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Capitalism is a type of economic organization or an economic system that describes how people are related. Some essential features of capitalism include accumulation of industrial capital, private ownership of the means of production, and a free market system. Although capitalism has been criticized by some scholars, it is considered by some to be a moral system that is capable of solving the resource allocation problem.
Ethical Objections to Capitalism
In my opinion, one of the most serious ethical objections to capitalism is its unjustness that leads to the exploitation of workers by robbing them of the products of their labor. It thus denies and corrupts human dignity and fails to promote fairness. To proponents of capitalism, however, there is a more important moral perspective from this criticism can be viewed. As an example, Chief Executive Officers (CEOs) are considered greedy simply because they are highly compensated at the expense of other employees.
Advocates of capitalism are opposed to this allegation and are convinced that it is not morally correct to conclude that highly paid CEOs are greedier than most people. Rather than meeting these objections directly by supporting or refuting them, it is more instructive to determine how compensation ought to be set by identifying the relevant ethical principles in the pay setting process.
Another serious ethical objection to capitalism has to do with environmental destruction. Recently, there have been concerns about the damage is being caused to the environment by human activities. Although capitalism has been blamed for causing so much destruction to the environment, it has been proposed as a solution to environmental problems. To a capitalist, natural resources are either owned as private property, or they are assets to be used by all.
However, when resources are left as property for all, every individual tends to maximize his or her use of the resources without regard for others. Among other things, this leads to the depletion of natural resources as everyone tries to benefit as much as possible. According to proponents of capitalism, it is critical to privatize natural resources so as to preserve them. Once privatized, the use of these resources will be determined by an owner who, because of the exchange value of the resources, will be interested in preserving them.
Private property and free markets are therefore provided as answers to preservation of the environment. In addition, it is assumed that the market value of the environment can only be realized once the environment is destroyed. Often times, minerals and trees do not have market unless they are mined or cut down. Considering that we all have a major responsibility of preserving the environment for future generations, this argument is not convincing enough.
There are, however, many moral objections to this relationship between capitalism and the environment. One such objection is that the propensity of property owners to preserve the environment applies only to those aspects of the environment, called resources, which have market value. Where there are no perceived benefits, property owners may not be interested.
Regardless of how much is done to support capitalism as a way of life, it is quite obvious that capitalism only leads to more harm than good. It may, however, be helpful to create a more powerful system by taking the strengths of different economic systems.