Most people assume that capitalism and the free market are the same thing. But capitalism is really just a subset of the free market. It’s the part that uses savings to create tools to expand production.
The free market is much more than that. It includes not only the production of tools but also…
- All consumption
- Quality control
- Retail display (stores)
- All exchanges, including barter
Think of it this way…
- The free market is a solar system.
- Capitalism is but one planet in that system.
It helps to focus discussion if we can show left-statists that capitalism is but a subset of the free market. That allows us to deal with the capitalism issue without having to discuss every aspect of free-market economics. We can then show left-statists how they too are capitalists. If a left-statist has a savings account or some kind of investment account then he or she is a capitalist.
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Your short definition of capitalism seems morally positive, or at least neutral. So many people view it as a morally charged word that brings to mind the “robber barons” and “greedy capitalists.” Whereas, capitalism is simply a system of using money (or any medium of exchange) in a disciplined, efficient way, to produce the goods that people need and want, while rewarding the capitalists with profits, if they are good at it. It may be enlightening to folks to discover what capitalism is not: it is not greedy, nor is it morally corrupt. Those are qualities that describe certain individuals and groups who use a system such as capitalism, or the state, in an unethical manner, to achieve their goals.