Thanksgiving Day: The Triumph of Capitalism

Americans celebrate the traditional Thanksgiving day today.

But many fail to realize that the quintessence of Thanksgiving is the showcase triumph of the experimentation of property rights, division of labor, and voluntary exchange or laissez faire capitalism over collectivism.

From a 2003 article by Bloomberg’s Caroline Baum…

One of the traditions the Pilgrims had brought with them from England was a practice known as ``farming in common.'' Everything they produced was put into a common pool, and the harvest was rationed among them according to need.

They had thought ``that the taking away of property, and bringing in community into a common wealth, would make them happy and flourishing,'' Bradford recounts.

They were wrong. ``For this community (so far as it was) was found to breed much confusion and discontent, and retard much imployment that would have been to their benefite and comforte,'' Bradford writes.

Young, able-bodied men resented working for others without compensation. Incentives were lacking.

After the Pilgrims had endured near-starvation for three winters, Bradford decided to experiment when it came time to plant in the spring of 1623. He set aside a plot of land for each family, that ``they should set corne every man for his owne particular, and in that regard trust to themselves.''

A New Way

The results were nothing short of miraculous.

Bradford writes: ``This had very good success; for it made all hands very industrious, so as much more corne was planted than other ways would have been by any means the Govr or any other could use, and saved him a great deall of trouble, and gave far better content.''

The women now went willingly into the field, carrying their young children on their backs. Those who previously claimed they were too old or ill to work embraced the idea of private property and enjoyed the fruits of their labor, eventually producing enough to trade their excess corn for furs and other desired commodities.

Given appropriate incentives, the Pilgrims produced and enjoyed a bountiful harvest in the fall of 1623 and set aside ``a day of thanksgiving'' to thank God for their good fortune.

``Any generall wante or famine hath not been amongst them since to this day,'' Bradford writes in an entry from 1647, the last year covered by his History.

With the benefit of hindsight, we know that the Pilgrim's good fortune was not a matter of luck. In 1623, they were responding to the same incentives that have been adopted almost universally four centuries later.

Remember the lessons of Thanksgiving

Happy Thanksgiving Day!