The Miracle of Capitalism

Part II: The Moral Basis of Capitalism

by Loyal to the Word

         Ezra Taft Benson said,


“The free-market system rests on a moral base....

“Without the moral base to our system, we are no better off than other nations that are now sunk into oblivion. If we are to remain under heaven’s benign protection and care, we must return to those principles which have brought us our peace, liberty, and prosperity. Our problems today are essentially problems of the spirit.”

(Ezra Taft Benson, This Nation Shall Endure, p. 101-117).


The Miracle of Capitalism Part II: The Moral Basis of Capitalism

         Part I of this Miracle of Capitalism video series discussed the question of “What is Capitalism?” Part II will now discuss the morality of the capitalist system. It becomes very evident, upon discussing the fundamental underlying philosophy, that capitalism is indeed a moral system. To illustrate this, we must first discuss the underlying ideologies between capitalism and also of its opponents, in other words, Individualism vs. Collectivism.


Individualism vs. Collectivism

         Individualism is the underlying ideology of capitalism. It consists of the principles discussed in Part I of this video series – that all people are equal before the law with the same rights as their neighbor; and that no matter if someone is rich or poor, their rights to life, liberty, and property are just as sacrosanct and worthy of protection by the government as for anyone; that this is the primary role of government before anything else – simply to impartially protect the rights of the individual in their property so that they may be free to act. For the government to undertake to redistribute wealth is a transgression of its primary function. “Individualism” does not mean “selfishness,” as some thoughtless people think. Individualism merely means preserving for the individual their right to control their own property without undue interference from government.

         Collectivism is simply the concept that specific groups of people ought to take precedence over the individual rights of others. Collectivist ideologies are diverse and include socialism, communism, fascism, and to a very large extent, Modern American Liberalism. What these ideologies all have in common, however, and what makes them collectivist, is that in each of them, people are not actually considered to be equal in their God-given rights, but instead certain groups are given preference at the expense of others. In fascism, the Nazis commandeered the property of Jews and sought to extinguish their innocent lives. In communism, the proletariat class or poorer workers sought to steal the property of the bourgeoisie, or wealthier class. In other forms of socialism, and in Modern American Liberalism, the rich are likewise bereft of their money and property in order to give it to poorer classes. In collectivism, individual rights are always and necessarily denied arbitrarily by whatever the wishes are of the governing group that happens to be in power. Collectivists of whatever stripe can all be classed together. The only difference between them is simply that they disagree on who the preferred groups should be and who should be receiving the other people’s money. Are all liberals Nazis? Of course not. But their methods work on the same principles – the overriding of freedom of choice and inalienable rights of the individual.


Collectivism and the United Order

         Some may be thinking at this point, that the United Order is a manifestation of collectivism. This idea, however, is totally false, and the leaders of the Church have been uniform in teaching us that the United Order is not socialistic or collectivist, but is rather much closer related to capitalism. The First Presidency has declared:


“Communism and all other similar isms [i.e. socialism and fascism] bear no relationship whatever to the United Order. They are merely the clumsy counterfeits which Satan always devises of the gospel plan. Communism debases the individual and makes him the enslaved tool of the state…. Latter-day Saints cannot be true to their faith and lend aid, encouragement, or sympathy to any of these false philosophies.”

(Heber J. Grant, J. Reuben Clark, David O. McKay, Messages of the First Presidency, 6: 151).


“To our Church members we say: Communism is not the United Order, and bears only the most superficial resemblance thereto; Communism is based upon intolerance and force, the United Order upon love and freedom of conscience and action; Communism involves forceful despoliation and confiscation, the United Order voluntary consecration…. no loyal American citizen and no faithful Church member can be a Communist. We call upon all Church members completely to eschew Communism.”

(Heber J. Grant, J. Reuben Clark, Jr., David O. McKay, Messages of the First Presidency, 6:17-18).


         President J. Reuben Clark taught in General Conference:


“The fundamental principle of this [United Order] system was the private ownership of property. Each man owned his portion, or inheritance, or stewardship, with an absolute title, which he could alienate, or hypothecate, or otherwise treat as his own. The Church did not own all of the property, and the life under the United Order was not a communal life, as the Prophet Joseph, himself said, [History of the Church, Vol. III, p. 28]. The United Order is an individualistic system, not a communal system.”

(President J. Reuben Clark, Jr., Conference Report, October 1942).


