The best and worst of times

In January I began the great five-year adventure of reading through the Great Books—the classic writings of Western Civilization from Homer’s Iliad and Odyssey to Samuel Beckett’s Waiting for Godot. This being mid-March, I have just finished Herodotus’ historic description of the Greek war with Persia and have begun the equally famous Peloponnesian Wars.

Looking once again at the political adventures and battles that set the poleis, or city-states, in conflict with one another, I am reminded of Charles Dickens’ famous opening to his novel of the French Revolution. Everyone knows how the novel begins: “It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness….” Likewise, everyone knows the closing line of the novel: “It is a far, far better thing that I do than I have ever done….” Probably not so many people can summarize the plot that fills four hundred pages between those lines or can remember any other memorable quotes from that novel. But I wander from my point, which is that for Greece in the years of the Peloponnesian Wars it also was the best of times and the worst of times.

Against all odds, the Greeks had withstood two invasions from the mighty Persian Empire. They had overcome both the massive land army raised by Persia and also its mighty navy. Now Athens was being rebuilt, fashioning the remarkable structures that still draw tourists today. The great Greek dramatists were writing the great timeless plays that are still read and studied today. Greek science and mathematics were reaching new and amazing heights, and for the first time philosophy was being developed in the European continent.

Yet at the same time, the Greeks were destroying themselves with constant warfare against one another. Men lost their lives on the battlefield in the prime of their life, sacrificing themselves nobly for petty squabbles that were unworthy of the price they demanded. Armies leveled the crops and orchards of their opponents. Money was wasted on military equipment—money that could have further advanced the architecture, drama, science, and philosophy of the age. Crowding into their cities to escape the battles, citizens spread plague that cost the Greeks more lives and more sorrow. Wisdom and foolishness, Light and Darkness: all these contrasts can be seen in the ancient Greek wars as clearly as in the French Revolution or any other modern conflict.

One of the lessons of classic literature is this: the more things change, the more they stay the same. Centuries have come and gone, and people continue to make the same mistakes. We study the past, but we fail to learn from it. Indeed, the history of the Peloponnesian wars is, without doubt, a tale of Thucydides. J.

Socialism, capitalism, and racism: part three–the last seventy years.

The aftermath of the Second World War found the United States in a new position in the world. Unquestionably, the nation was a superpower, no longer able to isolate itself from events happening on other continents. A second superpower, the Soviet Union, presented a different perspective on world politics and economics. The United States and its allies preferred democracy and capitalism; the Soviet Union and its allies held to totalitarianism and socialism, with the illusionary promise of communism down the road. Following a post-war recession, the economy of the United States flourished. New technology provided faster travel, faster communication, more information, more comforts and more luxuries, and new opportunities to explore the universe. New theories about education were tried in the schools. The ancient ideas of Socrates and Confucius—that people are good at heart and need merely to be taught how things work in the world—were applied to children in the classroom. By the end of the 1960s, authority was being widely questioned, countercultures were forming, and many Americans were eager for change.

Conspiracy theories also grew more common, and the Civil Rights movement was not immune to these theories. Some Americans—including J. Edgar Hoover, Director of the FBI—saw the Civil Rights movement and the anti-war movement as elements of a Communist anti-American conspiracy. Conversely, I’ve met people who consider the Civil Rights movement as part of a white conspiracy to destroy black communities just as they were beginning to achieve some measure of success after decades of struggle and growth.

The goals of the Civil Rights movement were and are appropriate: to provide equal opportunity for all citizens, regardless of culture or ethnic origin or of other inherent differences between individuals. The slave trade created inequity in the United States, and laws passed during the century after the end of slavery perpetuated that inequity. Confiscating and redistributing wealth was never going to make people equal; offering equal opportunity through education, assistance to the poor, and laws against discrimination were always the better path. Quotas in school enrollment and in hiring practices were controversial but were in some cases helpful to reduce cultural inequity. Desegregating schools to the point that students were bused from their homes and neighborhoods to distant school buildings was more controversial and less effective. Wealthier white families invested in private schools or moved to the suburbs. Many government programs instituted to combat poverty had negative effects—pulling apart families by granting more help to single mothers than to married parents, promoting students to higher grades while ignoring their failures to learn material usually required for promotion, and allowing some individuals and families to become dependent upon government funding rather than earned income. Some people took advantage of the system and its negative effects, while many others succeeded in spite of the system and its negative effects. Rhetoric of racism and deliberate discrimination was made socially unacceptable, and positive role models for blacks and other minorities were promoted in athletics, entertainment, and other fields.

