Capitalism and its relationship to individual rights

Capitalism and Social Rights

capitalism and its relationship to individual rights

Capitalism, and the individual freedom it necessarily protects, flies directly in the face of history and the deep desire of some people to control. The recognition of individual rights entails the banishment of physical force from human relationships: basically, rights can be violated only by means of force. capitalism, and the nature of the moral crisis confronting the world. of individual rights, the relationship between a country's political and.

But do workers in capitalism really get paid for all the work that they do? What are they actually paid for?

capitalism and its relationship to individual rights

Whatever the workers produce belongs to the capitalist, and the capitalist appropriates the difference between what the workers are paid and what their products or services will fetch on the market. So capitalists appropriate the surpluses produced by workers in the form of profit, just as landlords appropriate surpluses from peasants in the form of rent. Even the grand old man of liberalism, John Stuart Mill, saw it that way. But first I want to make some other points about capitalism.

The fact that capitalists can make profit only if they succeed in selling their goods and services on the market, and selling them for more than the costs of producing them, means that making profit is uncertain. Capitalists have to compete with other capitalists in the same market. Competition is, in fact, the driving force of capitalism — even if capitalists often do their best to avoid it, by means, for example, of monopolies. But the social conditions that, in any given market, determine success in price competition is beyond the control of individual capitalists.

This means above all constant pressure to cut the costs of labor. This requires constant pressure on wages, which workers constantly have to resist. It also requires constant improvements in labor productivity. That means finding the organizational and technical means of extracting as much surplus as possible from workers within a fixed period of time, at the lowest possible cost. To keep this process going requires regular investment, the reinvestment of surpluses. Investment requires constant capital accumulation.

The point is that this requirement is imposed on capitalists, regardless of their own personal needs and wants.

capitalism and its relationship to individual rights

Even the most modest and socially responsible capitalist is subject to these pressures and is forced to accumulate by maximizing profit, just to stay in business. We can talk as much as we like about corporate social responsibility.

But capitalism itself puts severe limits on that. The need constantly to improve the productivity of labor has made capitalism exceptionally dynamic. But the same market pressures that make it so dynamic also have contradictory effects. What I want to emphasize here are certain deep-rooted problems in capitalism critical to our discussion.

Despite its dynamism, capitalism is not an efficient way of supplying crucial human needs.

capitalism and its relationship to individual rights

Where production is skewed to the maximization of profit, a society can have massive productive capacities. It can have enough to feed, clothe, and house its whole population to a very high standard. But it can still have massive poverty, homelessness, and inadequate health care. You only have to look at the United States, where there are some of the highest rates of poverty in the developed world and where tens of millions have no access to affordable health care.

What possible excuse can there be for that in a society with such enormous wealth and productive capacities? Capitalism is inefficient in another sense too.

capitalism and its relationship to individual rights

It consumes vast amounts of resources; and it acts on the short-term requirements of profit rather than the long-term needs of a sustainable environment. All aspects of life that become market commodities are outside the reach of democratic accountability. They answer not to the will of the people but to the demands of the market and profit. And that, as you can imagine, has huge implications for the meaning of political rights.

The Meaning of Globalization What about global capitalism? What we mean when we talk about globalization, at least in its present form, is that more and more of the world is being drawn into the mechanisms of the capitalist market. It simply means that market imperatives coming out of the developed economies have been imposed in one way or another everywhere.

The gulf between rich and poor has been growing everywhere, not just between North and South but within developed economies.

capitalism and its relationship to individual rights

And while this has been going on, the rate of ecological degradation has also accelerated at an alarming rate. I want to emphasize two essential things, which have fundamental consequences for political rights and their relation to economic power and social rights. The first has to do with the relation between classes, those who labor and those who appropriate the labor of others. This means that economic and political power have been separated in a wholly new way.

If anything, capitalism needs intervention by the state in some ways more than any other system, just to maintain social order and the conditions of accumulation.

But the economic power of capital is separate from political power in two senses: The second major point is that the capitalist system is driven by certain inescapable imperatives, certain compulsions, the economic imperatives of competition, profit-maximization, constant accumulation and the endless need to improve labor productivity.

These really are imperatives. This is a critical point. We hear a lot about the free market, market choice and market opportunities. The Unknown Ideal39 Laissez-faire capitalism is the only social system based on the recognition of individual rights and, therefore, the only system that bans force from social relationships.

By the nature of its basic principles and interests, it is the only system fundamentally opposed to war. While archeologists are rummaging through the ruins of millennia for scraps of pottery and bits of bones, from which to reconstruct some information about prehistorical existence—the events of less than a century ago are hidden under a mound more impenetrable than the geological debris of winds, floods, and earthquakes: The Unknown Idealvii The nineteenth century was the ultimate product and expression of the intellectual trend of the Renaissance and the Age of Reason, which means: And, for the first time in history, it created a new economic system, the necessary corollary of political freedom, a system of free trade on a free market: No, it was not a full, perfect, unregulated, totally laissez-faire capitalism—as it should have been.

Various degrees of government interference and control still remained, even in America—and this is what led to the eventual destruction of capitalism. But the extent to which certain countries were free was the exact extent of their economic progress. America, the freest, achieved the most. Never mind the low wages and the harsh living conditions of the early years of capitalism.

They were all that the national economies of the time could afford. Capitalism did not create poverty—it inherited it. Compared to the centuries of precapitalist starvation, the living conditions of the poor in the early years of capitalism were the first chance the poor had ever had to survive.

Ayn Rand's Moral Defense of Capitalism

As proof—the enormous growth of the European population during the nineteenth century, a growth of over per cent, as compared to the previous growth of something like 3 per cent per century. The Unknown Ideal66 Capitalism has created the highest standard of living ever known on earth.

