May 1, 2013
Late last week in Orlando, a passionate champion of economic freedom, Rep. Trey Radel (R-Fl.) said, “Capitalism has turned into a dirty word” to a gathering of 500 pro-capitalist think tank operatives during the closing speech of the 36th Resource Bank. The conclave is one of the two largest annual events for U.S. market-oriented think tanks; the other being organized by State Policy Network.
If “capitalism” is viewed as a dirty word, should think tanks “clean it up” or abandon it? Like other Americans who were not born in the United States, I still mourn the loss of the word “liberal.” In most of the world the word means nearly the opposite of what it means here. I doubt that the word capitalism will be “stolen” but should we mind if it gets lost? During my college years I was more than satisfied with the arguments in favor of capitalism provided in Capitalism: the Unknown Ideal by Ayn Rand, and Ludwig von Mises’ The Anti-Capitalist Mentality. In his great treatise, Human Action, Mises recognized that “the system of free enterprise has been dubbed capitalism in order to deprecate and to smear it.” He chose nevertheless to keep the word and redeem it.
Although Karl Marx did not create the word, it was after his work Das Kapital (1867) when the term “capitalism” began to be widely used to describe an economic system based on private property as the means of production. Marx remains the great labeler: “capital,” “the capitalist” and “the capitalist system of production” appear repeatedly in his writings.
Ludwig von Mises was never shy about engaging in intellectual battles with the other side on their turf and with their choice of words. He wrote that the concept of capitalism “if it means anything, it means the market economy” and that modern capitalism is “essentially mass production for the needs of the masses.” Audiences view terms such as “a system of free enterprise,” the “market economy,” and “mass production for the needs of the masses,” much more favorably than “capitalism.”