That's bullshit. The government at least owes you a song and dance about how it's working for you. Even if you're too poor to pay taxes. Corporations don't owe you anything. When the masses have been squeezed dry they will have nothing to protect themselves from the externalities of corporations. The failure of this government is that it no longer exists. It's a corporation now. Sort of an inter-corporate security/insurance firm. What we actually need is a working government. I can't believe we still have the electoral college. Has no one heard of instant runoff voting? Or what happened in 2000 with Nader and Gore. The problem isn't just government period. It's this pretension of one.
Governments are the more dangerous, objectively speaking. All of them have the monopoly of army and public forces. Not a single corporation in the world could be equally dangerous just based on this.
Are you sure? There are some pretty scary private security firms. Do you actually know what they have? I hope government really does have a monopoly on force.
No private organization has committed crimes comparable to the ones committed by authoritarian governments. I could mention USSRs pogroms, concentration camps on Germany or summary executions in Cuba, to name a few.
Approval voting. You want approval voting. Range voting is actually better but approval voting is almost as good and is a lot simpler for people to understand, and both are better than IRV.
I agree that approval voting is simpler conceptually. I like that IRV lets me prioratize my vote. It's not that much more complicated. Counting the vote is a lot harder but the voters don't have to do that. If 60% prefer Gore to Bush and 90% of them prefer Nader to Gore then you don't get the "correct" result. You'd have Gore beating Nader with 60% vs 54% approval when 54% (the majority) of the population actually prefered Nader to Gore. They can't risk leaving Gore unapproved because then Bush might win. IRV solves this.
You're only getting that result by having 100% of the voters who prefer Nader to Gore approve of both while 100% of the voters who prefer Gore to Nader only approve of Gore. In which case approval voting does what it's supposed to do and gives the election to the candidate with the highest approval.
Moreover, the problem you're trying to solve is Arrow's Impossibility Theorem, which is provably impossible to do. You could have a third of voters prefer each candidate but majorities prefer Nader to Gore, Gore to Bush and Bush to Nader.
I see what you're saying about Arrow's Impossibility Theorem. I don't think I was specific enough. You're right in the general case and IRV doesn't solve that problem. What I mean is that 54% could prefer Nader outright. But since they also prefer Gore to Bush they have to approve of Gore or else Bush may win. This causes Gore to have the highest approval even though he wasn't the majority's most desired candidate. It wouldn't fix the bias towards those expected to win.
> But since they also prefer Gore to Bush they have to approve of Gore or else Bush may win.
Only the Gore voters have to do the same thing, and then Nader wins if he has more support. Because a small percentage of people will vote only for their preferred candidate and risk Bush, which will be proportional to the support that candidate has and thus give Nader the win if he actually has more support.
The thing you're really objecting to is why range voting is better than approval voting. With range voting the Nader supporters can give Nader 10, Gore 9 and Bush 0, the Gore voters swap Gore and Nader and then there is less brinkmanship necessary to get the right outcome. But that's the cost of using the one which is easier to explain. And range voting is more complicated than approval voting, but it's simpler than IRV, so you're really just making the argument for range voting over approval voting.
I feel like the trap you're falling into is to grade approval voting based on whether it does what IRV does.
The problem with IRV is that it tends to do crazy things. So for example, imagine everybody expects that in a runoff between Bush and Nader, Bush wins. But between Bush and Gore, Gore wins. So then people who would vote for Nader can't vote for him because it would give the election to Bush again. But even weirder, Bush voters can vote for Nader in order to give the election to Bush. So IRV doesn't solve the most important problem, because people will still be clamoring for third parties not to run and for people not to vote for them for fear that they'll harm the major party most similar to them.
Ok I think I'm with you. Thank you for this actually. I really appreciate it. Range voting doesn't seem that bad. People are used to taking surveys. I have failed many times to explain IRV and this does seem to have the same benefit. Also brinkmanship is an awesome word that I did not know.
There is actually quite a bit of government out there. I don't know exactly why it is the Legislature has all but collapsed, but that's not all of government.
Thing is, w.r.t the economy, what can actually be done? The only thing I know of that isn't pretty disruptive is as higher inflation target - and we cannot maintain GDP growth to hit the one we have.
