Countering Socialism with a Better Capitalism

In 2021, Newsweek, a Trust Project Member, ran an article titled, Majority of Gen Z Americans Hold Negative Views of Capitalism: Poll. The article reported that recent polls showed 54 percent of Gen Z (ages 18 to 24) held negative views of capitalism. And among young Republicans specifically, positive views of capitalism fell by 15 percent from the previous survey to just 66 percent.

Frankly, do they have good reason for their increasingly negative views of American capitalism? Yes! It’s beyond reasonable debate that American capitalism is in need of reform.

Of additional concern is that “[w]hile positive views of capitalism appear to be dropping, favorable views of socialism have moved upward somewhat.” Recent polls show 41 percent of respondents viewing socialism positively, up by two points from previous surveys.

Is socialism the best response to a capitalism in need of reform? No! A better capitalism is the best response.

Credit image:  DSAUSA.org

A clear take-away from the article includes, “[t]he survey additionally found that two-thirds (66 percent) of Americans believe the government should pursue policies that address economic inequality and reduce the growing gap between the wealthy and less well-off. . . . A majority (56 percent) of young Republicans (18 to 34) said they believe the government should work to reduce the wealth gap as well.”

Here’s the link to that article so you can read it for yourself. We appreciate when our readers trust but verify. This helps build trust. Quick reminder, Gen Z are America’s emerging business, government, and cultural leaders.

Fast forward four and a half years from that Newsweek article to earlier this week (the week of June 23, 2025). Self-proclaimed Democratic Socialist New York State Representative Zohran Mamdani won the run-off race against former New York Governor Andrew Cuomo to be the Democratic nominee for the 2025 NYC mayoral race. Although Mamdani’s win is just one event in America’s largest city, it adds to the column of evidence that negative views of capitalism are speeding up rather than slowing down.

 Image Credit: AP via CNN.com

How can America best respond to this current shuffle toward socialism? How does America frame that response – a better capitalism as an attractive alternative to socialism?

There is only one response that will ultimately prove successful – we need to reform the core ethic of capitalism so that it again benefits the common good rather than the select few. This begins with how we collectively think, talk, and act about capitalism. Of course, that begins with how YOU think, YOU talk, and YOU act about capitalism.

Recall that in the 1970s, America’s core ethic of capitalism began shifting from the flourishing “we’re in this together” ethic, to Milton Friedman’s damaging "maximize profit” ethic. For those new to this shift, you can get an introduction here. The ethic of maximize profit is substantially responsible for the legitimate criticisms of capitalism and current shuffle toward socialism, democratic or otherwise.

The remedy and antidote to this damaging maximize profit ethic is the flourishing “optimize profit” ethic, which comprises the principles of enough and mutuality. For those new to either principle, you can get introductions here and here.

While we reform capitalism by replacing the core ethic of "maximize profit" with the core ethic of "optimize profit," we, sadly, can’t just snap our fingers and make that happen. It happens by thinking, talking, and acting differently about capitalism in order to help it develop into a better version of itself. We particularly need to do so with those questioning the validity of capitalism as a preferred economic model while moving toward socialism, because they mistakenly think it’s the only viable option.

Image Credit: P.E. Knowlton  

One framework designed to help us think, talk, and act differently about capitalism was presented in the 1986 book Economic Justice for All: Pastoral Letter on Catholic Social Teaching and the U.S. Economy, by the National Conference of Catholic Bishops. As this framework helps you reform your inherited but damaging perspectives about capitalism, you’ll help reform capitalism and help others see that a reformed capitalism – not socialism – is the better and sustainable economic model.

Pro tip as you read this framework: Remember, capitalism is just a human created system; and like every system, it’s guided by a core ethic(s). If capitalism is working well, it’s in large part because it’s guided by the right ethic, like an ethic of "we’re in this together" that guided American capitalism in the post WWII economic boom. If capitalism isn’t working well, it’s in large part because it’s guided by the wrong ethic, like an ethic of "maximize profit" that has since guided American capitalism to our subsequent deindustrialization and modern economic crises.  

Here are the six themes of this framework, summarized for blog post length:

Every economic decision and institution must be judged in light of whether it protects or undermines the dignity of the human person.  . . .  We judge any economic system by what it does for and to people and by how it permits all to participate in it. The economy should serve people, not the other way around.

Human dignity can be realized and protected only in community.  . . .  We have many partial ways to measure and debate the health of our economy: Gross National Product, per capita income, stock market prices, and so forth. The Christian vision of economic life looks beyond them all and asks, "Does economic life enhance or threaten our life together as a community?"

All people have a right to participate in the economic life of society.  . . .  For it is through employment that most individuals and families meet their material needs, exercise their talents, and have an opportunity to contribute to the larger community. Such participation has a special significance in our tradition, because we believe that it is a means by which we join in carrying forward God's creative activity.

All members of society have a special obligation to the poor and vulnerable.  . . .  As followers of Christ, we are challenged to make a fundamental “option for the poor” – to speak for the voiceless, to defend the defenseless, to assess lifestyles, policies, and social institutions in terms of their impact on the poor. This “option for the poor” does not mean pitting one group against another, but rather strengthening the whole community by assisting those who are most vulnerable.

Human rights are the minimum conditions for life in community.  . . .  In Catholic teaching, human rights include not only civil and political rights but also economic rights.  . . .  This means that when people are without a chance to earn a living and must go hungry and homeless, they are being denied basic rights.

Society as a whole, acting through public and private institutions, has the moral responsibility to enhance human dignity and protect human rights. In addition to the clear responsibility of private institutions, government has an essential responsibility in this area. This does not mean that government has the primary or exclusive role, but it does have a positive moral responsibility in safeguarding human rights and ensuring that the minimum conditions of human dignity are met for all. In a democracy, government is a means by which we can act together to protect what is important to us and to promote our common values.

This framework is a solid introduction about how to think, talk, and act differently about our current form of capitalism. We encourage you to incorporate it in your thinking and talking about capitalism with others. We especially encourage you to incorporate it in the way you do business with others.

This framework also provides the themes for a solid defense of capitalism as the best of all economic systems, when capitalism operates within this kind of framework. By offering a reformed capitalism, one that includes an ethic of optimize profits within this kind of framework, we successfully address the concerns reported by Newsweek and remove the incentive to consider socialism as an attractive alternative.

We challenge you to give this framework a close read, use it to reform or sharpen your thinking about a better capitalism, and then join us in reforming capitalism so that all the generations, not just those shuffling away and toward socialism, can flourish under a fair and just economic system.

Fix Capitalism. Fix the American Dream.

Our vision is to benefit society by transforming capitalism's current core ethic of 'maximize shareholder value' to the better core ethic of 'optimize mutual value.' We achieve our vision by impacting learning, opinion, beliefs, and policy. Institute for Better Capitalism, Inc.

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