What's so bad about capitalism?

By David Barr 
It can be hard for many people to see why anyone would want to do away with capitalism. It can be especially hard to see why anyone would think capitalism is essentially about exploitation, greed, and materialism. This line of critique is just plainly implausible to many of us. When we think about why people we know and respect do their work, it doesn’t look like greed. People who start a business, for example, are after a lot more than money. They can realize their dreams, build families of loyal employees, and pass on their businesses to their children. Craftspeople produce goods and provide services that reflect who they are and what they care about. When markets work like this, people do not just make money; they pursue a vocation that is theirs, something in which they can take pride and find satisfaction.

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​There is something deeply human and meaningful about work when it is rewarding and rewarded, something good about using your talents and energy to produce something real. Even if you don’t make a physical product, getting paid for good work is a source of deep satisfaction. A paycheck that is earned just feels different than a gift or a handout. A day of hard work is not often fun or thrilling, but it resonates with something deep in us and creates a sense of accomplishment. It feels right and good for the soul, like the way eating healthy and exercising feels good for the body. 

Beyond the pleasures of success, the fact that not everyone and every venture succeeds – and that markets punish failure – is not itself a problem, either: building a successful business is rewarding in part because it can fail at any time. The possibility of failure (and of failure stinging, at least a bit) is part of what makes success sweet. If your business was going to persist and your life was going to be the same whether or not you worked hard to make it good, then its success and survival would mean significantly less. The gratification of providing a good product or service is greatly reduced if people have to buy what you’re selling, no matter its quality.

I grew up in a midwestern  community steeped in these values. For many local businesses, advertising was a waste of money. If you did good, honest work, then you would build a reputation and a loyal clientele. If you did shoddy or dishonest work, then it didn’t matter how much you spent on advertising; you weren’t going to make it. The contractor who built my parents’ home, for example, recently came back to do a repair, fifteen years after the house was finished. He asked my dad if there were any other issues with the house. My dad thought for a minute, then told him the garage floor had never sloped enough to drain completely, but it hadn’t seemed worth mentioning. In any case, the legal period for saying something had long passed. The builder responded, “well, there’s what’s legal and there’s what’s right,” and sent out a crew to tear up and repour the concrete the next day, all for free. Largely due to stories like this, his crew builds almost all the new homes in the area. Yes, his relationship with my parents was mediated by money, but that doesn’t mean it wasn’t also an expression of care and social responsibility. It was a moral as well as monetary interaction.

My point is this: the market isn’t just about greed and making money. Capitalism doesn’t just encourage vice. It is about people doing their work well, expressing who they are, providing what other people need, and earning a living because of it. The market, when it works well, helps to forge a connection between virtue and reward, between doing what’s right and living well. Work teaches valuable skills and it can contribute to weaving together the moral relationships that make up the fabric of society.  

Given all this, it can be hard to see any legitimate reasons for people to want to replace the free market with a more collectivist, socialist approach - especially when so many of these other kinds of economies failed so spectacularly. Is it just something like laziness, a desire to live off the work of other people, or a failure to recognize human goods deeper than a full belly? 

For an answer, we have to see that capitalism is a problem for many people, precisely because they value exactly the sort of economy I described at the start of this piece. 

What do I mean? Well, if you think of capitalism as just a marketplace of craftspeople and small businesses, like what I described at the start, then you need to know that Karl Marx himself wouldn’t have had any problem with it.[1] Marx was not anti-work, anti-productivity, or anti-virtue. Marx believed labor was an essential feature of human life. He believed humans are naturally laboring, social creatures who work and make things as members of social relations. The opportunity to benefit yourself and your community through work was what he wanted to protect and restore. 