The problem is there isn't a candidate running who is willing to do the right thing. The Republican Party hasn't been for small government in decades. They take your money and give it to defense contractors and banks, whereas the Democrats take your money and give it to insurance companies and banks. The Republicans eliminate regulations that protect people and competition from corporations while the Democrats enact regulations that protect corporations from people and competition.
Nobody is doing the right thing. That's why the Republican voters nominated The Joker and the Democrats almost nominated Sanders. People are for someone who will shake things up. But the fact is nobody knows what Trump will actually do, so your choices this year are between "clearly bad" and "wait, what?"
Firstly, Bernie is a Social Democrat. Secondly, Capitalism has gotten so much Crony in it that the inequality is hurting the capitalism. Bernie could have swung the scales towards infrastructure, unionism, and lowering inequality, which would put dollars in the pockets of the poor, which would in turn be spent directly into the economy.
" Bernie could have swung the scales towards infrastructure, unionism, and lowering inequality, which would put dollars in the pockets of the poor, which would in turn be spent directly into the economy."
That's a little bit of a stretch.
Inequality is a problem mostly because:
A) The benefits of globalism go to the 1%, then to the middle class in terms of cheaper prices, but the working class lose jobs.
B) US has massive importation of low-skilled immigrants. They go right at the bottom. You don't need a 'messed up system' - if you just add poor people, you increase inequality.
C) Bernie is an old-time socialist - he has no new ideas, really. I've heard him talk, he wants to massive increase wealth distribution and do it by taxing 'the rich'. This never works out, really. 'Infrastructure' is a cover - really, it's a wealth transfer exercise. Europe and Canada tried that in the 1960's it didn't go s well.
The problem is really difficult, and it's exacerbated by the sheer size of the US, also there are no ethnic ties. Sweden is only the size of Los Angeles - and they are 'Swedes' an ethnic group with fraternal social order, a Monarchy, a State Church, common cultural identity. It's easier to 'redistribute' when the person getting the service is someone you know.
The best kind of 'redistribution' is 'jobs'. Surely, increasing the minimum wage a little bit might work, and possibly having unions where none exist (Wallmart?), but strengthening already existing unions - particularly in the auto-sector and government is not going to help anyone - they are part of the problem. Auto workers and gov. workers are massively overcompensated relative to their private sector peers. Gov unions are one of the reasons government is so massively inefficient. If Bernie could fix that, that'd be great - but he's a politician, he's never had a normal job and wouldn't have a clue how to do it.
I think moving towards empowering people, making sure they can participate in the global wealth creation is very important, but 1960's style socialism is not the answer.
What the free market rules should be are fairly clear. When corporations influence government to favor those corporations and blunt competition, that is not a failure of the free market, it is a failure of the government.
Not true, wealth accumulation is sure to happen in a free market due to random circumstances and just even minimal imperfections in knowledge. Government is not required.
And a wealthy player would be a fool to not try to skew the rules in their favour.
Nobody has proven yet that it is possible to prevent this problem even in a really long term.
But can you have free markets if corporations are permitted to influence the government? It seems impossible; humans will be influenced by those with whom they have contact.
So the alternative is to prohibit corporations from lobbying government, but that would be tantamount to removing legal personality from corporations and it is questionable whether the result is a free market system. You would also need to remove the right of people to lobby on behalf of groups of other people, and it is questionable whether the resulting system is free at all, or in any ways desirable.
The system that we have approaches free market capitalism as well as a liberal system can.
You can never have a perfect free market, nothing that humans craft is ever perfect. But you can get pretty close. As I've posted here before, the software development industry is fairly close to a free market.
Besides, just because we cannot reach perfection is not justification to run the other way. The government is run by people, and people are subject to imperfection, incompetence, and corruption. The more power added to that means the more temptation there is to use that power for personal agendas.
Remember that county clerk who was using her government power to deny marriage licenses to gay couples?
Only a select few win big and often their products are way overvalued. The road to billion valuation is littered with dead startups doing almost the same thing.
