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Defenses of Capitalism or the “Free Market”

August 31, 2009

I’m working on a “Marxism 101” page (or set of pages) that I want to add to this site. The idea is to present, as succinctly and clearly as possible, why someone today might make the radical claim that there could be just a few flaws to capitalism or the idea of the “free market.”

Part of what I want to do is address the most popular ideological defenses of capitalism, but I want to make sure that I’m selecting the right targets.

Here’s what I’m thinking are the two most popular ideological defenses:

  1. invisible hand or utilitarian styled arguments alleging that the unregulated market works in everyone’s interests
  2. libertarian styled arguments about rights to self, property, and  fruits of one’s labor or merit

It seems to me that these points require the following sorts of Marxist critiques:

  1. actually, competition in an open market automatically works toward the exploitation of laborers and labor markets, and, in addition, it appears that many of the American companies who excel in “free markets” are ones that employ illegal means or that participate in obviously immoral or oppressive actions in other countries
  2. the libertarians’ individualist ideology is fit for a child—libertarians’ anthropology and understanding of self, society, and morality is about as unsophisticated and superficial as one can get; in particular, libertarians cannot understand anything like social privilege or social domination, both of which destroy the libertarian-styled appeals to dessert or merit

So, my question for my readers is this: have I properly identified the two most common ideological defenses of capitalism, as well as the most appopriate place to start crtique?

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10 Comments leave one →
  1. August 31, 2009 3:09 pm

    Also, social-contract libertarians like Matt Ridley.

  2. Alderson Warm-Fork permalink
    August 31, 2009 5:04 pm

    I think those are definitely the two major things to deal with, although I’d add, I think, perhaps a further one that’s sort of related: ‘economic freedom is necessary for political freedom’. It’s a combination of a general claim that free markets lead to liberalism, a specific claim that socialism is/led to the authoritarianism of the USSR et al, and the hypothetical claim that any socialist (or otherwise non-capitalist) society must be politically authoritarian. Hayek’s ‘Road to Serfdom’ is one of the canonical sources.

    The only thing I’d add regarding the critiques is that there’s more stuff to put into point 1: not only exploitation of labour but needless poverty (because it’s not profitable to meet even the most basic needs of those who can’t pay), problems with externalities/public goods (which, if you look at crime, childhood malnutrition, education, health, political participation, and the environment, are a pretty big chunk of what’s going on). Crises are another important one, linked to the whole ‘overproduction’ thing – if profitability comes from paying low and charging high, then prices will be pushed above what general wages can afford, and stuff can’t be sold.

    Plus maybe how economic behaviour can’t be kept out of politics – concentrations of wealth imply the power to manipulate politics, economic competition for markets and resources provides pressure for political warfare, etc.

  3. Liberty permalink
    September 1, 2009 1:18 am

    Please read Murray Rothbard’s book “For a New Liberty: The Libertarian Manifesto.” It will help clear up these misconceptions that you about libertarians and the free market. I’m sure you hate it when people denounce communism without reading “The Communist Manifesto.” There is more to it than you realize. Appealing to ridicule is not going to help you convince people of your position. Knowledge is power my friend.

  4. September 1, 2009 7:05 am

    I’m definitely interested to read it.

    I would add… I understand that most readers come from a capitalist context, but it seems that your Marxism 101 is being defined against capitalism rather than for itself.

  5. missivesfrommarx permalink*
    September 1, 2009 8:27 am

    Hi think mps! I think you’re right. I imagine that it’s a natural outcome of the rather watered-down type of “Marxist” I claim to be. For me, being a Marxist means looking at the structures and systematic relations in a society to see where and how relations of domination or exploitation are produced, while taking the economic side of things as the most important (although not logically prior or fundamental). This kind of makes me fundamentally reactionary: I’m reacting to whatever existing domination exists, and, presently, I see that the most domination in the current iteration of capitalism. There are definitely some problems with such an approach—Nietzsche’s warnings against ressentiment come to mind.

  6. Alderson Warm-Fork permalink
    September 1, 2009 10:41 am

    “This kind of makes me fundamentally reactionary: I’m reacting to whatever existing domination exists”

    Kind of like a famous communist whose grand masterwork is called ‘capital’?

  7. September 2, 2009 6:21 pm

    Another primary claim of Capitalism is that we can create endless amounts of wealth. For example, I’m morally allowed to own a yacht because, theoretically, everyone could own their own yacht if they just worked hard enough. Well, this is illogical, because the earth does not have infinite resources. Infinite wealth is unattainable.

    While I agree with your criticism of libertarianism, I would be more specific. Libertarianism, as I understand it, is founded upon the idea that we exist as individuals, responsible for our own well-being. This is wholly illogical, because experience and observation tells us that we exist solely in relationships, such that we are responsible for those relationships. The libertarian tends not to see that she or he is dependent upon many others. The libertarian does not understand that her or his actions have significant consequences for others, and that morality might dictate we care for others because of our connection to them.

    Libertarians probably have skewed understandings of “free will” as well, but I’m not sure. Most that I have encountered tend to underestimate the importance of social contexts.

  8. missivesfrommarx permalink*
    September 3, 2009 5:31 pm

    Thanks all for these suggestions!

  9. September 4, 2009 12:56 pm

    You might want to add the idea of incentive and creativity. There is the notion that only capitalism promotes enough incentive for people to be truly creative and to produce better products. We see this in the copyright debate, the healthcare debate, and in many of the pop-capitalist ideology.

    Cheers,

  10. Classical Liberal permalink
    November 24, 2009 1:20 am

    I realize that I’m late to the party and may not be noticed here, but I’m rather enjoying the archives of this blog. (It’s rare to find a Marxist, much less one who thinks so clearly and with such insight, at the law school I attend).
    In any case, I’d give Liberty’s point some consideration. There’s a lot more to libertarianism than what can be gleaned from self-described libertarians making idiotic posts on the internet. I stopped calling myself one for that very reason – people get the wrong idea.
    Anyway, an intelligent and clear-thinking libertarian will readily admit that he is dependent on others for his success and well-being. In fact, he will reject the notion that anyone can be literally self-made, because it is patently false. But he will argue that the best society is composed of people acting in their own self-interest and with minimal coercive interference. The idea certainly has its share of critiques and rebuttals, but then, so does Marxism (and, really, all the other -isms). Responding to libertarians by treating them as children will only cause them to reject you as close-minded, just as you would treat someone as close-minded if they rejected you simply for identifying as a Marxist.
    Anyway, keep up the blogging. There are so few reasonable people with blogs, and it’s much more interesting to disagree with reasonable people than with the average Facebooker.

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