Is Capitalism Moral? | 5 Minute Video — Transcript

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1. 0:00Many people believe that free market capitalism is selfish, even immoral. They say it's about
2. 0:08greed, about a hunger for money and power; that it helps the rich and hurts the poor.
3. 0:13They're wrong. The free market is not only economically superior, it is morally superior
4. 0:21to any other way of organizing economic behavior. Here's why.
5. 0:27The free market calls for voluntary actions between individuals. There's no coercion.
6. 0:33In a free market, if I want something from you, I have to do something for you.
7. 0:40Let's say I mow your lawn and you pay me twenty dollars. What does that twenty dollars really mean?
8. 0:46When I go to the grocer and say, "I would like to have four pounds of steak"
9. 0:51He, in effect, says to me, "You want a lot of people to serve you -- ranchers, truckers,
10. 0:58butchers, and packagers. All these people have to be paid.
11. 1:03What did you do to serve your fellow man?"
12. 1:07"Well," I say, "I mowed my fellow man's lawn." And the grocer says, "Prove it."
13. 1:13Then I offer him the twenty dollars. Think of the money that you've earned as a certificate of performance.
14. 1:20It's proof that you've served your fellow man.
15. 1:25People accuse the free market of not being moral because they say it's a zero-sum game,
16. 1:31like poker, where if you win, it means that I have to lose. But the free market is not
17. 1:37a zero-sum game. It's a positive sum game. You do something good for me, such as give
18. 1:42me that steak and I'll do something good for you -- give you twenty dollars.
19. 1:47I'm better off because I valued the steak more than I valued the $20 and the grocer is better off
20. 1:54because he valued the $20 more than he valued the steak. We both win.
21. 2:00Ironically, it's the government, not the free market, that creates zero-sum games in our economy.
22. 2:08If you use the government to get a food stamp, a farm subsidy or a business
23. 2:13bail out, you will benefit -- but at the expense of your fellow citizens. Isn't it more moral
24. 2:19to require that people serve their fellow man in order to have a claim on what he produces
25. 2:25rather than not serve others and still have a claim?
26. 2:29But, a lot of people ask, what about giant corporations? Don't they have too much power
27. 2:35over our lives? Not in a free market. Because in a free market We, the People, decide the
28. 2:42fate of companies who want our business.
29. 2:45Free market capitalism will punish a corporation that does not satisfy customers or fails to
30. 2:51use resources efficiently. Businesses, big and small, that wish to prosper are held accountable
31. 2:59by the people who vote with their dollars. And, again, it's the government that can undo this.
32. 3:07Take the example of the American automobile industry. It was struggling to survive in 2009.
33. 3:15Why? Because they were producing cars that did not please a sufficient number of
34. 3:22their fellow men. In a free market, they would therefore have gone bankrupt. The market would
35. 3:28have said, "Look, you're done. Sell your plant and equipment to somebody who can do a better job."
36. 3:35But when Chrysler and General Motors failed, they went to Washington D.C.
37. 3:40and got the government to bail them out.
38. 3:43The government bailout essentially meant to them: "You don't have to be accountable to
39. 3:47customers and stock holders.' No matter how inferior your product is and no matter how
40. 3:53inefficient you are, we'll keep you in business by taking your fellow man's money. When government
41. 4:00interferes in this way, it takes the power away from the people and rewards companies
42. 4:08that couldn't compete successfully in the marketplace. That may work out very well for
43. 4:13politicians, big unions and corporate officers, but it seldom does for the tax payer.
44. 4:20That's why a free market system can only work if there is limited government.
45. 4:25Limited government means you and I decide which businesses survive.
46. 4:31That's the America that our Founding Fathers envisioned -- a limited government that has
47. 4:36only a few specifically mentioned -- or enumerated -- powers that are listed in Article I, Section 8
48. 4:44of the United States Constitution. It's this brilliant, limited-government notion
49. 4:51that produced the wealthiest nation in history. In a free market, the ambition and the voluntary
50. 4:58effort of citizens, not the government, drives the economy.
51. 5:02That is: people, to the best of their ability, shaping their own destiny.
52. 5:10Sounds pretty moral to me.
53. 5:12I'm Walter Williams of George Mason University for Prager University.