         President Ezra Taft Benson taught the following:


“It has been erroneously concluded by some that the United Order is both communal and communistic in theory and practice because the revelations speak of equality. Equality under the United Order is not economic and social leveling as advocated by some today. Equality, as described by the Lord, is “equal[ity] according to [a man’s] family, according to his circumstances and his wants and needs” (D&C 51:3). “Is the United Order a communal system? Emphatically not. It never has been and never will be. It is ‘intensely individualistic.’ Does the United Order eliminate private ownership of property? No. ‘The fundamental principle of this system [is] the private ownership of property’ (J. Reuben Clark, Jr., Conference Report, October 1942, p. 57).”

(Ezra Taft Benson, “A Vision and a Hope for the Youth of Zion,” BYU Speeches, Apr. 12, 1977).


         Marion G. Romney, speaking expressly under the direction of the First Presidency in General Conference, taught:


“…the United Order can never function under socialism or ‘the welfare state,’ for the good and sufficient reason that the principles upon which socialism and the United Order are conceived and operated are inimical.”

(Marion G. Romney, Conference Report, April 1966).


         Harold B. Lee stated in General Conference, as a newly called apostle and having been head of the Church welfare program:


“…contrary to the belief and mistaken ideas of some of our people, the United Order will not be a socialistic or communistic set-up: it will be something distinctive and yet will be more capitalistic in its nature than either socialism or communism, in that private ownership and individual responsibility will be maintained.”

(Elder Harold B. Lee, Conference Report, October 1941).


         One might be excused for mistaking in ignorance that the United Order is socialistic. But after reading the foregoing quotes which speak expressly to the contrary, if one continues, because of ideological reasons, to insist that the United Order is like socialism, this constitutes open and willful rebellion against the truth. The differences between the United Order and socialism are many and fundamental. We will list them now for good measure:


  1. The United Order is completely voluntary, while socialism requires the use of force to confiscate (i.e. steal) the property of others in order to redistribute it. It is Satan’s method to operate by force, destroying free will and forcing the masses to bend to the will of a dictator (see Moses 4:1-3).
  2. The United Order retains the private ownership of property. Each individual’s consecrated property is considered private property once it is placed in new hands. In Mormonism, “the right and control of property” is a sacred and undeniable right (D&C 134:2). Those who participate in the United Order have absolute control over their property, while socialism seeks to abolish private ownership and give the sole power of property ownership and control into the hands of the state.
  3. The United Order encourages private competition, as competition is the means by which services are rendered better and more efficiently. Socialism seeks to eradicate competition and give the consumers only one choice - the state.
  4. The United Order is administered at the local level, with the Bishop of each ward being the Lord’s judge in the matter. Socialism, on the other hand, is administered at the federal level of government, the most inefficient and faceless and removed entity imaginable. 
  5. The family is the center of the United Order and the focus for which men work for economic prosperity. In socialism, the government seeks to replace the institution of the family with the state.
  6. The United Order holds respect and value for the Constitution of the United States, which is based on the premise of a free market capitalist system. Socialism is at its core completely opposite to the principles of the Constitution.
  7. The United Order is a private, voluntary system administered by a private Church among its members. Socialism is administered by the government with the aim to usurp authority over all people.


The Morality of Capitalism and Collectivism Contrasted

         The morality and justice of capitalism and the immorality and injustice of the various forms of collectivism can be clearly seen if we contrast the two. Consider the following:


  1. Capitalism only functions under a system of freedom of action. The course of collectivism is one of coercion and force.

    1. Recall again that in the preexistence, it was the Lord Jesus Christ who sought to preserve the Father’s plan of free will, and it was Satan’s plan to instead initiate force and coercion to meet his goals for humanity. Collectivist plans are therefore the way of Satan.

    2. Eminent economist Ludwig von Mises wrote, “Freedom, as people enjoyed it in the democratic countries of Western civilization in the years of the old liberalism’s triumph, was not a product of constitutions, bills of rights, laws, and statutes. Those documents aimed only at safeguarding liberty and freedom, firmly established by the operation of the market economy [i.e. capitalism], against encroachments on the part of officeholders. No government and no civil law can guarantee and bring about freedom otherwise than by supporting and defending the fundamental institutions of the market economy. Government means always coercion and compulsion and is by necessity the opposite of liberty. Government is a guarantor of liberty and is compatible with liberty only if its range is adequately restricted to the preservation of economic freedom.” (Ludwig von Mises, Human Action, p. 283). “There is no kind of freedom and liberty other than the kind which the market economy brings about.” (Ludwig von Mises, Human Action, p. 280).