The economy in general and government were quite disjoint for a very long time. This was considered an active goal to be pursued.
The arguments for changing that were largely of a Progressive (by the timbre of the times) nature - trustbusting and all of that. I don't think that genie can be put back in the bottle.
'Democratic Socialism' is almost like communism: 'Social ownership of the means of production' - no real private enterprise, but not quite centrally planned.
'Social Democracy' is socialism + free markets/private enterprise, meaning socialization of some things (i.e. possibly healthcare) and government intervention for the 'wellbeing' of people.
The former is basically far-far left wing, the later not quite as left ... is the political basis for most left wing parties in Europe, especially Scandinavian and somewhat continental as well. Canada's NDP party is basically Social Democracy. Bernie Sanders would probably be described as Social Democracy.
Thanks. May be next time I should describe myself as Social Democracy then.
Most people hate socialist. Which I describe myself as being one. I am all for national healthcare and education. If it wasn't Obama I would not have known there are countries without healthcare. Same goes to education. Although tuition fees for university is debatable.
I could not understand why even healthcare is on socilist side. May be capitalist should also get rid of Police, fireman etc these kind of public services?
But I am all for free market with hopefully minimum restrictions.
There is no monopoly on the creation of currency in the US because it's not a business activity.
The Fed, though technically privately owned, is effectively independent.
Yes, it's basically insane that the Fed is not a nationalized entity, but at the same time ... not much would change if the government did nationalize it, I don't think, anyhow.
The power structure and decision making process would be the same.
The Federal reserve is 'empowered to print money' by the Government, and is not really a profit-making entity - but it is privately owned.
It's a small detail, but an important one.
The banks of the USA each own shares in the Fed - it's privately owned.
By the way - American citizens don't have full control over it. There is no 'audit' or open books. Ron Paul demanded a historical audit of the Fed - and they would only go back as far as 2004.
I'm not a 'NWO conspiracist' - but the currency of the US is managed by private entities, under the oversight of Congress. If we could actually see what's on the books from 1913-2016 there would be many a skeleton.
"If the banks owned it, they could vote to take all the profits (instead of a small fraction). Let me know when that happens."
You are once again misled.
It's authorized by congress, but it is NOT A PART OF GOVERNMENT. Unlike in the UK, Canada - and everywhere else in the world, the US Fed is not a nationalized entity.
The Fed is literally owned by banks.
If you founded a bank in America, you would actually be forced to buy a share in it.
The banks don't 'vote to take all the profits' because the operating requirements are established by mandate from the government, and there is oversight. FYI the Fed does make a tiny profit.
And this from the US 9th circuit court:
"the United States Court of Appeals for the Ninth Circuit stated that: "The Reserve Banks are not federal instrumentalities for purposes of the FTCA [the Federal Tort Claims Act], but are independent, privately owned and locally controlled corporations."
"While the Board of Governors is an independent government agency, the Federal Reserve Banks are set up like private corporations. Member banks hold stock in the Federal Reserve Banks and earn dividends. Holding this stock does not carry with it the control and financial interest given to holders of common stock in for-profit organizations. The stock may not be sold or pledged as collateral for loans. Member banks also appoint six of the nine members of each Bank's board of directors. "
$100.2 billion tiny dollars in 2015. $97.7 billion of which was paid to US gov.
Holding this stock does not carry with it the control and financial interest given to holders of common stock in for-profit organizations. The stock may not be sold or pledged as collateral for loans. Member banks also appoint six of the nine members of each Bank's board of directors.
This is not ownership. It is membership. Membership that is required by law.
You nailed the point I think is the most critical: that artificially low interest rates (along with massive government debt) have resulted in an incredible misallocation of capital. Working in Silicon Valley I see (and benefit) from this first hand. Pensions, endowments, and all the other Limited Partners need 7-8% returns. Most directly access or are one to two steps removed from the free government money. With few “reasonable” investments that can return the required numbers, they are forced to chase returns. This leads to an abundance of capital in SV, one of the few places still believed to offer these returns (this is changing as this cycle comes to an end).
