A Moral Case for Capitalism | 5-Minute Videos — Transcript

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1. 0:01Okay, we're told. So, maybe capitalism
2. 0:03is efficient. Maybe it generates more
3. 0:06wealth than other systems, but what
4. 0:08about values? What about things that
5. 0:10can't be measured in cash? Things like
6. 0:12kindness and loyalty and integrity.
7. 0:16Well,
8. 0:17let me say something that you won't hear
9. 0:19very often.
10. 0:20Let me make the moral case for
11. 0:23capitalism.
12. 0:25Let's go back nearly 12,000 years to the
13. 0:28moment when one of our ancestors made a
14. 0:30world-changing discovery.
15. 0:32It turned out that if you left seeds in
16. 0:34fertile soil, plants would grow from
17. 0:36them.
18. 0:37Instead of having to forage, you could
19. 0:39produce your own grains or fruits where
20. 0:41you wanted.
21. 0:42But it didn't take long for someone to
22. 0:45make the next discovery. Rather than
23. 0:47spending all year tending to your own
24. 0:49crops, you could wait for your neighbor
25. 0:52to bring in his harvest and then steal
26. 0:54it.
27. 0:55And then came the truly diabolical
28. 0:58discovery.
29. 1:00If you wanted to maximize the ratio of
30. 1:02effort to outcome, you could organize a
31. 1:05gang of thugs and seize not only your
32. 1:07neighbor's harvest, but everyone's
33. 1:08harvest, regularizing your plunder
34. 1:11through tithes, tolls, and taxes. And
35. 1:14thus it continued until
36. 1:16well, until roughly the end of the 17th
37. 1:18century and the birth of modern liberal
38. 1:20capitalism.
39. 1:21Sure, there were premonitions before
40. 1:23then, little tremors of freedom, but
41. 1:25almost everyone on the planet still
42. 1:27lived in servitude and penury.
43. 1:30Every previous society was based on
44. 1:32systematized oppression.
45. 1:34Ruling elites would use the institutions
46. 1:36of the state to loot its resources and
47. 1:39then rig the rules so that their
48. 1:40children would inherit the same
49. 1:41privileged position.
50. 1:44A Bronze Age slave empire was not so
51. 1:46different in this sense from a medieval
52. 1:48European monarchy or a 20th century
53. 1:51African kleptocracy
54. 1:53or, come to that, from those modern
55. 1:55states that have avoided the liberal
56. 1:57capitalist revolution.
57. 1:58Oppression, serfdom, and bondage were
58. 2:01the lot of almost every human being from
59. 2:03the moment civilization began until a
60. 2:05night blink ago.
61. 2:07We don't know how lucky we are to live
62. 2:09at a time and in a place where the rules
63. 2:12are above the rulers.
64. 2:14The great Victorian jurist, Sir Henry
65. 2:16Maine, summarized the move to modern
66. 2:18liberty in three words,
67. 2:20status
68. 2:22to contract.
69. 2:24In nearly every previous society, our
70. 2:26relations with one another were dictated
71. 2:27by status, that is, birth and caste.
72. 2:31In a liberal capitalist society, we're
73. 2:33free to make one-off free-standing
74. 2:35arrangements with each other without
75. 2:37needing to ask anyone else's permission.
76. 2:39Our agreements, our contracts, are
77. 2:42enforced by an independent court system,
78. 2:45and adult citizens are equal in the eyes
79. 2:47of the law.
80. 2:48That's it.
81. 2:50That's the magic formula.
82. 2:52Status
83. 2:53to contract.
84. 2:55Grant it, and the rest follows.
85. 2:57It's the difference between North Korea
86. 3:00and South Korea, between China and
87. 3:02Taiwan, between Russia and Finland,
88. 3:03between Haiti and Bermuda.
89. 3:06In a society defined by status,
90. 3:09you get rich by sucking up to the people
91. 3:11in charge, emperors or people's
92. 3:13commissars or presidents for life.
93. 3:16But in a society defined by contract,
94. 3:19you get rich by offering a product or a
95. 3:21service to the people around you.
96. 3:24As the 20th century economist Joseph
97. 3:25Schumpeter put it,
98. 3:27the capitalist achievement does not
99. 3:29typically consist in providing more silk
100. 3:30stockings for queens,
101. 3:32but in bringing them within the reach of
102. 3:34factory girls.
103. 3:36When I buy something on Amazon, yes, I'm
104. 3:38enriching Jeff Bezos. I'm adding
105. 3:40fractionally to his net wealth,
106. 3:42but he is also enriching me, letting me
107. 3:45buy pretty much whatever I want without
108. 3:47having to get out of my chair.
109. 3:49No other economic system rests on
110. 3:52voluntary exchange.
111. 3:54Every other system requires coercion.
112. 3:57And that is the moral case for
113. 3:59capitalism.
114. 4:01Not just that it makes us richer, though
115. 4:02it does.
116. 4:03Not just that it raises the poorest on
117. 4:05the planet, making our life outcomes
118. 4:06more equal, though it does that, too.
119. 4:09No. The moral argument for capitalism is
120. 4:12that it's the only economic system that
121. 4:14values dignity and freedom and, yes,
122. 4:18equality.
123. 4:19It disdains distinctions of race and
124. 4:21creed. One customer's money is as good
125. 4:24as the next.
126. 4:25As Voltaire put it in 1764,
127. 4:28"Enter the London Stock Exchange and you
128. 4:30will see representatives from all
129. 4:32nations gathered together for the good
130. 4:34of mankind. Here, Jew, Muslim, and
131. 4:36Christian deal with each other as if all
132. 4:39were of the same faith, and the only
133. 4:41people called infidels are those who go
134. 4:43bankrupt."
135. 4:45Under capitalism, we need to think of
136. 4:47what other people want, of what we can
137. 4:49do for them.
138. 4:50It's how we get ahead.
139. 4:52Whereas socialism replaces our natural
140. 4:54human relations with state control,
141. 4:57capitalism draws us into productive
142. 4:59networks of mutual dependency.
143. 5:02We become more attentive, more
144. 5:04empathetic, and thus more aware of the
145. 5:07case for universal human rights.
146. 5:10Capitalism doesn't just make us better
147. 5:12off.
148. 5:13It makes us better people.
149. 5:17I'm Daniel Hannan, author of Inventing
150. 5:18Freedom: How the English-Speaking
151. 5:19Peoples Made the Modern World,
152. 5:21for Prager University.
153. 5:23Thank you for watching this video. To
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156. 5:29donation.