Utilitarian ethics evaluates morality by the ratio of pleasure to pain. John Stuart Mill, who framed the most philosophically robust version of Utilitarianism, applied his ethical theories to his writings on poliical economy. Like many of his contemporaries, Mill promoted “liberal democracy,” a political philosophy with a system of individual rights and freedoms that allows citizens to influence the action of government. Free market capitalism was seen by many political economists, Mill included, to be an essential ingredient of a free society. Unfortunately, capitalism accomplishes the opposite as wealthy people have opportunities never available to the poor. Understanding why Mill does not anticipate this dynamic and reject capitalism shows why Utiltarianism should instead reject capitalism, not merely reform it.


As a Utilitarian, Mill argued that moral good is achieved when there is generally more happiness than there is pain. Undergoing pain voluntarily into order to achieve a worthy end, like an athlete training for a competition, is good when the happiness gained outweighs the pain suffered. While an individual can decide to trade some current pain for future pleasure, Mill does not think that a society can ask one person to suffer for the sake of another person’s happiness. In such a situation, Mill argues that no one could be happy because any pleasure they enjoy could be taken away at any time if someone else would benefit.


When applied to political economy, Mill’s Utilitarian framework evaluates policies by their potential for enabling happiness and avoiding pain. Since Mill acknowledges that happiness depends on the individual’s preference, he prefers a societal system that enables individuals to pursue whatever happiness they choose as long as they don’t hurt anyone else. Mill also recognizes that concentrated wealth affords a small group more choice, and therefore more possibilities for happiness, than the majority of people enjoy. Instituting a tax on inheritance would ensure that wealth would be gradually redistributed, as Mill argues in his Principles of Political Economy.


However, Mill proposes only a gradual redistribution by reducing inheritance rather than an aggressive redistribution by taxing wealth directly. However, the advantages that accompany wealth tend to enable further concentration of wealth. Wealth purchases influence through political donations, lobbying, and propaganda. Political influence allows wealthy people to obstruct redistributive efforts, further exacerbating wealth inequality. Through philanthropy, wealthy individuals influence the education, science, and the economy, shaping it according to their needs and their beliefs. The working class generally enjoy fewer choices, and even their available choices must serve someone else’s happiness even if it luckily also serves their own.


A charitable interpretation of Mill’s views would assume that Mill believed the harms done by concentrated wealth are not too severe, that concentrated wealth would not influence public policy to prevent redistribution, and that Mill would revise his proposal if his beliefs changed. Mill argues against socialism by claiming that capitalism provides more freedom than socialism, that inequality provides more motivation to strive, and that monopoly abuses are unlikely to manifest. While Mill did not see wages declining during his day, the decline of real wages from the 20th to 21st century has now been well-documented. Compounding advantages of wealth enable monopolistic collusion to prevent wage increases. Reduced wages motivate workers, requiring them to spend more of their waking hours working in order to provide for their needs. The working class then have very little freedom as long as they remain chained to wage-earning activity.

From a contemporary perspective, none of Mill’s objections hold. While the wealthy may enjoy a high degree of freedom, the corresponding suffering of the working class cannot be justified. As such one might assume that, if he were exposed to the right data, Mill would agree that capitalism fails to enable freedom, and that more direct redisribution of wealth may be needed.