Others with first access to capital are doing great in this climate too: hedge funds, investment banks, government contractors, big companies. The rich get richer while the economy stagnates for the majority. Raising rates and stoping the bailouts of failed private institutions I believe will go a long way toward fixing this growing inequality. How we get leaders who can enact these policies is another thing since conventional wisdom (and much of academia) says dropping rates grows the economy. Amazes me that the world didn’t learn from Japan’s never ending stagnation. We hit the end of a 20 year credit expansion cycle in 2000 and there still is no will to let asset prices and credit deflate, instead we got the government “put” [1], not to mention the 2008 bailouts, and continued credit expansion.
The sad part is that instead of fixing the problem, micromanaged economic policy and money creation from on high, we will get jingoistic nationalism. While I do agree that some of our “free trade” has been anything but fair, the numbers, including those in the article, seem to indicate that it has helped large numbers of people throughout the world escape from poverty. I believe free and fair trade is a boon for all. These gains, unfortunately, will likely evaporate as fed-up, disenfranchised electorates in developed countries try anything to stop their slide backwards. It’s tough to sell a “help the world” argument to people who are hurting when those on the top are doing so well.
Indeed. SV has become just another government program. The sad irony for me personally is that I long ago quit a job working for the government to come here.
But individual banks of no particular affiliation - just "bank" banks - can create all the "currency" you want to the limits of regulation. They're really creating abstract money that can be exchanged for currency.
The story of the Scots Free Banks being busted out by the Bank of England is poignant and interesting, but we simply don't know what would have happened had it gone the other way. The way we use banks now, having a bank go insolvent and all the depositors and other interested taking a haircut doesn't sound very appealing.
No one can deny that there has been a great period of growth under capitalism, but it's also ridiculous to deny the fact that along with said growth there have also been many crises. That's what this article is about. So, the question that I originally posed was asking not whether GDPs are bigger now than they were in the Middle Ages, but whether or not we should move on from capitalism to something better. Your comment did absolutely nothing to answer that question.
Which "something better"? Does "something better" still contain all the salient characteristics of what we call capitalism such that we keep the advantages? We're pretty sure that many things are entangled here; it's not clear that we have the means to disentangle them
I'll put up with a lot to see freedom from food insecurity, basic clean water and good abatement of public disease vectors. If we break the system in certain ways, we may lose the ability to do even that. Don't say this doesn't happen; look at some of the South American countries.
I try to sidestep all the ideology by thinking that the things we don't like about the Rubric Currently Known as Capitalism probably involve the use of economic rents to enrich certain people and not enrich other people.
If that tool works ( and I can't defend it beyond a rudimentary level, frankly ) then the things you're talking about that you don't like aren't actually part of capitalism.
And i think we're really talking about "why is growth slow?" Well, good question but my biases lead me to think that this is a lot demographic and the rest is bad monetary policy grounded in a basic lack of understanding of things like the proper role of central banks and public debt.
I don't know that if we had 4% {rN}GDP growth we'd even be talking about this.
In that case, "replacing" capitalism might just make it worse.
No, we figured that out decades ago, which is why capitalism was generally abandoned in the developed world in favor of the modern mixed economy. "Capitalism" is now, though, used in at least three conflicting ways:
(1) To refer to actual capitalism (the real system dominant in the developed world in the late 19th and early 20th century, described and named "capitalism" by its socialist critics),
(2) To refer to modern mixed economies as opposed to forms further from capitalism, such as Leninism and its derivatives,
(3) To refer to a utopian realization of Econ 101 ideal markets, whose adherents seen to believe is actually a plausible economics system rather than a useful simplification in the same way as a friction-free model in physics.
The former, as mentioned above, cannot be redeemed, though a synthesis with other ideas is possible (and now dominant) that mitigates some of its worst elements.
The second may be improvable while still recognizably remaining a form of the modern mixed economy.
w.r.t 2), I think of the peak of that as roughly the time in which John Kenneth Galbraith wrote "The New Industrial State". We didn't exactly conspire to kill it, either - it sorta just happened.
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[ 4.6 ms ] story [ 117 ms ] threadApproval voting. You want approval voting. Range voting is actually better but approval voting is almost as good and is a lot simpler for people to understand, and both are better than IRV.
