The American System Is Not Capitalism

Authored by Bob Livingston via Personal Liberty Digest,

One of the great myths of our time is that America is a capitalistic country. It is not, and has not been close to capitalistic for more than 150 years.

Capitalism is a social system in which an individual’s rights, including his rights to own property, are recognized and all property is privately owned. In a capitalistic society, governments acknowledge that individuals and companies can and should compete for their own economic gain, and the prices of goods and services are determined by the free market. The role of government in capitalistic societies is to ensure that markets function without interference and to protect individuals from fraud and/or the use of physical force by others.

Capitalism is not about greed. Capitalism is about human freedom, or as we term it, personal liberty. As Adam Smith posited in Wealth of Nations, when individuals are permitted to pursue their self-interest through markets, they are amazingly good at finding ways of bettering not only themselves but society as well.

In Capitalism: The Unknown Ideal, Ayn Rand writes:

The recognition of individual rights entails the banishment of physical force from human relationships: basically, rights can be violated only by means of force.

In a capitalist society, no man or group may initiate the use of physical force against others. The only function of the government, in such a society, is the task of protecting man’s rights, i.e., the task of protecting him from physical force; the government acts as the agent of man’s right of self-defense, and may use force only in retaliation and only against those who initiate its use; thus the government is the means of placing the retaliatory use of force under objective control...

In a capitalist society, all human relationships are voluntary. Men are free to cooperate or not, to deal with one another or not, as their own individual judgments, convictions, and interests dictate. They can deal with one another only in terms of and by means of reason, i.e., by means of discussion, persuasion, and contractual agreement, by voluntary choice to mutual benefit.

The right to agree with others is not a problem in any society; it is the right to disagree that is crucial. It is the institution of private property that protects and implements the right to disagree — and thus keeps the road open to man’s most valuable attribute (valuable personally, socially, and objectively): the creative mind.

Americans no longer have property rights. Think you do?

Try going a year or two without paying tribute to the king (via property taxes) and you’ll see who owns your property. The local sheriff will evict you; the state or local government will seize your property and sell it to the highest bidder or its favorite crony.

Try building a structure on your property... or even remodeling your home. If you don’t obtain the proper permissions (approval for your design, building permits and inspections), you will be fined and forced to tear your structure down. Failure to do so will result in armed agents of the government invading your property, assaulting and incarcerating you until you comply with the government’s demands.

Try damming a creek, tampering with the watershed or capturing water for a pond on your property. You will get a visit from federal agents representing the Environmental Protection Agency and the result will be fines, expensive court costs and possible visits by armed federal agents who will forcibly escort you off your property and into a prison cell.

Try growing livestock or certain plants on your property. Unless you live in an area zoned for agriculture, you will likely get a visit from a local or federal "inspector" who will order you to dispose of your animals and/or uproot your plants in favor of others approved by the local authorities.

Try selling a product you grew or made. You will be forced to comply with regulations regarding harvesting, production, packaging and distribution. You will be forced to act as agent of government and collect government tribute (taxes) which you must then pass along to government — regardless of the time and effort required to comply. Failure to do so will result in fines and/or imprisonment.

Want to inform people about and sell a protocol that experience and use has shown to be beneficial to good health? You must first obtain permission from local and federal agencies, provide proof that your protocol has been tested, tested and retested, regardless of the expense or inconvenience to you. You must then comply with any and all regulations regarding marketing, production, packaging and distribution. Failure to do so will result in seizure of assets, fines and/or imprisonment.

Want to not sell your product for a reason — or no reason at all — not approved by the establishment? That is not allowed and you will find your business shuttered and you will be subject to fines and revocation of your previously-acquired permission to conduct business.

The establishment will tell you that once enter into business you have surrendered your individual rights to the collective, and all your activities must be geared toward the collective good. This is the very definition of force — government force, which is anathema to voluntary exchange and individual liberty.

