Well, I will not subscribe to the new yourkers for just an article, but my anwser wold be hell no. Intervencion of govern in the free market.... maybe.
I'd argue that the primary interventions of government in the free market involve the creation and support of currency, and the provision of property rights. It's hard for me to imagine a market of any significant size without those things. The absence of government intervention may not be what capitalism wants.
I'm ok with govern creating a small set of rules and enforcing them. But as litle as possible. Specially in types of business that aren't vital to population. I can understand certain rules like in insurance companies of some types of banking services.
I'm not ok with intervencions, like the banks bailout of 2008, the the goverment just save banks that should have break. This kindo f intervention isn't fair form most of the market, and should be avoided.
I've gotten downvoted for mentioning paywalls as well. I think this is a very valid call out though.
While there are workarounds, I don't want to spend more than 2 seconds opening an article (most the time it isn't worth going to google cache, some archive, or doing the fb redirect). I dislike that it is effectively a dead link for many people and that it is being shared on the front page of a major aggregator. It is poor user experience to be opening dead links and really trains me against visiting certain sites.
I would absolutely pay 5 cents to read an article. There is no feasible way to do this small of a transaction with our current payment systems. I will absolutely not subscribe for 5 dollars a month.
>While there are workarounds, I don't want to spend more than 2 seconds opening an article (most the time it isn't worth going to google cache, some archive, or doing the fb redirect).
And yet you wasted more time that that writing this comment, so we could waste more time that that reading it.
If your time is so valuable that you can't be bothered to put in even the few seconds of minimal effort needed to engage with the topic at hand, perhaps your time is better spent elsewhere.
Yes, I did spend time writing a comment about a topic I care about. I do not want to spend time circumventing a site's desired mode of operation for an article I am only moderately interested in.
More nuanced answer: not exactly. Not Capitalism per-se anyway. But clearly you can see an unhealthy degree of commingling of big government and big business, in a way that is damaging to society at large. But to my mind:
a. that's corruption, not capitalism
b. that's an argument against big government, not an argument against capitalism
Along that logic could we say that absolute private property rights nor the complete absence of exclusive use of capital goods is good for democracy, but that there is a whole range in between?
It's not immediately obvious to me that either is true in terms of producing viable societies, but as these are the primary axes which determine how a society is going to function, it seems they ought to both be or neither be.
But if you think in terms of multiscale, the difference between systems stops looking so qualitative and looks more quantitative:
Either you have an absolute property law system, and a limited commons forms on top of that through land trusts, etc.
Or you have an absolute communist system, and a limited free market forms on top of that, within a system of exceptions and exemptions.
Technically you could implement identical 50/50 socialized/private systems in both of those schemes.
In practice scale matters so which system runs which scale will affect the outcome.
But the long term outcome will inevitably be “the right things are socialized and the right things are privatized”... the two systems each do experiments and make concessions when they lose. They’ll end up being quite the same, although in the short term they are quite different. And we need both to exist to run all the experiments.
Actually, we see this with the social media giants live in action: they may decide to terminate your account at any time for arbitrary (or none at all) reasons for your whole life, and you have no way of legal recourse.
There have been way too many stories alone on HN about people losing e.g. their entire mail archives or Youtube deleting evidence videos of war crimes, to let this situation continue for any longer.
Government needs to finally recognize the importance of social media to modern society... after all, telcos are not allowed to arbitrarily cut you off (especially not for life!). Why should social media be treated differently?
Telcos can’t cut you off, but ISPs can. I guess dial up is potentially still an option, but internet access is much more relevant than telephone access in 2018.
Well, ISPs are replaceable (okay, they will offer different speeds). Get cut off, select another ISP (or mobile data).
A telco is not easily replaceable though, as the phone number is your unique handle that often cannot be changed easily (which is why you have the right to keep your number in Europe across providers)...
Yeah, that particular point is technically true, but in reality it is absolutely false. Far too many people simply do not have competing options. ADSL and satellite are not really competing options if your third option is fiber.
I'd say it's reasonable these days to expect regular people (especially the 18-34 demo) to actually rely on the speeds you get with fiber. ADSL and satellite, by comparison, are slow as molasses.
A number of those folks could probably survive with a mobile data hotspot, but that is really not ideal for a house or apartment.
"Too many" is subjective, but I would say they are quite few. Gmail has over 1 billion users. We hear stories like that, what, once year? Sometimes twice?
I'm not opposed to government regulation (I support the GDPR, for example), but I really don't see Gmail bans as a problem needing intervention.
YouTube banning videos is more concerning, but how would you regulate that? And which government decides what rules apply, considering that YouTube is international?
I don’t think that’s necessarily true. Government is unique because of its “social license” to govern, meaning that the vast majority of people recognize its authority to do things other people or groups cannot do (like make laws, imprison people, or collect taxes). Corporations don’t have that social license, which is why they need to cozy up with government to take advantage of that unique authority.
Without a government they can start to take this authority themselves in much the same way that local warlords do. Gradually by force, because they have power and you don't.
A small / weak government can't do anything to stop them.
Corporations are more than happy to take on that mantle if they are able. You saw that with the East India Company's full army and navy, you saw that with company mining towns that issued their own currency and controlled every aspect of their employees lives, you saw that with the Pinkertons investigating and dispatching extrajudicial punishment, and you see that today with Nestle paramilitaries.
Not necessarily. Big corporations actually depend on the State for their very existence, and leverage corruption, regulatory capture, etc., to grow larger and more powerful than they would naturally.
That's a common view, but I don't think the evidence supports it. What "corruption" and "regulatory capture" did Amazon or Google leverage in coming to dominate multiple verticals?
Instead, I think technology is the culprit. Technology pushes out the boundary where economies of scale give way to diseconomies of scale. Mom & pops can't compete with Amazon not because Amazon has a few senators in its pocket. They can't do it because Amazon's immense scale (multiple robotic warehouses, in-house shipping and logistics expertise, etc.) makes it impossible to compete on price and quality.
Capture and corruption doesn't help small startups become big[1]. They help big companies stay big.
I think you're right that Google and Amazon (and others) leveraged something new - the catalog-sales and cat-video dynamo we call the internet - to get where they are.
And I think I'm right that they will increasingly leverage government to stay big now that they are.
[1] You might say 'Uber' in response; I'd say the company was corrupt and failed to find sufficient exploitable government levers to succeed in those efforts, because someone else got to those levers first.
> And I think I'm right that they will increasingly leverage government to stay big now that they are.
IMO that's not a convincing argument. Your response to two specific counter-examples is "one day you'll see that those examples actually prove my point instead of yours"
That's nice. If you'd like to convince me I'm wrong, you'll have to explain why these companies, which are subject to the same pressures as others and hire from the same pool of execs, will behave differently than the rest of the herd of large public firms.
If you want to argue they'll lobby, manipulate and bribe less than average among peer-firms, well, that argument could be made.
But if you want to argue that there's something special about them that means they won't play all the same games, perhaps start with explaining how Amazon's begging-for-handouts HQ tour is different than the sports stadium scam.
> If you want to argue they'll lobby, manipulate and bribe less than average among peer-firms, well, that argument could be made.
You’re begging the question by assuming that this conduct is what keeps “peer firms” big. That’s the point in dispute.
I’d say that there is good reason to believe why that isn’t true. Walmart spent just $7 million on lobbying last year. It’s a company with $500 billion in revenue. Does it make logical sense to infer that the $7 million in lobbying is what keeps the $500 billion spigot flowing? Much smaller competitors could out-lobby Walmart, raising the market price of corruption. Why doesn’t that happen—with hundreds of billions of dollars on the line?
People take as a shibboleth that lobbying is corruption and corruption keeps big companies big. But that flies in the face of the actual data.
This is obviously a pretty pointless back-and-forth.
You're attempting to treat lobbying as a binary. Does it make logical sense that Walmart would spend $7M if it didn't feel that investment had a return?
Of course large companies are buoyed by other factors. But as congress-critters famously pointed out a while back, Silicon Valley had to learn to lobby. And they did, otherwise Bad Things could happen.
Also,
> People take as a shibboleth
I don't know what tribe you're trying to make me a member of, but, uh, no.
> But that flies in the face of the actual data
If you're talking about the gap between $7m and $.5T, that dataoid demonstrates nothing other than that multinational retailers operate much larger firms than politicians do.
My question stands: how is AZON playing a different game than they various sportball leagues?
> You're attempting to treat lobbying as a binary. Does it make logical sense that Walmart would spend $7M if it didn't feel that investment had a return?
Would Walmart spend only $7 million on lobbying if the return was so crazy high as you’re assuming it is?
> If you're talking about the gap between $7m and $.5T, that dataoid demonstrates nothing other than that multinational retailers operate much larger firms than politicians do.
Price doesn’t relate to size of firm or cost, but rather supply and demand. Under your theory, where lobbying is instrumental in keeping a $500 billion business from being out competed, demand should be high. At the same time, with a very limited number of Congress critters, supply is limited. That should push up the price as other firms bid to secure the supposed benefits Walmart now gets.
How about Apple, Microsoft, Walmart, and IBM? Does Apple stay big due to regulatory capture, or because its massive size allows them to create a supply chain nobody else can match?
One can consider that status quo as their infancy period. Once they're big enough, they'll be able to exist and thrive without corporate welfare. "Of the world's 100 largest economic entities, 51 are now corporations and 49 are countries." according to http://www.corporations.org/system/top100.html
We are not talking about an absence of govenremnt.
A small government is perfectly able to regulated what is needed to regulate. It is an absolutle isllusion to believe that only a big government can correctly regulated cooperations.
In fact, I would argue there is little corrulation either way, both big and small govenrment sometimes have effective laws.
The ability to regulated derives from a monopoly on violence, not control of 50% of the economy.
Exactly. I think its false to assume that a government that directly taxes 60% of all incomes is more effective law maker then a government who taxes 10% of all income is a flase assumtion.
As one of the other posters mentioned, big government _helps_ create big corporations. Even the legal idea of a "corporation" with the corporate veil to protect employees & those who control it from direct liability enables mega-corporations. If we simply eliminated corporate legal entities, we might have more careful business dealings. In the absence of this idea, you'd be free to take legal action against someone who harms you.
It is a similar thing with the EPA and FDA, if a corporation meets their requirements, you can't sue them, even if they are polluting your town. It actually _enables_ a legal limit that they can pollute rather than strictly reducing pollution. The most effective anti-littering campaign was the Keep America Beautiful, Crying Indian campaign, not really the EPA.
A lot of this has to do with culture, if people aren't okay with big corporations and corruption, then they would do something different. But on a certain level, people don't really care or believe that corporate entities somehow help the economy. Two-hundred years ago, the culture was different and people made things go a bit differently; the culture we have now generally supports corporate and governmental power.