Many activities of the Civil Rights movement were appropriate and beneficial: peaceful marches and protests, public speeches, sit-ins, and participation in political life all changed American society for the better. At times, though, the Civil Rights movement was used as an excuse for violence and destruction. From race riots in Birmingham, New York City, Philadelphia, Chicago, and Los Angeles in the 1960s to the Black Lives Matter riots of 2020, violent behavior has marred calls for justice and equality. The victims of that violence were often black business owners succeeding within the framework of capitalism rather than white capitalists deliberately continuing an unfair system. Indeed, at times it appeared that demonstrators were more interested in destroying the success of their fellow minority members than they were in building strong communities for themselves and for future generations in American cities.

It is not surprising that citizens protesting racial inequity and injustice would favor a new economic system to replace capitalism in the United States. But capitalism was never the cause of inequity and injustice. Socialism cannot keep its promises of better lives for all people or for most people. Socialism, as much as capitalism, would put power in the hands of decision-makers who might be honest and fair or who might be dishonest, prejudiced, and inclined to discriminate against minorities. Replacing capitalist investors with government bureaucrats cannot end injustice. Allowing the government to control prices, salaries, and decisions about production cannot make life fair for all people. Socialism consumes wealth, but capitalism creates wealth. Instead of redistributing wealth, socialism would distribute poverty; capitalism, on the other hand, offers a greater likelihood of increasing wealth for all citizens.

Historically, socialism has been tested and has failed. Over the years, people have fled socialist countries in search of freedom and opportunity. For the United States, winner of the Cold War, to strive thirty years later to adopt the failed policies of its defeated opponents would be laughable were the risks of such a change not so profound. For this reason, informed citizens need to continue defending and explaining capitalism, doing our best to keep what is working in America while continuing to improve whatever faults and mistakes we perceive in America. J.

Socialism, capitalism, and racism: part two–one hundred years of unequal freedom

In the 1840s, French political philosopher Alexis de Tocqueville foresaw difficulties the United States would face dealing with a population of Africans surrounded by a dominant culture of Europeans. De Tocqueville did not prophesy the Civil War, but he realized that slavery would end in North America. He warned that the African population would not be easily assimilated into the European culture of the United States, anticipating that conflict between the two populations was inevitable.

With the election of Abraham Lincoln as President in 1860, some southern states seceded and formed a Confederacy. Northern states answered Lincoln’s call to go to war to preserve the Union. The Confederate states seceded to preserve their practice of slavery, as their own documents from the time reveal. Northern states went to war, not to free the slaves, but to keep the country united; even Lincoln said that he would accept the continuing presence of slavery if it would keep the nation undivided. His Emancipation Proclamation did not free all the slaves—only the slaves held in the rebellious Confederate states. Only the thirteenth amendment to the Constitution ended slavery in the entire country, and that amendment was not passed until after the Civil War had ended.

Although the purchase and sale of slaves had operated until capitalistic practices, southern plantation owners perpetuated an economy that predated the rise of capitalism. After the war, they attempted to continue a feudal economy, treating the freed slaves as serfs who lived on white-owned land as sharecroppers and tenant farmers, leaving the white property owners in control of the political and social structure of the southern states. Northern reformers attempted to bring capitalism and equality to the south. They brought railroads, factories, and banks to the south. They established schools for black children and adults. They set up political systems that allowed black adults to vote, and some blacks were elected to positions in the local, county, and state governments. When this time of Reconstruction ended, the white power structure in the south reasserted their power. They instituted voting practices that kept black citizens away from the polls and prevented black candidates from being nominated. They reduced or eliminated black access to education. They used lynchings, race riots, and other crimes to terrorize the black population, keeping them under control of the same wealthy whites who had previously owned slaves.

National law, built upon the premise that all people are created equal and have certain human rights, allowed for the development of “separate but equal” benefits for white and black citizens. Schools were permitted to function, but taxes collected from white families funded schools for white children and taxes collected from black students funded schools for black children, perpetuating the poverty of black citizens and the predominance of white citizens. Businesses, medical care, and even train and bus transportation were segregated. Sometimes enforcement of the law bordered on the comic: a museum planation in Arkansas has preserved a doctor’s office which had separate entrances and separate waiting rooms for white and black patients but only a single room for treatment of all patients.

