Ten Myths About Capitalism That Keep Us Misled

In October 2023, Indian business tycoon N.R. Narayana Murthy made headlines by suggesting that young people should work 70 hours a week for India to compete with emerging economies. His comment was echoed by several prominent entrepreneurs, including Ola co-founder Bhavish Aggarwal and JSW Group Chairman Sajjan Jindal. While the statement drew widespread backlash on social media, it also exposed just how deeply capitalist myths are embedded in our collective mindset. We’re told that overwork leads to productivity, that billionaires represent progress, and that wealth eventually trickles down. But what if none of that is true?

Capitalism is often sold as the most efficient and fair economic system, rewarding hard work, promoting innovation, and lifting people out of poverty. Most countries in the world today embrace it as the dominant economic doctrine and actively promote it as the optimal model for growth and prosperity. But scratch the surface, and you’ll find a system that thrives on inequality, concentrates wealth in the hands of a few, and justifies exploitation. Many of its core ideas are myths designed to keep people accepting an unjust system.

Here are ten capitalist myths that deserve to be debunked.

1. Trickle-down economics works

The claim that tax cuts for the rich and corporate deregulation will “trickle down” to benefit everyone has been debunked repeatedly.

• The wealthiest hoard their gains instead of reinvesting them into wages or job creation.
• Income inequality has skyrocketed in countries that embraced trickle-down policies, while wages for the majority have stagnated.
• The richest get richer, and the poor get poorer—because wealth, when concentrated, stays concentrated.
• A 2020 London School of Economics study analysing 50 years of data from 18 countries found that tax cuts for the rich had no significant effect on economic growth or employment but did increase income inequality.

Wealth doesn’t trickle down; it gets sucked up.

2. More billionaires mean a better society

The rise of billionaires is presented as a sign of economic success, but extreme wealth accumulation usually harms society rather than helps it.

• Billionaires hoard money that could be reinvested in wages, public services, or social welfare.
• Many get rich through tax avoidance, low wages, and monopolistic practices.
• No billionaire earns their wealth alone—it’s built on the labour of thousands or even millions of workers.
• India added 40 new billionaires in 2021 and in the same year, the income of 84% Indian households declined and over 4.6 crore people fell to extreme poverty, according to an Oxfam report.

A healthy society doesn’t need billionaires; it needs fair distribution of wealth.

3. Poor people are poor because they don’t work enough, and rich people are rich because they work hard

Capitalism loves the “rags to riches” story, making us believe that anyone who works hard can become rich. But reality tells a different story.

• Some of the hardest-working people—farmers, factory workers, nurses, sanitation workers—earn the least.
• Many of the richest people inherit wealth, profit from monopolies, or make money through financial speculation rather than hard work.
• Systemic barriers, like racial, caste and gender discrimination, education access, and economic background, determine financial success more than effort.
• In the US, the bottom 90% of earners have seen only a 28.7% increase in income from 1979-2021, while the top 1% and the top 0.1% saw their income grow by 206.3% and 465.1% respectively according to this report from the Economic Policy Institute.

Wealth is not just about working hard; it’s about access to opportunities and structural advantages.

4. Capitalism rewards innovation and talent

The idea that capitalism fosters innovation is misleading. Many of history’s greatest inventions and advancements didn’t come from profit-driven motives.

• The internet, GPS and many medical breakthroughs were funded by public money, not private corporations.
• Capitalism often kills innovation by prioritising monopolies, patent hoarding, and profit over public good.
• Many talented individuals never get opportunities because they can’t afford education or the capital to start ventures.
• According to an Economic Policy Institute Report, the net productivity of workers in the US grew 59.7% from 1979-2019 while a typical worker’s compensation grew by only 15.8%.

True innovation happens when knowledge is shared, not hoarded for profit.

5. More working hours mean more productivity

Capitalist culture glorifies overwork, convincing people that longer hours lead to greater efficiency. But in reality:

• Studies show that overworked employees make more mistakes, suffer from burnout, and are less productive over time.
• Countries with shorter workweeks, like Denmark and the Netherlands, have higher productivity and better work-life balance.
• The richest people don’t work 80-hour weeks; they let their money work for them while workers are expected to sacrifice their well-being.
• A 2014 Stanford University study found that productivity per hour drops sharply after 50 hours of work per week, and people working 70 hours produce pretty much the same output as those working 55 hours.