The evidence is incontrovertible. The contrast between West and East Berlin is the latest demonstration, like a laboratory experiment for all to see. Yet those who are loudest in proclaiming their desire to eliminate poverty are loudest in denouncing capitalism.

The Unknown IdealIf a detailed, factual study were made of all those instances in the history of American industry which have been used by the statists as an indictment of free enterprise and as an argument in favor of a government-controlled economy, it would be found that the actions blamed on businessmen were caused, necessitated, and made possible only by government intervention in business.

The evils, popularly ascribed to big industrialists, were not the result of an unregulated industry, but of government power over industry.

The villain in the picture was not the businessman, but the legislator, not free enterprise, but government controls. The Unknown IdealCapitalism cannot work with slave labor. Because in both of these cases no one is forcibly stopping the individual from attaining his ends.

However, the fact that an individual cannot start his own electric company is a violation of his freedom. Because in this case his actions are impeded by the use of force -- the government's legal monopoly on utility companies prevents him from starting his own electric company through the threat of force.

Freedom is only a negative, it imposes no positive constraints on other people's actions. In a free or capitalist society all men may act as they choose as so long as they do not infringe on the freedom of others -- by violating their rights through force. Subsequently, it is only a government limited to protecting individual rights that fails to violate the freedom its citizens. Since capitalism upholds individual rights as absolutes, capitalism upholds freedom as absolute.

All non-capitalistic societies force some men to live at the expense of others. Whether you are forced to live, in part or in whole, for the sake of God as in a theocracy"the underprivileged" as in the welfare stateor the latest sadist in power as in a dictatorship does not matter, it is only the fact that some individuals are violating the freedom of others, not the method by which they do it, that matters.

Is capitalism a just social system?

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In fact, capitalism is the complete embodiment of social justice. In social or political context justice means that every person gets no more, and no less, than what he gains through voluntary association with other men. A capitalist society is a just society because all individuals are considered equal under the law. Capitalism recognizes that it is just for a man to keep what he has earned and that it is unjust for a man, or group of men, to have the right to what other people have earned.

Since all people must live independently under capitalism, all of the material values that a person acquires must be earned. Thus, the expression of social justice under capitalism is that what a man earns is directly proportional to what he produces, with no antitrust laws or progressive income taxes stifling his achievement for the sole fact the he did achieve.

All other forms of government, such as the welfare state, institutionalize injustice by legally expropriating the property of some men and giving it to others. Many people have trouble accepting that capitalism is a just system because of the existence of economic inequality. It is observed that famous celebrities and sports stars have very large incomes for work that is perceived as trivial, and that many hard working people make incomes which pale in comparison for jobs that are perceived to be a greater benefit to society.

What people must realize is that it is perfectly just for a superstar athlete, even with little or no education, to make a hundred times the income of a scientist who has a Ph. Because the athlete creates enormous profits through ticket sales and product endorsements whereas the scientist generates very little revenue through his research.

Capitalism FAQ: Theory

That is, each of them deserves what they earn, and what they earn is the result of how much wealth each of them creates Incidentally, this is not to say that the athlete is morally superior to the scientist because he is wealthier.

Since each man has the right to the product of his labor, it is completely just for the disparity in incomes to exist, and the only injustice to occur would be or the government to take money from the athlete and give it to those who supposedly deserve it on the basis of their "need. What is a capitalist?

From a purely economic point of view, a capitalist is a person who buys in order to sell for profit. However, the productive role that capitalists and businessman serve cannot be overstated. Far from being exploiters, the true function of capitalists and businessmen " Furthermore, by funding research and capital investments, corporations and capitalists make possible all of the modern day conveniences, from laser surgery to orchestra halls, that most people take for granted every day.

Capitalism and Social Rights

In fact, since capitalists make available so much life-saving and labor-saving technology to so many people, they should be regarded as some of mankind's greatest benefactors.

A few capitalists and businessmen have done more to help mankind live a more enjoyable life indeed, most people would not even be alive today if it weren't for capitalists than all of the humanitarians, social workers, and clergy men combined. If one considers human life a value, then they should regard capitalists as one of its greatest promoters. If Mother Theresa really wanted to help people, she should try and accumulate enough capital to start a factory in a poor nation and employ thousands of people who would not have jobs without her.

In a more fundamental sense, a capitalist is anyone from a janitor to a millionaire who lives solely by his own effort and who respects the rights of others. The best symbol of a capitalist is the trader. That is, the man or woman who only deals with other people on a voluntary basis. A capitalist is not an "exploiter" nor necessarily a "greedy" individual.

How is democracy related to capitalism? An absolute democracy, which means unlimited majority rule, is incompatible with capitalism and freedom. This is so because capitalism rests on the principle of individual rights. In an absolute democracy, rights would really have no legitimate meaning because they could always be voted away in the next election.

Individual rights must be consistently upheld if capitalism is to be achieved, and if the majority may do whatever it wants regardless of the rights of the minority, capitalism cannot exist, not even in principle. When most people think of "democracy" they usually mean a constitutionally limited democracy. The function of a limited democracy is to decide who held political power and how that power is specifically exercised such as how many policemen or judges are neededbut what that power is should be strictly defined and limited in the constitution.

Individual Rights | The Ayn Rand Institute

This is basically the original American system. In a proper capitalist nation, a constitution based upon individual rights would be necessary to limit the actions of its citizens and the government. Under capitalism, the majority would never be able to vote to violate the rights of the minority, no matter how large the majority or how small the minority.