    3. There is a Book of Mormon parallel to the struggle of freedom that exists between the individualist and collectivist ideologies: it is the Book of Mormon story of the freemen vs. the king men (see Alma 51:5-6). The freemen sought to preserve their freedom and their rights. The king men sought to establish a rule by kingship in the land. Throughout most of the world’s history, mankind has been under the yoke of oppressive kings who owned and controlled virtually everything. Whenever there has been government ownership and control pervading the lives of individuals it has led to a loss of freedom. The foundation for freedom, of course, is private ownership and private enterprise. The modern parallel to this story, and the reason it was included on the gold plates, was to illustrate the struggle that would exist in our modern times between freedom (the principles of individualism), and collectivism (the modern king men, who prefer government control).

  2. Capitalism requires the government as well as all people to respect the unalienable and inherent rights of others. Collectivism tramples over the unalienable rights of certain groups of people in order to meet the goals of the state, whatever they may be.

    1. One of the most fundamental of rights is the right to private property, which includes all assets under the ownership of an individual, and includes their earnings. The government is not justified in taking these earnings for the purpose of increasing the wealth of other groups, because it tramples over the individual’s right to property. The idea that excessive taxes are justified if the government provides services with them is false, because it still denies the individual their right to spend their own money specifically and precisely on only the services they desire, and not what the government would prefer to do with their money. And anyway, the history of capitalism has shown that private enterprise can perform most of these services better and more efficiently anyway.

    2. It is both interesting and important to note the moral inconsistency of collectivists. For instance, many liberals would cringe at the government giving special favors to big business in the form of bailouts – and for good reason, for it is a dishonest theft of the people, taking the money of the common man and giving it others without their earning it. Yet, the liberals would claim that this very method – forcefully taking from some to give to others – is exactly what we should be doing for the poor. Rather than the individualist value that stealing private property is simply wrong on principle, collectivists harbor the notion that stealing is only wrong depending whether the circumstance suit them or not.

  3. Capitalism allows people to deal with others voluntarily according to their own volition and preferences. Collectivism ignores the preferences and desires of individuals as irrelevant and instead concentrates on satisfying the goals of a governing group.

    1. This means that good relations are essential to success in capitalism, and that in collectivism people are not actually as important as the goals of the political planners. Nothing could be more social than capitalism. And nothing could be more antisocial than socialism.

  4. Under capitalism, man is the master of his destiny, and obtains to his position and prosperity in society according to his choices. Under collectivism, the person becomes a mere tool of the state, subject to its direction and whims.

    1. [Show capitalism power dynamic] Consider that in capitalism, each individual has the power to be an owner of their private property, and therefore the ability to control their lives. Each person is equal in this same power, and may obtain to any advantage they can dream of if they exercise hard work and ingenuity. [Show socialism power dynamic] Under collectivism, the power dynamic is much different, for there exists two classes of people, the powerful elite who make the decisions for society, and the rest of the people who must obey this direction.

  5. In capitalism, people must deal with each other respectfully as fellow agents of their own will and destiny. Exchange is done voluntarily when there is mutual benefit. In collectivism, people are treated simply as a means to the political ends of the ruling elite.

    1. Economist Friedrich Hayek wrote, “Although the professed aim of [economic] planning [i.e. as seen in socialism or government interventionism] would be that man should cease to be a mere means, in fact – since it would be impossible to take account in the plan of individual likes and dislikes – the individual would more than ever become a mere means, to be used by the authority in the service of such abstractions as the ‘social welfare’ or the ‘good of the community.’”

      (Friedrich Hayek, The Road to Serfdom, The Definitive Edition, p. 130).

  6. Capitalism is the only system wherein a man may improve his circumstances if he has the desire to do so. In collectivism, improvement of one’s circumstances is not possible except by the arbitrary consent of the state.

  7. In capitalism, the average, everyday consumer is the ultimate authority to whom the capitalists seek to satisfy. In collectivism, the interests of the state are paramount, and the individual is expendable.