Moreover, the problem you're trying to solve is Arrow's Impossibility Theorem, which is provably impossible to do. You could have a third of voters prefer each candidate but majorities prefer Nader to Gore, Gore to Bush and Bush to Nader.
Only the Gore voters have to do the same thing, and then Nader wins if he has more support. Because a small percentage of people will vote only for their preferred candidate and risk Bush, which will be proportional to the support that candidate has and thus give Nader the win if he actually has more support.
The thing you're really objecting to is why range voting is better than approval voting. With range voting the Nader supporters can give Nader 10, Gore 9 and Bush 0, the Gore voters swap Gore and Nader and then there is less brinkmanship necessary to get the right outcome. But that's the cost of using the one which is easier to explain. And range voting is more complicated than approval voting, but it's simpler than IRV, so you're really just making the argument for range voting over approval voting.
I feel like the trap you're falling into is to grade approval voting based on whether it does what IRV does.
The problem with IRV is that it tends to do crazy things. So for example, imagine everybody expects that in a runoff between Bush and Nader, Bush wins. But between Bush and Gore, Gore wins. So then people who would vote for Nader can't vote for him because it would give the election to Bush again. But even weirder, Bush voters can vote for Nader in order to give the election to Bush. So IRV doesn't solve the most important problem, because people will still be clamoring for third parties not to run and for people not to vote for them for fear that they'll harm the major party most similar to them.
http://scorevoting.net/AppCW.html
Thing is, w.r.t the economy, what can actually be done? The only thing I know of that isn't pretty disruptive is as higher inflation target - and we cannot maintain GDP growth to hit the one we have.
Nobody is doing the right thing. That's why the Republican voters nominated The Joker and the Democrats almost nominated Sanders. People are for someone who will shake things up. But the fact is nobody knows what Trump will actually do, so your choices this year are between "clearly bad" and "wait, what?"
And how can you possibly say he is part of the DNC? Do you even follow US politics at all?
That's a little bit of a stretch.
Inequality is a problem mostly because:
A) The benefits of globalism go to the 1%, then to the middle class in terms of cheaper prices, but the working class lose jobs.
B) US has massive importation of low-skilled immigrants. They go right at the bottom. You don't need a 'messed up system' - if you just add poor people, you increase inequality.
C) Bernie is an old-time socialist - he has no new ideas, really. I've heard him talk, he wants to massive increase wealth distribution and do it by taxing 'the rich'. This never works out, really. 'Infrastructure' is a cover - really, it's a wealth transfer exercise. Europe and Canada tried that in the 1960's it didn't go s well.
The problem is really difficult, and it's exacerbated by the sheer size of the US, also there are no ethnic ties. Sweden is only the size of Los Angeles - and they are 'Swedes' an ethnic group with fraternal social order, a Monarchy, a State Church, common cultural identity. It's easier to 'redistribute' when the person getting the service is someone you know.
The best kind of 'redistribution' is 'jobs'. Surely, increasing the minimum wage a little bit might work, and possibly having unions where none exist (Wallmart?), but strengthening already existing unions - particularly in the auto-sector and government is not going to help anyone - they are part of the problem. Auto workers and gov. workers are massively overcompensated relative to their private sector peers. Gov unions are one of the reasons government is so massively inefficient. If Bernie could fix that, that'd be great - but he's a politician, he's never had a normal job and wouldn't have a clue how to do it.
I think moving towards empowering people, making sure they can participate in the global wealth creation is very important, but 1960's style socialism is not the answer.
And a wealthy player would be a fool to not try to skew the rules in their favour.
Nobody has proven yet that it is possible to prevent this problem even in a really long term.
So the alternative is to prohibit corporations from lobbying government, but that would be tantamount to removing legal personality from corporations and it is questionable whether the result is a free market system. You would also need to remove the right of people to lobby on behalf of groups of other people, and it is questionable whether the resulting system is free at all, or in any ways desirable.
The system that we have approaches free market capitalism as well as a liberal system can.
Besides, just because we cannot reach perfection is not justification to run the other way. The government is run by people, and people are subject to imperfection, incompetence, and corruption. The more power added to that means the more temptation there is to use that power for personal agendas.
