Sunday, 20 April 2014

Food poverty is a failure of government. Capitalism is the solution.


I'm a capitalist. A proud capitalist. I believe that, without capitalism, we'd be poorer, less healthy, shorter lived and less happy. The evidence of the past two hundred years tells me this is so.

The thing about capitalism, about those free markets, that neoliberalism is that it celebrates everything that is good about people. I know you've been told by your teachers and by the man on the telly that capitalism is all about greed and rapacious exploitation. But they are wrong - capitalism is about exchange, cooperation, creativity and, above all, foregoing something now in the anticipation of more tomorrow.

I am always curious when people seek affirmation of their mistaken belief about capitalism in what they term 'market failure'. By this, they don't mean that the market actually stopped working (markets just don't do this) but that the market didn't deliver the outcome they desire. So it is with food banks. We are told that these little local institutions are a consequence of capitalism's failure because it has failed to put food on the table of some families.

Except this isn't the case at all is it. Food banks are a consequence of the failure of government not the failure of capitalism or the market. Look at those figures from the Trussell Trust - over half of those arriving for support are doing so because the benefits system has failed them in some way. So the market (a generous, charitable market in this case) steps in to provide - for we should be clear about charity, it is a private matter driven by the energy of people who want to help not by the direction of the state.

The second important lesson in this is that people's generosity is made more effective by the success of capitalism. All those people can afford to forgo something in order to help others have dinner - if we'd not had that neoliberalism we would still help but the help would not be enough. Children really would go without rather than getting food.

We have still got poverty - and be clear that poverty is absolute material lack not some abstract measure of inequality. But we are able to respond to that poverty both by urging the government to act and also by doing something ourselves. Even if that something is as little as giving some tins of beans and a bag of pasta to the food bank. However, if we want to eliminate that poverty - not just through relief but forever - we need to support capitalism because that is the best, we could say the only effective, route from poverty to comfort.

In an inverted way the wealthy and powerful can afford to reject capitalism - they're already on top of the pile. For the poor, the market and its freedoms should represent the route out from not knowing where tomorrow's dinner will come from. Sadly, some of those wealthy and powerful protect their wealth and power by telling the poor their state is due to freedom and the market rather than the reverse. Yet every exchange in that free market adds value whether it's a gift freely given, a bartered exchange or a cash transaction. Those who try to stop this liberty are the true creators of poverty, people who have the good things using their power to prevent others using capitalism to getthose good thing.


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