Objections Against Capitalism: The Perils of “Too Much” Freedom

In discussing capitalism with my MBA business ethics class, this objection came up: there is too much freedom in a capitalist society, and it causes all kinds of problems from violent crime to obesity and drug addiction. In other words, we need the government to regulate weapon, food and beverage manufacture and sales, and to keep narcotics illegal—to prevent people from indulging in their whims to initiate physical force on others, to over-consume unhealthy food and beverages, and to snort cocaine and other drugs.

The argument for limiting our freedom—and for objecting capitalism, a system of freedom—is based on a dismal view of human beings. In that view, we are all children, either incapable of knowing what choices are good for us or unable to control our harmful urges, or both. And if we are helpless children prone to self-destruction and harming others, we need to have a strong nanny—the government—to tell us what is good for us and what we should do. A capitalist social system based on the recognition of individual rights and on private ownership of property does not fit that view of human nature.

The first question we need to ask when we hear such arguments against capitalism is: Are those claims about human nature true? And even if some people behave irresponsibly, is that behavior “caused” by freedom? The answer to both questions is no. Let’s see why and why freedom, based on the protection of individual rights, is the most fundamental social requirement of our survival and flourishing.

To argue that we are all like toddlers incapable of knowing what choices are good for us is ignoring the fact that all adults with intact brains possess the faculty of reason, our tool of knowledge. It is true that we are not omniscient and can make errors and poor choices, but the evidence is overwhelming for the human capacity for acquiring knowledge, solving problems, and for making life-enhancing choices, all without the help of governments telling us what to do. There was no government to tell Stone Age cave dwellers how to build tools and weapons, how to hunt mammoths, and how to utilize their kill. No government instructed Thomas Edison how to invent the electric light bulb or electric power distribution, and government certainly did not play a guiding role in the invention of the MacIntosh computer and the iPod, the iPhone and the iPad, led by Steve Jobs.

The same answer can be given to the argument that we are unable to control our whims even when we know what choices are good for our life. Life-enhancing choices aren’t automatic; there is plenty of evidence of bad choices that people make, from initiating physical force on others to indulging their whims. However, this is balanced by the evidence of life-enhancing choices that many people make, from producing material values—such electric light bulbs, laptops, cellphones, and tablets—to trading peacefully with others, and eating healthy foods in moderation, and not abusing drugs.

If the life-enhancing choices aren’t automatic, why can’t the government make us take them? Wouldn’t that solve the problems for which some of my students (and many others) blame capitalism? Government’s use of force to make us behave in ways we wouldn’t choose to behave does not work—because it takes away our motivation. And motivation is crucially important to our flourishing. A forced choice is not a choice; if we cannot choose what to produce, with whom to trade, and what to eat and drink, we are not motivated to work hard, to innovate, to persuade others to trade with us, and to look after our health. We give up personal responsibility and let the nanny state tell us what to do and take care of us.

The freedom to choose that capitalism protects includes the right to make wrong choices—and to suffer the consequences. That teaches us personal responsibility, long-range planning, problem solving, entrepreneurship, and productivity, all of which are qualities and skills that make our flourishing possible. To thrive and to be the best we can be, we need capitalism. Problems such as crime, obesity, and drug abuse are not caused by too much freedom and capitalism, but by too little. (And crime is deterred by strong protection of individual rights.) Such problems come from too little or no personal responsibility and a perennial dependence on the government to tell us what to do and to bail us out when we get into trouble. So instead of objecting freedom, capitalism, and individual rights, let us defend them.