Glenn Rodgers - A Brief History of Capitalistic Free Enterprise and Why It Is Better Than Any Form of Socialism

Introduction

Before I retired from academia, I taughtIntroduction to Sociology probably thirty times or more. When we would get tothe chapter on government, politics, and economics (which are often covered inthe same chapter) I was always distressed at how uninformed students were regardingcapitalism and socialism. I also find it distressing that so many in our society,and even in our government, have embraced socialism as a viable socioeconomicsystem and want to remake America into a socialist society. The 2016 and 2020 Presidentialcandidate, Bernie Sanders, is one of them. Along with Bernie, a number ofdemocratic politicians have embraced socialism. One is a young woman named Alexandria Ocasio -Cortez. In the summer of 2018, she won anelection in her New York district, defeating her Republican opponent so thatshe is now a member of the House. Being only twenty-eight years old and anavowed socialist, Ocasio -Cortezs victory generated alot of media attention. Naturally, she did a lot of interviews. In one of them,when asked about her views regarding capitalism and socialism, she commentedthat capitalism hasnt been around a very long time. When America was settledand established, she asserted, there was no capitalism. I was both amused and confusedby her assertion. I had heard that she was a graduate of Boston Universitysprogram in economics. Surely she knew better than to say that early Americansettlers were not capitalistic in their economic activities. What else couldthey have been? They certainly werent socialistic. They owned and controlledtheir own resourcesmeager as those resources sometimes were. Of coursethey were capitalists. They engaged in free enterprise.

Curious as to the source of Ms. Ocasio -Cortezs confusion, I began to review some of theliterature with which some of her professors might have been familiar. Theproblem became immediately apparent. For instance, in her book, The Origins of Capitalism, Ellen Meiksins Wood, defines capitalism as:

[A] system in which goods andservices, down to the most basic necessities of life, are produced forprofitable exchange, where even human labour -power isa commodity for sale in the market, and where all economic actors are dependenton the market... Capitalism differs from other social forms because producersdepend on the market for access to the means of production Above all, it is asystem in which the bulk of societys work is done by propertyless labourerswho are obliged to sell their labour-power in exchange for a wage in order togain access to the means of life and of labour itself Few would say that thecapitalist system existed in earnest before the sixteenth or seventeenthcentury, and some would place it as late as the eighteenth, or perhaps even thenineteenth, when it matured into its industrial form.

If one did not know better, one might acceptthis sort of negative sounding, Marxist-influenced definition as a true andaccurate explanation of capitalism, which could lead one to reach a conclusionsimilar to Ms. Ocasio -Cortezs. However, when onelooks up the definition of capitalism in a dictionary of economics, thedefinition is quite different from the one given above.

It is apparent that Marxist-orientedeconomists and sociologists are playing fast and loose with the definition ofcapitalism in order to align themselves with Marx and continue his negativesocialist critique of capitalism. The problem is that what they are saying issimply not true, and playing fast and loose with a definition to make a thingeasier to criticize is intellectually dishonest.

One of the things Marxist-orientedeconomists and sociologists like to do is claim that capitalism as an economicsystem is relatively new. It is not. Capitalistic free enterprise is ancient.It is the way humans have done business pretty much since there has beenbusiness to do. Over the centuries, captialism has evolved into something more complexthan it was, say, 10,000 years ago. But the fundamentals of the system are thesame. In this small book, I intend to provide a brief historical overview ofeconomics, demonstrating that capitalistic free enterprise has, for the most part,been the economic choice of humans since human societies formed and peoplebegan doing business with one another.

But before we begin our historical survey,we need to understand what the terms capitalism and socialism actually mean.Chapter 1, therefore, will focus on definitions.