In this episode of EconTalk, starting around 59:00:
Russ Roberts: So, the Left's response, I think, ... is that: 'Oh, you are romanticizing capitalism. In fact, it's a dreary system that grinds down the worker. It grinds down the poor. It enables the wealthy and powerful to lead pleasant lives at the expense of others by exploiting them.'
So, they would argue it's not upstream of capitalism: Capitalism is the problem. How would you respond to that?
Jonah Goldberg: First of all, there's all sorts of empirical ways to answer it, which is, you know, insofar as if capitalism is inherently exploitative or exploiting of people, why has the amount of leisure time that everybody enjoys continually risen?
You know: Why are child labor laws lagging rather than leading indicators about the end of child labor?
Why has it, why was it in capitalist countries that we saw everything from the end of slavery to the rise of civil rights, the rise of feminism, and all these kinds of things?
Capitalism allows for all of that kind of stuff. It also just simply allows people more options to choose the kind of life that they want to live. The problem is ... you still need ... other mediating institutions to fill the void.
And this is where Schumpeter, I think, plays an important role. Capitalism – capitalism is a problem, at least in the sense, in Schumpeter's telling, that capitalism is relentlessly rational. And it provides no – what he calls, no extra meaning or substance. That has to come from someplace else. And the family plays an enormously important role in that, that gives – family is the first institution of civilization because it's the one that explains to children their place in the universe.
You know, Hannah Arendt has this great line where she says: 'Every generation, Western civilization is invaded barbarians. We call them "children."' ... families are the first line of defense against the barbarian invasion. They civilize babies into human beings, and then citizens. And then, schools play that function. And local community organizations play that function. And if they fail, the state can't fix them. And neither can capitalism. And one of the things that those kids who are not properly socialized ... [is that] they will be filled with a sense of ingratitude about what came before them. And, they will start making arguments, you know, in the McCloskey sense: They will start marshaling words.
This is something that Schumpeter got from Nietzsche in the Genealogy of Morals, is this idea that basically the priests will come forward; and the priests had no real power in olden days. But they had words. And they had arguments. And, what they would do, is they would make all those things that were once considered virtuous into vices.
And that's what a lot of the sort of idea-merchants of today do, where they say getting rich is evil. Where they say democracy is a problem. Where they say freedom is a problem. Where they say that the story of America is a problem – that we shouldn't be proud of America; we should reject it. That's why you get identity politics the way that we do. And to a large extent, that's why the Right is surrendering to identity politics, which breaks my heart... and the only solution to these problems, or to those arguments, is to come back with better arguments. And not just at the level of college debates, but in your own family. And in your own communities. Explain to people why they should be grateful that they are born in this age. I mean, I have my problems with the Veil of Ignorance, the –
Roberts: That's John Rawls –
Goldberg: Rawls. I have some problems with it. But, as Barack Obama – and again, I find it strange I'm agreeing with Barack Obama a lot on this – but, you know, Barack Obama basically used a Rawlsian argument; said that: If you were going to pick any time in all of human history to be born – you didn't know if you were going to be black or white, or gay or straight, or male or female, or rich or poor, you would want to be born right now. And you'd probably want to be born in America. And, I think that's true.
We don't teach people that. We don't teach them to be grateful for the moment they are born in. And we don't teach them to be grateful for the sacrifices that created this glorious country and this glorious way of life, in the first place. Instead, we have an entire industry dedicated to resenting what we have.