Defining Terms: A Brief Squib

There is an interesting FB discussion going on over a post by Carl Jones on the question of capitalism. I would suggest that people who use terms like free market and capitalism begin by understanding the literal meaning of the words they are using.

Start with reality and you gain in understanding; start with abstraction and you end up in the NeverNever Land of Classical Liberal abstractions. Markets are a place where people buy and sell things. The place can eventually be virtualized and institutionalized in the form of stock exchanges, telephone and telegraph, and the internet, but the basic notion remains. To do business in a market, one has to follow the rules of the people who control the market, accept their regulation of weights and measures, their arbitration in disputes, their acceptance or refusal of currencies, and the tolls the impose. No markets, for practical purpose, can be free, either in the sense meant by the term "free market," because the authorities who own and control the market determine who gets access, and in the other sense of free, namely, gratis, because they are going to tax your participation.

The second point of reality to start with is that capitalism is not reality, and the word does not refer to the way a society operates economically. It is essentially a theory, mostly a Marxist theory, that those who own the means of production control society as a whole.

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Thomas Fleming

Thomas Fleming is president of the Fleming Foundation. He is the author of six books, including The Morality of Everyday Life and The Politics of Human Nature, as well as many articles and columns for newspapers, magazines,and learned journals. He holds a Ph.D. in Classics from the University of North Carolina, Chapel Hill and a B.A. in Greek from the College of Charleston. He served as editor of Chronicles: a Magazine of American Culture from 1984 to 2015 and president of The Rockford Institute from 1997-2014. In a previous life he taught classics at several colleges and served as a school headmaster in South Carolina

2 Responses

  1. Kellen Buckles says:

    Dr. Fleming: Your second point in which you define Capitalism with a “C” as a theory reflecting economic control of society seems to apply to the way our Marxists and Neo-cons bandy about the virtues of Capitalism/Wall Street vs Socialism/Communism.

    What term would you use to describe the village blacksmith with a new idea for a plowshare who gets his friends to be part owners (via shares) in his enterprise? Can’t “capitalism” legitimately be used to describe this form of societal economic operation?

  2. Avatar photo Thomas Fleming says:

    Kellen, I don’t know how deliberately this confusion has been devised and propagated but it has worked a great deal of mischief. This deserves a separate little essay in which I would make a few points, including: 1) Capitalism is an “ism” and like all “isms” and “ologies” it is a system of belief that does not necessarily correspond to any structures in reality. Remember phrenology. 2) We do have the term “free enterprise” but that is of suspiciously recent coinage and again serves to reduce the practices of everyday life to the level of theory, and 3) most traditional practices did not have isms or ologies to justify or explain them, and it can be very distracting to use this misleading terminology. 4) On a broader level, one may observe how we use words like “ecology” to refer not just to scientific theories but to landscape and waterways, geology–the study of land–to the composition of the land itself, and even history, which properly refers to inquiry into the past, now means what supposedly happened in the past.