lofhay

I read somewhere that Adam Smith , in "Wealth of Nations", said that people did not have to exploit others to be wealthy. He showed that everyone could be wealthy if they went about their business to their own selfish ends, but within reason, and with an eye toward the common good. The writer called this "altruistic capitalism", and callled the form that creates profits for some to the detriment of others "exploitative capitalism".

Makes sense to me.

ratbastid

It's a nice idea, but I'm afraid it just doesn't account for human nature.

ASU2003

It's the way it should be, where all parties benefit from what a company produces and none suffer. But very few companies would be in business if there were really strict environmental, health, and labor laws.

Cynthetiq

lots of things make sense and work on paper or in theory. seems that in actual practice. now so much.

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Baraka_Guru

I'm not sure this is purely from Smith. My understanding is that he did not use such terms at capitalism. He was technically a pre-capitalist.

Moreover, Smith focused on the function of wealth as being generated by the drive behind people looking after their own self-interest, which could ultimately create a better standard of living for everyone.

It is my understanding that The Wealth of Nations is about outlining the benefits of a free and open market economy. I'm not sure morality played much of a role in it. It was about capital and how it uses labour and other resources for generating wealth and that it could be more efficient if there were no restrictions, such as tariffs and subsidies and other protectionist practices.

But don't quote me on this. I'm not that familiar with the work. It's important to realize it's more of a proto-capitalist treatise, coming out during the rise of the Industrial Revolution (and an increasing interest in open markets) and the decline of mercantilism (marked by a strict practice of protectionism).

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Knowing that death is certain and that the time of death is uncertain, what's the most important thing?
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Humankind cannot bear very much reality.
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Zeraph

The other thing is that the theory assumes decent to abundant resources. When resources become scarce it changes things. The divide between poor and rich is increased. If youre a rich merchant class person in a scarce resource economy, its hard to follow that theory and not hurt some group of people. The theory only works if there are "extra" resources sitting around and otherwise being unused.

bwfeelgood

There are.But we won't have them as long as we are so docile when others tell us what we need&should want.

Baraka_Guru

This isn't always true. What is always true is that capital and resources are scarce. If they weren't, they'd have no discernible value.

What isn't always true is that scarce resources will always create a divide between the rich and poor. Take the case of scarce labour resources. When the labour pool is tight, wages invariably increase, which bumps up the incomes of even lower wage workers. This is one of the causes of inflation, but there it is.

I don't think business will ever view resources as "extra." Either it's accounted for or it's not. The stuff that's accounted for is limited (i.e. scarce) and has a determined value. That which is not yet accounted for has an unknown value, as there isn't an understanding of how much there is and who owns it.

Back to the OP: capitalism does have the capacity to be moral, but not in and of itself. When it's tempered with good government, then it's entirely possible and is in practice to some extent today. Capitalism is a system of economics; it shouldn't be a system of government. The two need one another to ensure stability and fairness.

__________________
Knowing that death is certain and that the time of death is uncertain, what's the most important thing?
—Bhikkhuni Pema Chödrön

Humankind cannot bear very much reality.
—From "Burnt Norton," Four Quartets (1936), T. S. Eliot

Crack

Laissez-faire capitalism works in a perfect world too, as long as you aren't a lazy bastard.

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Charlatan

Adam Smith is to Capitalism as Karl Marx is to Communism.

The both provide a road map to a Utopian economic system. The key word here is Utopian (i.e. an unattainable ideal state).

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