Political conservatives today celebrate capitalism as if their predecessors wisely invented it. Actually, “capitalist system” was first used in Karl Marx’s criticism of the mid-19th century economy.
The thought basis of capitalism was laid down by Adam Smith, some 75 years earlier, arguing that the best route to national wealth was open markets, free trade and laissez-faire (French for “let [it or them] do”) policies. He wrote that as little government restraint or taxation as possible should be imposed on wealthy investors, bankers, merchants and captains of industry.
Smith was a rebelling, on behalf of the industrial revolution, against the taxes and controls by kings and lords. He also fought against mercantilism, in Britain exemplified by Oliver Cromwell’s establishment of a merchant marine. That was a policy enhancing the trade position of one’s own nation at the expense of all others (yes, you guessed, Trump is unconsciously a mercantilist), originally in what turned out to be the 16th- to 18th-century ruinous pursuit of gold and silver reserves.
Smith placed his trust instead on what he described as the market’s “invisible hand” to provide “the necessaries of life.”
This continues the We Hold These Truths series, into which we inserted a Labor Day entry that broke the scheme a bit, simply for timeliness.