Many black workers traveled north, hoping for better opportunities in the big cities. Already those cities had traditions of separate neighborhoods for separate cultures—German, Swedish, Irish, Italian, Polish, and so on. Soon black neighborhoods were created, complete with black schools, black churches, and black businesses. Segregation, “separate but equal,” was as real in the north as it was in the south.

Would socialism have provided greater equality for white and black citizens at the end of the nineteenth century and beginning of the twentieth century? Definitely not. Every step in that direction continued to separate white and black, giving greater benefits to the white. White labor unions, among other expectations, were intended to keep factories from replacing white workers with black workers. Roosevelt’s New Deal provided much more help to white workers and families than to black. One reason for the disparity was that local direction of government programs always fell into the hands of the same powerful families that had managed the economy before the war and after Reconstruction. They had no intention of offering true equality to their black neighbors under any economic theory.

During this “separate but equal” era, some American blacks found ways to succeed. Black labor unions were developed for industrial and for agricultural workers. Black businesses, following the principles of capitalism, brought services to black communities and wealth to black entrepreneurs in both north and south. Black banks, black insurance companies, and black social organizations grew. Black schools, including institutions of higher education, improved. Although many schools for blacks limited their education to vocational training, others offered broader education. Black writers and poets, black musicians, and black historians and philosophers all gained an audience among both black and white Americans.

During these years, the United States did not meet its high standards of “liberty and justice for all.” Life was unfair for black citizens, native Americans, and immigrants from Europe and Asia; poverty persisted among populations of every culture and nationality. Prejudice and discrimination were widely practiced against blacks, Chinese, eastern Europeans, Catholics, and Jews. Capitalism was not the problem; socialism would not have solved the divisions and inequalities of American society. But in the later half of the twentieth century, new ideas and new approaches would make greater efforts to provide Civil Rights to all citizens of the United States. J.

Socialism, capitalism, and racism: part one–the trans-Atlantic slave trade

Slavery has existed in the world since the earliest historical records were written. Some slaves were prisoners of war; others became slaves as punishments for crime or as a result of debts they could not repay. In most ancient civilizations, slaves had rights that were protected by law. Some slaves did agricultural work or household chores, but others held highly respectable positions—private tutors for children of the rich, managers of property, and financial advisors. Joseph, son of Jacob, was a slave in Egypt who managed his master’s property. The Roman philosopher Epictetus was also a slave.

Even before the trans-Atlantic slave trade began, Africans were bought by Muslim traders and were sold in Arabia, India, and China. Even today descendants of African slaves live in China. But the tragedy of the trans-Atlantic slave trade was caused by sugar addiction. Crusaders first encountered cane sugar in western Asia. (Sugar cane is native to the Indonesian islands, but it had been sold and consumed in India, Persia, and Arabia for centuries.) Europeans had some natural sweeteners—honey and fruits—but the pure sweetness of cane sugar captivated European tastes. More than cinnamon, nutmeg, or cloves, the spice called “sugar” was in great demand as Europeans sought Asian spices from the silk roads. Italian investors tried to cultivate sugar cane on Mediterranean islands, but the climate was wrong and the crops failed.

In the 1400s, Portuguese explorers and traders began to look for short cuts in the silk roads, ways to obtain valued items such as gold and spices while bypassing some of the middle steps. (Taxes from governments and profits from merchants heighted the costs of Asian goods in Europe, so naturally western Europeans wanted to create and pursue any shortcuts they could find.) Traveling down the coast of Africa, the Portuguese found African civilizations eager to trade, and among the commodities offered by these Africans were slaves—prisoners captured from nearby tribes during disputes over land and wealth. At the same time, the Portuguese discovered islands off the coast of Africa that were uninhabited and were ideal for cultivating sugar cane. The Portuguese traded for African slaves and used them to grow and harvest sugar cane. When other explorers happened upon the Caribbean islands, they again found land ideal for sugar cane, and slaves purchased in Africa were transported across the ocean to labor in fields from Spanish Florida south to Portuguese Brazil. Slaves were soon introduced into British colonies north of Florida as well.

The plantations and haciendas established by Spain and Portugal in the New World were not capitalist ventures. They belonged to an economic philosophy now called mercantilism. In mercantilism, thinkers assume that the wealth in the world is limited and stagnant—one individual or nation can become richer only as another becomes poorer. Wealth from the New World—precious metals, crops (including sugar, cotton, coffee, rubber, and tobacco), animal furs, and fish—was transported to the Old World to enrich governments in Europe. Capitalists from Great Britain and the Netherlands did engage in the slave trade. Their ships traveled in a triangle: they traded with the Africans, selling European commodities and buying slaves; they sold slaves in the western hemisphere and bought New World wealth; they sold materials from the New World in European ports and gained European commodities. With each sale, they made a profit, much of which was distributed among investors.

