How Capitalism Creates Wealth & Promotes Prosperity

Capitalism brings freedom and prosperity, and more capitalism leads to more freedom and prosperity. Yet most countries move the other way. Governments try to control, organize, and tame capitalism as much asthey can. Many people believe that the best economic system is the welfare state. Yet what they get is less well-being, less prosperity, and less freedom. The anti-capitalist mentality demands a high price. Who pays the bill is the common man. Most of the ailments that politicians, the media, and the leftist in academia diagnose are not the result of capitalism but its lack. The cure to poverty is not less but more capitalism. The cure for environmental problems is not more regulation but better property rights. Private education would not only be much cheaper than the present system but also more creative and much better tuned to the needs of the student. The social-democratic era is coming to its end. The 21st century will belong to those countries that embrace radical capitalism. Instead of making capitalism more socialist, we need a more capitalist capitalism. Free capitalism together with the drastic reduction of the state and the abolishment of politics would do away with the financial burdens that afflict the modern citizen. Not state intervention in economic life leads to prosperity. The path to affluence is the withdrawal of the state and the end of politics. The new millennium will belong to those societies that discard the administrative state and move towards a capitalism that is free of the state and of politics. A free economy in a free society requires three major institutional changes. First, the selection of the society’s representative body through a process of random selection; second, a private monetary system to substitute the central banks; third, the provision of law and security by private suppliers. In order to establish a state-free society, insight must come first. The legitimacy of a free social order cannot come from the application of force – as it has been the case with all other political systems – but needs as its base the voluntary cooperation of the people to arise as a spontaneous order. Antony Mueller is a professor of economics who currently teaches in Brazil. He is an associate scholar of the Ludwig von Mises Institute and a senior fellow of the American Institute for Economic Research (AIER). This booklet is based on the comprehensive monograph “Beyond the State and Politics. Capitalism for the New Millennium.”