Where Have All The Capitalists Gone?

After the fall of the Berlin Wall and dissolution of the USSR two decades ago, almost everyone, including famed leftists like Robert Heilbroner, conceded that capitalism was the historic “victor” over socialism. Yet interventionist policies reflecting largely socialist premises have returned with a vengeance in recent years, while capitalism has been blamed for causing the 2007-2009 financial crisis and global economic recession.

Robert Heilbroner

In 2009 a Newsweek cover insisted that “We Are All Socialists Now,” soon after Alan Greenspan publicly decried the “infectious greed” of markets. Meanwhile long-failed Keynesian policies have been aggressively re-imposed on innocents almost daily.

Despite an economic recovery this past year, hostility remains trained on Wall Street, business, profits and the rich, whether by populists from the left and right, or by capitalism’s traditional haters among politicians and journalists. The Economist just ran a column titled “The Filthy Rich,” which declares that since the rich are “unloved and unwanted” they should “hide or support a charity.” The hatred of wealth-makers is ubiquitous–yet people wonder why is capital (loan institutions) on strike.



Alan Greenspan

 What explains this seemingly abrupt shift in the world’s estimate of capitalism from only a couple of decades ago? After all, a political-economic system, whether capitalist or socialist, is a broad and persistent phenomenon that cannot logically be construed as beneficial one decade yet destructive the next. These systems simply are what they are, for good or ill.

Yet while capitalism was being credited as “victory” over socialism a mere two decades ago, it now stands convicted without a trial, amid a revived eagerness for socialist schemes. Not even today’s Tea Party movement seems committed to capitalism in any deep sense.

In short, where have all the capitalists gone? The beginning of an answer might be found in the curious phenomenon that a “socialist” today means an advocate for the political-economic system of socialism as a moral ideal, yet a “capitalist” means a Wall Street financier, venture capitalist or entrepreneur–not an advocate of the political-economic system of capitalism as a moral ideal.

Indeed, most of the world’s wealthiest people–for example, George Soros, Warren Buffet and Bill Gates–are “liberals” who advocate for an ever bigger, more intrusive state. Most people distrust the wealthy for making so much money, yet tolerate or cheer them on for giving it away or lobbying for still-higher tax rates.

That the concept “capitalist” today is still largely non-ideological or amoral reflects a deeper bias (especially among intellectuals who claim the rich are guilty and the rich who view themselves as guilty because the intellectuals say so): that capitalism is not and cannot be moral, at least not on Judeo-Christian grounds. Thus in spite of its vast practical benefits–its promotion of peace, prosperity and culture–capitalism is deeply distrusted, by liberals and conservatives alike, precisely because it is secular, materialist and individualistic.

Capitalism embodies the life-enhancing, wealth-creating ethic of rational self-interest–of egoism, of “greed,” if you will–which is perhaps most blatantly manifested in the profit motive. So long as this humane ethic is distrusted or despised, capitalism will suffer unearned blame for any social-economic ill.

Both the enemies and friends of capitalism concede its productive prowess, yet also disdain its morals, as one can see in as varied a group as Karl Marx, John Maynard Keynes, Friedrich Hayek and President Barack Obama.

Karl Marx

In his Communist Manifesto (1848) the arch anti-capitalist Marx conceded that capitalism “created more massive and more colossal productive forces than have all preceding generations together,” gave “an immense development to commerce, to navigation, to communication by land,” and “by the rapid improvement of all instruments of production, by the immensely facilitated means of communication,” drew “even the most barbarous nations into civilization.” Why then wasn’t Marx pro-capitalist? He claimed capitalism was evil, because it “put an end to all feudal, patriarchal, idyllic relations,” “left no other nexus between people than naked self-interest,” and “drowned out the most heavenly ecstasies of religious fervor” in the “icy water of egotistical calculation.”

Capitalism immorally “set up that single, unconscionable freedom–free trade,” and this “evil” system was doomed to fail on practical grounds, Marx insisted, by creating “too much civilization, too much means of subsistence, too much industry, too much commerce.” Private property must be abolished, he said, despite its vast power to create a productive civilization, because “the right of man to property is the right to enjoy his possessions and dispose of the same,” and it is a right “without regard for other men,” hence “the right of selfishness.” Capitalism must “fail” because it is “evil.

In the 1930s intellectuals claimed that British economist John Maynard Keynes “saved” capitalism from the clutches of socialism. But at root Keynes, like Marx, despised capitalism’s morality. In a 1930 essay he yearned for “great changes in the code of morals” and for a future in which “the accumulation of wealth is no longer of high social importance” and “we shall be able to rid ourselves” of such “distasteful human qualities” as “the money motive,” which he described as a “disgusting morbidity, one of those semi-criminal, semi-pathological propensities.”

John Maynard Keynes



Friedrich Hayek

 In a 1933 essay he wrote that “the decadent international but individualistic capitalism, in the hands of which we found ourselves after the War, is not a success. It is not intelligent, it is not beautiful, it is not just, it is not virtuous. … In short, we dislike it and are beginning to despise it.” In his introduction to the German edition of his General Theory of Employment, Interest and Money, issued as Hitler ascended to power, Keynes said his theories and policies were “more easily applied to the conditions of a totalitarian state” than to those with “a considerable degree of laissez-faire.” Thus today’s top disciple of Keynes, Nobel laureate Paul Krugman, loudly heralds the most reckless and punitive policies.

Yet beware also the conservatives, who today argue as the late Friedrich Hayek once did. In The Road to Serfdom (1944), where he warned, correctly, that the seemingly benign welfare state can lead to a totalitarian state, Hayek also complained of pro-capitalists who with “wooden insistence” defended “the principle of laissez-faire.” For Hayek, as for leftists, “the desire for a collectivist system springs from high moral motives,” where “high” motives means those “above,” beyond and opposed to the motive of self-interest and the individualist ethic, the capitalist morals which are presumed to be low, vulgar, and crude. Such an unwarranted apologetic for capitalism could never constitute even a speed-bump on the road to serfdom.

Barack Obama


Obama is only the latest to concede capitalism’s productive power, while adamantly opposing its morals. “The reason we’ve got an unparalleled standard of living in the history of the world,” he said recently, “is because we’ve got a free market that’s dynamic and entrepreneurial, and that free market has to be nurtured and cultivated.” All that’s true enough–to the extent we’ve had freedom in markets. But Obama’s policies, like those of his predecessor, only stifle markets instead of nurturing them. Obama has said capitalism’s profit motive is corrupting, its wealth distribution is “unjust” and its financiers are “fat cats.” As with Marx, Keynes and Hayek, such biases reflect a deep disdain for capitalism’s morals.

The collapse of socialist regimes two decades ago didn’t mean capitalism was finally being hailed for its many virtues; the historic event only merely reminded people of capitalism’s productive ability–an ability that already long-proven and long-acknowledged even by its worst enemies. Persistent animosity toward capitalism today rests on moral, not practical grounds. Unless rational self-interest is understood as the one moral code consistent with genuine humanity, and the moral estimate of capitalism thus improves, socialism will keep making comebacks, despite its deep and dark record of human misery.