There is no general framework of morality or justice that supports laissez-faire capitalism. This is a problem of course for those who wish to argue on behalf of it. When you talk to such people, a familiar argumentative pattern emerges that I have come to call Capitalism Whack-A-Mole.
Someone playing Capitalism Whack-A-Mole moves seamlessly between three different — and mutually incompatible — frameworks of justification. Those frameworks are desert (each person should get what they produce with their labor), voluntarism (each person should get whatever they come about through voluntary, non-coercive means), and utility (the economic system should be created to maximize well-being). This Capitalism Whack-A-Mole does not need a starting point, but, in my experience, either desert or voluntarism comes first, with utility the back up when the argument turns really bad.
Here is a simulation of one such argument.
Them: Capitalism is right because people should get what they earn through their hard work.
Me: But this is not what happens under capitalism. Among other things, one-third of the national income goes to capital owners who have done no work at all for that income. If you really believe the economic system should distribute according to hard work, then you’ve got to at least tax capital income at 100%. That’s not to mention the value of nature, which nobody produces with their hard work, and which you must therefore also tax at 100%. There are other problems as well.
Them: Capital owners may not produce anything to get that one-third of national income, but they got it through voluntary transactions. I am just against force and for voluntarism.
Me: Transactions are not voluntary. They are coerced through systems of property ownership. You only trade with someone because there is a gun at your head to keep you from simply grabbing the thing that you trade for. There is nothing voluntary about that. The only system that respects voluntarism is the Grab What You Can World, in which people are free to act on any piece of the world as they wish, without restriction.
Them: Capitalist institutions may require violent coercion to enforce, but they make everyone very rich. We’d be much poorer, even at the bottom of society, if we got rid of them.
Me: OK. So you support using violent coercion in order to make sure people are well off. But people, especially the poor that you are now concerned with, are better off in Social Democratic systems than they are in laissez-faire capitalism. The diminishing marginal utility of money, by itself, justifies significant tax and transfer schemes under a “making everyone as well off as possible” analysis.
Them: But taxes are involuntary and use force.
Me: So are property institutions. We just went over this.
Them: Taxes are theft. People should be able to keep what they work for.
Me: Capital income, which comprises around one-third of the national income, is not worked for. We just went over this.
Me: That requires taxes and transfers.
Me: That requires getting rid of capitalist ownership institutions.
Me: That requires getting rid of capital income.
And so on. Desert, voluntarism, utility. Desert, voluntarism, utility. Desert, voluntarism, utility. None of these frameworks support capitalism, but when utilized in Capitalist Whack-A-Mole, they are able to complement each other in a way that ensures the problems of one can be answered by another.
Desert cannot handle the fact that capital income is not earned through work. But voluntarism can chime in at that point to say capital income is gotten voluntarily at least. Voluntarism cannot handle the problem that all economic institutions are involuntary, most especially property laws. But utility can chime in at that point to say property laws are instrumentally useful for overall welfare. Utility cannot handle the fact that transfers are utility-boosting, both in aggregate and for their recipients. But voluntarism can help argue against those on “taxation is force” grounds and desert can help argue against those on “taxation is stealing people’s product” grounds.
The fact that proponents of laissez faire capitalism move between three radically different justificatory frameworks that are all incompatible with one another is not particularly surprising, of course. Most people come to their feverish support of capitalism through unreflective cultural mechanisms first, and their arguments are then filled in later. It is kind of funny to watch though.