A Report on ‘The Moral Foundations of Capitalism’


I was honored to speak, once again, at the annual pro-capitalism conference at Clemson University, and I’d like to say a few words about why this event is profoundly important and effective.

The conference theme this year was “The Moral Foundations of Capitalism,” and the speakers delivered on that count and more. Cohosted by the Foundation for Economic Education (FEE) and the Clemson Institute for the Study of Capitalism (CISC), the event amounted to a massive integration of the moral, historical, economic, and practical case for the social system of individual rights.

The speakers were Drs. Andrew Bernstein, Anne Bradley, Richard Ebeling, C. Bradley Thompson, and me. The attendees included sixty-seven students and recent graduates from all over the world, who were selected from a large pool of applicants. The conference staff, from both FEE and CISC were, as usual, lighthearted, fun-loving, and perfectly professional.

The conference began in earnest Friday morning with Dr. Bernstein speaking on “The History of Capitalism in the 19th Century.” Andy “I’m just a kid from Brooklyn” Bernstein has near-encyclopedic knowledge of this era, and he delivered a rousing, fact-packed concretization of what happened when men were almost completely free to think, act, produce, and trade in accordance with their rational judgment. In short, what happened is that innovation, production, and wealth skyrocketed—dramatically improving the quality of life for everyone within economic reach of the transformation. What caused the transformation, most fundamentally, Bernstein explained, was the unshackled minds of men such as Andrew Carnegie, John D. Rockefeller, Cornelius Vanderbilt, Eli Whitney, George Washington Carver, Booker T. Washington, and many others who put their free minds to the task of discovering truths, solving problems, and improving human life. Bernstein’s lecture was delivered with all of the drama, humor, and “humility” for which he is famous.

Next, I discussed “The Source and Nature of Rights,” briefly reviewing the traditional theories (i.e., God-given rights, government-granted rights, and natural rights), pointing out major problems inherent in each, and providing an overview of the kinds of observations and integrations that give rise to the fact-based theory of rights developed by Ayn Rand. This was a highly abbreviated and extemporaneous version of my article “Ayn Rand’s Theory of Rights,” and it was new and substantially challenging material for these exceptionally bright yet traditionally educated youths.

After my talk, the conference broke into small groups, each attended by one of the speakers, to discuss the reading materials that had been assigned for the conference: “I, Pencil” by Leonard Read along with “Man’s Rights” and “The Nature of Government” by Ayn Rand. At this point, the students were burning with questions. They wanted to make sense of these new ideas that challenged much of what they’ve been taught throughout their lives. The conversations that ensued are precisely the kinds that help people to learn and embrace the method of objectivity: the policy of insisting that an idea makes sense—that it integrates with what one knows by means of observation and logic—before one accepts it as true. This session, along with the later breakout sessions in which students discussed the lectures in general, were pure gold.

Following the reading discussions, we broke for lunch, where the conversations and integrations continued, meandering into all corners of human concern.

After lunch, Dr. Thompson laid out his case for the moral propriety of “Self-Interest Rightly Understood.” Using a mixture of real-life examples (e.g., Bernie Madoff’s alleged selfishness) and thought experiments (e.g., Plato’s Ring of Gyges), Thompson provided substantial evidence in support of the principle that being self-interested, properly understood, does not consist in doing whatever you feel like doing, or whatever gives you short-term pleasure, or whatever you think you can “get away” with; rather, being self-interested consists in thinking and acting with respect to the long-range requirements of one’s life and happiness, given the kind of being one is: a rational being. Again, this material was new and challenging, and it gave rise to many good questions and further efforts to understand, integrate, make sense. More gold.

Dr. Thompson’s lecture was followed by a period of free time, during which the conversations continued, and after which we reconvened for more breakout sessions specifically to discuss the lectures so far. At this point, the students were beginning to see morality, history, economics, and politics in a whole new light.

The final talk of day one was by Dr. Richard Ebeling, who briefly surveyed the “Economics of Capitalism.” Ebeling began the presentation (as he always does) with a few new jokes, which were truly funny (as they always are). He then touched on essential ideas of Adam Smith, Carl Menger, Ludwig von Mises, Friedrich Hayek, and others—providing a clear and concise overview of how and why free markets allocate both capital and labor in the most efficient and effective ways possible, thus generating ever more wealth and ever higher standards of living.

That lecture concluded the formal discussions for the day—but certainly not discussions or integrations in general. Minds remained in motion through dinner and late into the evening, as almost everyone gathered at a local pub for more discussion, infused with drinks, billiards, and various other fruits of capitalism that make our lives so beautiful.

Day two began with Dr. Ebeling’s “Historical Perspectives on Socialism,” a harrowing presentation of the sources, nature, development, and implementation of collectivism and the horrors arising from notions such as “It’s for the greater good” and “From each according to his ability, to each according to his needs.” Ebeling eloquently conveyed the essential ideas behind the socialist movement, from those of Otto von Bismarck to those of Karl Marx, Vladimir Lenin, Joseph Stalin, Adolf Hitler, Mao Zedong, Pol Pot, and others—showing that when the ideas of socialism are taken seriously and put into practice, mass starvation, human sacrifice, unfathomable suffering, and rivers of blood ensue. The facts Ebeling presented and the atrocities he recounted were news to most, if not all, of the students. None will ever be the same for having heard them.

