Its Defenders Need To Understand That "Capitalism" Is Not An "Ism"

Writing in the Wall Street Journal on June 30 (July 1 in the print edition), editorialist Matthew Hennessey advocates that “Capitalism Needs Champions.” Reacting to the victory of avowed socialist Zohran Mamdani in New York City’s mayoral primary, Hennessey says that the electoral result indicates that the defenders of capitalism are doing a poor job, and need to step up their game:

Let Zohran Mamdani’s victory in last week’s Democratic mayoral primary in New York serve as your periodic reminder that capitalism is in dire need of able defenders. Socialism has more cheerleaders than it deserves, considering its record of consistent failure. Markets need champions too. This is always true, especially now. . . . [T]he problem isn’t capitalism. The problem is complacency.

I don’t disagree. But there’s another problem for defenders of what its enemies call “capitalism.” The problem is that capitalism is not an “ism.”

Think about it. In every instance other than the word “capitalism,” the suffix “ism” is used to designate something as a system of beliefs. The implication of the “ism” suffix is that there are adherents who have adopted these beliefs, and who think that these beliefs are the correct and moral ones that should be adopted by everybody. Such, they think, is the way to a better world. Thus religions are clearly all “isms”: Catholicism, Protestantism, Mohammedism, Judaism, Buddhism, Hinduism, Taoism, even Paganism. In the political realm, most any organized system of beliefs with advocates on its behalf gets the “ism” suffix: not just socialism and communism, but fascism, anarchism, liberalism, conservatism, environmentalism, and plenty more. Even sets of policy prescriptions associated with a particular politician can become an “ism”: think Reaganism, Obamaism, or Trumpism.

But “capitalism”? It’s just a fundamentally different thing. Capitalism is not a belief system. Nobody “believes” in capitalism per se. The word “capitalism” is better understood as a descriptive term for the natural order that arises in the presence of private property and free exchange. The natural order is full of warts and flaws, as are all human institutions. The combination of private property and free exchange could perhaps make a good case for being designated an “ism,” but it turns out that we don’t have that concept in a single word.

The system of private property and free exchange has demonstrated its ability to provide for every human want and need in remarkable abundance: necessities like food, clothing and shelter in incredible quantities and variety; refined art, music, entertainment and other culture; services to provide for every human comfort; and at the same time also every kind of dubious product and service, from drugs to the sex trade to loan sharking to cryptocurrencies to guns, and on and on. Even murder for hire! Some people achieve wild success and wealth, while others struggle to survive no matter how much abundance is created.

It’s all a jumbled mess. Who wants to advocate for this? Certainly not an idealistic young person looking for purpose in life by helping to create a perfect world.

There are no such warts and flaws in the fantasy world of socialism. In socialism we have a true belief system that offers an imaginary path to a world of perfect justice and fairness if only we will follow its creed. And the path is claimed to be an easy one — basically, just have the government take greater control of the economy and allocate all the wealth in a fair manner. Unfortunately, socialism has been proven time and again not to work. In short order, it will bring about economic decline, followed ultimately by near universal poverty and deprivation (with the exception of a few privileged persons who get to run the socialist state machinery).

So yes, we do need champions for “capitalism,” or at least for the system of private property and free exchange. But we also need to recognize what we are advocating for. We cannot claim to have a set of beliefs and prescriptions that, if followed, are the key to achieving a perfect world, or a completely fair world. Our system will always be full of warts and flaws. But it does offer the opportunity for everyone to have the freedom and the dignity to make their own decisions in life, to seek their own success in life, without need for the consent and meddling of government busybodies.

Maybe there is a large group of the “idealistic” to whom capitalism will never appeal. If that group is large enough, then the lesson of the economic failure of socialism will need to be re-learned in bitter experience in every generation from now to the end of time. But we can certainly keep pointing out that the world of perfection offered by socialism is an illusion, and that the actual world that will emerge from socialist prescriptions is far worse than the one we get from private property and free exchange. I’m actually optimistic that there can continue to be a critical mass of voters to keep the advance of socialism at bay, but it’s a much closer horse race than I ever would have thought.