> It is a similar thing with the EPA and FDA, if a corporation meets their requirements, you can't sue them, even if they are polluting your town.
Do you have a citation for that? States, cities, and individuals sue all the time. Saying you met the federal standards may be part of the defense but it’s not immunity.
A fish doesn't know it's in water because it never experienced anything else.
Can we imagine anything other than the system we live in?
I suppose we can imagine small adjustments like higher or lower taxation, more or less regulation, increasing or decreasing subsidies for different groups.
But that's like slightly changing the temperature or salinity of the water we're swimming in. It doesn't help us imagine what walking through air would be like.
“We live in capitalism. Its power seems inescapable. So did the divine right of kings. Any human power can be resisted and changed by human beings.” - Ursula Le Guin
The trust busters in the early 20th century were not part of a big government. You need an effective government, not a big government to police corruption.
As the government has balooned in size, trust busting has become almost non existent. Corruption these days just gets a yawn.
I don't know of any nice rankings on these things but I also can't see why it should be the case. If you have the monopoly of violence you can tell a company to do X and if they don't you can punish them.
Of course it depends on the size of your population/market, if you are small, a company can just leave the country rather then comply. However that is equally true for a small country with powerful government.
This argument seems to subtly imply that the only efficacious means to "level an uneven playing field" is government regulation, and not some other, non-government process such as boycotts.
Government regulation is, ultimately, only one item in the civic toolbox of society. If it turns out this is flawed, and will in the long run generate more negative outcomes than positive ones, abandoning the tool does not mean abandoning the final goal. Instead, we must utilize alternate means of achieving the same ends... or accept that corruption as the price of our chosen path.
By your logic, a labor union "strike" must also be extremely ineffective. (They require massive coordination and go against each individual's incentive to work.)
Yet they do work, and we don't call labor unions "government".
This is the same logic used by people who argue "That's corruption, not socialism." If everywhere there is capitalism, there is corruption, you can't simply wave it away.
Edit: I originally asked "How is this argument different from 'that's corruption, not socialism'", which some seemed to interpret as a defense of socialism. I'm just pointing out the flawed logic in both arguments.
This. People supporting capitalism alway seem to argue that any abuses of power and corruption are exceptions. The system is built on competition so without strong regulation it seems inevitable that people will take shortcuts to win.
What we have today throughout the world is a mixed economy: a blend of intervention and freedom. You're exactly right that laissez-faire has never been fully tried: we've come close at various points and various places.
There have been industries that were free of corruption and meddling even though the larger society was rife with corruption. I'm thinking of the Scottish banking system in the late eighteenth century because it was completely unregulated. Its example showed what laissez-faire might look like in that sector.
Silicon Valley in the 80s, 90s, and 00s was similarly left alone. We all saw how it flourished and almost entirely stayed out of politics.
The American constitutional system provides an excellent approach to limiting corruption through checks and balances and enumeration of powers. It has plenty of loopholes and those have been exploited from inception on.
But that's the unfortunate consequence of these systems being built for a perfect world filled with entirely rational beings that only do what's in the interest of the common good. Everything from economics systems like Capitalism and Communism to political ones like Democracy have this very same issue; they work fine in theory then completely collapse in the real world due to human selfishness and irrationality.
Some have argued, however, that this commingling is caused by the forces of capitalism. Once you have large profits, it makes sense to direct some of them towards altering the laws in your favor. Simultaneously, capitalism seems to encourage the kind of concentration of wealth that will always ensure some capitalists have large profits relative to the norm of society. So in many ways this commingling ends up being inevitable.
Some have argued, however, that this commingling is caused by the forces of capitalism
True, but personally I remain unconvinced by those arguments. It gets complicated though, because a lot of people (implicitly or explicitly) equate "capitalism" and "corporations". But in reality, capitalism doesn't require corporations and corporations require the State. A capitalist economy without corporations (which break the link between actions and liability for the consequences of those actions) would very likely be a much different thing.
I agree that there is a lot of inevitability in this result. This is often a debate in the implicit context of "we should make the government even stronger, probably socialism or communism", but in those cases instead of two entities who at least sometimes struggle for power, we're just giving up and giving all the power to one entity.
So, if the problem is that corporations and governments tend to get too close to each other, what exactly is the nominally-better solution that we're supposed to be comparing against?
What if this is already just about the best we could hope for? It does sometimes seem to me that people have this implicit idea of a world in which, basically, nobody has any power, or everybody has the exact same amount to an arbitrary number of decimal places, but even by the standards of Utopianism, that's Utopian. What, exactly, is the goal of this conversation?
It'll differ for different people, of course, but it's still a valid exercise. There is a lot of "1. Identify problem. 2. Propose solution. 3. Fail to observe that proposed solution couldn't possibly have solved original problem, even if it worked as designed."
(For another example, see the last few mass shootings, and the subsequent proposed "solutions"; without reference to whether or not they would be good idea and whether or not more gun control is good or bad, it was frequently the case that even if the proposed solutions were in place and perfectly, unrealistically functional prior to the incident that the solution still wouldn't have prevented the event, e.g., "more background checks" that the shooter still would have passed, etc.)
This is a bit similar to claiming that communism is great, because all the times when it was tried and there were problems weren't real communism.
If capitalism tends to inevitably lead to corruption of government and the undermining of democracy etc in the long run, then that's an interesting critique, which can't just be swatted away with "yes but the result isn't capitalism".
Yes it is - but my point is that it is a reasonable discussion to have, and any attempt to avoid even having the discussion by saying "oh it isn't my theoretical pure capitalism" doesn't work.
I would argue capitalism (or any economic system really) always corrupts government, it's just a matter of degree.
Farmer A gives free goats (or his daughter in marriage) to farmer B who is in charge of allocating newly acquired tribal farmland. Farmer A gets a good, fertile pasture with a stream, farmer Z might get a bunch of rocky hillside.
> If capitalism tends to inevitably lead to corruption of government
Everything tends to lead to corruption of government, in fact most forms of government are the corruption we see as the problem here. The key point of liberal democracy is to put mechanisms in place to prevent this from happening.
Well maybe, but there's a question of degree. Free Market / Capitalism proponents, will argue until they are blue in the face about how much more clever and intelligent and better actors in a free and competitive market will behave compared to alternative systems, so why wouldn't these actors also apply that competitive edge to the business of "corrupting the government for personal gain" and end up doing the corruption better than an alternative system would?
Perhaps you could have a liberal democracy that copes fine in one era with various built-in systems to combat corruption, but if you make the market more competitive/free-er/better then it can no longer cope in subsequent eras? Who knows, but it certainly seems to match my perceptions of certain countries following market liberalisation.
> end up doing the corruption better than an alternative system would?
Because the same people who advocated free markets also thought long and hard about the problems of corruption.
Lets remember that scottish enlightment thinkers are not just responsable for many of these ideas but also many of the ideas about how to design parlaments and politics in general.
The reason a govenrment in a mostly capitalist state can be resistant is because it can be keeped relativly small and focused a small number of task. There are a large number of safeguards that can be built into the governemnt as long as the government has a limited scope. I also think that as long as government focus on the essentials, a large part of the population will agree that what the government does is good.
The mechanism however to not scale having a government that needs to fight massive wars and plan the economy.
In his book 'Road to Serfdom' Hayek goes into details about the tention between powerful government action and democratic institutions.
But is not the case that it inevitable that it leads to large amounts of corruption. As we can see that in the real world many of the most economically free governments are also amoung the least corrupt.
It seems to me that any system of economic organisation that has a goverment will have some level of that problem, its absolutly impossible not to have the problem in concept.
The question is what system would you want where you can effecivly minimise the power of these effects. I would argue that having a small less powerful governmnet that is bound by rules (constiution for example) is the most resistant.
As soon a government gets bigger monitoring gets harder, oppertunity for corruption get larger, negative effects of bad regulation have larger scope and so on.
> As we can see that in the real world many of the most economically free governments are also among the least corrupt.
I suspect that "among the least corrupt" is necessary for "most economically free". Or to put it another way: Corruption destroys economic freedom, because those economically on top at the moment use the corruption to write rules that keep others from being able to challenge them.
Corruption is just the free market between those who have power but (relatively) no wealth, and those who have wealth but (relatively) no power. It's treating power and influence as just another asset that can be purchased (with wealth).
Those who have power can freely take wealth e.g. taxation but those who have wealth cannot freely take power. Corrupt politicians might treat power as a free market commodity; but that's still corruption and not a market.
I think that to be at all fair we should treat the side-effects of capitalism as capitalism, just as we treat the side-effects of communism as communism.
When we see that communist regimes have famines and vast imprisonments and corrupt party leaders stealing from the people, we correctly identify that as one of the realities of communism which stems from the impossibility of making communism work within the confines of human nature.
When it's the inevitable effects of capitalism, we deny it. We say, "Oh no, that's not pure capitalism, they aren't practicing real capitalism, they're corrupt." It IS an effect of capitalism in every case. Where else is this coming from? Powerful entities in capitalist societies capture regulatory bodies and political figures and force them to enact policies which are harmful to common people yet benefit their bottom line.
It's intellectually dishonest to say that all of a sudden it isn't capitalism so capitalist ideology isn't at fault. We have been driven by capitalist ideology every step of the way up to this, but the instant something bad happens then the definitions suddenly change and capitalism is insulated from harm.
Let's not be in denial and say that yes, capitalism per-se is to blame. There comes a point when capitalism is bad for free society and democracy. Does that mean that we have to enact the exact opposite? No. Let's not have a false dichotomy. We need to realize that pure capitalist ideology doesn't work due to human nature in exactly the same way that pure communist ideology doesn't work. We need a strong and effective system to suppress certain parts of the capitalist ideology or we will perish.
When it's the inevitable effects of capitalism, we deny it
I haven't seen any proof that there are any "inevitable" effects of capitalism. Certainly we can't take the existence of these effects that you are referring to as a given.
Have we had any examples of capitalism that didn't produce corruption?
I feel like once again you're using different standards for evidence for the two systems. We see the awful effects of communism each and every time and we correctly attribute it to communism. But suddenly there's a need for negative proof with capitalism. We can't be sure because we haven't seen every single permutation where it might be possible. But this systemic corruption exist in each real instance so far. But we don't know if it's strictly "inevitable." Do you see how that is bad reasoning? Do you see how that isn't falsifiable?
It also stands to reason that this is inherent in capitalism. If you have complete freedom to purchase anything in the market, can you not see a situation where, without outside control, a successful party will have the opportunity to use capital to seize the system itself and change it to suit their needs above others? It stops being lassis-faire at that point. What about capitalism is meant to prevent that from happening? There's no inherent safeguard to keep it from developing that problem.
