The Capitalist Code

Ben Stein has an interesting short book called The Capitalist Code: It Can Save Your Life and Make You Very Rich.  He aims it mostly at young people as a combination of financial advice and a defense of capitalism.

The advice part of the book is essentially to save some money to invest in stocks as a way to hitch a ride on the incredible wealth generation capitalism provides.  He says that when “we hook up our lives to the mighty engine of capitalism,” we’re generating wealth to deal with the wide array of uncertainties in life.

On the subject of employment, Stein “will always advise working at one loves,” and “we might as well be prisoners as work in jobs we loathe.”  I agree with this to an extent, but we have to meet the world halfway.  If all the people who love painting landscapes tried to make a living at it, 99% would starve.  You have to choose among jobs that have some hope of paying enough money to live.

To those who might doubt the benefits of capitalism, Stein says “When your professors and your schoolmates tell you that capitalism as we see it in the United States of America right now is an evil exploitive system, they’re lying.  When they tell you that you’re being consistently ripped off by Wall Street, they’re lying and they’re hurting you.”

Stein points to Elizabeth Warren as an example of a professor who is wrong about capitalism.  I think the truth is somewhere between their points of view.  Capitalism works, but we can afford to carve out a small part of the wealth to protect the less fortunate.  The catch is deciding how much wealth to dedicate to the needy.  In my view, the U.S. is crazy to allow severe medical problems to bankrupt some of their citizens.  They also need to deal with some corporations that have become so large that their effects are anti-capitalistic.

Overall, this book is worth a read.  Stein gives solid advice for young people and offers an interesting defense of capitalism at a time when many are singing the praises of socialism.