Next came FEE’s wonderful invention, “The Trading Game,” whereby students are placed into several groups and given goody bags filled with candy, bouncing balls, rubber ducks, and the like. The general satisfaction within each group was then measured to create a baseline. With that, trading began within each group, such that members of the group were free to trade with each other but not with people outside of their group. After a round of trading, satisfaction was measured again. Then trading was opened between members of each group and those of one other group—and, again, after a round of trading, satisfaction was measured. Finally trading was opened entirely, such that everyone was free to trade with each other with no restrictions. Satisfaction was measured one more time, after which all of the measurements were shown on a bar graph. The economic point was made perfectly clear: The freer people are to trade with one another, the better their lives will be.

The Trading Game was followed by Dr. Bernstein’s talk on “The Trader Principle,” in which the “kid from Brooklyn” showed that trading involves not only material values, such as money, food, clothing, and automobiles, but also spiritual, emotional, and intellectual values, such as friendship, love, gratitude, and good will. Providing a flood of examples illuminating various kinds of material and spiritual values and trades, Bernstein demonstrated that people trade all the time and in myriad ways to improve their lives, and he drove home the fact that freedom to engage in such trades is essential to human life and flourishing.

After lunch, I spoke on the subject of “Rights-Protecting Government and Objective Law,” providing an indication of how and why we can see that these values are both possible and necessary. This is a massive subject, and my aim was merely to highlight some of the kinds of facts that support the possibility and need of rights-protecting government and objective law. Brief indications of the material I covered in this presentation may be found in my recent article “Principles of the Liberal Right” under the header “Rights-protecting government is a necessary good,” and in my article “How Would Government Be Funded in a Free Society?

Next, Dr. Bradley took to the stage to discuss how “Power Corrupts” and the nature of what economists call “public choice theory.” Public choice theory views the world from the perspective that governments are not perfect, and thus we have to make the best of the governmental situation we have at any given time. The focus is on incentives within government, in the marketplace, and in between—and on cost-benefit analysis within this context. Although I take issue with much of this school of thought, I think Dr. Bradley provided a sound introduction to the field, certain aspects of which can help to clarify why people and governments act as they do—and thus to equip advocates of capitalism with additional knowledge for advancing our ideas.

Dr. Bradley’s talk was followed by another breakout session for discussion of the ideas presented so far. By this point, evidence of the students’ cumulative integrations was on vivid display. The students were seeing the world in a new way, and their questions were drilling deeper and deeper into the fundamentals of liberty and the foundations of capitalism.

Dr. Ebeling then delivered the final presentation of the day, “Myths of International Trade,” in which he systematically debunked some of the many misconceptions about how trade across borders works. He discussed the history of nationalism, protectionism, globalization, immigration, tariffs, and related matters, explaining how and why interference in trade is always destructive and freedom to trade is always (in the aggregate) constructive. As an example of Ebeling’s jovial style and the power of his lectures, when discussing how tariffs “work,” he pointed out that they amount to telling someone who is doing something you disapprove of that if he doesn’t stop, you’ll punch this other guy in the face—and if that doesn’t stop him, you’ll punch additional other people in the face. Given the current U.S. administration’s “thinking” and policies on tariffs, this lecture was especially poignant. Ebeling ended the presentation with a beautiful story about how Leonard Read, the founder of FEE, once turned out the lights during a lecture, lit an electric candle, and began to discuss what it means for each of us to be a light of liberty. Read pointed out that all eyes were drawn to the light. Then, as he spoke, he turned up the light, bit by bit, and explained that as each of us becomes more enlightened and enlightens others with what we’ve learned, more and more people can see the truths about liberty and capitalism. It was a powerful story, which I am doing no justice here. But I wanted to mention it because this is precisely what these kinds of conferences do. They brighten the world by enlightening individual’s minds and inspiring them to enlighten others.

We then broke for dinner, followed by another night at the pub. It was a bright night.

The final day of the conference began with my presentation, “Property Rights,” in which I focused on this most misunderstood and most violated right. My aim was to show specifically how this right can be derived from observation, logic, and the requirements of human life. I read a few brief excerpts from John Locke’s The Second Treatise of Civil Government, in which he beautifully explains how the right to property can be derived by observing the difference that human reason and labor make when mixed with the raw materials of nature to create life-serving values that otherwise would not exist. I mixed Locke’s conception of the right to property with Ayn Rand’s conception, which identifies the fundamental difference maker as the reasoning human mind. My aim was to indicate how the right to keep, use, and dispose of the product of one’s effort is as real and as demonstrable as the fact that we were at this conference. Again, I think that most, if not all, of the attendees found this material new and enlightening.

The final prepared talk of the conference—and one of my favorites—was Anne Bradley’s presentation on “The Virtues of Entrepreneurship.” Dr. Bradley masterfully showed through historic and present-day examples (plus a great accompanying slide show) that entrepreneurs—men and women who take risks and invest their time and effort in ideas and ventures that may or may not pan out for them—deliver countless values that profoundly improve our lives. With her wide variety of clarifying examples, including a deeply personal one that powerfully drove home the point, Bradley gave an impassioned account of the life-and-death importance of the entrepreneurial mind-set and of the freedom necessary for entrepreneurs to function. Gold.

After Bradley’s final lecture, all of the speakers gathered on stage for a question-and-answer session. The questions were so good, and the students so eager, that I wish it could have gone on for hours. Alas, we all had flights to catch and places to go. But each of us left with a light in our soul. That light will continue to brighten as we continue to grow. And it will enlighten countless others as we convey what we know. In this way, and with help from other enlightened lovers of liberty, we will illuminate the world with the moral truths that support individual rights and a free society.

A big thank-you to the people at FEE and CISC for hosting this event. And a huge thank-you to the “invisible hands” behind the scenes who funded it.

When good people come together, good things happen. Let’s do more of this.


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