But emerging capitalism in Great Britain and the Netherlands was accompanied by an abolition movement, an insistence that all people—even Africans and native Americans—possess human rights and should not be treated as property. The Industrial Revolution, created and funded by capitalism, replaced human labor with machinery, reducing the need to enslave human workers. Britain abolished the slave trade in 1807, followed by the United States the next year. All slavery was abolished in the British Empire in 1833. Compromises in the American government allowed slavery to persist in some states until the Civil War. Worldwide, slavery was not declared illegal in all countries until the 1960s.

Between 1500 and 1800, more Africans were introduced into the western hemisphere than Europeans. Sixteen million Africans (most of them sold by other Africans) were purchased in Africa and put in ships to be taken to the western hemisphere. Twelve million survived the trip and were sold as slaves. The death of four million Africans on those trading ships is one of the shameful facts about the slave trade—human beings were treated as an expendable commodity like any other crop. Treatment of slaves in the New World was a mixed package: some were treated with kindness and respect, but many were abused, tortured, and worked to death. Twenty-first century historians and moralists find it easy to condemn slavery and the trans-Atlantic slave trade. Dealing with the aftermath of those three hundred years is a different kettle of fish. J.

Socialism, totalitarianism, and the Cold War

In the aftermath of the Great War (that is, World War I) came the Great Depression. These combined perils caused the citizens of several countries to surrender their individual rights to their governments, hoping in return to obtain economic security, national pride, and protection from hostile forces within and beyond their countries’ borders. In Russia, Lenin’s Bolsheviks became Stalin’s Communist Party. In Italy, the Fascist Party rose under Mussolini; in Germany, the Nazi Party rose under Hitler. All three parties exercised totalitarianism, government control of the population that restricted freedom and human rights, controlled communication, and punished citizens who disagreed with the government’s policies.

Earlier dictators may have wished for totalitarian control of their countries, but twentieth century technology opened avenues to government power that had not previously existed. Governments could exercise total control over the printed word of newspapers, magazines, and books. They could exercise total control over spoken word of radio broadcasts. They could monitor private communication between citizens that used the postal service or the telephone. Rapid communication made control of schools easier than earlier times. Teachers were required to spread government propaganda in their classrooms and to report to the government any dissent represented among their students or noticed in the families of their students.

Stalin’s government was openly socialist—the official name of the country was the Union of Soviet Socialist Republics. Hitler and Mussolini did not advocate socialist economies. Meanwhile, the United States government, led by Roosevelt’s Democratic Party, offered New Deal that increased government participation in the economy but did not directly threaten individual freedoms. Communication and education were not totally controlled by the government. Citizens were not arrested for openly disagreeing with government policies.

The Second World War defeated the Nazis and Fascists without overthrowing Stalin’s Communist Party. The Soviet Union was permitted to set up totalitarian governments and socialist economies in several nations, from Poland and East Germany to North Korea. Shortly thereafter, Mao’s Communist Party won control over most of China, establishing a government that was also totalitarian and socialist. The Cold War had begun. On one side of the Cold War stood totalitarian and socialist governments promising a Communist world when they had prevailed. On the other side stood democratic and capitalist governments promising a free world when they had prevailed. The rhetoric was more stark than the reality. Many allies of the United States maintained dictatorships rather than democracies, and some American allies in Europe experimented with socialist economies.

The “Communist” governments during the Cold War portrayed capitalists as a wealthy and powerful minority who crushed the majority of their fellow citizens, forcing them to work long hard hours for insufficient wages, forcing them to live in substandard housing with little medical care or hygiene, and denying them any real control of the political process that ran their lives. The “Free” governments during the Cold War portrayed communists as radical subversives, trying to overthrow the established order to take control, abolish religion, end all freedom, and enslave the entire world.

Democratic socialism and dictatorial capitalism were quietly ignored. Yet the stereotype of the “godless Communist,” as described by leaders in the “free world,” contained truth despite their exaggerations. During the decades of the Cold War, capitalist nations thrived while socialist nations struggled. As the standard of living rose in capitalist nations, so did individual freedoms. Dictatorships were replaced by democracies. Meanwhile, the totalitarian socialist governments regularly had to crush opposition with military force. People fled totalitarian socialist nations for free capitalist nations, forcing the former to build walls to contain their own people. Even China eventually chose to reestablish a capitalist economy, while remaining under control of a totalitarian government that still identified itself as the Communist Party.