    1. Economist Ludwig von Mises wrote: “In the market, economic power is vested in the consumers. They ultimately determine, by their buying or abstention from buying, what should be produced, by whom and how, of what quality and in what quantity. The entrepreneurs, capitalists, and landowners who fail to satisfy in the best possible and cheapest way the most urgent of the not-yet-satisfied wishes of the consumers are forced to go out of business and forfeit their preferred position. “In business offices and in laboratories, the keenest minds are busy fructifying the most complex achievements of scientific research for the production of ever-better implements and gadgets for people who have no inkling of the theories that make the fabrication of such things possible. The bigger an enterprise is, the more is it forced to adjust its production to the changing whims and fancies of the masses, its masters. The fundamental principle of capitalism is mass production to supply the masses. It is the patronage of the masses that make enterprises grow big. The common man is supreme in the market economy. He is the customer who ‘is always right.’ “…Under capitalism they are vying with one another in serving the masses of less gifted men. All their thoughts aim at perfecting the methods of supplying the consumers. Every year, every month, every week something unheard of before appears on the market and is soon made accessible to the many. “…Under capitalism the customer is the man for whose patronage the suppliers are striving and to whom after the sale they say ‘thank you’ and ‘please come again.’ Under socialism the ‘comrade’ gets what ‘big brother’ deigns to give him and he is to be thankful for whatever he got.” (Ludwig von Mises, Money, Method, and the Market Process, Ch. 14).

  8. Capitalism rewards hard work, ingenuity, and the ability to satisfy the wants and desires of others. Collectivism does none of this, but instead rewards evil designs to take the property of others without earning it.

  9. Capitalism is branded by collectivists as being greedy because capitalists seek after profit as a reward for their service to mankind. But the collectivists want us to believe that they are devoid of greed when they seek to forcefully take the hard-earned money of others.

    1. It is as economist Thomas Sowell stated, “I have never understood why it is ‘greed’ to want to keep the money you have earned but not greed to want to take somebody else’s money.” (Thomas Sowell, Barbarians Inside the Gates and Other Controversial Essays).

    2. Economist Ludwig von Mises wrote, “Profit, in a broader sense, is the gain derived from action; it is the increase in satisfaction (decrease in uneasiness) brought about; it is the difference between the higher value attached to the result attained and the lower value attached to the sacrifices made for its attainment; it is, in other words, yield minus costs. To make profit is invariably the aim sought by any action.” (Ludwig von Mises, Human Action, p. 286). Simply the search for profit, therefore, cannot be an evil thing, as it is what all people do their whole lives through. However, profit sought by taking from others against their will, is at the immoral core of collectivism.

    3. The Book of Mormon further highlights the difference between properly achieved profits, under capitalistic enterprise, and ill-gotten profits, through dishonest coercion. It says:

      “And they [the Jaredites] were exceedingly industrious, and they did buy and sell and traffic one with another, that they might get gain.” And after describing their commerce the scripture concludes, “And never could be a people more blessed than were they, and more prospered by the hand of the Lord.” (Ether 10:22, 28). The Book of Mormon likewise records commerce and trade that existed among the Nephites during one of their righteous periods: “And behold, there was peace in all the land, insomuch that the Nephites did go into whatsoever part of the land they would, whether among the Nephites or the Lamanites…. and thus they did have free intercourse one with another, to buy and to sell, and to get gain, according to their desire. And it came to pass that they became exceedingly rich, both the Lamanites and the Nephites” (Helaman 6:7-9). In each of these instances of righteousness, the desire for gain was not demonized, but spoken of favorably. Contrast this with gain achieved by unscrupulous methods of coercion which the Book of Mormon laments: “therefore they began to commit secret murders, and to rob and to plunder, that they might get gain.” (Helaman 6:17).

  10. Those who generally succeed in the system of capitalism are those who work hard, are honest and frugal, and who do the best job of satisfying the needs and desires of others. Those who generally fail are those who are dishonest, lazy, extravagant, and unwise. In collectivism, the way to get ahead is to use the coercion of the state to underhandedly take the economic means of others away from them.

  11. Capitalism is based upon personal responsibility. If a business is not successful, it will fail, and the failed business owner must pay the cost. Collectivism is devoid of personal responsibility for one’s own life and actions, because it assumes that it is the responsibility of the state to take care of the masses. This leads directly to dependency and a lack of productivity.

