Economics for Helen by Hilaire Belloc

The Capitalist State is that one in which though all men are free (that is, though no one is compelled to work for another by law, nor anyone compelled to support another), yet a few owners of the land and capital have working for them the great mass of the people who own little or nothing and receive a _wage_ to keep them alive: that is, a part only of the wealth they produce, the rest going as rent and profit to the owners.

The Capitalist State is a recent phenomenon compared with the great length of known recorded history. It is a modern phenomenon produced by our white race alone, by no means covering the whole of that race, nor the most of it, but of great interest to us in England because we alone are, of all nations, an almost purely capitalist society.

Here again we can tabulate the advantages and disadvantages.

The chief moral advantage of Capitalism as compared with the Slave-owning State is that _every man, however poor, feels himself to be free and to that extent saves his honour_. He may be compelled by poverty to suffer a very hard bargain; he may see himself producing wealth for other men, of which wealth he is only allowed to keep a portion for himself. To that extent he is "exploited," as the phrase goes. He feels himself the victim of a certain injustice. He remains poor in spite of all his labour, and the man for whom he works grows rich. But, after all, it is a contract which the free workman has made, and he has made it as a citizen. If those who own nothing, or next to nothing, in a capitalist state (this great majority is technically called in economic language "the _proletariat_") organise, they can bargain, as our great Trade Unions do, with the few owners of their means of livelihood and of production, and be fairly certain, for some little time ahead, of a reasonable livelihood.

Another advantage of Capitalism, purely economic, is the _effectiveness of human energy_ under this system, at least, _in the first part of its development_. We spoke of this in the last section.

But the disadvantages are very grave indeed.

Under Capitalism the capitalist himself acts competitively and for a profit. He does not, like the slave-owner, direct a regular, simple machine which works evenly year in and year out. He is perpetually struggling to rise; or suffering, through the rise of others, a fall of fortune. He is always on the look-out to buy labour as cheaply as he can and then to sell the product as dearly as he can. There is thus a perpetual gamble going on, the owners of Capital rapidly growing rich and poor by turns and a general insecurity gradually poisoning all the owning part of society. A far worse insecurity affects the propertyless majority. The Proletariat -- that is, the mass of the State -- lives perpetually under the fear of falling into unemployment and starvation. The lash urging the workman to his fullest effort is this dread of misery. At first that lash urges men to intense effort, but later it destroys their energy. Capitalism was marked by nothing more striking when it first arose than by the immense expansion of wealth and population which followed it. In every district which fell under the capitalist system this expansion of total wealth and of total population could be observed; and England, which has become completely capitalist, had in the hey-day of its Capitalism -- up to the present generation -- a more rapid rate of expansion in wealth and population than any other ancient people. But already the tide has turned, and the inhumanity of such a life is beginning to breed everywhere an ill-ease and revolt which threaten our civilisation.

The disadvantages of Capitalism are, in the long run, so great that now, after not more than a lifetime of complete Capitalism, and that in only one State -- the English State -- nearly everybody is profoundly discontented with it and many people are in violent rebellion against it. This grinding and increasing insecurity which attaches to the Capitalist system is killing it. No one is safe for the morrow. Perpetual competition, increasing with every increase of energy, has led to a chaos in human society such as there never was before. The mass of the people, not being slaves, cannot be certain that they will be kept alive. They live in a state of perpetual anxiety as to whether their employment will continue; while among the owners themselves the same anxiety exists in another form. The competition among them gets more and more severe. The number of owners gets less, and even the richest of them is more insecure than were the moderately rich of a generation ago. All society is like a boiling pot, with individuals suddenly coming into great wealth from below and then dropping out again; the whole State suffers from an increasing absence of leisure and an increasing turmoil.

There is, then, this very grave disadvantage of insecurity everywhere, and particularly for the mass of the people, who live under permanent conditions of insecurity; nearly all the wage-earners have had experience at some time, longer or shorter, of insufficiency through unemployment. Capitalism leaves free men under a sense of acute grievance (which they would _not_ feel if they were slaves, accustomed to a regular and fixed status in society), and, what is worse, Capitalism _in its later stages_ need not provide for the livelihood of the mass of citizens, and, in effect, _does not_ so provide.