Productivity isn’t about working more hours; it’s about working smarter.

6. Raising minimum wages makes poor people lazy and leads to job loss

This is one of capitalism’s favourite scare tactics: “If wages rise, people won’t work!” But studies show the opposite.

• Higher wages lead to increased productivity, better health, and lower employee turnover.
• Poor people don’t stop working when they get paid better—they just stop being desperate.
• CEOs and shareholders take home millions, yet no one calls them lazy for not working a 12-hour shift.
• Most minimum wage studies find little-to-no effect on employment, according to a 2024 NBER research paper .

A fair wage doesn’t make workers lazy; it makes them human.

7. People need to earn their living; freebies are bad

Capitalist societies promote the idea that social welfare is a burden, but corporate subsidies and tax breaks are never criticised as “freebies”.

• Governments bail out banks and corporations but hesitate to provide basic income to citizens.
• Public services like healthcare and education are framed as luxuries rather than rights.
• The wealthiest often pay the least in taxes, yet it’s the poor who are shamed for “not contributing”.
• Indian states with strong welfare schemes, like Tamil Nadu and Kerala, consistently outperform others in human development indicators, with higher literacy, life expectancy, and lower poverty rates, according to NITI Aayog reports.

We already live in a world of “freebies”—they’re just given to the rich, not the poor.

8. Overpopulation is the reason for climate change

When climate change is discussed, fingers often point at rising populations, especially in poorer countries. But the real problem is capitalist overproduction and reckless consumption.

• Large corporations exploit fossil fuels, deforest land, and pollute oceans—all in the pursuit of profit.
• Capitalist economies prioritise endless growth, creating a throwaway culture that fuels environmental destruction.
• Richest 1% account for more carbon emissions than poorest 66%, according to a recent Oxfam study

Climate change isn’t a population issue; it’s a capitalism issue.

9. Stock markets measure economic health

Whenever the stock market is booming, we’re told the economy is doing great. But stock prices have little to do with actual economic well-being.

• The stock market primarily benefits the wealthy, while wages and job security remain stagnant for the working class.
• Companies lay off workers and cut wages to boost stock prices—not because they’re struggling, but to maximise shareholder profits.
• Economic health should be measured by living standards, healthcare, education, and public well-being—not by the gains of Wall Street.
• According to the US Federal Reserve, the richest 10% of Americans own 93% of all stocks, meaning stock market gains disproportionately benefit the wealthy while having little impact on the working class.

A rising stock market doesn’t mean a better life for ordinary people.

10. Money can’t buy happiness

This phrase is often used to downplay the importance of financial stability. While money alone doesn’t guarantee happiness, lack of money definitely causes misery.

• Financial security reduces stress, improves health, and increases life expectancy.
• More income means better access to education, healthcare, and leisure.
• The wealthy use this myth to justify inequality, pretending that money doesn’t really matter while hoarding billions.

Happiness is about more than money, but financial security is the foundation.

Capitalism thrives on myths that keep people believing the system is fair and functional. But when we strip away the illusions, it becomes clear that this economic model is built to serve the few at the expense of the many. Recognising these myths is the first step toward challenging the structures that sustain inequality—and imagining a better alternative.

What can we do?

Recognising these myths is just the beginning. Capitalism isn’t a law of nature—it’s a system created by people, and it can be changed. Here’s what you can do:

• Question the narratives fed to you by corporations and the media. Who benefits from them?
• Support policies that prioritise workers’ rights, wealth redistribution, and public welfare.
• Engage in conversations—challenge these myths in discussions with friends, family, and colleagues.
• Organise and advocate—join unions, grassroots movements, or political groups pushing for economic justice.
• Vote with your wallet when possible, supporting ethical businesses over exploitative corporations.

A better world is possible—but only if we stop believing in the myths that keep us tied to a broken system.

Siddharth tweets at @dearthofsid.

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