Here’s a letter to The American Conservative.
Editor, The American Conservative
My friend Alex Salter argues that we should embrace “common-good capitalism” (“The Quest for Common Good Capitalism,” April 15). In doing so, he insists that “common-good capitalism” is something new – a capitalism different not only from all varieties of socialism, but also from, on one hand, “regulated capitalism” of the sort familiar today to Americans and western Europeans, and, on the other hand, presumably from the sort famously championed by classical-liberal scholars such as F.A. Hayek and Milton Friedman.
I say “presumably” because Alex never explicitly identifies capitalism as championed by Hayek and Friedman as a variety of capitalism inferior to the “common good” upgrade. This omission is fatal given that the least alloyed and most famous form of capitalism is that which was explained and supported by scholars such as Hayek and Friedman (and today most vigorously by Deirdre McCloskey) – scholars who, by the way, believed that the capitalism they supported served the common good. Alex’s case is only further weakened by his failure to do more than list “common-good capitalists’” aspirations; to readers of his essay, the substantive details about how the operation of “common-good capitalism” differs from the operation of the capitalism of Hayek and Friedman remain a mystery.
To encourage people to embrace “common-good capitalism” as something that’s both new and superior to all other varieties without identifying a single alleged problem with capitalism as understood and endorsed by classical-liberal scholars such as Hayek, Friedman, and McCloskey is to encourage people to reject the most profound case for capitalism yet to be offered in favor of a policy defined only by aspirations as vague as they are banal and marketed under a platitudinous name.
Donald J. Boudreaux
Professor of Economics
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030
Perhaps in his forthcoming book Alex explains what’s wrong with plain ‘ol capitalism as understood and endorsed by scholars such as Adam Smith, Bastiat, Mises, Hayek, Coase, Friedman, Alchian, Buchanan, Demsetz, Sowell, Walter Williams, Vernon Smith, Bruce Yandle, Deirdre McCloskey, Bob Higgs, and Pete Boettke. (If so, I’m eager to read it.) But no such explanation appears in his American Conservative essay.