Chocolate fudge glory is delicious. No, it’s more than that. When I sit down to eat at a Pizza Express or Cosy Club restaurant my first glance at the menu is always toward their chocolate fudge and ice cream combo, served in a tall shapely ice cream glass. But as I pondered the deliciousness of these affordable, intoxicating treats I was troubled by the rep of the system that brings me these pleasures. As a low down, dirty Austro-libertarian with no real public profile I cannot help but enter into long debates in the comment sections of YouTube videos and online articles and blog posts.

Recently I heeded the call to defend capitalism against some online naysayers because, gee whiz, without my input that conversation will be stale as Hell. Or so I dreamed. As I have attempted on liberty.me in the past, I tried to define capitalism in a clear way that was neither weighted in its favour nor disfavour.

Capitalism is the product of three forms of enterprise compounding one another, namely;

1. Entrepreneurship; starting of new businesses or new endeavours within existing businesses – basically actions in a commercial environment characterised by uncertainty as to outcome.

2. Investment; paying into businesses in return for the promise of dividends over a long stretch of time in the future. This lot can exhibit a whole range of different time references, but the usually high time preference exibited by this lot is the main reason that they an often rush like a tide to take money out at once in response to the downward end of a business cycle.

3. Lending; this could just as easily be called ‘finance’, for this is the industry that moves money to make money. There is nothing intrinsically wrong with that, but you combine lending with fractional reserve holding and… well, let’s just say it’s bad enough with a gold standard, let alone the fiat nightmare we’ve all lived in since 1914*.

With my description in place I felt sure I’d be the toast of the comment section within a day even to those who were advocating the abolition of capitalism. In fact I was mostly ignored and actually attack by one user who, I only found out days later, shared most of the same views as me! Oops. But out of the conversation I marshalled my thoughts on capitalism and its theoretical absence. I decided that the boring definitions of capitalism and socialism, wherein they refer simply to private vs. state ownership of the means of production, distribution and exchange had sunk in too deep for people to really recognise that even in a nominally private social order such as fascism you do not have capitalism at work any longer since the state presumes to regulate the minutiae of every sector and to outright tell the private organisations what to invest on, or what timetables to keep to, or who to hire.

That is not capitalism by any stretch of the imagination, but rather corporatism, and it will be unfriendly to serving the real desires of anyone other than those in power , though at least it won’t suffer from the economic calculation problem as prices – albeit highly regulated ones – will still work much of their value-maximising magic. So, how did I do? The capitalist process is one of constant discovery and innovation, driving prices ever lower and quality ever higher – in fact those two phenomena mean pretty much the same thing. In response to all this I think I know now how to describe that chocolate fudge glory from earlier; it’s capitalicious!

 

 

 

* – I’m aware that the transition from a gold standard to total fiat currency has come at different speeds in different lands, and has been a halting back and forth process a few times, but nevertheless World War One showed the governments of the world what they could get away with.