If you want a good system, you have to look at it honestly. You can't be in denial and keep giving it a benefit of a doubt just to protect the system instead of the people living within it. The system exists for a purpose, not of its own merit. It needs modification in the same way that all systems need modification. Any creation of humankind can be improved, and one of the advantages of our kind is that we have reason and agency to continually improve. The danger lies in ossifying and exalting a system as flawless the way we do with capitalism.
I would just say that the people who pushed thought about capitlaism, like Adam Smith, David Hume, F.A. Hayek and others, spent a lot of time thinking about how to make the system resistant against that cooruption.
There are whole fields in economics that try to analyse how these cooruptions and problems come about and how we could lessen their impact.
The important thing to note is that this is difficult and having a government with less overall power and scope is easier to manage because their is less insentive to capture it.
No. You're confusing the free market economy (a mechanism) vs. capitalism (a political economical system). Competition leads inevitably to monopoly as the best and the winners prevail and entrench in political power, that's the central contradiction built into capitalism. You can't separate one from the other if you want capitalism. This is the classical Marxist critique.
Colloquially, "capitalism" and "free market capitalism" are used interchangeably. I understand the strict distinction, but in this context I don't think descending to that level of pedantry is really necessary.
This old marxist critique has been disproved over and over. It has been show that it does not even make sense in marxes own theoretical system. That why marx has no credibilty in economcis, his own theoretical system does not make sense.
Marx himself had known this, and that's why he never published the second and third volume of 'Das Kapital'. Engels in a attempted to save Marx bacon made a competition where he asked people if the could find a solution (rather predict what Marxes eventual solution would be) and nobody found on.
That is why Marx was obandend by economist in the first place.
Since then we have also seen complete destruction of Marxist argument because of empirce, there is no inherent invetable centralisation, rather process that goes in different direction depend on many factors.
It's not even just capitalism. Human behavior itself can be a threat to democracy.
Honestly, I don't know what the author is talking about when they say "free market" in the present tense. The U.S. economy and the global economy aren't even close to being a free market.
That is just old marxist economics that has been disproven. Economists agree that markets do not automatically lead to oligopoly.
This is why Marx has no credibilty in economics. All his predictions turned out to be false not because 'economists are the hand maidens of capital' as leftist like to claim.
In fact Marx economics was very popular amoung economist at one point, it was then deconstructed theortically and disproven by evidence.
I agree with your statements; however, I feel like your argument would be much stronger if you had sources for your claims that Marx has been disproven and deconstructed.
This is not at all the effect being discussed. The effect being discussed is laid out quite plainly in the subtitle. I'll just quote it here, and save you the effort of right clicking and selecting open in new tab:
"The idea that authoritarianism attracts workers harmed by the free market, which emerged when the Nazis were in power, has been making a comeback."
It's a very simple mechanism. Capitalism produces winners and losers. The losers are eventually an angry majority. An angry majority will vote to maximize change.
Optimistically, I think this is somewhat a self-limiting problem.
Capitalism wound up helping workers - sharing far more of the gains with them than in Marx's day. Why? Out of the goodness of capitalists' hearts? Perhaps to some degree, but I think that part of the reason was the challenge of communism. Capitalists wanted to show that capitalism could give workers a better deal than communism, and in doing so, cut much of the ground out from under communism. Why would I want to try to bring about a "communist workers' paradise", if I see that I'm actually better off as a worker under another system?
But after the collapse of communism, the capitalists have seemed to suck more of the money out, leaving less for the workers. That leaves the majority the losers, and becoming angrier and angrier. As you say, they're going to vote for change... unless the capitalists wise up.
The other problem is, people keep offering them change, and the angry majority votes for them, and the promised change keeps on not showing up. Eventually, the angry majority is going to want to do more than just vote...
To your nuanced answer, has there been a time when Capitalism didn't seek to dominate all of it's regulatory bodies? Unions, governments, activists, even other Capitalists as they represent competition. There's a reason leftists call Imperialism the highest form of Capitalism.
Of course they do. Adam Smith already understood this.
However, just because any group in society wants to change the rules of society to their benefit, does not make the existance of those groups a bad thing per se.
Sometimes people act as if that was unique for capitalist. In fact Unions, Activists, Government burocracies and so on have the exact same insentives, they want to change rules to benefit them.
The reason leftists call Imperialism the highest statge of capitalism is because these leftists had a very limited understanding of both history and the reasons behind imperialism. Their theory never made much sense and much modern history has desproved these simplified Leninist notions.
The right is just as bad as history and have mostly manage to erase the economic system Smith wanted abolished, and according to Marx had re-emerged after Smiths dead.
Or to put it differently capitalism was never envisioned as a critique of socialism, but as a critique of nationalist mercantilism, which is the same system international socialism was supposed to tackle a century after Capitalism had failed. Though by then Imperialism had replaced mercantilism as the common name for a system where one large property owners competed with each other for world supremacy with little regard for mere renters/workers.
Once could argue that capitalism was revived after the two wars to end all wars finally managed to wipe out the old feudal order(at least in Europe) but one could also argue that the european disaster merely reset the clock and gave rise to a new (mostly American) aristocracy which is now finally becoming visible as a aristocracy. For a lot of 3rd world the end of European hegemony after world war 2 was perceived more a handover from one set of foreign owners to a new one, then "freedom and democracy", and the us have toppled more democracies then it helped build, giving some credence to the theory of the US as a mercantilist empire rather then capitalist democracy.
In a lot of ways the problem is that few modern politicians(and that economist is in practice often a subclass of politician) dare to leave the confines of circular logic where morality can be a simple matter of good vs evil and history is a consistent narrative going from the bad old times to the brave new world. Which gives rise to an extremely toxic debate culture of fractions yelling general insults of each other, using words that have long since lost any resemblance of coherent meaning.
Honestly I have no idea what you mean by the words you say.
By no strech of the imagination was did capitlaism fail. In fact the strech from 1870 to 1914 was the largest and strongest period of growth thanks to capitlaism and increasing trend, specialisation and so on.
Feudalistic order as a system of economics had long stopped in most of western Europe and even in Russia. The feudalistic titles still being around and having some meansing does absoutly not make the economics system feudalistic.
I am not defending imperalism, of course those nations that were under fogin occupation did not really participate in this system and therefore could not get the same benefits. However it is equally false to say that capitlaism only worked because of imperalism.
In fact, as Adam Smith said, it would be better if everybody were equally capitalistic. The raise of nations like Japan, Taiwan and so many others made us all richer. I wish nations in Africa and Latin America would also manage to adopt a better system.
To pretend that 1870 to 1910(also known as the long depression in literature) was some kind of glory period of equality and democracy is only almost plausible because of the complete dissater that follows, and completely at ods with just about every credible history book written about that period. Wars of conquest still happen doing that period, and new colonies are still being formed.
Where the myth of the glorious 19th century comes in is that it's fundamental to america's founding myth that it was a democracy(as defined by the modern UN) prior to or even doing the 1st world war, and did not evolve into one almost as gradually as the Europeans empires.
Dickens and Rasputin is from the late 19th century, as is the term rubber baron and banana republic and America main foreign policy activity is to topple Latin American states and patrol china in defense of American corporations(in colaboration with Britain, germany and Japan an event that's forgotten in the US but definitely not in china).
The traditional agrarian feudal order with serfs and knights are of cause gone, replaced by mercantist national companies like the British east India company targeted by the Boston tea party and the primary subject of Smiths criticism, but the aristocratic system is still in place and it's a low point in terms of economic equality not a high point(for the west equality peaks sometimes between Nixon taking office and Reagan leaving office, where as global equality might actually be increasing).
But of cause if you are one of the many who have bought the myth that Smiths wealth of nations is about socialism(the fact is that smith never writes a single word about socialism), and that the long depression never happened we are of cause not even talking the same language but thats of cause the core problem with our political discourse. And the reason that the old ideals about the good king/dictator/chairman keeps reemerging as the lone alternative to the bad power brookers corrupting the system.
My point is that both sides is essentially working from a historic narrative thats more myth then reality, and that it's really hard to explain the incredible increase in wealth that we have seen since the last war to end all war ended as a result of anything but technological developments and prolonged peace
Modern research agree that there was no 'long depression'. Its an invention of depression era economists who just looked back in history and said 'there was deflation, therefore there was a depression'. There have been multiple books on this but somehow this myth never dies because the left has put it as part of their narrative.
It was a period of sustained growth with recession in between but a strong avg.
I don't really care about inequality and I have never said it was a period of equality, if inequality was high during this period is because it was a new age of globalism and mass production. Of course the first people into that are gone be richer, but if you look at the consumption for everybody its absolutely clear that it was a period of improvement for most people.
Inequality does not automatically mean that the system was unfair or bad.
Secondly, its not wrong the imperialist polices by the US and others gave them some access amount of money and some people profited from that. However, you simply can not explain the amount of growth by point to exploitation of Banana republics, the numbers simply don't add up.
Claiming that companies like the East India were a replacement or somehow economically equal in effect to feudalism is totally wrong. In fact the amount of government granted monopoly was far, far lower during that time. Domestic monopolies were largely removed and trade monopolies were in fact far weaker then most people seem to think. It was possible in the umbrella of the East India company to have basically independent business and trade voyages. This is also how the stock market was invented in the Netherlands (btw without government protection or approval).
I never said a single thing about socialism and I would never claim that Smith was a socialist. I have no idea based on what you made that up.
> My point is that both sides is essentially working from a historic narrative thats more myth then reality, and that it's really hard to explain the incredible increase in wealth that we have seen since the last war to end all war ended as a result of anything but technological developments and prolonged peace
I do not accept this 'balance' view just because its balance. Growth does not magically happen when technology is around and their is peace.
These things have actually been studied by economists and there are tons of country back then and now that live in peace and that have access to those technologies, and you they don't have growth.
Also, technological progress is not automatic, its not a magical thing that just happens. Technological progress comes when people and companies try to improve their position in the market and produce things cheaper or better.
People like the 'evil' Robber Barron were actually some of the most important in that. Standard oil made a lot of innovations in all stages of oil production and so on. However it is not just them but millions of people who lived and worked back then.
Global capitalism and the global gold standard was an unqualified success that produced the largest growth spit in human history up to that point and it was not slowing down before WW1.
"Damaging to society" is a a very subjective concept. The segment of society benefiting from said commingling of big government and big business might disagree with the assertion that their role is "damaging" to the broader society.
I listened recently on a radio an interview where the claim was that it's easier to achieve equality in a benevolent dictatorship than in capitalistic democracy.
Capitalistic democracy tend to distort to an organization influenced by lobbies and corporations, and in the long run governments have to take that and pay back by allowing monopolies and their clients.