The federal government works overtime to ensure we are not a capitalist system by passing legislation and enabling federal alphabet soup regulatory agencies to create rules favorable to certain businesses and unfavorable to others. Congressweasels pass tax laws to encourage and discourage behaviors.

The federal government subsidizes certain products, driving up prices and encouraging unsound business practices that skew the market. There are still price controls on food products that were put in place during the Great Depression.

The Federal Reserve, which is not a federal agency but a privately-owned bank, prints money to infinity, which encourages mal-investment and skews the market. It is depreciating your currency.

Here is what has happened to the American people: The money creators, the Federal Reserve and the U.S. Treasury as symbiotic partners, are creating non-substance (fiat money) and "buying" (stealing) substance with it.

Has anyone wondered why "federal money" never gives out? As admitted in congressional testimony and in Federal Reserve publications, the federal money creators can create any amount of "money." Of course this money is non-substance fiat. It is imaginary numbers that appear either on green pieces of paper called dollars or as computer symbols.

The key word to describe fiat non-substance is infinity. This imaginary money system can be created to infinity and indeed is on its way. The American people (and the world) believe that this non-substance is real money. This is an exercise in an unbelievable and unimaginable delusion that is accepted by the mind as real.

This is socialism at its most perfect creation and it is doing exactly socialism’s work of transferring the wealth and savings of the American people to the state without payment.

Every writer, commentator politician in America refers to the U.S. as a democracy of free enterprise capitalism with individual privacy and property rights. We live in a fiction of freedom perpetuated with semantic corruption that has evolved us into economic fascism. Language and words that support a free society have been turned inside out.

The American economic system, and in fact the world’s economic system is failing, and that failure is being attributed by many on the left (and some on the right) as a failure of capitalism. This is a big laugh to any sober person.

All governments are fronts for monopoly capitalism, and monopoly capitalism has many names: fascism, socialism, communism and democracy. Big business has and will promote every ideology and philosophy known to man to disguise its madness for profits. But one equals the other. They are all immoral systems that use the power of government to exist and to suppress human freedom.

Capitalism is the only moral system. It was American free market capitalism that fueled the growth of the U.S. economic engine beginning in the 1800s and raised the standard of living around the globe, before monopoly capitalism began to exert greater and greater control over the U.S. economic system beginning in the mid-1800s and accelerated after the creation of the Federal Reserve in 1913.

The extraordinary level of material prosperity achieved by the capitalist system over the course of the last 200 years is a matter of historical record. But very few people are willing to defend capitalism as morally uplifting.

Sadly, it’s not just the progressive left and ignorant millennials that oppose free market capitalism. In any discussion forum where true or laissez-faire capitalism is discussed, "conservatives" are quick to make the disclaimer that "we must have some regulation" or, "we can’t have unfettered capitalism." In truth, most so-called conservatives are really closet socialists. This is a testament to the powerful propaganda we are subjected to.

Throughout history there have been two basic forms of social organization: collectivism and individualism. In the 20th century, collectivism has taken many forms: socialism, fascism, Nazism, welfare-statism and communism are its more notable variations. The only social system commensurate with individualism is laissez-faire capitalism.

The return of capitalism will not happen until there is a moral revolution in this country. We must rediscover and then teach our young the virtues associated with being free and independent citizens. Then and only then, will there be social justice in America.


uhland62 peddling-fiction Tue, 01/23/2018 - 20:42 Permalink

... but when governments steal your capital you are up the creek without a pedal. The German Kohl-Regime stole our asset (a piece of land Prenzlauer Promenade 191 in Berlin) without compensation.

We had no money for the court case because they breached the constitution, i.e. no confiscation of property without compensation. No other redress, I used to be a journalist and know how these people are protected at the taxpayer's expense.

Freedom, democracy, and rules based order - my a3se.

