The Thing That Works

        Young people now blame capitalism for poverty, racism, high prices, even climate change. 

        They listen to people like Rep. Alexandria Ocasio-Cortez, who says, “Capitalism … is the absolute pursuit of profit at all human, environmental and social cost. That is not a redeemable system.”

        Give me a break.

        Yes, capitalism is often ugly. It brings out greed in some, exacerbates wealth differences, creates pollution (creating an actual need for government regulation, which capitalism funds) and leaves some people behind.

        But nothing else works! Nothing else makes life better for most people, including the poor!

        “Capitalism is moral, precisely because success comes from meeting the needs and wants of others,” says Steve Forbes of Forbes magazine. “Higher standard of living comes from trading, buying and selling with one another. Everybody gets something from a transaction.”

        Everybody, because capitalism, unlike socialism, and most of government, is voluntary. Transactions happen only if both sides believe they won.

        It’s why there’s often an odd double “thank you” moment when we buy something — both buyer and seller say, “Thank you.”

        Why? Because the seller wants my money more than his product. I want his product more than the money I paid. Otherwise, the trade wouldn’t happen.

        Millions of such voluntary transactions create wealth.

        That’s capitalism.

        The ignorant think rich people take from poor people. As the popular YouTube channel Secular Talk puts it, “Jeff Bezos … his wealth is making a lot of people poor … because we have a finite amount of money.”

        Wrong! There is not a finite amount of money. That silly idea is the essential fallacy in attacks on capitalism.

        Because capitalism is voluntary, it creates wealth.

        For thousands of years, everyone but the nobility was poor. Then, when some countries tried capitalism, wealth skyrocketed.

        When people are allowed to buy and sell things freely, everyone is better off.

        Socialists don’t get that. AOC insists: “No one ever makes a billion dollars. You take a billion.”

        But no billionaire showed up at my door demanding I give them money. Under capitalism, they can only get rich by offering people something we think is better than what we bought before.

        Yes, Amazon’s founder is now absurdly rich, but consumers didn’t lose. Jeff Bezos got rich by inventing a way for us to shop efficiently and pay less.

        And as Forbes points out, most billionaires weren’t born rich.

        “What’s amazing about these individuals, they’re from the most unlikely backgrounds, and (they invented) things you don’t plan for.”

        Margaret Rudkin, a housewife in Connecticut, noticed that bread worsened her son’s asthma.

        She experimented with different recipes, came up with modern whole wheat bread and grew her business into the company we now know as Pepperidge Farm.

        “What planner would have planned that?” laughs Forbes in my new video.

        He uses the term “planner” because socialists claim government dictates will make our economy work better than letting individuals making our own choices.

        They’re wrong. The failure of socialism everywhere should have taught us that!

        But no. Politicians still think they can do better. “Capitalism has let a lot of people down,” says likely presidential candidate Pete Buttigieg.

        Maybe, but capitalism also lifted more people out of poverty, created more opportunities and improved more lives than any other system.

        Economist Thomas Sowell said, “I don’t ask, ‘What is the cause of poverty?’ Everybody is born poor and ignorant. The question is, what factors allow some groups to get from that position?”

        “Sowell put it well,” concludes Forbes. “What is the difference between people today and people in the Stone Age? Difference is — we know more. That’s how you get a higher standard of living, from experiments in the marketplace, the laboratory, always trying to find new things. That’s why planning doesn’t work, because if we already knew it, we’d already be doing it!”

        Only capitalism allows the experiments that create better lives.

        Every Tuesday at JohnStossel.com, Stossel posts a new video about the battle between government and freedom. He is the author of “Government Gone Wild: Exposing the Truth Behind the Headlines.”

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