Thirty years since the Cold War ended, its rhetoric and its reality continue to shape politics in the United States and around the world. American families who escaped totalitarian socialist governments in Poland, East Germany, China, Vietnam, and Cuba remain suspicious of politicians who speak well of socialism or who advocate greater government control of the American economy. Freedom, democracy, and capitalism remain linked in the minds of many people. Old pictures of capitalistic oppression, once fostered by the Soviet Union and its allies, are sometimes reiterated in political debate in the twenty-first century. Some American citizens, especially younger people born after the Cold War, sometimes forget why our side prevailed in that conflict. But advocates of socialism are rightly portrayed as isolated, huddling in the cold, bundled to resist reality while they continue to call for an economic system that has never worked.

Although democratic socialism exists as an option, it contains more threats to freedom than capitalism contains. Government control over prices and wages reduces freedom. Government decisions about which products to produce reduces freedom. As silly as it may seem, freedom to choose among dozens of brands of toothpaste or coffee or beer is far better than a single, mass-produced, government-controlled monopoly of toothpaste or coffee or beer. One free pair of shoes given each citizen once a year can never satisfy the human spirit as well as freedom to choose among many kinds of shoes, spending one’s own hard-earned money for the shoes one truly prefers.

The pendulum of politics swings to the left and then to the right. Free elections often reveal massive divisions of philosophy within a national population. True freedom allows both sides to state their case and invites voters to choose between them. Those who gain power cannot maintain their grasp indefinitely; the tighter they cling to power, the more it slips from between their fingers. Reversals happen, but the long course of history shows that freedom prevails over tyranny.  The future of America and of the world is bright, because free people will always work to remain free. J.

The welfare state

Already the free market economy reflects a compromise between pure capitalism and pure socialism, although the free market preserves the benefits of capitalism and permits only necessary legislation to moderate the economy. Governments limit pollution of the air and land and water. They make sure that the products sold to consumers are safe. They also regulate work areas for the safety of the workers. Governments even place limits upon who can work—setting minimum working ages to keep children out of the work force—and they limit the number of hours per week required of workers and demand rest times and meal times for workers.

A further compromise between pure capitalism and pure socialism is called the welfare state. Although some kinds of government welfare can be detected in ancient times—the Roman government subsidized bread and circuses for the people—the real welfare state began in the late nineteenth century as a result of the conflict between the ideas of capitalism and socialism. Otto von Bismarck introduced the welfare state to the newly-formed country of Germany in the 1880s. Fifty years later, Franklin Roosevelt introduced aspects of the welfare state to the United States as part of his New Deal, an attempt to overcome the troubles of the Great Depression.

Behind the welfare state lies the concept that all people have rights and that governments exist to protect those rights. In the original definition of human rights (life, liberty, property), the work of the government was largely negative. The government was not to deprive people of their rights without due process (a declaration of war or a criminal trial, for example). The government was to protect the rights of some citizens from enemies and criminals that would violate those rights. But, at first, no one said that the government should guarantee life by positive efforts to support the lives of all citizens.

People have basic needs. We need food and drink, clothing and shelter, and other physical supplies. When John Locke and Thomas Jefferson wrote about a right to life, they did not intend for the government to feed and clothe and house all citizens. People who work are given money, and they use that money to purchase what they need. People who do not work receive care from their families—children, the elderly, and the ill generally expect their families to feed and clothe and shelter them. Churches, community groups, and other charitable organizations care for those who are lacking the support of a family and those whose needs surpass the capacity of their family to meet. The government, therefore, had no role in supporting and protecting the poor beyond its essential task to keep enemies and criminals from taking advantage of those who were poor.

God gave his Law to his chosen people, the Israelites. He said that poverty would not exist if his Law was obeyed, but God acknowledged the reality of sin when he said, “You will always have the poor with you.” Jesus calls his people to be loving and generous, caring for those in need. If every Christian obeyed those commands to their fullest extent, poverty would not exist. Today’s Christians must confess that we have not perfectly followed the commands of Jesus. The poor, the needy, the homeless, and the oppressed among us reveal our shortcomings, our sins, our need for forgiveness. Christians are forgiven. Jesus paid the debt of all sinners in full on the cross. Being forgiven, Christians are being transformed into the image of Christ, doing what Jesus would do. Because the transformation is not complete, the poor and needy and homeless and oppressed are still among us.

