The Trump administration’s tariffs and the damage they could cause to people’s livelihoods globally are a rude reminder that free markets matter. But we live in a time when the mainstream voices of the media, academia, and politics are hopelessly preoccupied with their disdain for “capitalism.” Despite the unprecedented progress and technological advancement free markets have brought, much of society still hates the goose that lays the golden egg. But why?
Ludwig von Mises found himself asking this question again and again. Why did the loudest voices in the academy, the press, and polite society seem to loathe capitalism?
In The Anti-Capitalistic Mentality, first published in 1956, Mises offers a provocative answer: capitalism’s critics aren’t just mistaken—they’re resentful. For the anti-capitalist, the problem with capitalism isn’t that it fails the masses; it’s that it empowers them.
Mises provided some of the most powerful critiques of the socialist idea of a planned economy in favor of a free market system. Mises avoided the term “capitalist” due to its Marxist origins. He believed it carried too much baggage, and instead preferred the term “market economy.”
For Mises, the market economy is not defined by a set of institutions but by the kind of goods produced; there is “mass production of goods destined for consumption by the masses.” While goods and services for the wealthy command a share of the market, they “play merely a subordinate role.” The adoption of the market economy across the globe has brought unprecedented technological innovation and prosperity.
Mises was equally frustrated and perplexed by condemnations of the market economy despite its role in lifting billions out of poverty. In The Anti-Capitalistic Mentality he explored two conflicting phenomena: how laissez-faire economics has raised living standards to unprecedented levels, while many, especially well-educated professionals, passionately claim to loathe capitalism.
Compared to Mises’s economic works, The Anti-Capitalistic Mentality is a more personal book that expresses his raw frustration, particularly with intellectuals and professionals.
Before the Age of Enlightenment and the rise of liberalism, a small elite, normally the descendants of former conquerors, largely dictated resources and production under feudalism. Markets existed but were hampered by strict regulation.
The emergence of the market economy of the 18th century challenged feudal hierarchies. Instead of production being decided by a small few, regular people, through incentives and prices, discovered ways to earn money by “filling the wants of the people in the best possible and cheapest way.” This encouraged constant innovation and competition to improve services and goods for the masses.
Under feudalism, wealth was decided by birth and status. In a market economy, wealth is mainly dictated by what Mises calls “a daily repeated plebiscite”—the constant buying and selling of goods. The needs of the masses were prioritized, and those who could fulfill them better and affordably became wealthier.
Pundits often compare the wealthiest capitalists to past eras’ aristocrats. But for Mises, there is a crucial difference: aristocrats gained their wealth through “conquest or from largess on the part of a conqueror,” while capitalists “owe their wealth to the people who patronize their business.”
Both conservatives and progressives lament capitalism’s standards, wishing to replace the profit motive with “fairer” methods of distribution. Mises acknowledges that capitalism does not reward people according to their inherent worth or merit, but according to their ability to produce goods and services the masses value most.
Today, a popular YouTuber might earn five times what a professor at a prestigious university makes. Mises explains, “What counts in the frame of the market economy is not academic judgments of value, but the valuations actually manifested by people in buying or not buying.” Maybe philosophers deserve more praise than YouTubers, but it is not up to any individual or group to decide—this is determined by the daily plebiscite of the market.
The absence of status and privileges gives capitalism its dynamism by incentivizing better production methods. However, it also creates uncertainty, forcing people to adapt to new technologies and endure anxiety about the future.
In a society dictated by caste and status, one’s condition in life is beyond his or her control. Under capitalism, it is the opposite. As Mises says, “everybody’s station in life depends on his own doing.” Under feudalism, two individuals might work as farmers because birth and prestige dictate their roles, leaving them with roughly equal and fixed prospects, making jealousy unlikely.
In contrast, in a modern market economy, those same individuals could pursue a vast range of careers. Unlike the serfs of feudalism, people today must compete in a world where their peers can surpass them in status and earnings. They have the potential to outdo us and outearn us. Living in a market economy, we are constantly forced to witness others succeeding despite their circumstances. As Mises remarks, “Everybody is aware of his own defeat and insufficiency.”
Many seek a scapegoat to counteract frustrated ambitions. According to Mises, some console themselves by associating profit with evil and poverty with virtue, framing capitalism as a choice between exploitative wealth and virtuous poverty. He argues that intellectuals tend to sublimate their disdain for capitalism into a broader ideological critique.
Advocates of progressive causes often point to the fact that many academics, doctors, and scientists—the most educated—view capitalism as flawed. If intellectual authorities like Albert Einstein opposed capitalism, they argue, there must be merit to their position, the reasoning goes.
Responding to this, Mises notes that people tend to interact most with those in their own income bracket. Due to their upbringing, education, and wealth, Mises believes that educated academics, professors, and doctors often associate with the wealthy more than the average person does. They often encounter wealthier business owners and entrepreneurs who outearn them despite lacking their level of intellectual achievement. Mises believes this fosters resentment, as educated professionals see their own fields as most intellectually valuable and deserving of higher status than private enterprise.
Mises states that intellectuals “loathe capitalism because it has assigned to this other man the position they themselves would like to have.” He attributes this to the nature of their occupations, which “throw a veil of comradeship and colleagueship over the reality of competition.” They can feign the idea that theirs is a vocation rather than a financial pursuit.
The dynamism of a free-market economy enriches societies but also creates frustrations. For Mises, “Life is a process, not a perseverance in a status quo.” Competition and innovation disrupt vested interests and traditional authorities, forcing adaptation or decay. Though imperfect, capitalism compels individuals to evolve.
The Anti-Capitalistic Mentality is undeniably a product of frustration. Mises concludes by warning that advocates of the market economy and a free society cannot merely be anti-government intervention. People are driven by the pursuit of goals, not simply rejecting evil. Advocates of the market economy must do more than argue against worse alternatives—they must make a compelling positive case for the market economy while deconstructing the anti-capitalist mentality.