In a benevolent dictatorship, corporations can't have a big influence on government. It's clear who is more powerful, and benevolent dictator can actually care more about the actual wellbeing of the people more than some democratically elected government which is just a proxy for big corporates.
To be fair, it's arguably easier to do anything right if you have a benevolent dicator who knows what's best for society and doesn't care too much about whether people disagree.
The problem is finding anyone who's truly 'benevolent' or would stay as such once they've got power. It's the same issue we see with a lot of systems; in everyone was a perfectly rational, decent person who only did what was right they'd be a utopia, but that's never the case.
It's also easier to achieve equality in a tyrannical dictatorship. If you aren't part of the (very small) inner circle, you're poor and exploited, just like everybody else.
But most of us don't want that kind of equality...
Capitalism as a social framework that “looks” like what we know wasn’t a thing until the mid-1800s
150+ years of “guidance” by experts, stewards of industry, and government making claims of operating roughly along that framework
And this is where we are
Humans are the problem with every social system they have built. Humans bring it down because humans get sick of propping up the dead past
These silly abstractions rely on getting everyone on board and the ones that aren’t are treated as heretics
Capitalism has never been about a free flow of capital and information
It has since its beginning been inherently about benefiting the owners who, due to HUMAN nature, not government which is used as a straw man, an abstraction away from reality (humans are doing this, not “government”)
Our economics, including capitalism are, like Trump, a byproduct of the broader cultural feelings. The words and attitudes flow; might and power bring gains. I will fight to protect them. Capitalism
You can wave the math around and I’ll say ok yes they followed the rules of math. But it’s applied to the wrong context
Humans are corruptable, emotional first animals. Capitalism manipulates that reality to favor conversation and action in support of owners
It’s inherently intended as a framework to control conversation; protect my stuff and way of life
It’s another religion. Belief and support of it are rewarded. Anything else and you starve
> Humans are the problem with every social system they have built
No one will ever be able to look at our network of interactions and create a perfect pattern with a social ideology. But we need a social system so that we can attach to it rules that fulfill our needs like self-preservation or even just hunger and companionship. We could do better for ourselves if we fit the social system to fit these needs and not the other way around.
> But clearly you can see an unhealthy degree of commingling of big government and big business, in a way that is damaging to society at large. But to my mind:
> a. that's corruption, not capitalism
I can swear there is a name 19th Century critics came up for the politico-economic system then dominant in the developed West where the State, starting with the system of property rights and extending throughout all of its functions, is organized to serve the interests of and reinforce the power of the owners of the means of production, and it wasn't “corruption” (though that would have been a decent name, too.)
What you wrote is the stock conservative answer, but I'd encourage you to think more closely about the question.
In the US, the "it's big government's fault!!!11" line of thought starts with the slaveholders in the South and their penchant for a lawless aristocracy.
It was picked up, especially in the 1940s-1970s, by conservatives opposing the left-leaning segments of society. They played to the Southerners and their longing for the old slave system, and they merged it with a corporatism with fascist tendencies.
Both the pro-slavery and corporatist/fascist wings ultimately mean the same thing when they complain about big government: they believe that the government should not infringe the right of the wealthy to wield power absolutely over the rest of society.
This is the sense in which Libertarianism and democracy are at odds. Peter Thiel has said the same thing, but he lands on the side of capitalism. Others, like apparently the New Yorker, are asking the same question and presumably land on the side of Democracy.
So ultimately the question is: do citizens have a right to influence the laws that govern them? If so, then Libertarianism and laissez-faire capitalism can't be adopted because they explicitly limit the ability of the people to enact laws. Conversely, if laissez-faire capitalism is adopted, then democracy suffers because the wealthy insist that the unwashed masses cannot enact certain laws to protect the majority of people from a tyrannical minority.
This is akin to the argument that communism didn't kill millions because it wasn't really communism. The commingling of government and business is how capitalism plays out in practice, it is an inevitable result of ostensibly "laissez-faire" economics.
Pure capitalism can never become reality because it's a philosophy. No philosophy that seeks to organize a potentially infinite number of sentient creatures can be fully implemented.
So no, it's not an argument against capitalism, but it is an argument against policy. Most policy in The US uses capitalism as a justification for implementing bad policy that doesn't serve the argued purpose. Arguments like that are based off the premise that capitalism itself is enough of a justification because it's assumed it improves the state of affairs. Even if in most cases that it true it's a faulty place to argue from. Arguments on policy should directly concern how it improves the state of affairs, not how it serves an abstract philosophy.
De-regulation and regulation both have their place and need to be addressed case by case. Although as an aside when regulating to protect an industry it's important to match those regulations with regulations to equally protect their customers--something that The US rarely does.
Right now we have a lot of lazy and greedy policy-makers who have the power and money to continue business as usual and the last thing we need to worry about is what ideology a solution conforms to and not what the solution actually does.
Capitalism isn't a threat to democracy since the main distribution of power is by capitalist elite rule with democratic institutions constrained by capitalist economic power structure, and has been for the whole history of modern democratic political institutions.
The article might more properly ask the question “is capitalism with fig-leaf democracy inherently unstable”?
That's like saying the massive amount of written content is the biggest threat to search engines.
No, search engines are the solution to massive amounts of content.
Greed isn't the biggest threat to democracy. Democracy (or any other form of government) is the solution to whatever set of behaviors are undesirable in the ungoverned.
Can you even have capitalism without greed? Greed is just a pejorative term for self-interest, which is a core assumption in the treatise of capitalism. It can't exist without it.
It just needs to be limited. You can't have lassis-faire capitalism forever because the people who are most successful will change the initial conditions and it will no longer be lassis-faire. So you need some kind of control outside the free market. The free market alone is not corruption-proof in any way.
> Greed is just a pejorative term for self-interest
Greed is a correctly pejorative term for pursuing power and wealth beyond what people actually need to live well enough. Self-interest prior to reaching that point is not greed.
Capitalism is defined as private ownership of means of production and core resources. It doesn't inherently require greed.
Unregulated capitalism, perhaps. However, I don't think the US has capitalism (well-regulated or otherwise) today.
Today we have a system where gains are privatized, losses are socialized, and market-participants can coerce their elected officials to tilt the market in their favor. This is not capitalism.
Why do you say that's not capitalism? I'm no expert but a lot of the socialists I've talked to see capitalism as privatization of gains. Socialized losses are just the other side of that equation. Coercion of elected officials is corruption and it happens in both capitalism and socialism.
The end of your comment sounds exactly like the guys who defend communism arguing that it’s never really been tried. I think this is capitalism but that that recognition leads to the understanding that it comes in more and less healthy varieties. The U.S. version has oscillated over the years and we can see the results of the better and worse eras.
(This is similar to the way some people use “socialism” to mean something like the Cultural Revolution and completely ignore the existence of e.g. European and especially Scandinavian examples)
For anyone who doesn't have time to read the whole article, the conclusion is pretty much "No, as long as we have a strong social safety net."
IE capitalism with some elements of socialism to preserve individual liberties and dignities when economies slow down. Which sounds reasonable to me as a capitalist but also as a human being.
> For anyone who doesn't have time to read the whole article, the conclusion is pretty much "No, as long as we have a strong social safety net."
Well, then the answer is "yes". The whole issue being debated here is whether capitalism inevitably leads to a concentration of wealth which can then be leveraged into political power to create more concentration of wealth in a positive feedback cycle. The theory goes that after a couple iterations of that cycle, the wealthy will dismantle the social safety net entirely so they can cut their taxes.
1) When competition is allowed to enter the market, we eventually have an equilibrium where the right number of competitors is producing a good or a service at the best price and highest quality possible. That is capitalism. When concentrations of wealth are leveraged into political power, you have cronyism in the government. That's not a fault of capitalism itself.
2) The wealthy cutting their taxes does not necessarily mean the social safety net has to be dismantled. You can have lower taxes and a high safety net. It all depends on what your tax revenue is and where you spend it. The US has trillions in tax revenue coming in every year, and yet we had something like 60 billion dollars of medicare fraud in a single year, exorbitant spending on useless military ventures, etc. If we slashed wasteful spending and fraudulent activities at the governmental level, we could afford a lot more safety net with less tax revenue.
The issue is that cronyism in government results in government only ever being satisfied with getting by with more funding and more budget, and never less.
> When competition is allowed to enter the market, we eventually have an equilibrium where the right number of competitors is producing a good or a service at the best price and highest quality possible. That is capitalism.
No, that's a highly theoretical model that doesn't exist in the real world.
> When concentrations of wealth are leveraged into political power, you have cronyism in the government. That's not a fault of capitalism itself.
No True Capitalism eh? Why would a capitalist not use their capital in whichever fashion would lead to gaining even more wealth? Whether that be monopoly, collusion, or political power?
It does exist in the real world, although it can sometimes become obfuscated by government regulation and intervention. Example: Entering the pharmaceutical space to produce cost-effective generic medicines in order to steal market share from the big pharmaceuticals is hard because of government red-tape.
Using capital as leverage for political influence is not a central tenet of capitalism. You can be a capitalist and remain entirely outside the political realm. Some capitalists are known to use their capital for expensive philanthropic ventures or to support candidates who want to raise taxes.
Why did you ignore my comment about tax revenue and spending, by the way? That was the meat of the post.
> Using capital as leverage for political influence is not a central tenet of capitalism. You can be a capitalist and remain entirely outside the political realm.
If capitalism is based around rational self-interest, why would anyone exclude political power as a means of increasing their wealth? It would be deeply irrational to avoid such an avenue.
> It does exist in the real world, although it can sometimes become obfuscated by government regulation and intervention. Example: Entering the pharmaceutical space to produce cost-effective generic medicines in order to steal market share from the big pharmaceuticals is hard because of government red-tape.
Yes, regulations will interfere with the unfettered pursuit of profit, but that's by intent.
> Why did you ignore my comment about tax revenue and spending, by the way? That was the meat of the post.
Because it didn't really seem to make much of a point. Yes government spending priorities could be different and I'm sure there's wastage that could be lessened - although I'd guess less than you think. Cronyism exists in any organisation of more than one person.
> If capitalism is based around rational self-interest, why would anyone exclude political power as a means of increasing their wealth? It would be deeply irrational to avoid such an avenue.
Not true. It is in our best and most rational self-interest to participate in philanthropy and in building a nice society that we can live in, enjoy, and make a profit in. Capitalism and philanthropy and a social safety net are not mutually exclusive, which is why (like I already said) there are capitalists who vote for candidates who want to increase taxes and increase spending on social goods and services.
In fact I'd argue that it's only capitalists who can properly invest and sustain a strong safety net. That's why countries like Switzerland and Denmark are capitalist countries.
> Yes, regulations will interfere with the unfettered pursuit of profit, but that's by intent.
