Being a Capitalist and Socialist in a Free Market

Warren Buffett is one of the most successful capitalists of all time. Yet he advocates for a system that so-called "free market" capitalists would denounce as a "welfare state."

I would argue, though, that Buffett makes an excellent point when he says that someone who is wealthy through inheritance benefits from a sort of privatized welfare.

The argument that you have to earn your wealth is smoke and mirrors. Upward mobility has always been at least as much about timing as it has been about strategy, and if you say "hard work" I have a big ol' can of elbow grease to sell you.

That is to say, with very few exceptions, wealth has always been about luck.

How can a very successful capitalist advocate for a system that free market capitalists decry as "socialist?"

Unfortunately, many labels which are meant to be objective have been tainted by context, subjectivity and emotion. "Socialism" absolutely does not mean the same thing it meant a century ago.

So what does it mean?

That's tricky. You might point to Scandinavian countries as an example, or you might point to China. These countries utilize VERY different systems, and in some ways could be described as polar opposites, but both rely on a mix of socialist and capitalist elements.

Even India can only be described as a "mixed economy."

To my second point: power is not some kind of magic that obeys categorization. The point of government is to limit the behavior of non-government actors, and in the modern sense, the power of government should be limited.

We bear witness to a new kind of power. With modern communications, technology, and economic means of accumulating vast stores of wealth, the private sector has power that could not have been accounted for in drafting the rules by which government functions.

Some would argue that markets are self-regulating. That's a nice idea, but the rose-colored glasses need to come off. Power and wealth trickle upward.

The century-old populism which tore into the heart of monopolistic capitalism has been replaced with a corporate-sponsored populism which tears instead into the means by which we can speak for our own interests.

We should fear the power of corporations as much as, if not more than, the power of government. And we should put ourselves closer to the tools of government, not distance ourselves from our only means of ensuring for ourselves the comforts of freedom.