Capitalism Is Not Democracy

Among the colorful images of Occupy marches and camps over the last few months, one stood out recently.

As several hundred Occupiers marched through downtown Portland on the evening of Saturday, December 3, one wore this sign on his back: “Capitalism is not Democracy.”

Besides the fact that capitalism is a moral economic system based on voluntary exchange, while democracy is a political system, the sign brings several relevant thoughts to mind.

Occupiers seem to have a visceral dislike of capitalism, mixing it up with the cronyism that really should be the focus of their attention. It is a powerful government dishing out favors to its friends (cronies) on Wall Street that is at the heart of Occupiers’ complaints. But those favors would be dished out almost regardless of our economic system. Socialism is rife with such favors also.

But democracy isn’t the answer to Occupiers’ prayers for a more just society. They ignore the fact that taking from one group and giving to another based on a majority, or even consensus vote, has its own moral problems.

It may have been founding father Benjamin Franklin who gave us one of the most colorful and thoughtful descriptions of democracy:

So, no, capitalism is not democracy, and thank goodness it isn’t.

* While this quote is often attributed to Franklin online, no primary sources have been found to confirm it. The author may actually be unknown.

Steve Buckstein is Founder and Senior Policy Analyst at Cascade Policy Institute, Oregon’s free market public policy research organization.