In his 1651 book Leviathan, the Enlightenment political theorist Thomas Hobbes wrote that in the uncivilized, lawless state of nature, the life of humankind was “solitary, poor, nasty, brutish, and short”. Even in Hobbes’ own day, when a relative degree of civilization had been achieved, there was considerable truth to this. But in just the last few hundred years, our society has been transformed almost beyond recognition.
For most of human history, nearly everyone lived in conditions of poverty, squalor and deprivation. But, ever since the Industrial Revolution, we have had a tool to overcome that! That tool is capitalism, which, when combined with science and technology, has proven itself to be a powerful engine of economic growth. The greatest virtue of capitalism is that it creates wealth, rather than just shuffling it around. Capitalism rewards the development of more efficient ways of making and doing things, from agricultural techniques that produce larger and more reliable yields of food, to industrial manufacturing methods that create far greater quantities of goods than could ever be made by hand. Although this does cause hardship for people whose ways of making a living become obsolete, in the long run it benefits everyone, because the human resources that are freed up can find new employment in other, more productive areas and increase the net wealth of society further still.
And when we can create wealth, we are freed from the Darwinian struggle for physical survival. We need not spend every moment in cutthroat competition for necessary resources. We are no longer limited by what untamed nature provides us. By using our ingenuity and our will to shape our environment, we can all be lifted up by economic growth that benefits every member of a society, creating more abundance than past eras had dreamed of. As opposed to traditional pastoral or hunter-gatherer societies, where the net wealth and range of opportunities open to a person was small, industrial society offers an enormously greater field of opportunity and abundance.
Although the process of economic competition causes hardship, it is necessary, because meritocracy is an essential part of capitalism. It’s the way in which the good ideas which produce more wealth flourish and spread, while bad, inefficient or outdated ideas are selected against and disappear. But the important point is that competition and meritocracy are a means to an end. They are not the end in themselves.
Some people, especially libertarians, seem not to grasp this. They act as if competition itself was the end, as if inequality was the end – and this is absurd. The purpose of the economy is, or at least should be, to produce happiness, not to produce winners and losers. Competition is merely the means; the end is producing greater wealth and greater opportunity, and with them, greater well-being for all members of society.
This is why progressive, redistributive taxation is a vital part of any civilized state’s economic policy. Those libertarian philosophies which would allow individuals to accumulate unlimited wealth without interference have lost sight of why an economy and a state exist in the first place. By allowing some people to acquire unlimited wealth, they have implicitly decided that their goal is happiness not for everyone, but only for a privileged few. By any reasonable standard of morality, this is wrong. By aiming at a suboptimal standard, they would construct a state that enjoys less prosperity and less happiness in general, and such nations will inevitably be outcompeted by those that ensure a fair distribution of basic resources.
We should not help people with no reasonable expectation of repayment. If there are people who want to be free-riders, who want to take advantage of others’ effort and not contribute in return, then by all means, cut them off. This conclusion flows from the same principle that implies taxation of the wealthy: namely, the principle that all people should do their part in contributing to society. The point of a meritocracy is that people should be rewarded commensurate with their effort. But they should also, as a precondition of participating in society, contribute to that society commensurate with their ability to do so. By spreading the wealth around, we create a better, more prosperous community – one that any rational person should prefer to join – than could ever be achieved by other methods.