  12. In capitalism, well-deserved prosperity and comfort are the rewards of success. This success is reached because others voluntarily parted with their money to obtain the goods or services provided by the capitalist in question. In collectivism, prosperity is demonized through propaganda, and seeks to portray that those who have worked hard have done something wrong, that they are taking advantage of others or that they are oppressing them – complete lies.

    1. It is interesting to note about leftists, that it is always someone else who is acting as a greedy, oppressive capitalist. But when they, themselves, go into business, or make any significant amount of money, somehow they seem to evade characterizing themselves in that same light. [show a picture of Michael Moore and Capitalism a Love Story]

    2. It is quite comical that the political left accuses capitalism of oppression, when in actual fact it is their collectivist schemes of government control that would stifle freedom and lead to oppression. It is very much like George Orwell’s novel 1984, wherein the socialist government that completely controlled people’s lives plastered everywhere the propaganda slogan: “FREEDOM IS SLAVERY.” Collectivists want you to think that freedom under capitalism is oppressive, while their government control is not.

  13. In capitalism, seeking after your own self-interest results in more available products, services, and jobs for others. It makes life better for everyone. In collectivism, seeking after your own self-interest can only mean taking the hard-earned money of others without earning it. The net effect is to make society less productive and less wealthy.

  14. In capitalism, charitable giving is as common as there are good people, and a person is charitable precisely because they want to be. Voluntary giving is ennobling and Godlike. In collectivism, no consideration is afforded for the God-given free will of the individual, and property is taken from the individual whether they like it or not, to be spent on a cause that they have no control over and may have no sympathy for. This sort of spending ceases to be charity, and is instead simple theft. Though they pride themselves on being noble and generous because they want to help the poor, or whatever their favored group may happen to be, collectivists are only generous with other people’s money!

    1. Despite popular perceptions to the contrary, capitalists are not more greedy than the collectivists on the political left. According to research, people with conservative values are much more likely to give to charity than those of the left! The best indicators of charitable giving are “strong families, church attendance, earning one’s own income (as opposed to receiving welfare), and the belief that individuals – not government – offer the best solution to social problems.”

      (Arthur C. Brooks, Who Really Cares: The Surprising Truth About Compassionate Conservatism, 2007, description on back cover).

  15. And finally, Capitalism actually works – it really does increase the wealth of all groups and classes of people that live in nations where it is tried. Not everyone prospers to the same extent, and life is not easy, but in capitalist societies, even the poor people enjoy a high standard of living. Nations prosper only by following the principles of capitalism to a greater or lesser extent. Collectivism does not work, and leads to a decrease in wealth and standard of living, and often poverty and death. Its merits cannot be trumpeted without the use of inaccuracies and falsehoods. The misguided idealism of collectivists, which leads them to oppose capitalism, causes them to bite the very hand that feeds them. And their stubborn and irrational allegiance to their false doctrines ultimately condemns their fellowmen to lives of drudgery and poverty.

    1. Economist Ludwig von Mises wrote, “The truth is that capitalism has not only multiplied population figures but at the same time improved the people's standard of living in an unprecedented way. Neither economic thinking nor historical experience suggest that any other social system could be more beneficial to the masses than capitalism. The results speak for themselves. The market economy needs no apologists and propagandists.”

      (Ludwig von Mises, Human Action, p. 850).



         In conclusion, recall that we have discussed the underlying philosophy of capitalism, which is individualism, as well discussed opposing ideologies, which we have noted are the various forms of collectivism. Individualism is the way of God-ordained freedom, while collectivism is the path of tyranny.

         We have also established beyond any reasonable doubt the nature of the United Order, and shown that it is individualistic and not collectivist. Any who would disagree after becoming conscious of the quotes supplied in this presentation are in open rebellion to the truth as revealed by God through his prophets.

         We have also highlighted the stark moral contrast between the principles of capitalism (or individualism), and the assorted opposing philosophies of collectivism. It is clear that the principles on which capitalism is based are the highest and noblest in existence.

         It can be readily seen that collectivist ideologies ignore rights, stifle freedom, and transgress the principle of justice, taking from those who rightfully earned and giving it to others without the permission of the rightful owner. Redistribution of wealth is a complete injustice. In capitalism, if a man is industrious or clever, he will benefit materially from this. This is justice. And if he wishes to give some of his means to others, he is free to do so as he sees fit with his own property. Capitalism does not preclude giving to others, but collectivism must always preclude human freedom.


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