Socialists point to the poor and oppressed and blame capitalism for their plight. Rather than acknowledging the sinful nature of all people, they focus their accusations upon the wealthy, the business owners, the people who benefit most from capitalism. Bismarck and Roosevelt did not want to renounce capitalism and endorse socialism. Instead, they used the authority of the government to require more help for the needy from those who could afford to offer help. Businesses are required to give their workers health insurance, disability insurance, and retirement plans. Under Social Security (part of the New Deal), workers are taxed to provide the government money; that money pays other people—chiefly the elderly and the disabled—not to work.

Does its defense of the right to life require the government to guarantee food, clothing, shelter, education, and health care to every citizen? This question defines the debate between conservatives and liberals in Europe, North America, and much of the rest of the world. The more services the government undertakes to feed the hungry, shelter the homeless, and provide medical care for the ill and injured, the more money it must collect from all its citizens. Government programs tend to be less efficient and more expensive than comparable programs under private ownership. Wealthy capitalists and their foundations often provide help for the poor that addresses their needs more specifically and more completely than government programs. On the other hand, when citizens begin trusting the government to solve the problems of the poor, those citizens often become detached from the problems of the poor, losing their compassion and their willingness to help their neighbors one person at a time.

Many Americans who say that they support socialism are actually longing for a more complete welfare state. They do not necessarily want their government to run all the factories, all the farms, all the hospitals and clinics, and all the means of production. They merely want a guarantee that all the hungry will be fed, all the homeless will be sheltered, and all the sick will receive the care they need. Calling for socialism, they blame the wealthy for creating and perpetuating the needs of their neighbors, and they accept no personal responsibility for causing or for solving those needs. The welfare state is not as bad an answer to human problems as is pure socialism; but it falls short of being the best answer available. J.

The richest Americans

A frequent complaint against capitalism is that it permits the rich to get richer, even at the expense of the poor. Capitalists reply that the success of rich business leaders helps all people, providing jobs for workers and products for customers. Over the years, who have been the richest American citizens, and how did they make their money? For this study, I chose to take a snapshot of the country’s wealthiest citizens every fifty years, beginning in 1820.

Stephen Girard was one of the richest citizens of the United States in 1820. He made his first profits from shipping, and then increased his wealth through banking. John Jacob Astor is another wealthy American alive in 1820. His initial wealth came from the fur trade, but he then increased his fortune through buying and selling real estate. Banker Thomas Willing and real estate mavin Stephen Van Rensselaer were also among the richest men in the country two hundred years ago.

In 1870, Cornelius Vanderbilt was one of the richest people in the United States. His money came from railroads, as did that of another wealthy American, Jay Gould. Alexander Turney Stewart became wealthy from selling textiles and dry goods. In 1870 Frederick Weyerhauser was beginning to build his fortune from the timber industry.

One hundred years ago, John D. Rockefeller had become one of the wealthiest citizens of the United States through his profits from Standard Oil and the petroleum industry. Henry Ford was one of the richest Americans due to the automobile industry. Brothers Richard Mellon and Andrew Mellon began as bankers but increased their fortunes through steel, oil, and railroads. Andrew Carnegie barely misses the cutoff of 1920, having died the previous year, but his fortune came from railroads and the steel industry.

H. L. Hunt and J. Paul Getty both gained wealth through oil. But by 1970 the richest American was Howard Hughes, whose wealth came from air travel and the movie industry. Another wealthy American in 1970 was Sam Walton, the founder of Walmart.

And in 2020, the wealthiest Americans include Bill Gates (Microsoft), Elon Musk (Tesla and SpaceX), and Jeff Bezos (Amazon). Another wealthy American is Warren Buffett, whose fortune came from the clothing and retail business.

Of course, all these wealthy Americans are white and male. Their opportunities for success were probably greater than potential competitors who were female or non-white. Looking beyond that impression, though, all of these men became rich by giving what consumers what consumers wanted. Railroads, cars, gasoline, steel, computer technology, and innovations in shopping mark the majority of these highly successful individuals.

Beyond that, most of them are known for philanthropy, for using their wealth for the benefit of others. Carnegie, Rockefeller, Walton, and other men on this list devoted much of their wealth to projects that helped others—combating disease and malnutrition, establishing opportunities for future entrepreneurs, and making libraries, concert halls, and museums available to the public. Most of these wealthy men and their families created foundations to continue their work beyond their lifetimes. Meanwhile, as they made their wealth by giving consumers what consumers wanted, they also created bountiful jobs for American workers.

