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The roots of capitalism

The most important opponent with which the spirit of capitalism has historically had to struggle was traditional views on wealth during the time of Catholic Feudalism. A man does not “by nature” wish to earn more and more money, and historically simply wished to live as he was accustomed to live and to earn as much as is necessary for survival. Whenever modern capitalism began its work of increasing the productivity of human labour by increasing its intensity, it encountered the immensely stubborn resistance of this leading trait of pre-capitalistic labour. The emergence of new religious forces, specifically Protestantism, and the ethical ideas of duty based upon them, have in the past always been among the most important formative influences on the formation of rational economic conduct. In this case, we are dealing with the connection of the spirit of modern economic capitalism with the rational ethics of ascetic Protestantism. The spirit of capitalism was born out of the Protestant reformation of the Catholic Church.

In order to understand the connection between the fundamental religious ideas of ascetic Protestantism and its maxims for everyday economic conduct, it is necessary to understand the religious teachings of English Puritanism, which were derived from the Calvinist reformation of the Catholic church. Waste of time was the first and deadliest of sins. Loss of time through sociability, idle talk, luxury, even more sleep than is necessary for health is worthy of absolute moral condemnation. It did not yet hold, as modern ethos has it, that time is money, although the proposition was true in a spiritual sense. Time was infinitely valuable because every hour lost was lost to labor for the glory of God. Wealth was thus bad ethically only in so far as it was a temptation to idleness and sinful enjoyment of life, and its acquisition was bad only when it was with the purpose of later living merrily and without care. The emphasis on ascetic importance of a fixed “calling” provided an ethical justification of the modern specialized division of labour. Worldly Protestant asceticism acted powerfully against the spontaneous enjoyment of possessions; it restricted consumption, especially of luxuries. On the other hand, it had the psychological effect of maximizing the acquisition of goods from the inhibitions of traditionalistic Catholic ethics. It broke the bonds of the impulse of acquisition in that it looked upon it as directly willed by God. The campaign against the temptations of the flesh, and the dependence on external things, was not a struggle against rational acquisition, but against irrational use of wealth. Over against the glitter and ostentation of Catholic feudal magnificence which, resting on an unsound economic basis, prefers a sordid elegance to sober simplicity, they set the clean and solid comfort of the middle-class home as an ideal.

When the limitation of consumption in asceticism is combined with a release of acquisitive activity, the inevitable practical result is obvious: accumulation of capital through ascetic compulsion to save. Asceticism condemned the pursuit of riches for their own sake; but the attainment of it as a fruit of labour in a calling was a sign of God’s blessing. The greater simplicity of life, in combination with great wealth, led to an excessive propensity to accumulation. As far as the influence of the Puritan outlook extended, it favored the development of a rational bourgeois economic life; it was the most important and consistent influence in the development of that life. It stood at the cradle of modern economic man.