RE: Post interval: It has been eight months and I feel shame.
Awhile back I was contemplating giving a presentation to a local group of progressive types about capitalism, since they seemed to be making a lot of offhanded complaints about it which nobody seemed to feel required substantiation. As I sat down to start compiling my thoughts, an interesting problem presented itself: did I know what capitalism was?
Certainly the way my prospective audience had used the term indicated that they didn't seem to think it meant what I thought it meant, but language is descriptive, and if I was going to tell them their definition was wrong I'd better have some substantial proof that the "right" definition was going to result in more effective communication. I was, after all, considered a socialist by most of the Republicans in my acquaintance (by virtue of not completely and exactly agreeing with every single word Nozick ever said), so maybe I would find I agreed with them if only I understood what they meant.
So I contacted my economist friend and asked, and... he had no idea.
I'd noticed at the time that the more economics-minded folks in my life seemed not to use the word much, and the answer I got back was basically "something Marx was obsessed about." Vague as that was, it did match what my progressive friends were saying. I could drop the subject there, but I felt like I hadn't yet engaged with the ideas I was in conflict with, so I kept going.
I decided I would define the idea myself, and go from there. Surely I'd always meant something in particular by it. The best I could do was explain myself and hope to find common ground.
So, in short:
Capitalism is the use of markets as the primary method of resource allocation within a society.
It is important, here, to realize that capitalism, to me, means nothing more than this. Nobody need work jobs or engage in any particular form of "consumerism" (whatever that means). All we need here are property rights that protect (to a large degree, not absolutely) sovreignty over ones posessions, and the largely unrestricted right to transfer those posessions. As long as we have that, and the majority of goods worth acquiring are posessions of one entity or another, capitalism is in effect.
This should pretty much clear up my also identifying as a socialist earlier; while many damn or praise the various "socialist" countries in Europe, I would wager that by this definition there isn't a single advanced nation on earth that isn't, pound for pound, more capitalist than not. The United States spends about 19% of its GDP on social spending, with some, but not all of the "socialist" western states reaching up in to the 30s.1 Keep in mind that as GDP per capita rises, it is in theory possible to provide the same level of social benefits while spending less as a percentage of GDP providing them. I've made the bolder conjecture that the US could guarantee a high standard of living for all if it were willing to replace most or all of its social infrastructure with a guaranteed basic income at the same cost, but I'm not prepared to substantiate that now.
Capitalism is, so far as we've seen, the best mechanism on earth for making an economy create wealth. It has no particular provisions for fairness, but that's a moot point. The old conservative proverb about "unequally shared wealth" versus "equally shared misery" holds up surprisingly well under economic scrutiny. Oddly, only the most extremist socialist thinkers I talk to seem to grasp this perfectly; I take a lot of issue with the anarcho-communists who want to see the entire world return to subsistance farming on small plots of land, but at least when they say they want to destroy capitalism, they understand the result.
But, from the other side, capitalism is also more resilient than the right gives it credit for. There's a paranoia among conservatives that that not-so-utopia of quiet subsistence farming will suddenly spring in to existence if one more dollar is spent on social programs. Granted I'd like us to get much, much more value out of the money we are spending, but the reality is it's a sliding scale. At 100% taxation we get our hippie farming not-really-paradise, and at 0% we get massive wealth and fatal poverty. All points in between are available to us. And, yes, the ideal point is probably pretty far to the right of the curve, assuming you can decide what constitutes a center.
And so, I'm a capitalist. One who supports modest wealth redistribution carried out by means of direct payment systems which can be implemented by a small, weak government. Not so scary, huh?