All political systems are ultimately the expression of some underlying philosophy. For example, Marxian socialism holds that man is a collective entity shaped by economic forces beyond his control, whose greatest good is to serve the ends of "society."   

  1. Capitalism, however, is implicitly based upon a world view which holds that man's mind is competent in dealing with reality, that it is morally good for each person to strive for his own happiness; and that the only proper social arrangement for men to live under is one in which the initiation of physical force is banished. This is the ideological basis upon which the United States of America was implicitly founded. The importance of recognizing the philosophy which capitalism -- and America rests upon, lies in the fact that no social system can be properly understood or defended, apart from its broader philosophical framework.

  2. With regard to morality, capitalism is the only moral (meaning pro-human-life) social system because it safeguards a human's primary means of survival: his mind. Through upholding individual rights, capitalism recognizes the fact the each and every human being must use his own mind to grasp reality and act accordingly to better his own life. Capitalism is the only political system that is based upon man's true nature as a being who possesses the faculty of reason -- capitalism is the only system that recognizes that human beings can think. Indeed, individual rights and capitalism not only protect the individual person and property of each human being, but most importantly, they protect the individual mind of every human being.

  3. Historically speaking, capitalism has been claimed to be consistent with philosophies such as Utilitarianism, social Darwinism, and even fundamentalist Christianity. However, these philosophies are in fact antithecal to the true nature of capitalism because they subordinate the good of the individual's life on earth to some "higher good", in a life "hereafter". In fact, the only philosophy that is completely consistent with the theoretical requirements for understanding and promoting capitalism is the philosophy of  Objectivism.

  4. So, what is the proper role of government in a capitalist society?

    The only legitimate purpose of government under pure capitalism, would be to protect its citizens from force or fraud.

    The protection from force, that is, the protection of individual rights, has to be achieved through the use of a police force to protect the rights of citizens at home; a military, to protect the rights of citizens from foreign aggression; and a court system to enforce contracts and settle disputes between citizens. Since rights can only be violated by initiating force, the government's only legitimate use of force is in retaliation against those who wrongfully initiated it.

    The greatest aggressor against man -- the greatest spillers of human blood, have always been the various governments that man has adopted throughout history. Because governments hold a legal monopoly on the use of force, the crimes committed by individuals acting on their own behalf are trivial, compared to the crimes, tyrannies, and wholesale barbarism that governments have carried out against their own and other populations.

  5. This is why it is crucial that governments be limited in their ability to use force, by a constitution based upon individual rights. That was the key insight of the Founding Fathers which made - and has kept - America freer than any other nation on earth.

    Any other function of government than those listed above, no matter what its intentions, would necessitate the violation of human rights by initiating the use of force against the people it is supposed to protect. For perhaps a trivial  example, even compulsory tax-supported education forces some people to pay for the schooling of others for whom they would not voluntarily choose to pay.  To some degree this miniscule requirement invades the sphere of  human rights and individual determination. 

    In the strictest interpretation of "human rights", the term promises a moral buffer between the private citizen and authoritarian demands, that require actions or abstentions that are contrary to the wishes of the individual - and that do not savage the rights of others.

  6. Who are the defenders of capitalism?

    There are two thinkers who stand as virtual twin towers in the history of pro-capitalist thought, namely the novelist-philosopher Ayn Rand and economist Ludwig von Mises.

    The importance of Rand's ideas to the furthering of capitalism cannot be overstated, for she gave capitalism what it had badly needed: a philosophic defense. Rand recognized that the supremacy of reason and the morality of egoism are the indispensable philosophical foundations upon which capitalism
    is based. In particular, her connection of capitalism to individual rights, and her recognition that individuals have the moral right to live for their own sake makes her philosophy of Objectivism of utmost importance for a thorough and consistent defense of capitalism.

    The other tower of pro-capitalist thought is the most prominent member of the Austrian school of economics, and arguably the greatest economic thinker of all time, Ludwig von Mises. (The Austrian school has been the leading school of pro-capitalist economic thought since 1871). Mises's identification of capitalism
    as being the one system which benefits all, his refutation of virtually every accusation made against capitalism (such as the claims that capitalism leads to exploitation and depressions), and his proof of the economic impossibility of socialism, rank him the as other great defender of capitalism of all time.
                                                                                                    Other major pro-capitalist economists are the members of the Austrian school such as Eugen von Bohm-Bawerk and Carl Menger, the French economist Frederic Bastiat, and members of the British classical school such as Adam Smith and Dave Ricardo. Furthermore, economists and political philosophers such as George Reisman, Henry Hazlitt, Tibor Machan, John Locke, and the Founding Fathers of the United States. There are also some less consistent defenders such as (monetarist) Milton Friedman, F.A. Hayek, and Murray Rothbard,  all of whom constitute important names in the defense of capitalism.

  7. How is theory related to practice?

    Capitalism's most Frequently Asked Question is divided into two parts: Theory and Practice.                                                                                                     This is not to suggest a dichotomy between the two. Theory does not exist qua floating abstraction, without reference or basis in reality. It is not just an "essence" apart from cognition. Theory is human theory, and it is theory about something: existence. As such it is a reflection on the nature of existence, the nature of man, and the relationship between the two. Practice, or action, is human action. It is volitional, i.e. chosen (among alternatives), directed at a specific end, and based on value judgment(s) of the facts of reality.

    Political-Economic theory is the body of fundamental principles underlying the science of human action. Theory is abstraction. It is a process of identification; an attempt to describe perceptual data by means of a conscious focus of the human mind.                                                                                                       To identify the ideal economic system, one must observe and understand what it (the system)   is, and what the object of the system, man, is. Obviously then, theory is not an object (idea) detached from its subject (man). If a theory is correctly formulated, it is eminently practical. After all, if theory has nothing to do with reality, i.e. cannot be "put into practice", then how does one evaluate whether it is good or not?                                                                                                      Ideas are not separate and apart from those who think them.
    Actions are not distinct and apart from those who act them out. Actions are necessarily - implementations of ideas.                                                                                                    Within this evaluative matrix, one may defend capitalism on the basis of its practicability, just   as long as one remains  aware that the reason "it works" is because it is good theory.
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