America Made Capitalism Great - II
Which came first, Democracy or Capitalism? If you agree that the Greeks invented democracy (for a limited group), then democracy was first. Only governments could command the labor of thousands to build, say, the Pyramids.
Proto-capitalism began in pre-Biblical times with merchants who advanced money to farmers and craftsmen, getting their products to sell at a profit. In Biblical times, lending and selling separated. Farmers, craftsmen, and merchants too, borrowed from money-lenders, created or bought their products and after they were sold, paid back the money-lenders.
Greek democracy disappeared, but capitalism took root, first in Italy with the Medici family, then in the Netherlands, then all over Europe. In London, goldsmiths lent money with a wrinkle: If they lent a £1000 sterling, and got a promise to repay £1100, they could sell the promise - the debt - immediately for, say, £1040, to someone willing to wait, giving the lender a quick profit of £40. Soon banking became bewilderingly complex, although its basis is still cash up front.
Europe, a hodge-podge of princely states, all relied on capitalism, and it was deeply embedded in those who crossed the Atlantic to form the first American colonies. As American democracy developed, so did American capitalism based on American values: honesty, fairness, and mutual advantage.
Yet in itself capitalism is morally neutral. If you claim that capitalism made America great, you’d have to agree it also made Al Capone and organized crime great. But the capitalism we respect and rely on is the capitalism that America made great, not the other way around, as Herman Cain seems to believe.
Which came first, Democracy or Capitalism? If you agree that the Greeks invented democracy (for a limited group), then democracy was first. Only governments could command the labor of thousands to build, say, the Pyramids.
Proto-capitalism began in pre-Biblical times with merchants who advanced money to farmers and craftsmen, getting their products to sell at a profit. In Biblical times, lending and selling separated. Farmers, craftsmen, and merchants too, borrowed from money-lenders, created or bought their products and after they were sold, paid back the money-lenders.
Greek democracy disappeared, but capitalism took root, first in Italy with the Medici family, then in the Netherlands, then all over Europe. In London, goldsmiths lent money with a wrinkle: If they lent a £1000 sterling, and got a promise to repay £1100, they could sell the promise - the debt - immediately for, say, £1040, to someone willing to wait, giving the lender a quick profit of £40. Soon banking became bewilderingly complex, although its basis is still cash up front.
Europe, a hodge-podge of princely states, all relied on capitalism, and it was deeply embedded in those who crossed the Atlantic to form the first American colonies. As American democracy developed, so did American capitalism based on American values: honesty, fairness, and mutual advantage.
Yet in itself capitalism is morally neutral. If you claim that capitalism made America great, you’d have to agree it also made Al Capone and organized crime great. But the capitalism we respect and rely on is the capitalism that America made great, not the other way around, as Herman Cain seems to believe.
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