Centralized control, growth, and size
The first fundamental point is that capitalism requires some level of centralized control. It doesn’t operate very effectively in a hunter-gatherer or agrarian society where decisions are made and actions are taken at the level of tribe, clan, or family. Second, most of us would agree that capitalism is fueled by growth. The economics of capitalism require surplus revenues for reinvestment and profit. Surplus revenues are used to produce growth. Growth, in turn, is necessary for sustained surplus revenues. Important reciprocity is thus to be found in the interplay between growth, surplus revenues, and profits.
Even if one does not accept this assumption of reciprocity, it is hard to deny that an emphasis on growth and being “big” is dominant in virtually all capitalist-based societies. Furthermore, it is important to note that supporting institutions (such as governments and human service organizations) must continue to grow if they are to accompany and accommodate the capitalist institutions. Regulation and oversight must be provided (even if unsuccessful) in this expanding capitalist society. Furthermore, expanded assistance (health, education, welfare) must be engaged if those living and working in this growth-oriented society remain active and competent as employees in these capitalist enterprises, especially since leaders of these enterprises are not inclined, typically, to provide this assistance.
Profit
Capitalism focuses on profit rather than use. The quality of the product being produced or the quality of services being rendered is not of central importance. Worth is more likely to be assigned to return on investment rather than craftsmanship or skillful preparation and serving of food. While reputation and trust reside at the core of premodern societies, this is not the case with capitalist modern societies (Bergquist, 1993). The small communities and intimate relationships that serve as a foundation in the premodern exchange of products and services (a mixture of market and social exchange) typically do not exist in modern and postmodern societies. These more contemporary societies often require the creation of large communities (cities) and the establishment of impersonal norms of exchange (a pure market exchange).
While there may be small intra-city neighborhoods (often ethnically homogenous) where the norms of premodern societies continue to operate, the overall operations of the modern, capitalist society are usually depersonalized and market-based. With their increased investment in sales departments and contracting with advertising firms, executives in many organizations (especially corporations) firmly commit to elevating the sales volume of whatever their enterprise produces or offers. The marketability of their product or service and profit margins associated with the product or service are critical. The quality of the product or service is important. However, it is not of central concern. Economic profit serves as the “bottom line.” It is not quality or even the ultimate utility (usefulness) of the product or service that is “bottom-lined”.
Ethics and Public Interests
Before leaving behind this observation regarding the profit focus of capitalism, it should be noted that profit has not always been the focus of organizations. For instance, the Puritan Ethic was manifest in the mindset of and occasionally actions taken by two American pioneering entrepreneurs featured in the book Rosalind Sun and I wrote (Sun and Bergquist, 2021). These two entrepreneurs were Frederick Cabot Lowell, who established many Mills in New England, and Fred Harvey, who established restaurants along railroad lines and in National Parks.