Remember that county clerk who was using her government power to deny marriage licenses to gay couples?
Since when you have become a venture capitalist?
Only a select few win big and often their products are way overvalued. The road to billion valuation is littered with dead startups doing almost the same thing.
Once religion and state were one. Then they separated and now it is hard for the pope to have any real influence.
I think the same will happen with state, money and capitalism.
For that, it needs to get worse for sure thou.
The arguments for changing that were largely of a Progressive (by the timbre of the times) nature - trustbusting and all of that. I don't think that genie can be put back in the bottle.
If information is allowed to flow from corporations to government, what are the rules?
And "blunt competition" how, exactly?
'Democratic Socialism' is almost like communism: 'Social ownership of the means of production' - no real private enterprise, but not quite centrally planned.
'Social Democracy' is socialism + free markets/private enterprise, meaning socialization of some things (i.e. possibly healthcare) and government intervention for the 'wellbeing' of people.
The former is basically far-far left wing, the later not quite as left ... is the political basis for most left wing parties in Europe, especially Scandinavian and somewhat continental as well. Canada's NDP party is basically Social Democracy. Bernie Sanders would probably be described as Social Democracy.
Most people hate socialist. Which I describe myself as being one. I am all for national healthcare and education. If it wasn't Obama I would not have known there are countries without healthcare. Same goes to education. Although tuition fees for university is debatable.
I could not understand why even healthcare is on socilist side. May be capitalist should also get rid of Police, fireman etc these kind of public services?
But I am all for free market with hopefully minimum restrictions.
what exactly is left, what exactly is right?
?
You must be living in a bubble if you did not know other countries had socialized medicine. In fact, almost all modern nations do.
You should also be weary: I live in a country with socialized medicine, and it's not very good. If I pay a doctor to help my I go to jail.
It's a paradox: America has the best healthcare, but it's very expensive, and not everyone has it.
Most nations have 'parallel systems' and it works out ok, like Germany and the Netherlands.
The Fed, though technically privately owned, is effectively independent.
Yes, it's basically insane that the Fed is not a nationalized entity, but at the same time ... not much would change if the government did nationalize it, I don't think, anyhow.
The power structure and decision making process would be the same.
https://www.federalreserve.gov/faqs/about_14986.htm
When it makes a profit, it pays a little bit of it to member banks and the rest of it to the US Government.
I guess there aren't really laws about scrip in the US, but taxpayers know which money they like.
The Federal reserve is 'empowered to print money' by the Government, and is not really a profit-making entity - but it is privately owned.
It's a small detail, but an important one.
The banks of the USA each own shares in the Fed - it's privately owned.
By the way - American citizens don't have full control over it. There is no 'audit' or open books. Ron Paul demanded a historical audit of the Fed - and they would only go back as far as 2004.
I'm not a 'NWO conspiracist' - but the currency of the US is managed by private entities, under the oversight of Congress. If we could actually see what's on the books from 1913-2016 there would be many a skeleton.
https://en.wikipedia.org/wiki/Federal_Reserve_Act
If the banks owned it, they could vote to take all the profits (instead of a small fraction). Let me know when that happens.
You are once again misled.
It's authorized by congress, but it is NOT A PART OF GOVERNMENT. Unlike in the UK, Canada - and everywhere else in the world, the US Fed is not a nationalized entity.
The Fed is literally owned by banks.
If you founded a bank in America, you would actually be forced to buy a share in it.
The banks don't 'vote to take all the profits' because the operating requirements are established by mandate from the government, and there is oversight. FYI the Fed does make a tiny profit.
And this from the US 9th circuit court:
"the United States Court of Appeals for the Ninth Circuit stated that: "The Reserve Banks are not federal instrumentalities for purposes of the FTCA [the Federal Tort Claims Act], but are independent, privately owned and locally controlled corporations."
Here it is from the Fed of St. Louis:
https://www.stlouisfed.org/in-plain-english/who-owns-the-fed...
