Counseling Capitalism

Image by ijmaki from Pixabay

“That invidious word, ‘capitalism,’” Irving Kristol reminds us, “was invented by European socialists about a half-century” after the publication of Adam Smith’s Wealth of Nations.

Although the term is now lovingly embraced by proponents of free enterprise, it has never ceased to carry negative connotations, even to souls disinclined towards socialism.

Kristol recognizes that, in a democratic republic, the “concentration of assets and power—power to make economic decisions affecting the lives of tens of thousands of citizens—[seems] to create a dangerous disharmony between the economic system and the political.”

Yet the laws of economics, as he understands them, dictate that concentrations of economic power are necessary if one is to produce prosperity for the mases, and profits for the enterprising.

As a result, economic freedom seems inevitably to lead to the continuous growth of corporations, whose economic weight predictably fuels social and political pressures, impelling them to use their power for the benefit of society.

If such pressures were consistently directed at the actual common good, the dynamic might be healthy. Alas, there are reasons to doubt the likelihood of such an outcome.

Since corporations are run by experts in profit rather than politics, Kristol observes, they are often bemused by these political demands, and respond ineptly. He is at pains to give them wise counsel on how to respond truthfully and convincingly to complaints about their activities, whether just or unjust.

But what if corporations decline wise counsel? Kristol fears that unsavvy businesses will eventually “be thoroughly integrated into the public sector,” which (for reasons I will not attempt to summarize here) tends also to be dominated by the unwise.

The end result, which “could fairly be described as a kind of ‘state capitalism’,” constitutes “a huge potential threat to the individual liberties Americans have traditionally enjoyed.”

Whatever we think of Kristol’s counsels to the capitalists of his time, his warning about capitalism’s likely trajectory seems spot on.

Could the crude dictatorship our corporations are now attempting to impose be a (still bumbling, but nonetheless massive) attempt to justify their power by using it to appease their loudest critics?

If so, how sad that our capitalists ended up taking counsel from totalitarians.

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