Any doctor would say that health is the ideal condition of human body. In a similar manner a good economist would say Capitalism is the ideal system of social organization. This must be surprising as most of the people who claim to be “economists” are anti-capitalistic. Yet, what I say is no exaggeration. The only real economists are the advocates of liberty and Capitalism.
Economics is the study of production of wealth under a system of division of labor. A high degree of civilization is possibly only under a system of division of labor. Division of labor, however is a recent phenomenon and exists only in the nations which are termed as Capitalistic. The existence of division of labor in a society is dependent on the laws which the society adopts. Any nation is free to adopt the rules and laws which would help division of labor flourish. Yet, very few nations have opted to do so, and the ones which have opted to do so have done so only in the recent past and not in a complete manner.
The majority of the population should have a reasonably good understanding of Economics if we are to attain a state of complete liberty. People should realize that inflation is credit expansion and depressions are the result of it. They should trace back shortages to price controls and unemployment to minimum wage laws and pro-labor union regulations. They should be made aware of the fact that taxation is bleeding the economy and regulations are strangulating it. The study of economics should be an essential part of the education of everyone, especially the first hand and second hand dealers of ideas. A clear understanding of economics is necessary if we are save the civilization. It is the ideas which are held by the majority which determines the economic policies a society adopt. Hence, the burden is on everyone’s shoulders. The task demands an exacting morality. But, the rewards are worth the effort.
The teachings of economics are usually derided as it seems to be totally against the notions of conventional morality. Capitalism is usually said to be the cause of alienation and other mental diseases. The person who introduced this concept of alienation was Marx. But, it was later supported by psychologists like Erich Fromm and even some popular novelists like Chetan Bhagath. Such notions are the result of ignorance of the immense benefits Capitalism and a division of labor society bestows.
Capitalism is a politico-economic system based on the concept of individual rights. Capitalism is the only system which grants individual freedom to its citizens. A society of which the basic structure is capitalistic was implemented largely as the result of the ideas of philosophers like John Locke and the founding fathers of United States. A philosophy which upholds reason-that reason is capable of dealing with reality, and the fact that there isn’t a life beyond grave have played a large part in the flourishing of Capitalism.
It is usually believed that a Government is required for the proper functioning of the society. Nothing can be farther from the truth. Government means an agency which has the legal power to initiate force, and initiating force is wrong and immoral. All services and goods, including defense and security services could be provided by private individuals. Some intellectuals argue that doing away with the government would provide private agencies with an unregulated power to employ force. But, this argument contradicts itself. Who will regulate government bureaucrats & politicians other than themselves?
Economic freedom and political freedom are indivisible. Both are in fact, the different aspects of the same thing. It is usually said that we have political freedom, but lack economic freedom. Most of them think the right to vote gives the citizens political freedom. Then there are people who think that economic freedom means that a job or income is guaranteed. They usually utter bromides such as “a hungry man is not free” or that economic freedom means “the freedom to starve”. All these people are way off the mark. Economic freedom means one would be free to pursue his economic goals without the initiation of physical force from others. If a person wants to start working at a wage lower than which the labor unions and government legislation decree, he would be allow to work in a system which guarantees economic freedom. The employer would be free to hire a person, and the employee would be free to work. Economic freedom is a necessary, though not sufficient condition for economic security. It is widely believed that government measures such as social security are necessary for economic security. The exact opposite is true.
One of the main reasons why people turn their deaf ears towards the teaching of economics is the morality of altruism. Too dull to think for themselves, they think that one mans loss is another person’s gain. The other reason is that to understand the theorems of economics needs a long chain of thought. What appears to be true in first glance, doesn’t happen to be true I reality. Irrational, short term interest too happens to play a large role in the opposition to economics and its teachings. Envy plays a much larger role in the hatred of economics, as most people want their superiors to be taxed and humiliated. Whatever the reasons, it is evident that the vast majority of the people don’t agree to the teachings of economics. Their ignorance is taking us on the path of destruction. If we are to save the world, we should turn to the teachings of economics and other social sciences, which all lead to the same conclusions in the matter of social organization.