The example of it being hard to enter the pharmaceutical space to produce cost-effective generics is an example of government regulations prohibiting cost-reducing competition.
You can pursue profit while offering a good or a service that is less expensive and higher quality than the alternatives.
> Because it didn't really seem to make much of a point. Yes government spending priorities could be different and I'm sure there's wastage that could be lessened - although I'd guess less than you think. Cronyism exists in any organisation of more than one person.
But the point was that it isn't capitalism that is responsible for that cronyism. And that the wealthy wanting tax cuts does NOT mean that the wealthy need to dismantle the safety net in order to get their tax cuts. We can afford both tax cuts and a safety net if we eliminate cronyism in the government.
> But the point was that it isn't capitalism that is responsible for that cronyism
If by “capitalism” you mean the real-world economic system for which that name was coined by it's critical you are wrong.
If by “capitalism” you mean the abstract theory created to provide propaganda to justify that system after it already existed, you are, well, still wrong, because that propaganda tool serves to protect the actual source of the problem.
> And that the wealthy wanting tax cuts does NOT mean that the wealthy need to dismantle the safety net in order to get their tax cuts. We can afford both tax cuts and a safety net if we eliminate cronyism in the government.
The wealthy don't want tax cuts independent of cronyism and social safety net, they want cronyism in their favor, including particular forms of tax and social safety net cuts.
I mean the very first corporations weren't even little kingdoms, they were big ones like the east India trading company, which operated as quasi sovereign states. And they still operate that way, just on a smaller scale. If you think we are currently living in an age of democracy right now you're crazy or just not paying attention.
The assumptions of monarchy-ish corporatism have gone deep enough at this point that we are starting to see ourselves as monarchies of one, rather than equals in some kind of community. That's where you get these sovereign citizen people and also the point of view that every employee is a contractor.
Jonah Goldberg has a good take on this in his new book.[1] His basic theory is that capitalism and democracy is not self-perpetuating (kind of like gains at the gym). Societies constantly have to defend and justify it in the face of new challenges and humans' innate tendency toward tribalism.
> The idea that authoritarianism attracts workers harmed by the free market, which emerged when the Nazis were in power, has been making a comeback.
Makes me disappointed for the state of discourse that occurs today. The article itself is better than the subtitle made me infer - ending essentially with a nuanced 'No'.
But these transparent attempts to make you form an emotional response to an issue by eliciting images of Nazi Germany I find borderline disrespectful.
for all it's ills, capitalism is very anti-fragile in the sense that regions that that fail (perhaps even because of capitalism) become cannibalized and therefore stabilized by the greater system.
It may not provide much security for individuals, but it is very effective at self-perpetuating the scheme.
This reads like an onion article. I'll take free market capitalism and any government over socialism. These people represent a kind of "democracy" that wants to threaten Capitalism, which is the real danger.
OH god no. Democracy is a system which can easily trample on the freedoms of the vulnerable. It's why you need to engineer your actual system of government to give representation to the vulnerable that is hard to ignore.
Democracy is a system designed to give representation to the vulnerable. I suppose you're saying that it's possible to have a poorly designed democracy such as one that gives representation to the majority at the expense of the minority, which I agree with.
Ha! That's funny. :) But not entirely accurate. The word "democracy" comes from the word "deme" which essentially a group of individually weak people who band together to make sure that they're all represented against other groups.
Individually weak people can band together and vote to steal from the less weak, but smaller groups. Does voting and being represented make stealing moral?
What happens when those privileged are able to control the primary source of information for the population? It seems likely they would be able to convince the vulnerable to give up their freedom by convincing them it was in their interest.
People use freedom as a platitude and have no respect for the meaning of the word. As if it's just a mantra that means absolute good and nothing more.
Is freedom a threat to democracy? Yes, it can be. Freedom to go around killing your political rivals and their supporters is definitely a threat to democracy. Absolute freedom is anarchy, and it's horrible for anyone who is not the most powerful. It's great for them, though.
That's a hyperbolic example. But the freedom of corporations to completely capture political parties and wrest the nation's tiller away from the people and hog it all to themselves is definitely an existential threat for democracy and our well-being. To allow their absolute freedom is a threat to our basic freedoms.
I think one could make an argument that unfettered freedom of speech combined with capitalism is a threat to democracy. Money allows one to purchase speech. Speech allows you to influence people. You can control the people if you can control the money. Money is not distributed equally in a capitalist society which results in the power to influence not being distributed equally. We have all seen this in action.
Therefore if you want a properly functioning democracy you will need campaign finance laws which are inherently restrictions on speech. And even campaign finance reform might not be enough now that we are in an era of constant propaganda that is able to lay the ground work of influencing people outside of election cycles.
Look at the vocabulary and reading level used to determine the target. It pushes a narrative right out the gate and uses a story format with fancy fonts to reinforce it.
Capitalism does not appear to have a stable mode with a low Gini coefficient. Power that derives from wealth becomes concentrated, which is clearly anti-democratic.
Democracy is only viable as a decision-making process in societies where everyone is more or less equal. When people gain power at the expense of others, the result is that the system may remain nominally democratic, but becomes more and more of a plutocracy.
In Marx's view, the abuse of the 99% by the 1% would inevitably lead to revolution, violent or otherwise. He then tried to come up with a method of economic organization that could be fair and stable after that revolution. It's not clear that this method has ever worked on a scale larger than a kibbutz or cooperative, but it's also clear that most families are run as communes, though this is rarely discussed.
Somewhere in the trek from startup partnership to corporation there is a shift from commune-like organization to dictatorial/plutocratic organization. I don't know if anyone has done an organized study.
> it's also clear that most families are run as communes
Interesting observation. I'm not saying I disagree but growing up in an Evangelical religious culture (which describes much of America), this was definitely not the case. Men, specifically husbands/fathers were considered superior than other members of the family.
I think programmatic organisational structures with economics and voting built in are pretty interesting. We're building tooling for something like that with https://aragon.one
It's still pretty early days but right now you can create your democracy based DAO in a couple of minutes with no programming. You can issue tokens, vote and and tie in any action of a dapp to another action (like transfer of tokens to the result of a vote).
I think it's an interesting vision of a future where you can very easily create programmatic cross-border organisations that can have economic value creation attached to them, and operate based on how the token holders vote.
> but it's also clear that most families are run as communes
Hunter-gatherer groups also operate on a cooperative basis where food sharing is an integral part of their social organisation. The trouble is whether this sort of model scales beyond Dunbar's number, something that few political models seem to take into account IMHO.
Don't throw out 'all economist' argument when its not true. It is simply false the all economist believe in the marxist notion of automatic capital centralisation.
There is also little evidence that economiclly freeer country are more unequal or that have a lower share of wealth amoung the poor.
> It's not clear that this method has ever worked on a scale larger than a kibbutz or cooperative, but it's also clear that most families are run as communes, though this is rarely discussed.
This is actually not rarly discussed. Capitalist thinkers like F.A. Hayek and Adam Smith did actually think about these problems quite carefully. Sadly people like him are simply ignored by much of the leftist marxist crowd becuase they are just evil capitalist handmaidens.
If you read Adam Smith two books 'Wealth of Nation' and 'Theory of Moral Sentiment' it is quite clear how he fought about this. Hayek made this into a more coherent theory.
As you abserve amoung familiy and friends (evne in tribes) we do not engadge in property rights and trade. The problem is that humans devloped in these communities and to attemed to scale the same way of thinking and organisation to a macro society is impossible because of information and insentive problems.
Hayek makes distinction between micro cosmos and macro cosmos where in the small you would not want to run it like a market, but it would be equally damaging to attemped to apply the micro cosmos rules to macro cosmos.
In fact psycology has made it perfectly clear that humans simply do not have the intellectual capacity to relate to millions of human that they don't know in anywhere close to the same way the do to the humans they know.
I'd answer this question by asking another: Is it profitable to destroy democracy? If so, someone is going to try it. That doesn't mean capitalism is any less compatible with democracy than socialism or any other system. But if we value democracy we need to defend against economic forces that threaten it.
I'd agree with this, and take it further: if there is any person or group of people who stand to gain something by destroying freedom or democracy, you can assume they will do so. To repeat the quote commonly misattributed to Thomas Jefferson, the price of liberty is eternal vigilance.
It is not profitable to destroy democracy complitly. But it is profitable to undermine democracy so that in your particular case you get an exception to the rules everybody else has to follow.
If enough people get that change of rules, democracy is pointless.
I think it's better to discuss individual things like private property, capital ownership of companies, monopolies, free markets, consumerism, imperialism (along the lines of Standard Fruit Company) etc. on their own merit, not throwing everything on one pile - even if things interact, influence and lead to each other.
I just don't understand why people think they can refute an argument that's been fleshed out into a book by writing a couple offhand sentences in response to a long form article on the book. Presumably the author would address popularly held assumptions to the contrary of his provocative argument in the book.
I wish there was more data on the subject of alternatives to capitalism to make comparisons. Really it's most likely any conclusion is in vain with only half of the picture. The best we have is china and the soviet union and those are faulty sources at best considering none of them actually had a socialist economy. Any other systems come from small societies without known large nation scale examples.
Maybe democracy is a fragile construction at its core or maybe all political systems have an inherent fragility to them.
And what if you are free to purchase that political leadership and use it to curtail the freedom of others? And use it to skew the system and hoard wealth so nobody can ever buy it back? Hm?
I swear, an-caps just don't consider the actual consequences of their ideology. Just once I wish y'all would think something through all the way to the end and consider the possibility of non-ideal situations.
No such thing as anarcho-capitalists. Just Neo-Feudalists. The State no longer controls the means of violence, those with the most money become de facto lords capable of hiring their own mercenary protectors and creating small states. Everything becomes monopolies through consolidation or destruction of competition using stronger economic force by exploiting the lack of regulation. The 1300's come back in vogue.
No. Human beings who put money and control of land and resources over and above the welfare of other human beings are a threat to us all and always have been.
I wish sociopathic hypergreedy control freaks were viewed the same way we perceive pedophiles instead of being rewarded.
I'm confused as to why you think that just because two concepts are abstract they can't interact with each other. How do you explain that logic?
Do we claim that capitalism cannot produce hyper-greedy sociopaths? Because I would argue that it distills those people better than most systems. We need some form of modified capitalism which has some checks and balances. We did have that system for a long while, but the controlling agencies got captured by private interests and we can all plainly see the risk involved there.
But it's pure capitalism. People who say pure capitalism would have an even playing field discount the possibility that the winners on that level playing field would change the playing field to benefit them forever. What is keeping the playing field level? Not the market. The market doesn't limit systemic drift.
Capitalism self-selects for those hypergreedy people. Thankfully, a lot of humans are social animals interested in welfare of other humans, and society at large. A Welfare component is required to offset people harmed by the excess of capitalism.
