Interesting history lesson by Ludwig Von Mises that shows early capitalism in Europe saved people from starving to death.
It states that in the early 18th century, prior to the industrial age, there were only about 6 million people in Europe. 1-2 million were outcasts that did not fit into the feudal system (no room at the inn?), and so wandered in an abject state of poverty. The feudal system was limited in what it could do, and was focused on benefitting on a small group at the top. Then, some people began small cottage industries. Instead of manufacturing luxury items for the rich, they made simple things for the common person. Now, where there once were 2 million people, 1/3 of the population of England starving to death, there are 53 million people with a safety net. This means that many children who would have died of starvation, survived and thrived because of capitalism.
Today, we see the same thing happening. India and China had extreme poverty and starvation, with millions dying over the years. The Soviet Union had 30-40 million people starve to death under Stalin’s restrictions over the economy. With capitalism, they now have a middle class, and the poor are better off than they were even 10 years ago.
American poor mostly have a place to live, food, televisions, heat/air, cars and an IPhone. Many of our poor are better off than the rich people of 17th century Europe. As noted by Mises, most business today is focused on providing basic services for the average person. I remember spending $10,000 to buy the Air Force an early 1x speed CD-ROM burner. Thanks to competition and supply/demand, faster CD/DVD-burners come in most computers at a fraction of the cost today. People through out the world now have phone and computer service because of cell phones and tablets. Average Americans can buy raspberries and cantaloupes in the winter because of trade with Mexico.
Capitalism is not perfect. There are excesses and abuses of the system. But the system, when left to work, tends to fix its own problems. When government steps in, it tends to twist capitalism into something else, creating big pockets of stagnation that are not self-correcting.
For example, there are major areas of our school systems that are broken. Yet, because of government interference and monopolies (including teachers’ unions), they are as bad as ever. Free capitalistic forces in education would shut down bad schools and replace them with better schools. Instead, we get one government program after another, none of which make any real difference, except growing political constituencies.
Freedom allows some people to do bad things. Guess what? They are doing bad things even with rules and regulations! The difference is how much time, energy, and money is spent on punishing Americans, rather than using those resources to grow opportunities.
How would it be if government intrusions (intentional or not), caused our children to go hungry or be ignorant, while leaving a rich cadre to rule over them as did the kings and lords of feudal days? Freedom saved Europe centuries ago, is saving many countries today, and is still our best hope for economic progression.