Would railroads or automobile travel have been as affordable under government ownership and control? Would they have opened as many jobs as quickly as private investment made possible? If Walmart and Amazon were operated by the federal government, would they benefit as many shoppers? It is hard to imagine a scenario in which government control of these businesses would have been nearly as successful as they became under private ownership and control. J.

Capitalism or socialism–you make the choice

In 1980, a few Cuban citizens sought refuge in embassies, seeking to leave Cuba. After Fidel Castro announced that anyone who wished was welcome to leave, the number of emigrants swelled to more than 125,000. Cubans living in south Florida arranged boats to transport emigrants to the United States. Many of the migrants had to be housed on military bases in the United States until sponsors were found for them all—many of whom were relatives of the migrants, while others were charitable organizations offering help.

One young man from Cuba was taken in by his uncle and aunt in Miami. After a few days, he startled them at the breakfast table by announcing that he was ready to go pick up his Nikes. Further conversation clarified what he expected. The government of Cuba gave one pair of shoes to each Cuban citizen once a year. Now that he was in the United States, a much more prosperous country, this young man thought that he would receive a pair of expensive sports shoes from the government rather than the less luxurious shoes offered by his former government.

His uncle and aunt explained to him that the United States government does not pass out Nikes, or any other shoes. In the United States one works, saves one’s money, and then buys the shoes one wants and can afford. Those who want to save up for a pair of Nikes can do so; those who want to buy more affordable shoes sooner may do so. People in the United States can buy as many shoes as often as they want, provided they have the income to pay for their shoes. This is part of the difference between capitalism and socialism.

Discussion question: Which do you prefer: one free pair of shoes a year, provided by the government, or the opportunity to buy the shoes you want when you want them, provided you have the money? Explain your answer.

In the movie Moscow on the Hudson (1984), Robin Williams plays a Russian musician who defects to the United States. Shortly after his defection, the musician offers to stand in line to buy coffee for his American host family. He finds himself instead in a grocery store aisle surrounded by dozens of different brands and styles of coffee, which results in an emotional breakdown.

Discussion question: Which do you prefer: one style of coffee, chosen and distributed by the government, or the opportunity to buy the kind of coffee you want when you want it, provided you have the money? Explain your answer.

These two examples are not cherry-picked from an array of comparisons between free market capitalism and socialism. Both of them portray the real differences between life in the American free market economy and life under a socialist government. Once again, which do you prefer? J.

Rescuing capitalism

Under capitalism, the rich try to become richer. In the process, they provide jobs for workers and products for consumers, stimulating the economy. As businessowners compete with one another for customers and for workers, they try to achieve the best balance of price and quality for their products. They try to find the right wages to pay their workers, high enough wages to keep the best workers, but low enough wages to keep their products affordable.

The Industrial Revolution offered a glut of workers because the population was growing, agricultural workers were being pushed off their land, and machines were making it possible to accomplish more work with fewer laborers. Socialists (and other enemies of capitalism) recognized the problems that the system contained; they saw the poverty of the working class. At the same time, industry and the growing population of the cities led to other problems not directly due to capitalism, such as pollution and disease. Blaming all these problems on capitalism, socialists assured their audience that changing economic systems would fix these problems and would offer workers a better life.

Karl Marx predicted that the workers would violently overthrow business owners, along with political and religious leaders and others who supported the status quo. He further predicted that the overthrow would happen earliest at the places where the Industrial Revolution began—the British Isles, followed by western Europe. Marx could not foresee a response to capitalism that would fix its problems from within. But certain things were already happening in Marx’s lifetime that would rescue capitalism from its dangers by improving the lives of the working class.

Even Moses and the prophets pronounced laws against greed, oppression, and unfair practices. They denounced cheating weights, scales, and measures; they spoke against mixing the chaff and the sweepings with the grain. According to the Bible, government represents God’s authority among people to enforce the laws, to protect the people, to limit the power of greed and other sinful tendencies. Governments in western Europe used their authority for the good of the people. They inspected stores and businesses to make sure their practices were fair and honest. They restricted pollution of the air, land, and water, establishing sewage treatment plants, water purification plants, and other needed responses to the pollution caused by industry and by urbanization. Governments placed limits upon the age of factory workers; they also limited the number of hours that could be required of workers. In many ways, governments used the force of the law to reduce the problems within capitalism, industrialism, and urbanization—and they did so without seizing the means of production, without taking farms and factories and stores out of the hands of their capitalist owners.