In reply to by peddling-fiction

Hans-Zandvliet peddling-fiction Tue, 01/23/2018 - 20:52 Permalink

The only problem is that even if you manage to start off with a level playing field (like starting a Monopoly game), you can't keep it level by definition (as you can observe prety soon after the Monopoly game is under way).

The more successful ones will end up (half a century later) being transnational corporations with enough money and political influence to even buy the votes they need in Congress to get their favourable legislation signed into law, wich will make them yet more powerful.

Wash, rinse, repeat for a century or so and, voilá: USA Today...

In reply to by peddling-fiction

Aireannpure Tue, 01/23/2018 - 20:29 Permalink

We are the slaves to the FED master's. Fake money cannot provide real savings and real long term wealth to the masses. We all know how the rich HATE anything middle class. Long live the true bourgeoisie way.


nmewn Mr. Universe Tue, 01/23/2018 - 20:35 Permalink

Centralization of credit in the hands of the state, by means of a national bank with State capital and an exclusive monopoly.

Centralization of the means of communications and transportation in the hands of the State. 

A heavy progressive or graduated income tax.

Abolition of all rights of inheritance. 

Abolition of private property and the application of all rents of land to public purposes. 

Its right there in the Communist Manifesto ;-)

In reply to by Mr. Universe

css1971 Tue, 01/23/2018 - 20:32 Permalink

Well. 80 years anyway. It became "corporatist" in 1933.

Where corporatism is the economic basis which underlies fascism, as a social and political system. Most of The West is economically fascist today and has been since around the WWII.

"Fascism entirely agrees with Mr. Maynard Keynes, despite the latter's prominent position as a Liberal. In fact, Mr. Keynes' excellent little book, The End of Laissez-Faire (l926) might, so far as it goes, serve as a useful introduction to fascist economics. There is scarcely anything to object to in it and there is much to applaud."
― Mussolini (Universal Aspects of Fascism, 1928)

It's why so few people understand what Fascism really was. They go off on some rubbish about ultra-nationalism... WTF? Or Racism..... Just think about it for a second. How the hell do you organise a society based purely on racism. it's a ridiculous caricature.

The reason they can't define Fascism, is because they're already living it. You can't see the air you're living in.

"You want to know what fascism is like? It is like your New Deal!"
― Mussolini (Talking to Grover A. Whalen, 1939)


Hans-Zandvliet Tue, 01/23/2018 - 20:32 Permalink

Alright, this is an interesting statement, which I accept on one condition:

that the socialism and communism bashers who visit this site, also recognize that the Sovjet Union never was a real communist experiment, so the failure of the USSR is no valid example to prove that communism doesn't work.

Refuse that, then I also refuse to accept that the USA never was a real capitalist system, so capitalism failed just as miserably as communism.


Sid Davis Hans-Zandvliet Tue, 01/23/2018 - 23:11 Permalink

The USSR is exactly what happens when slave systems like communism, socialism, feudalism, or fascism are in place.

Slave systems require that most people be slaves and few be masters, otherwise it doesn't work.  So in slave systems like socialism, the masses are required to act against their own best interest, and this is not something people will do without being forced to do so.  Hence all slave systems require tyranny to force people to act against their own best interet.

Absolutely, the USSR was a proper example of communism, with the elements prescribed in the Communist Manifesto in place, and the only way to keep them in place was tyranny.  Read the Communist Manifesto if you already have not.

In reply to by Hans-Zandvliet

Cabreado Tue, 01/23/2018 - 20:36 Permalink

Capitalism requires a functioning Rule of Law, and it requires Humility.

They are related.

And in places of influence and control... they are now gone.

This is the rise of the Self-Absorbed -- the Narcissist and Sociopath.


hazenyc Tue, 01/23/2018 - 20:55 Permalink

Capitalism is none of these things/ At least not originally (e.g. when Adam Smith was writing). Capitalism is a system of economic production whereby an owner(s) (aka the capitalist) owns the tools or means of production (the capital) and hires workers in return for labor, whereby the workers own neither the means of production nor the finished product.