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[ 3.1 ms ] story [ 231 ms ] threadI'm not ok with intervencions, like the banks bailout of 2008, the the goverment just save banks that should have break. This kindo f intervention isn't fair form most of the market, and should be avoided.
Even if it means a global market collapse and depression?
While there are workarounds, I don't want to spend more than 2 seconds opening an article (most the time it isn't worth going to google cache, some archive, or doing the fb redirect). I dislike that it is effectively a dead link for many people and that it is being shared on the front page of a major aggregator. It is poor user experience to be opening dead links and really trains me against visiting certain sites.
I would absolutely pay 5 cents to read an article. There is no feasible way to do this small of a transaction with our current payment systems. I will absolutely not subscribe for 5 dollars a month.
And yet you wasted more time that that writing this comment, so we could waste more time that that reading it.
If your time is so valuable that you can't be bothered to put in even the few seconds of minimal effort needed to engage with the topic at hand, perhaps your time is better spent elsewhere.
>so we could waste more time that that reading it
No need to be nasty about it.
More nuanced answer: not exactly. Not Capitalism per-se anyway. But clearly you can see an unhealthy degree of commingling of big government and big business, in a way that is damaging to society at large. But to my mind:
a. that's corruption, not capitalism
b. that's an argument against big government, not an argument against capitalism
It's not immediately obvious to me that either is true in terms of producing viable societies, but as these are the primary axes which determine how a society is going to function, it seems they ought to both be or neither be.
But if you think in terms of multiscale, the difference between systems stops looking so qualitative and looks more quantitative:
Either you have an absolute property law system, and a limited commons forms on top of that through land trusts, etc.
Or you have an absolute communist system, and a limited free market forms on top of that, within a system of exceptions and exemptions.
Technically you could implement identical 50/50 socialized/private systems in both of those schemes.
In practice scale matters so which system runs which scale will affect the outcome.
But the long term outcome will inevitably be “the right things are socialized and the right things are privatized”... the two systems each do experiments and make concessions when they lose. They’ll end up being quite the same, although in the short term they are quite different. And we need both to exist to run all the experiments.
There have been way too many stories alone on HN about people losing e.g. their entire mail archives or Youtube deleting evidence videos of war crimes, to let this situation continue for any longer.
Government needs to finally recognize the importance of social media to modern society... after all, telcos are not allowed to arbitrarily cut you off (especially not for life!). Why should social media be treated differently?
Well, ISPs are replaceable (okay, they will offer different speeds). Get cut off, select another ISP (or mobile data).
A telco is not easily replaceable though, as the phone number is your unique handle that often cannot be changed easily (which is why you have the right to keep your number in Europe across providers)...
Comcast customers would like to have a word with you.
I'd say it's reasonable these days to expect regular people (especially the 18-34 demo) to actually rely on the speeds you get with fiber. ADSL and satellite, by comparison, are slow as molasses.
A number of those folks could probably survive with a mobile data hotspot, but that is really not ideal for a house or apartment.
I'm not opposed to government regulation (I support the GDPR, for example), but I really don't see Gmail bans as a problem needing intervention.
YouTube banning videos is more concerning, but how would you regulate that? And which government decides what rules apply, considering that YouTube is international?
A small / weak government can't do anything to stop them.
Instead, I think technology is the culprit. Technology pushes out the boundary where economies of scale give way to diseconomies of scale. Mom & pops can't compete with Amazon not because Amazon has a few senators in its pocket. They can't do it because Amazon's immense scale (multiple robotic warehouses, in-house shipping and logistics expertise, etc.) makes it impossible to compete on price and quality.
I think you're right that Google and Amazon (and others) leveraged something new - the catalog-sales and cat-video dynamo we call the internet - to get where they are.
And I think I'm right that they will increasingly leverage government to stay big now that they are.
[1] You might say 'Uber' in response; I'd say the company was corrupt and failed to find sufficient exploitable government levers to succeed in those efforts, because someone else got to those levers first.
IMO that's not a convincing argument. Your response to two specific counter-examples is "one day you'll see that those examples actually prove my point instead of yours"
If you want to argue they'll lobby, manipulate and bribe less than average among peer-firms, well, that argument could be made.
But if you want to argue that there's something special about them that means they won't play all the same games, perhaps start with explaining how Amazon's begging-for-handouts HQ tour is different than the sports stadium scam.
You’re begging the question by assuming that this conduct is what keeps “peer firms” big. That’s the point in dispute.
I’d say that there is good reason to believe why that isn’t true. Walmart spent just $7 million on lobbying last year. It’s a company with $500 billion in revenue. Does it make logical sense to infer that the $7 million in lobbying is what keeps the $500 billion spigot flowing? Much smaller competitors could out-lobby Walmart, raising the market price of corruption. Why doesn’t that happen—with hundreds of billions of dollars on the line?
People take as a shibboleth that lobbying is corruption and corruption keeps big companies big. But that flies in the face of the actual data.
You're attempting to treat lobbying as a binary. Does it make logical sense that Walmart would spend $7M if it didn't feel that investment had a return?
Of course large companies are buoyed by other factors. But as congress-critters famously pointed out a while back, Silicon Valley had to learn to lobby. And they did, otherwise Bad Things could happen.
Also,
> People take as a shibboleth
I don't know what tribe you're trying to make me a member of, but, uh, no.
> But that flies in the face of the actual data
If you're talking about the gap between $7m and $.5T, that dataoid demonstrates nothing other than that multinational retailers operate much larger firms than politicians do.
My question stands: how is AZON playing a different game than they various sportball leagues?
Would Walmart spend only $7 million on lobbying if the return was so crazy high as you’re assuming it is?
> If you're talking about the gap between $7m and $.5T, that dataoid demonstrates nothing other than that multinational retailers operate much larger firms than politicians do.
Price doesn’t relate to size of firm or cost, but rather supply and demand. Under your theory, where lobbying is instrumental in keeping a $500 billion business from being out competed, demand should be high. At the same time, with a very limited number of Congress critters, supply is limited. That should push up the price as other firms bid to secure the supposed benefits Walmart now gets.
A small government is perfectly able to regulated what is needed to regulate. It is an absolutle isllusion to believe that only a big government can correctly regulated cooperations.
In fact, I would argue there is little corrulation either way, both big and small govenrment sometimes have effective laws.
The ability to regulated derives from a monopoly on violence, not control of 50% of the economy.
It is a similar thing with the EPA and FDA, if a corporation meets their requirements, you can't sue them, even if they are polluting your town. It actually _enables_ a legal limit that they can pollute rather than strictly reducing pollution. The most effective anti-littering campaign was the Keep America Beautiful, Crying Indian campaign, not really the EPA.
A lot of this has to do with culture, if people aren't okay with big corporations and corruption, then they would do something different. But on a certain level, people don't really care or believe that corporate entities somehow help the economy. Two-hundred years ago, the culture was different and people made things go a bit differently; the culture we have now generally supports corporate and governmental power.
Do you have a citation for that? States, cities, and individuals sue all the time. Saying you met the federal standards may be part of the defense but it’s not immunity.
Can we imagine anything other than the system we live in?
I suppose we can imagine small adjustments like higher or lower taxation, more or less regulation, increasing or decreasing subsidies for different groups.
But that's like slightly changing the temperature or salinity of the water we're swimming in. It doesn't help us imagine what walking through air would be like.
As the government has balooned in size, trust busting has become almost non existent. Corruption these days just gets a yawn.
A government that is not large enough to upset an even playing field will also not be large enough to level an uneven playing field.
There is litte correlation between the size of a govenrment and its ability to regulate.
Of course it depends on the size of your population/market, if you are small, a company can just leave the country rather then comply. However that is equally true for a small country with powerful government.
Government regulation is, ultimately, only one item in the civic toolbox of society. If it turns out this is flawed, and will in the long run generate more negative outcomes than positive ones, abandoning the tool does not mean abandoning the final goal. Instead, we must utilize alternate means of achieving the same ends... or accept that corruption as the price of our chosen path.
If you have strong enough coordination, we end up calling it "government".
Yet they do work, and we don't call labor unions "government".
...effectively enforce the system of property rights which is the foundation of capitalism, since the latter is an example of the former.
This is the same logic used by people who argue "That's corruption, not socialism." If everywhere there is capitalism, there is corruption, you can't simply wave it away.
Edit: I originally asked "How is this argument different from 'that's corruption, not socialism'", which some seemed to interpret as a defense of socialism. I'm just pointing out the flawed logic in both arguments.
It’s not at all different. In fact, state socialism and state capitalism are extremely similar systems.
There have been industries that were free of corruption and meddling even though the larger society was rife with corruption. I'm thinking of the Scottish banking system in the late eighteenth century because it was completely unregulated. Its example showed what laissez-faire might look like in that sector.
Silicon Valley in the 80s, 90s, and 00s was similarly left alone. We all saw how it flourished and almost entirely stayed out of politics.
The American constitutional system provides an excellent approach to limiting corruption through checks and balances and enumeration of powers. It has plenty of loopholes and those have been exploited from inception on.
But that's the unfortunate consequence of these systems being built for a perfect world filled with entirely rational beings that only do what's in the interest of the common good. Everything from economics systems like Capitalism and Communism to political ones like Democracy have this very same issue; they work fine in theory then completely collapse in the real world due to human selfishness and irrationality.
But I'm not sure what the answer is that problem.
True, but personally I remain unconvinced by those arguments. It gets complicated though, because a lot of people (implicitly or explicitly) equate "capitalism" and "corporations". But in reality, capitalism doesn't require corporations and corporations require the State. A capitalist economy without corporations (which break the link between actions and liability for the consequences of those actions) would very likely be a much different thing.
So, if the problem is that corporations and governments tend to get too close to each other, what exactly is the nominally-better solution that we're supposed to be comparing against?
What if this is already just about the best we could hope for? It does sometimes seem to me that people have this implicit idea of a world in which, basically, nobody has any power, or everybody has the exact same amount to an arbitrary number of decimal places, but even by the standards of Utopianism, that's Utopian. What, exactly, is the goal of this conversation?
It'll differ for different people, of course, but it's still a valid exercise. There is a lot of "1. Identify problem. 2. Propose solution. 3. Fail to observe that proposed solution couldn't possibly have solved original problem, even if it worked as designed."
(For another example, see the last few mass shootings, and the subsequent proposed "solutions"; without reference to whether or not they would be good idea and whether or not more gun control is good or bad, it was frequently the case that even if the proposed solutions were in place and perfectly, unrealistically functional prior to the incident that the solution still wouldn't have prevented the event, e.g., "more background checks" that the shooter still would have passed, etc.)