God’s law demands perfection. Human law cannot mandate the same level that God requires. Food contamination laws permit a small amount of insect parts, rodent hairs, and other contaminations; reading those permissions can be stomach-turning. Questions are raised, and will always be raised, about how much regulation is necessary and how much is too much. The political system exists to address such questions, and negotiation and compromise will always be part of the answer to these questions.

Perhaps the most important laws prompted by the Industrial Revolution were those that permitted workers to organize labor unions, leaders who represented the workers and negotiated with business owners for higher salaries and better working conditions. At first, business owners tried to break the unions, but governments supported the unions and insisted that business owners hear their demands and negotiate with them for the good of the workers. This process, unexpected by Marx and other revolutionary socialists, preserved capitalism in western Europe and North America. Eventually, much of the rest of the world would be persuaded to follow the same economic system. People turned to capitalism because it works. J.

What’s wrong with capitalism?

Two principle complaints about capitalism are that it perpetuates inequity of wealth and that it both causes and worsens poverty. While these might seem to be two sides of the same coin, they are not the same complaint at all. In fact, when advocates of socialism combine these two complaints into one argument, they are working to undermine the very strength of capitalism, its reason for existence.

People once believed that wealth is stagnant, that if one person gains wealth, another person must lose wealth. Adam Smith demonstrated that labor adds value, and that wealth is not stagnant. When capitalism works as intended, everyone benefits. Competition between the wealthy business owners helps their customers to have more choices and also provides their workers with more opportunities to earn wages and improve their lives and those of their families.

God in his creation (or Nature, if you prefer) did not make all people the same. Some people are stronger than others. Some are more physically attractive than others. Some are smarter than others—and there are various kinds of intelligence, so that one person may excel in one kind of thinking while the next is better in a different intellectual field. To hold that all people are created equal is not to hold that everyone must have the same advantages and the same benefits. The fact that some people are born into wealthy families and others are born into poor families is neither the fault of capitalism nor a reason to abandon capitalism. We are all different in several ways; but still we maintain that we all are created equal.

Deuteronomy 15 teaches that, if all people followed God’s commands, there would be no poverty. The same chapter warns us that the poor will always be with us. Capitalism might seem contrary to Christian and humanist principles of loving one’s neighbor, helping those who need help, and caring for the needy and the oppressed. A wealthy capitalist seeks to increase his or her wealth. As selfish as that sounds, the capitalist actually is a servant to his or her neighbors. To increase wealth, the capitalist seeks to provide a product that consumers want or need. The capitalist seeks to make that product more desirable—higher quality, more affordable, or in some other way better. At the same time, the capitalist creates jobs, paying workers to create the product and so providing for those workers and their families.

As the Industrial Revolution emerged, wealthy capitalists found an excess of labor on their doorsteps. More and better food from overseas expanded the population, and enclosure of agricultural lands drove more poor families off the land and into the cities. Craftsworkers were overwhelmed with new competition. At the same time, business owners were using steam and steel to become more efficient, offering products that were both better quality than before and more affordable. Work moved from homes into factories. Only wealthy people could afford to maintain factories and to purchase the new machinery of steam and steel. Often they combined their wealth, creating corporations. The rich became richer, but it was not inevitable that the poor had to become poorer.

I tell my history students that, for every Jane Austen novel they read, they must also read a Charles Dickens novel. Dickens captured the problems of the Industrial Revolution vividly in his fiction. Women and children worked in factories, because they would accept less money for their labor and would cause fewer problems for their managers. A large underclass of unemployed men frequently turned to crime, both out of need and out of boredom. Cities were dirty, overcrowded, and dangerous. Disease ran rampart through the population. For these reasons, nineteenth century socialists predicted the overthrow of capitalism. They expected working people to rise up and demand their rights, including a larger share of the wealth to which their labor was contributing.

Before the Industrial Revolution, families worked together, whether raising food on the land or producing crafts such as shoes, clothing, and candles. Women often were members of guilds, equal to men active in the same crafts. Factories tore apart families. They separated adults from children and women from men. Over time, the dream of the Victorian family developed: the family in which the man was the sole worker and breadwinner, the children went to school and played at home, and the women stayed home to raise a family. This idyllic picture never represented reality for most of the population. But, over time, society and government began to work in that direction. Labor laws took children out of the factories and put them in schools. Other laws began to clean the cities, reducing industrial pollution and untreated sewage. The free market found means of regulating itself so that capitalism did not imply poverty for the working class. More about this will be said in a future post. J.