It’s almost useless to use the word capitalism these days. Its meaning has been so distorted, so polarized, so manipulated, that almost every time I pull it out, I have to stop and define it first. And even then, knee-jerk reactions continue.
So, I’m generally abandoning the word. In its place, I’m using commerce. But that raises yet another issue:
It’s entirely wrong to describe a mom-and-pop store with the same word we use for General Motors.
Did Stalin Support Capitalism?
No, of course not; Stalin was a Marxist. But at the same time, he was a major supporter of industry. For example, check out this very typical poster of his era:
So, what gives? Stalin hated capitalism but strongly supported industry. What’s the difference?
The difference lies is the exercise of will:
- Commerce—capitalism of the mom-and-pop variety—involves individuals choosing to perform productive actions, such as growing food and making shoes.
- Industry—capitalism of the corporate variety—involves the domination of individual will. Sure, the corporate suite and their government partners get to exercise will, but mere corporate employees are forbidden from exercising theirs. So, 1%-2% get to use their wills to some effective extent, and 98%-99% are restricted.
Stalin killed people of the first type and rewarded people of the second type. I think that also helps to clarify the distinction.
What About Now?
So, what about our current situation? Are mom and pop being rewarded, or at least left alone?
No, they’re not; they’re being ground into the dust. No matter how much governments and their sycophants swear that regulation is good for business, every small businessman, myself among them, knows the truth. People are getting out of businesses in droves and telling their children to find something else to do. As one small businessman I know says, “It’s just not fun anymore.”
Did you know that fewer small businesses are being created than destroyed? And there’s a one-word reason for it: regulation.
Stripped of the self-righteous lies that surround it, regulation is simply a restriction of will. It involves the biggest bosses telling everyone else what they can or cannot do. And here’s the rub: Big corporations can get regulations written as they like; small businesses can’t. The result is this:
Corporate numbers are up because their small competitors have been squeezed out. Mom and pop’s cash flow has been transferred to the corporation.
Stalin would thrive in this environment. He’d find a prominent place in the corporate takeover of America.
On the other hand, Stalin could never survive in a world where mom-and-pop capitalism was the order of the day. He’d be a rank hoodlum, and eventually some shopkeeper would shoot him.
But Wait, We Need Regulation!
Some of the sadder news stories I see are those involving small business alliances sucking up to the big imposers of will, saying things like, “We recognize the necessity of some regulation, but…”
Yes, I know that they mean well (and Lord knows I’ve had my own share of “meant well” mistakes), but commerce is contrary to regulation by its very nature.
Commerce (and I’m tempted to christen it natural commerce) is a liberated-will strategy. Cuddling up to people who impose controlled-will strategies is not helpful.
I covered this entire subject in much more detail in my newsletter (issue #29), but I would like to make one point on the “necessity” of regulation here. Please take a look at this map:
What you’re looking at are the Near East trade routes of 7000 BC. Let me put that into some perspective for you:
This is a record of self-motivated individuals, traveling hundreds of miles to trade with foreigners. (And there is much more to be discovered.)
And when were these people doing this?
- 4,500 years before the pyramids of Egypt.
- 4,700 years before Stonehenge.
- 3,000 years before the Sumerians (depending on how you pick their start date).
- 6,200 years before Homer and the beginnings of Greek civilization.
You get the point.
So, all those history-book passages about “necessary organization and administration” and “an appropriate bureaucratic infrastructure” were simply false.
From time immemorial, humans exercised will and solved problems to make commerce work. They didn’t need pompous parasites telling them what to do and what not to do.
So, commerce—natural commerce; mom and pop commerce—is, by its very nature, born free. It evades regulations and controls, because it serves its own will, not the wills of rulers.
For this reason, Joe Stalin killed its practitioners. For the same reason, he rewarded industrial operations.
On Main Street, Joe Stalin would knife mom and pop. In the corporate tower, he would thrive.
That’s something to think about.
This article was originally published by Casey Research.