Capitalism has been championed, largely, by democracy. We take it for granted that capitalism exists only in democracies. When we think of dictatorships, we think of socialist experiments like the USSR or Mao's China. If not that, we think of despotic dictators abusing the populace of resource-rich countries to benefit themselves. I am beginning to question these assumptions more and more, and beginning to consider that perhaps capitalism can really only function in a dictatorship.
Before I go any further, I would like to clarify that this is not a commentary on capitalism as an economic system nor is it a commentary on the current political climate here in America. This is a purely theoretical concept that I have developed inside my own head with its own flaws and blindspots.
Since Adam Smith, the modern capitalist system, and the not so modern one, has relied on what he calls the "division of labor." Simply put, the division of labor is the idea that when people specialize they become more productive. As people focus on one thing instead of many, they learn to do that one thing very well.
This idea has been beneficial not only to capitalist systems but to communist ones as well. It has brought incredible increases in standards of living across the board. Today specialization has increased so much that it is possible to make $40,000 to $50,000 a year rolling blunts for Snoop Dogg, as he revealed in an interview on the Howard Stern Show. To even understand what experts are talking about in a specific field requires at least an undergraduate degree, if not higher. Furthermore, as our understanding of the world increases, we should only expect this trend to continue towards the extreme.
What does all of this have to do with democracy? Democracy relies on the masses. It's as simple as that. Over the summer, I work for my dad washing residential windows in Nashville, so I generally talk to many of our clients. Since I'm currently in college, they tend to ask, "What are you studying?" Invariably I reply, "Economics," and they make a lot of assumptions about what I believe. Most of these people do not really understand economic concepts. Typically they prattle on about what they've heard from politicians and news pundits, who also often don't know what economists really say. In a democracy where, theoretically, policy decisions are decided by the majority, how can they really make an informed decision if they don't understand what they're deciding on?
Now I hear your complaints: "Elias, if that's the issue, we just need to get more people through college so they can understand better." But that's the problem: we simply can't do that. The renaissance man has long since died, and specialization has killed him.
To illustrate my point, I will use one of my friends who is a forestry major, and his girlfriend, who is in wildlife management. Talking to them, I realize that they feel the same way in their own fields. I listen to them, and I learn, but I can never understand their area of expertise as well as they can. Sure, when elections roll around I can ask them what they think on a certain topic, but that's one field out of the thousands that exist. How can we expect the average Joe to obtain the requisite knowledge required to really make an informed decision? We simply cannot expect them to know everything. We must rely on conventional wisdom, which presents a host of problems.
Kenneth Galbraith in his book “The Affluent Society” said, "To a very large extent, of course, we associate truth with convenience—with what most closely accords with self-interest and personal well-being or promises best to avoid awkward effort or unwelcome dislocation of life.” To use his words succinctly, the "hallmark of conventional wisdom is acceptability”—not truth, or really even wisdom, but acceptability. It is often too difficult and taxing for people to really understand everything, so they simply stick to "conventional wisdom.”
Experts are not exempt from this either. In fact, they perpetuate the problem because they also need public support. "An expert whose argument reeks of restraint or nuance often doesn't get much attention. An expert must be bold if he hopes to alchemize his homespun theory into conventional wisdom," according to Steven D. Levitt in his book “Freakanomics.”
Obviously, the public is unreliable in terms of making policy decisions, and experts become neutered in the process, but why must we resort to a dictatorship? Despite its many problems (such as its terrible history, frequent abuses of power, and the issue of peaceful transfers of power), a dictatorship does allow experts to specialize and really use their knowledge. In a dictatorship, public thoughts on an individual policy matter much less. China has been weaponizing what is essentially a dictatorship to explosively grow their economy for several decades now; they can utilize whatever tools are needed to grow the country. Experts can be experts and don't have to water down their work or try to explain it in terms that are understandable to the common individual.
Dictatorships can utilize capitalism's advantages and minimize these disadvantages. Granted, before America truly becomes a dictatorship, there are myriads of other issues with the political system that must be addressed beforehand. However, if we want capitalism to perform at its peak, perhaps it's time to give dictatorial regimes a second chance.