Capitalism, Exploitation, Lending

The Marxist concept of Capitalist Exploitation consists in Profit from the Labor of another.  Thus, Slavery is a special case of such Exploitation.  But, in turn, Profit from the Labor of another can be conceived as a special case of Gain that entails any Loss of another.  Hence, any lending with Interest is also a case of such Exploitation.  Clearly, the victim of Exploitation is acting involuntarily, whether it is the slave under the whip, the laborer who must accept disadvantaged conditions in order to survive, or the borrower in desperate straits.  Accordingly, Marxist Socialism is only a special case of a remedy for Capitalist Exploitation; others include the abolition of Slavery, the illegalization of lending with Interest, and, in general, the elimination of any interaction in which Profit entails Loss.  Likewise, if Smith had focused exclusively on the general aim of national Economic benefit, he might have recognized that individual Profit-seeking is antithetical to such a doctrine.  Indeed, if he had maintained his initial insight of Wealth of Nations--that the basic unit of any Market is the exchange of vital necessities--and formulated as a fundamental normative Market principle the equitable exchange, i. e. in which both parties are satisfied--the recognition that Profit-seeking is antithetical to that principle might have stopped him from proposing it as his fundamental principle instead at the outset.

Profit-Motive and Usury

The existence of laws against Usury implies that there is a threshold at which Interest becomes harmful.  Furthermore, the variability of that threshold indicates its arbitrariness.  Hence, it is even possible that 0% is that threshold, i. e. that charging any Interest on a loan is harmful.  Now, the comparison with an Interest-free loan shows that the only motive for charging Interest is Profit for its own sake.  Thus, implied in the acceptance of a law against Usury, is the recognition of the inadequacy of the Profit-motive as a fundamental principle.  For, implied is that 'One should seek Profit' is not unconditional, and, hence, does not account for all behavior.  Furthermore, the arbitrariness of the threshold, which does not preclude the possibility that it be 0%, implies that at least some of, and perhaps the entire system that Smith bases on the Profit-motive is Vicious, a possibility that is clearer from the identification of the Profit-motive and Greed, a Vice in many Moral doctrines.  Nevertheless, Capitalists seem not to recognition that their acceptance of constraints on Usury entails constraints on Profit-seeking behavior.

Capitalism and Contradiction

Simultaneous Excess and Deficiency is tautological if two parties are involved, but contradictory if attributed to a single entity.  Thus, the fundamental Contradiction of Smith's system is his promotion of both behavior that creates an Excess-Deficiency combination, i. e. the Profit-motive, and a unitary Economic entity, i. e. a Nation.  In other words, it promotes both Zero-Sum transactions and a non-Zero-Sum goal.  Now, Exploitation can be conceived as simultaneous Excess and Deficiency.  But, studying it as such, Marx misses casting it as a Contradiction, i. e. by attributing it to a Whole, and, hence, as systematically related to Dialectical Materialism.  Similarly, subsequent Capitalists have avoided the potential internal Contradiction by simply de-emphasising the holistic component of Smith's system.  Accordingly, the American resistance to the presumed inevitability of Socialist Revolution that has stymied some Marxists, is due to the relative lack of such a holistic component in a relatively new society that is too young to develop any entrenched common tradition, resulting in an unusually resilient Individualism.

Profit, Excess, Interest

Profit is a Surplus with respect to an initial investment.  But it is also an Excess--with respect to breaking even.  Thus, as has been previously discussed, the Profit-motive is open to the diagnosis that it is an expression of Greed, and, hence, a Vice.  Now, as the fundamental principle of Capitalism, it is a factor in all transactions.  But, one transaction in particular expresses the characteristic of a fundamental principle that it is for its own sake--charging Interest on a loan.   That expression is sharply defined since Interest quantifies the Excess entailed in Profit-seeking, i. e. with respect to an Interest-free loan.  Thus, Interest is the primary exemplar of Capitalism.  Now, Interest entails not only Excess, but Deficiency, i. e. that of the payer.  Thus, Interest is a Zero-Sum relation, or, in other words, the Profit that it entails is one-sided, not general.  Accordingly, by missing that Profit is an Excess, Marx also overlooks that the fundamental Capitalist contradiction is that between Excess and Deficiency in what is purportedly a unity, i. e. a Nation.

Profit-Seeking and Freedom

The Profit-motive is sometimes defended as 'free' behavior, and, so protected as such.  It follows from that thesis that one is free to choose between breaking even and realizing a profit.  Furthermore, since Profit-seeking is accepted by those defenders as the fundamental behavioral principle, the choice is independent of any ends that might condition it.  But, according to Aristotle, any pursuit of Excess, e. g. seeking more than breaking even, is behavior that is out of one's control, and hence, is not 'free'.  So, absent a response to the Aristotelian analysis, as well to the Spinozist exposure of its inadequacy, the association of 'freedom' and Profit-seeking remains groundless.

Profit-Seeking and the Critique of Capitalism

Marx attacks Capitalism in two, not necessarily related, ways: 1. Via Dialectical Materialism, leading to an exposure of the internal contradictions of the system; and 2. Via an etiology of Profit, leading to an exposure of the Exploitation of Labor.  However, in the latter case, he leaves unexamined the phenomenon of Profit itself, thereby missing the possibility of a more direct, more coherent, criticism of Capitalism.  For, as has been previously discussed, the foundation of Capitalism--the Profit-motive--is shaky in two respects.  First, the proposed identity of traditional Egoism and Profit-seeking is without justification.  Second, healthiness of Profit-seeking behavior is taken for granted.  So, Marx misses an opportunity for a simpler, more decisive undermining of the foundation of Capitalism, perhaps because it would not entail Socialism as a remedy.  He thus leaves unchallenged the dogma that Profit-seeking is sound behavior, a dogma the acceptance of which has become widely and deeply entrenched since.

Greed, Goodness, Capitalism

Greed is a Vice, according to Aristotle, simply on the grounds that it is a disordered condition of a Soul.  So, Aristotle would unequivocally reject the thesis that 'Greed is good'.  Now, that phrase has been associated with the excesses of the resurgent Free Market Capitalism of recent decades, primarily via the film Wall Street, which may have some factual roots.  In any case, because of that specific association, the possibility of an inherent relation of Greed to Capitalism has gone unaddressed.  So, generally unconsidered is that the fundamental principle of Capitalism--the Profit-motive--is equivalent to Greed, in either its descriptive or normative versions.  For, entailed in it is that simply meeting one's needs may be deficient in some respect.  Now, there may be cases in which realizing a profit is necessary to meeting one's needs.  But the formulation is indifferent to any such specification--it ascribes to Profit a Goodness that is unconditional, without a derivation from a Rational principle.  Thus, the Profit-motive in itself is a Vice, according to Aristotle.  So, not only Greed, but Capitalism itself, and not merely the variety that has emerged in recent decades, is Bad, according to Aristotle--for the Profit-seeker, independent of the harm done to any others.