If capitalism tends to inevitably lead to corruption of government and the undermining of democracy etc in the long run, then that's an interesting critique, which can't just be swatted away with "yes but the result isn't capitalism".
That's a pretty big if.
Farmer A gives free goats (or his daughter in marriage) to farmer B who is in charge of allocating newly acquired tribal farmland. Farmer A gets a good, fertile pasture with a stream, farmer Z might get a bunch of rocky hillside.
Everything tends to lead to corruption of government, in fact most forms of government are the corruption we see as the problem here. The key point of liberal democracy is to put mechanisms in place to prevent this from happening.
Perhaps you could have a liberal democracy that copes fine in one era with various built-in systems to combat corruption, but if you make the market more competitive/free-er/better then it can no longer cope in subsequent eras? Who knows, but it certainly seems to match my perceptions of certain countries following market liberalisation.
Because the same people who advocated free markets also thought long and hard about the problems of corruption.
Lets remember that scottish enlightment thinkers are not just responsable for many of these ideas but also many of the ideas about how to design parlaments and politics in general.
The reason a govenrment in a mostly capitalist state can be resistant is because it can be keeped relativly small and focused a small number of task. There are a large number of safeguards that can be built into the governemnt as long as the government has a limited scope. I also think that as long as government focus on the essentials, a large part of the population will agree that what the government does is good.
The mechanism however to not scale having a government that needs to fight massive wars and plan the economy.
In his book 'Road to Serfdom' Hayek goes into details about the tention between powerful government action and democratic institutions.
It seems to me that any system of economic organisation that has a goverment will have some level of that problem, its absolutly impossible not to have the problem in concept.
The question is what system would you want where you can effecivly minimise the power of these effects. I would argue that having a small less powerful governmnet that is bound by rules (constiution for example) is the most resistant.
As soon a government gets bigger monitoring gets harder, oppertunity for corruption get larger, negative effects of bad regulation have larger scope and so on.
I suspect that "among the least corrupt" is necessary for "most economically free". Or to put it another way: Corruption destroys economic freedom, because those economically on top at the moment use the corruption to write rules that keep others from being able to challenge them.
Capitalism, like all other systems, can't exist in a vacuum. You must consider the human factor and the likelihoods it will produce.
A might treat B as a market commodity, but that's not a market. What does make a market then, if not having commodities in a market?
When we see that communist regimes have famines and vast imprisonments and corrupt party leaders stealing from the people, we correctly identify that as one of the realities of communism which stems from the impossibility of making communism work within the confines of human nature.
When it's the inevitable effects of capitalism, we deny it. We say, "Oh no, that's not pure capitalism, they aren't practicing real capitalism, they're corrupt." It IS an effect of capitalism in every case. Where else is this coming from? Powerful entities in capitalist societies capture regulatory bodies and political figures and force them to enact policies which are harmful to common people yet benefit their bottom line.
It's intellectually dishonest to say that all of a sudden it isn't capitalism so capitalist ideology isn't at fault. We have been driven by capitalist ideology every step of the way up to this, but the instant something bad happens then the definitions suddenly change and capitalism is insulated from harm.
Let's not be in denial and say that yes, capitalism per-se is to blame. There comes a point when capitalism is bad for free society and democracy. Does that mean that we have to enact the exact opposite? No. Let's not have a false dichotomy. We need to realize that pure capitalist ideology doesn't work due to human nature in exactly the same way that pure communist ideology doesn't work. We need a strong and effective system to suppress certain parts of the capitalist ideology or we will perish.
I haven't seen any proof that there are any "inevitable" effects of capitalism. Certainly we can't take the existence of these effects that you are referring to as a given.
I feel like once again you're using different standards for evidence for the two systems. We see the awful effects of communism each and every time and we correctly attribute it to communism. But suddenly there's a need for negative proof with capitalism. We can't be sure because we haven't seen every single permutation where it might be possible. But this systemic corruption exist in each real instance so far. But we don't know if it's strictly "inevitable." Do you see how that is bad reasoning? Do you see how that isn't falsifiable?
It also stands to reason that this is inherent in capitalism. If you have complete freedom to purchase anything in the market, can you not see a situation where, without outside control, a successful party will have the opportunity to use capital to seize the system itself and change it to suit their needs above others? It stops being lassis-faire at that point. What about capitalism is meant to prevent that from happening? There's no inherent safeguard to keep it from developing that problem.
If you want a good system, you have to look at it honestly. You can't be in denial and keep giving it a benefit of a doubt just to protect the system instead of the people living within it. The system exists for a purpose, not of its own merit. It needs modification in the same way that all systems need modification. Any creation of humankind can be improved, and one of the advantages of our kind is that we have reason and agency to continually improve. The danger lies in ossifying and exalting a system as flawless the way we do with capitalism.
I would just say that the people who pushed thought about capitlaism, like Adam Smith, David Hume, F.A. Hayek and others, spent a lot of time thinking about how to make the system resistant against that cooruption.
There are whole fields in economics that try to analyse how these cooruptions and problems come about and how we could lessen their impact.
The important thing to note is that this is difficult and having a government with less overall power and scope is easier to manage because their is less insentive to capture it.
This old marxist critique has been disproved over and over. It has been show that it does not even make sense in marxes own theoretical system. That why marx has no credibilty in economcis, his own theoretical system does not make sense.
Marx himself had known this, and that's why he never published the second and third volume of 'Das Kapital'. Engels in a attempted to save Marx bacon made a competition where he asked people if the could find a solution (rather predict what Marxes eventual solution would be) and nobody found on.
That is why Marx was obandend by economist in the first place.
Since then we have also seen complete destruction of Marxist argument because of empirce, there is no inherent invetable centralisation, rather process that goes in different direction depend on many factors.
Honestly, I don't know what the author is talking about when they say "free market" in the present tense. The U.S. economy and the global economy aren't even close to being a free market.
This is why Marx has no credibilty in economics. All his predictions turned out to be false not because 'economists are the hand maidens of capital' as leftist like to claim.
In fact Marx economics was very popular amoung economist at one point, it was then deconstructed theortically and disproven by evidence.
That's an argument for checks on capitalism and corruption. Your way is just unchecked harmful capitalism without any government controls.
"The idea that authoritarianism attracts workers harmed by the free market, which emerged when the Nazis were in power, has been making a comeback."
It's a very simple mechanism. Capitalism produces winners and losers. The losers are eventually an angry majority. An angry majority will vote to maximize change.
Capitalism wound up helping workers - sharing far more of the gains with them than in Marx's day. Why? Out of the goodness of capitalists' hearts? Perhaps to some degree, but I think that part of the reason was the challenge of communism. Capitalists wanted to show that capitalism could give workers a better deal than communism, and in doing so, cut much of the ground out from under communism. Why would I want to try to bring about a "communist workers' paradise", if I see that I'm actually better off as a worker under another system?
But after the collapse of communism, the capitalists have seemed to suck more of the money out, leaving less for the workers. That leaves the majority the losers, and becoming angrier and angrier. As you say, they're going to vote for change... unless the capitalists wise up.
The other problem is, people keep offering them change, and the angry majority votes for them, and the promised change keeps on not showing up. Eventually, the angry majority is going to want to do more than just vote...
However, just because any group in society wants to change the rules of society to their benefit, does not make the existance of those groups a bad thing per se.
Sometimes people act as if that was unique for capitalist. In fact Unions, Activists, Government burocracies and so on have the exact same insentives, they want to change rules to benefit them.
The reason leftists call Imperialism the highest statge of capitalism is because these leftists had a very limited understanding of both history and the reasons behind imperialism. Their theory never made much sense and much modern history has desproved these simplified Leninist notions.
Or to put it differently capitalism was never envisioned as a critique of socialism, but as a critique of nationalist mercantilism, which is the same system international socialism was supposed to tackle a century after Capitalism had failed. Though by then Imperialism had replaced mercantilism as the common name for a system where one large property owners competed with each other for world supremacy with little regard for mere renters/workers.
Once could argue that capitalism was revived after the two wars to end all wars finally managed to wipe out the old feudal order(at least in Europe) but one could also argue that the european disaster merely reset the clock and gave rise to a new (mostly American) aristocracy which is now finally becoming visible as a aristocracy. For a lot of 3rd world the end of European hegemony after world war 2 was perceived more a handover from one set of foreign owners to a new one, then "freedom and democracy", and the us have toppled more democracies then it helped build, giving some credence to the theory of the US as a mercantilist empire rather then capitalist democracy.
In a lot of ways the problem is that few modern politicians(and that economist is in practice often a subclass of politician) dare to leave the confines of circular logic where morality can be a simple matter of good vs evil and history is a consistent narrative going from the bad old times to the brave new world. Which gives rise to an extremely toxic debate culture of fractions yelling general insults of each other, using words that have long since lost any resemblance of coherent meaning.
By no strech of the imagination was did capitlaism fail. In fact the strech from 1870 to 1914 was the largest and strongest period of growth thanks to capitlaism and increasing trend, specialisation and so on.
Feudalistic order as a system of economics had long stopped in most of western Europe and even in Russia. The feudalistic titles still being around and having some meansing does absoutly not make the economics system feudalistic.
I am not defending imperalism, of course those nations that were under fogin occupation did not really participate in this system and therefore could not get the same benefits. However it is equally false to say that capitlaism only worked because of imperalism.
In fact, as Adam Smith said, it would be better if everybody were equally capitalistic. The raise of nations like Japan, Taiwan and so many others made us all richer. I wish nations in Africa and Latin America would also manage to adopt a better system.
Where the myth of the glorious 19th century comes in is that it's fundamental to america's founding myth that it was a democracy(as defined by the modern UN) prior to or even doing the 1st world war, and did not evolve into one almost as gradually as the Europeans empires.
Dickens and Rasputin is from the late 19th century, as is the term rubber baron and banana republic and America main foreign policy activity is to topple Latin American states and patrol china in defense of American corporations(in colaboration with Britain, germany and Japan an event that's forgotten in the US but definitely not in china).
The traditional agrarian feudal order with serfs and knights are of cause gone, replaced by mercantist national companies like the British east India company targeted by the Boston tea party and the primary subject of Smiths criticism, but the aristocratic system is still in place and it's a low point in terms of economic equality not a high point(for the west equality peaks sometimes between Nixon taking office and Reagan leaving office, where as global equality might actually be increasing).
But of cause if you are one of the many who have bought the myth that Smiths wealth of nations is about socialism(the fact is that smith never writes a single word about socialism), and that the long depression never happened we are of cause not even talking the same language but thats of cause the core problem with our political discourse. And the reason that the old ideals about the good king/dictator/chairman keeps reemerging as the lone alternative to the bad power brookers corrupting the system.
