BB&T Academic Programs
What Capitalism Is
The Nature of Government
Economics of Capitalism
Rationality and Morality
All of the goods that man uses in his life have come to him by a process of thought, i.e., through reason. Consider what it required to build one's home. Those who built the home, the architects and engineers, had to acquire a knowledge of how material objects act in relation to each other—they had to know everything from physics to mechanics to astronomy. They had to learn why only walls of a certain thickness can support a roof of a given size, or why windows facing south allow for more natural light. The suppliers who provided the materials for the house also had to observe reality and gain knowledge about it. They had to test and experiment with different woods to determine which one made the best framing. They had to discover why sheetrock makes a good wall surface for insulation and sound qualities, relying on the fields of thermodynamics and acoustics. The construction crew relied on reason to understand the tools that they use, from air-powered nail-guns to simple levers and pulleys, to make them work correctly. Reason is necessary not only for building shelter, it underlies all of the values that man needs. Nothing is given to man in nature—he must look out at reality with his senses, put together what he sees with his reasoning mind, and come to a conscious conclusion about how he will shape it to serve his needs.
The contrast to using reason as a means of survival is to go by some other method—whether this is by wishing, by relying on faith in the powers of a deity, or by ignoring facts and hoping for the best. Whenever man deviates from using reason, the result is not productivity and flourishing, it is stagnation and death. Consider how successful someone like Thomas Edison would have been if he had resorted to feelings or instincts instead of reason. When he was confronted with the problem of designing the filament for his light bulb, would he have succeeded by insisting that corn straw was the best material because he felt it to be true? In fact, he painstakingly investigated every substance he could find, applying the scientific method to each one until he had the results that he needed. Would Henry Ford have prospered if he had arranged his assembly line according to his instinct? Even more simply, would any human survive for long at any stage of economic development without using his mind to discover the facts and evaluate them according to how they affected his life?
To be moral, to pursue one's self-interest in the clearest possible way, to succeed at producing values, men have to hold an unwavering commitment to live according to the only means possible to them—their reason. This means holding rationality as a virtue. One must accept reason as an absolute, never faking reality or placing feelings and whims above logic, never suspending or abridging rational thought or allowing oneself to be controlled by anything else. This has always been the great virtue of the heroes of capitalism.
To hold rationality as a primary virtue implies a set of other virtues that men must follow, but the most important of these for a system of capitalism is the virtue of productiveness. The system of capitalism, by embracing the moral code of egoism and rationality, makes possible all of the splendor and comfort that is available in the world today. The producers have accepted that man's happiness on earth is his most moral purpose. They have engaged in transforming the standard of living into what it is today. This productiveness, the selfish pursuit of profit and moneymaking, is only possible under capitalism, the system that frees men to pursue their own self-interest and their own ends.
The moral commitment to achieving happiness through productivity, though, does not mean that one can do whatever one wishes. As all of the great innovators and producers have realized, a human life is inherently long-range. An immediately beneficial action, say, selling a stock because its value has increased, may not be in his interest over the course of his entire life and that no choice, no matter how small, is irrelevant to his survival. Business and production aim to the highest levels of happiness and human flourishing. When Sam Walton developed the management ideas that have helped to make Wal-Mart one of the most successful companies in the world, he did not have in mind what would only benefit him today, next week, or next year. He knew that building a great company meant having a vision for the future, for its growth over time, and that careful thought and planning were necessary to this. The same is true of any human endeavor, from the individual to the largest business, acting long-range—which means acting on principle—is absolutely required for success.
The moral foundation of capitalism is the morality of egoism. By recognizing that, to be fully moral, men must act long-range, in their own interest, according to their own conclusions, capitalism provides a context in which morality is possible because it leaves men free to use their minds and pursue their happiness.