It has nothing to do with freedom, and everything to do with surrendering your means of subsistence to an employer, and it is only he who profits off of your labor.

hazenyc shovelhead Tue, 01/23/2018 - 21:54 Permalink

That's not what I'm thinking. I am (correctly) defining capitalism and pointing out that the inherent "freedom" is merely an illusion. Unless you happen to be a successful business owner (or investor). 

You are not actually working to support only yourself in capitalism, but you are also working to support your employer and his investors. If you work 2x as hard and become 2x as productive, you don't get 2x the income, meanwhile the owners get 2x the profits.



In reply to by shovelhead

Gerrilea shovelhead Tue, 01/23/2018 - 23:41 Permalink

I think you've missed the whole point he was making.  We don't have "free choices" today.  Work for "the man" or die.

Allodial ownership has been stolen from us all.  Today, the almighty "State" owns you, your labor and your property.

I can't plant a garden, raise sheep, chickens or whatever to provide for myself or my family.  At some point I MUST barter my labor or products to pay property taxes.

WE are not allowed to be self-sufficient, period.

"Be of this world but not part of it." To paraphrase Jesus.



In reply to by shovelhead

Saucy-Jack hazenyc Tue, 01/23/2018 - 21:08 Permalink

If you don't like working for an employer, create your own business, become profitable, and make payroll every week. Easy right?

Poor people don't create jobs for others. Smart, rich people do.

Men voluntarily choose to work for a company. No one is putting a gun to their head and forcing them to surrender to work. Geeesh.


In reply to by hazenyc

hazenyc Saucy-Jack Tue, 01/23/2018 - 21:23 Permalink

You can argue that if you can't find a job (for whatever reason, lack of skill, motivation, disability, too old, too young, whatever) that you will go hungry and eventually die (assuming a pure libertarian state).

There is the illusion that you can just go and work for yourself, but most small businesses don't last.

In our system, you have to work for somebody else to live. And that is capitalism. Those capitalists who succeed get filthy rich, and everybody else scrapes along.

In reply to by Saucy-Jack

HRH of Aquitaine 2.0 Saucy-Jack Tue, 01/23/2018 - 22:26 Permalink

I agree! Anytime I wanted a job I either found one or created one. Was it hard work? Yes. Was it fun? No. Not in the early years. Was I bragging about cleaning toilets? No. But I was making $15 an hour twenty years ago. With no help from the federal government, with no small business loan, with nothing but an advertisement in the local paper. I also got a business license, business insurance, and a bond and used those documents, along with an old Martha Stewart article, on "How to Hire a Housekeeper." I showed up on time, was clean, professional, and provided photocopies of my license, business license, and bond.

I recently discovered Jordan Peterson. He says there are two indicators of success: intelligence and responsiblity. Indeed. It isn't complicated.

Work is hard. That is the point.

In reply to by Saucy-Jack

HRH of Aquitaine 2.0 Tue, 01/23/2018 - 21:02 Permalink

I insist on being an individual. I hate this collectivist, neo-Marxist bullshit. No, you do not own me. No, you cannot control my internal thoughts. No, I will never comply. Am I a radical? Yes.

Leafy Greens Tue, 01/23/2018 - 21:06 Permalink

I agree with the underlying premise of the article that we do not have a capitalist system per se. Capitalism requires a defense of small business from poorly executed state-sponsored programs and monopolies, a protection of the entrepreneurial spirit which generates small business creation and thus job creation and true free market enterprise.


However, it is incorrect to think that somehow the halcyon days of the early 19th century U.S. had anything to do with capitalism. It is an ideal to strive for, not one that existed back then, especially not during a period of our history that saw capital accumulation driven by the rampant oppression of labor both through slave ownership in the south and slave-like conditions for workers in the north - a period in our history that saw free use of child labor, slave-like conditions for young women in textile mills (e.g. Lowell, Mass.) and numerous other abuses of human life in the name of profit.