Two Paradoxes of Capitalism, Resolved - The Objective Standard

Recently Robert Fulford wrote an op-ed for Canada’s National Post titled “The Capitalist Paradox.” A description of a book Fulford discusses, Why We Bite the Invisible Hand: The Psychology of Anti-Capitalism (by Peter Foster), suggests not one but two paradoxes:

How can we at once live in a world of expanding technological wonders and unprecedented well-being, and yet hear a constant drumbeat of condemnation of the system that created it? That system, capitalism, which is based on private property and voluntary dealings, is guided by the “Invisible Hand,” the metaphor for economic markets associated with the great Eighteenth Century Scottish philosopher Adam Smith. The hand guides people to serve others while pursuing their own interests, and produces a broader good that, as Smith put it, is “no part of their intention.”

What are the paradoxes? First, it seems paradoxical that many people condemn capitalism even while enjoying its fruits. Second, the fact that self-interested action often benefits others strikes many people as paradoxical.

Both paradoxes arise in different ways from the same philosophical error, the error of altruism. Altruism holds that being moral consists in self-sacrificially serving others, whereas being immoral consists in self-interestedly pursuing one’s own values. If self-interest is immoral, then how can capitalism—the social system in which government protects people’s rights to pursue their selfish interests—produce a prosperous and successful society? Because altruists condemn self-interest, they condemn capitalism and the wealth it enables, even as they benefit from that wealth. . . .

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