"While the Board of Governors is an independent government agency, the Federal Reserve Banks are set up like private corporations. Member banks hold stock in the Federal Reserve Banks and earn dividends. Holding this stock does not carry with it the control and financial interest given to holders of common stock in for-profit organizations. The stock may not be sold or pledged as collateral for loans. Member banks also appoint six of the nine members of each Bank's board of directors. "
It is a highly controversial issue.
Holding this stock does not carry with it the control and financial interest given to holders of common stock in for-profit organizations. The stock may not be sold or pledged as collateral for loans. Member banks also appoint six of the nine members of each Bank's board of directors.
This is not ownership. It is membership. Membership that is required by law.
It is not a nationalized entity, nor a part of government.
It's right there in writing.
There's also no reason that the US Fed should not be nationalized as it is in ever other nation.
Others with first access to capital are doing great in this climate too: hedge funds, investment banks, government contractors, big companies. The rich get richer while the economy stagnates for the majority. Raising rates and stoping the bailouts of failed private institutions I believe will go a long way toward fixing this growing inequality. How we get leaders who can enact these policies is another thing since conventional wisdom (and much of academia) says dropping rates grows the economy. Amazes me that the world didn’t learn from Japan’s never ending stagnation. We hit the end of a 20 year credit expansion cycle in 2000 and there still is no will to let asset prices and credit deflate, instead we got the government “put” [1], not to mention the 2008 bailouts, and continued credit expansion.
The sad part is that instead of fixing the problem, micromanaged economic policy and money creation from on high, we will get jingoistic nationalism. While I do agree that some of our “free trade” has been anything but fair, the numbers, including those in the article, seem to indicate that it has helped large numbers of people throughout the world escape from poverty. I believe free and fair trade is a boon for all. These gains, unfortunately, will likely evaporate as fed-up, disenfranchised electorates in developed countries try anything to stop their slide backwards. It’s tough to sell a “help the world” argument to people who are hurting when those on the top are doing so well.
1. http://www.investopedia.com/terms/g/greenspanput.asp
1. The masses correctly perceive that they are being duped by people with first access to capital.
2. They elect/employ/contract other people who promise "ponies for everyone and a clean house" but instead mainly profit from first access to capital.
3. goto 1
The story of the Scots Free Banks being busted out by the Bank of England is poignant and interesting, but we simply don't know what would have happened had it gone the other way. The way we use banks now, having a bank go insolvent and all the depositors and other interested taking a haircut doesn't sound very appealing.
Non-monopoly currency is a pain in the neck.
Which "something better"? Does "something better" still contain all the salient characteristics of what we call capitalism such that we keep the advantages? We're pretty sure that many things are entangled here; it's not clear that we have the means to disentangle them
I'll put up with a lot to see freedom from food insecurity, basic clean water and good abatement of public disease vectors. If we break the system in certain ways, we may lose the ability to do even that. Don't say this doesn't happen; look at some of the South American countries.
I try to sidestep all the ideology by thinking that the things we don't like about the Rubric Currently Known as Capitalism probably involve the use of economic rents to enrich certain people and not enrich other people.
If that tool works ( and I can't defend it beyond a rudimentary level, frankly ) then the things you're talking about that you don't like aren't actually part of capitalism.
And i think we're really talking about "why is growth slow?" Well, good question but my biases lead me to think that this is a lot demographic and the rest is bad monetary policy grounded in a basic lack of understanding of things like the proper role of central banks and public debt.
I don't know that if we had 4% {rN}GDP growth we'd even be talking about this.
In that case, "replacing" capitalism might just make it worse.
(1) To refer to actual capitalism (the real system dominant in the developed world in the late 19th and early 20th century, described and named "capitalism" by its socialist critics),
(2) To refer to modern mixed economies as opposed to forms further from capitalism, such as Leninism and its derivatives,
(3) To refer to a utopian realization of Econ 101 ideal markets, whose adherents seen to believe is actually a plausible economics system rather than a useful simplification in the same way as a friction-free model in physics.
The former, as mentioned above, cannot be redeemed, though a synthesis with other ideas is possible (and now dominant) that mitigates some of its worst elements.
The second may be improvable while still recognizably remaining a form of the modern mixed economy.
The third isn't realistic, much less redeemable.