To see why he opposed capitalism, you have to see his context. Marx wrote what he did because, by his day, most local economies of independent production and exchange had already been replaced by the faceless and dehumanizing wage labor of mechanized industry. Economies in which people found satisfaction in what they built and what they could contribute were quickly disappearing. The industrial revolution was making them obsolete. In much of industrializing Europe, the majority of people were becoming part of a laboring class that was little different from slavery. You were born, toiled, and died in the sooty shadows of factories and tenement houses. You began working sixty or more hours per week in dangerous conditions as a child and continued until you died, which was often from health hazards related to your work. You were paid only enough to stay alive to keep the machinery of production churning. You would spend your life in debt to the company store to the point that you couldn’t legally quit your job if you wanted. You wore out your body as a living part of the factory machinery and accumulated nothing to show for it. You were, in Marxist terms, alienated from the product of your labor and from your existence as a member of the human species. In plain English, you got all of the hardships and difficulties of work, but none of the benefits. 

The economy did not reward hard work; it rewarded ownership. Economic reward did not accrue to those who worked the machines, but to those who owned them. What matters in in these forms of capitalism is not primarily virtue or work; what matters is capital. The hardest working, most honest, efficient, and reliable laborer is rewarded far less than a lazy, dissolute, and dishonest person who happens to inherit stock in the company. If you wonder why Marx wanted to separate reward from hard work, the easiest answer is that he didn’t. Industrialized capitalism had already separated them. Marx in fact wanted to reconnect reward to work by making it so that the people doing the work were the ones who reaped the reward.[2]

Marxism does not appeal to people for whom the market is a realm of freedom and possibility because it was never meant to. Marxism appeals to people who have experienced capitalism as a crushing weight of alien and inaccessible economic power, an immense, impersonal machine in which their life is reduced to one industrial commodity among others. It appeals to a permanent laboring class in the West and to the victims of Western imperialism in places like Asia and Latin America. The Chinese introduction to capitalism, for example, didn’t look like the description at the top of this post; it looked like the Opium Wars. 

I imagine most everyone wants to live in a society in which good, hard work is rewarded and happens within relationships that encourage honesty, industry, and usefulness to the community. For many disagreements about economic systems, the differences are not in the goals.[3] We want people to live rewarding, healthy, virtuous, and productive lives. The main source of disagreement is over whether the market will meet those goals when left to its own devices. For some, the answer is yes. For many others it seems obvious that capitalism will tend to favor the owners of capital, that industrialized, corporate wage labor can be dehumanizing, and that there is no reason to think companies will voluntarily pay a living wage in cases where the supply of labor exceeds demand. 

In conclusion, let me say that it is clear that many Marxist revolutionaries got (and get) a lot of things wrong. Many state-run economies proved massively inefficient, for example. However, this doesn’t mean we should think that any criticism of unregulated, industrialized capitalism implies promoting a system in which we'll surely end up driving terrible cars to wait in line for beet rations under the watchful gaze of the secret police. We can find middle ground. The world is full of countries with hybrid economies. You can support markets and good public schools and healthcare. You can believe in private property and progressive tax structures. You can think business failures should sting, but not be lethal. 

Rather than folks on the left believing that those on the right are driven by greed and those on the right thinking that people on the left are after a free ride, it would be better (and I think more accurate) for both sides to see that they often share a goal: an economy in which work is internally rewarding and externally rewarded, one that respects and promotes human dignity. We have to be realistic about the inefficiencies and alienation that can come from government overreach, of course, but we also need to take seriously the reality that we don’t live in a Arcadian world of individual craftsmen plying their trade, but in a global industrialized economy in which the dignity and value of work and workers must be protected and preserved. 




[1] We might call it the “Paul Harvey describing a Norman Rockwell painting of Mike Rowe reading a book of essays by Wendell Berry” economy (or the “PHDANRPOMRRABOEBWBE”), pictured at the top of the article
[2] Note: Its collectivism does not come out of a dogmatic denial of human individual dignity; it comes out of the realization that industrialization required cooperation. Individual smiths could not compete with the efficiencies of hundreds of factory workers on an assembly line. If production had to be collective, then the only way the laborers could own what they made was if ownership of the machines and factories was also shared.
[3] I don’t want to deny that materialism, laziness, greed, or self-interest are factors in shaping the systems people want. I just mean to say that there is significant agreement that the best economy is one in which working hard and being useful allows you to live well.