The Truth About Capitalism

By Herb Bowie

No matter which way you lean politically, you probably have strong feelings about capitalism. It seems to me that there are a lot of odd ideas on this topic running around out there in today’s world. Let me offer some thoughts about what seems true to me.

1. Capitalism is not evil.

At its essence, capitalism is an economic system that does the following things:

a. Organizes useful work in order to maximize overall productivity;

b. Allows individuals and organizations to freely buy and sell products and services from and to whomever they like, at whatever prices they can negotiate;

c. Generates a surplus, in the form of products and services not immediately needed to satisfy the basic needs of members of society;

d. Provides a means for storing that surplus so that it can be used at a later date;

e. Provides incentives for individuals and organizations to invest some of their surplus, not in items and services that are directly and inherently pleasing, but to provide land, buildings, machinery and startup expenses so that labor can be employed ever more efficiently to produce better, more desirable goods and services.