"Capitalization is the accumulation of wealth, the conversion of work, savings, and forethought into tangible working assets. No progress is possible without some measure of capitalization. It is a serious error to assume that socialism and communism are opposed to capitalization or to capitalism; their opposition is simply to private capitalism, but their dedicated policy is to state capitalism. For the state to plan any program of progress, public works, or conquest, work, frugality, and forethought are necessary. The work is exacted from the people by force; the frugality or savings is again forced out of the people by means of wage controls, compulsory savings and bond-buying programs, and slave labor, the forethought is provided by the state planners.
State capitalism is seriously defective for a number of reasons. Most notably, first of all, it represents theft. The private capital of the people is expropriated, as well as their work and savings. It is thus a radically dishonest capitalization.
Second, forethought is divorced from work and frugality, that is, the planners are not the ones who provide the work and the sacrifice. As a result, the planners have no brake of immediate consequences imposed upon them. They can be prodigal in their waste of manpower and capital without bankruptcy, in that the state compels the continuance of their non-economic and wasteful planning. The consequence is that, wherever planning is separated from work and savings, instead of capitalization, the result is decapitalization. Socialism is thus by nature imperialistic, in that it must periodically seize or annex a fresh territory in order to have fresh capital to gut by expropriation. State capitalism is thus an agency of decapitalization.
…. capitalization in a society requires a background of faith and character. In every era of history, capitalization is a product of the Puritan disposition, of the willingness to forego present pleasures to accumulate some wealth for future purposes. Where there is no character, there is no capitalization but rather decapitalization, the steady depletion of wealth. Society becomes consumption centered rather than productive, and it begins to decapitalize the centuries-rich inheritance which surrounds it.
Thus, decapitalization is preceded always by a breakdown of faith and character. Where men feel that private happiness is man's purpose and goal rather than serving and glorifying God, and finding joy in Him, where men feel that life owes them something rather than seeing themselves as debtors to God, and where men feel called to fulfill themselves apart from God rather than in Him, there society is in rapid process of decapitalization."
From: Institutes of Biblical Law
By Rousas J. Rushdoony / P & R Publishing