My point is that both sides is essentially working from a historic narrative thats more myth then reality, and that it's really hard to explain the incredible increase in wealth that we have seen since the last war to end all war ended as a result of anything but technological developments and prolonged peace
Modern research agree that there was no 'long depression'. Its an invention of depression era economists who just looked back in history and said 'there was deflation, therefore there was a depression'. There have been multiple books on this but somehow this myth never dies because the left has put it as part of their narrative.
It was a period of sustained growth with recession in between but a strong avg.
I don't really care about inequality and I have never said it was a period of equality, if inequality was high during this period is because it was a new age of globalism and mass production. Of course the first people into that are gone be richer, but if you look at the consumption for everybody its absolutely clear that it was a period of improvement for most people.
Inequality does not automatically mean that the system was unfair or bad.
Secondly, its not wrong the imperialist polices by the US and others gave them some access amount of money and some people profited from that. However, you simply can not explain the amount of growth by point to exploitation of Banana republics, the numbers simply don't add up.
Claiming that companies like the East India were a replacement or somehow economically equal in effect to feudalism is totally wrong. In fact the amount of government granted monopoly was far, far lower during that time. Domestic monopolies were largely removed and trade monopolies were in fact far weaker then most people seem to think. It was possible in the umbrella of the East India company to have basically independent business and trade voyages. This is also how the stock market was invented in the Netherlands (btw without government protection or approval).
I never said a single thing about socialism and I would never claim that Smith was a socialist. I have no idea based on what you made that up.
> My point is that both sides is essentially working from a historic narrative thats more myth then reality, and that it's really hard to explain the incredible increase in wealth that we have seen since the last war to end all war ended as a result of anything but technological developments and prolonged peace
I do not accept this 'balance' view just because its balance. Growth does not magically happen when technology is around and their is peace.
These things have actually been studied by economists and there are tons of country back then and now that live in peace and that have access to those technologies, and you they don't have growth.
Also, technological progress is not automatic, its not a magical thing that just happens. Technological progress comes when people and companies try to improve their position in the market and produce things cheaper or better.
People like the 'evil' Robber Barron were actually some of the most important in that. Standard oil made a lot of innovations in all stages of oil production and so on. However it is not just them but millions of people who lived and worked back then.
Global capitalism and the global gold standard was an unqualified success that produced the largest growth spit in human history up to that point and it was not slowing down before WW1.
Capitalistic democracy tend to distort to an organization influenced by lobbies and corporations, and in the long run governments have to take that and pay back by allowing monopolies and their clients.
In a benevolent dictatorship, corporations can't have a big influence on government. It's clear who is more powerful, and benevolent dictator can actually care more about the actual wellbeing of the people more than some democratically elected government which is just a proxy for big corporates.
Pretty dystopian.
The problem is finding anyone who's truly 'benevolent' or would stay as such once they've got power. It's the same issue we see with a lot of systems; in everyone was a perfectly rational, decent person who only did what was right they'd be a utopia, but that's never the case.
But most of us don't want that kind of equality...
150+ years of “guidance” by experts, stewards of industry, and government making claims of operating roughly along that framework
And this is where we are
Humans are the problem with every social system they have built. Humans bring it down because humans get sick of propping up the dead past
These silly abstractions rely on getting everyone on board and the ones that aren’t are treated as heretics
Capitalism has never been about a free flow of capital and information
It has since its beginning been inherently about benefiting the owners who, due to HUMAN nature, not government which is used as a straw man, an abstraction away from reality (humans are doing this, not “government”)
Our economics, including capitalism are, like Trump, a byproduct of the broader cultural feelings. The words and attitudes flow; might and power bring gains. I will fight to protect them. Capitalism
You can wave the math around and I’ll say ok yes they followed the rules of math. But it’s applied to the wrong context
Humans are corruptable, emotional first animals. Capitalism manipulates that reality to favor conversation and action in support of owners
It’s inherently intended as a framework to control conversation; protect my stuff and way of life
It’s another religion. Belief and support of it are rewarded. Anything else and you starve
In the land of the free. Ha
No one will ever be able to look at our network of interactions and create a perfect pattern with a social ideology. But we need a social system so that we can attach to it rules that fulfill our needs like self-preservation or even just hunger and companionship. We could do better for ourselves if we fit the social system to fit these needs and not the other way around.
The nature of Capitalism is always to press for this. Like a liquid, it will find any crack in your Democratic system to permeate.
The answer is not no, or even not exactly, the answer is probably always at least a little. Democracy's job is to make it as little as possible.
In America it seems we have gone the other direction once you start to dig in. See: political ad season and SuperPACs.
> a. that's corruption, not capitalism
I can swear there is a name 19th Century critics came up for the politico-economic system then dominant in the developed West where the State, starting with the system of property rights and extending throughout all of its functions, is organized to serve the interests of and reinforce the power of the owners of the means of production, and it wasn't “corruption” (though that would have been a decent name, too.)
In the US, the "it's big government's fault!!!11" line of thought starts with the slaveholders in the South and their penchant for a lawless aristocracy.
It was picked up, especially in the 1940s-1970s, by conservatives opposing the left-leaning segments of society. They played to the Southerners and their longing for the old slave system, and they merged it with a corporatism with fascist tendencies.
Both the pro-slavery and corporatist/fascist wings ultimately mean the same thing when they complain about big government: they believe that the government should not infringe the right of the wealthy to wield power absolutely over the rest of society.
This is the sense in which Libertarianism and democracy are at odds. Peter Thiel has said the same thing, but he lands on the side of capitalism. Others, like apparently the New Yorker, are asking the same question and presumably land on the side of Democracy.
So ultimately the question is: do citizens have a right to influence the laws that govern them? If so, then Libertarianism and laissez-faire capitalism can't be adopted because they explicitly limit the ability of the people to enact laws. Conversely, if laissez-faire capitalism is adopted, then democracy suffers because the wealthy insist that the unwashed masses cannot enact certain laws to protect the majority of people from a tyrannical minority.
So no, it's not an argument against capitalism, but it is an argument against policy. Most policy in The US uses capitalism as a justification for implementing bad policy that doesn't serve the argued purpose. Arguments like that are based off the premise that capitalism itself is enough of a justification because it's assumed it improves the state of affairs. Even if in most cases that it true it's a faulty place to argue from. Arguments on policy should directly concern how it improves the state of affairs, not how it serves an abstract philosophy.
De-regulation and regulation both have their place and need to be addressed case by case. Although as an aside when regulating to protect an industry it's important to match those regulations with regulations to equally protect their customers--something that The US rarely does.
Right now we have a lot of lazy and greedy policy-makers who have the power and money to continue business as usual and the last thing we need to worry about is what ideology a solution conforms to and not what the solution actually does.
The article might more properly ask the question “is capitalism with fig-leaf democracy inherently unstable”?
No, search engines are the solution to massive amounts of content.
Greed isn't the biggest threat to democracy. Democracy (or any other form of government) is the solution to whatever set of behaviors are undesirable in the ungoverned.
It just needs to be limited. You can't have lassis-faire capitalism forever because the people who are most successful will change the initial conditions and it will no longer be lassis-faire. So you need some kind of control outside the free market. The free market alone is not corruption-proof in any way.
Greed is a correctly pejorative term for pursuing power and wealth beyond what people actually need to live well enough. Self-interest prior to reaching that point is not greed.
Capitalism is defined as private ownership of means of production and core resources. It doesn't inherently require greed.
I agree with your second paragraph, btw.
Today we have a system where gains are privatized, losses are socialized, and market-participants can coerce their elected officials to tilt the market in their favor. This is not capitalism.
Edit: Downvotes but no answer to the question?
(This is similar to the way some people use “socialism” to mean something like the Cultural Revolution and completely ignore the existence of e.g. European and especially Scandinavian examples)
IE capitalism with some elements of socialism to preserve individual liberties and dignities when economies slow down. Which sounds reasonable to me as a capitalist but also as a human being.
Well, then the answer is "yes". The whole issue being debated here is whether capitalism inevitably leads to a concentration of wealth which can then be leveraged into political power to create more concentration of wealth in a positive feedback cycle. The theory goes that after a couple iterations of that cycle, the wealthy will dismantle the social safety net entirely so they can cut their taxes.
Which is exactly what we're seeing right now.
2) The wealthy cutting their taxes does not necessarily mean the social safety net has to be dismantled. You can have lower taxes and a high safety net. It all depends on what your tax revenue is and where you spend it. The US has trillions in tax revenue coming in every year, and yet we had something like 60 billion dollars of medicare fraud in a single year, exorbitant spending on useless military ventures, etc. If we slashed wasteful spending and fraudulent activities at the governmental level, we could afford a lot more safety net with less tax revenue.
The issue is that cronyism in government results in government only ever being satisfied with getting by with more funding and more budget, and never less.
No, that's a highly theoretical model that doesn't exist in the real world.
> When concentrations of wealth are leveraged into political power, you have cronyism in the government. That's not a fault of capitalism itself.
No True Capitalism eh? Why would a capitalist not use their capital in whichever fashion would lead to gaining even more wealth? Whether that be monopoly, collusion, or political power?
Using capital as leverage for political influence is not a central tenet of capitalism. You can be a capitalist and remain entirely outside the political realm. Some capitalists are known to use their capital for expensive philanthropic ventures or to support candidates who want to raise taxes.
Why did you ignore my comment about tax revenue and spending, by the way? That was the meat of the post.
If capitalism is based around rational self-interest, why would anyone exclude political power as a means of increasing their wealth? It would be deeply irrational to avoid such an avenue.
> It does exist in the real world, although it can sometimes become obfuscated by government regulation and intervention. Example: Entering the pharmaceutical space to produce cost-effective generic medicines in order to steal market share from the big pharmaceuticals is hard because of government red-tape.
Yes, regulations will interfere with the unfettered pursuit of profit, but that's by intent.
> Why did you ignore my comment about tax revenue and spending, by the way? That was the meat of the post.
Because it didn't really seem to make much of a point. Yes government spending priorities could be different and I'm sure there's wastage that could be lessened - although I'd guess less than you think. Cronyism exists in any organisation of more than one person.
Not true. It is in our best and most rational self-interest to participate in philanthropy and in building a nice society that we can live in, enjoy, and make a profit in. Capitalism and philanthropy and a social safety net are not mutually exclusive, which is why (like I already said) there are capitalists who vote for candidates who want to increase taxes and increase spending on social goods and services.
In fact I'd argue that it's only capitalists who can properly invest and sustain a strong safety net. That's why countries like Switzerland and Denmark are capitalist countries.
> Yes, regulations will interfere with the unfettered pursuit of profit, but that's by intent.
The example of it being hard to enter the pharmaceutical space to produce cost-effective generics is an example of government regulations prohibiting cost-reducing competition.
You can pursue profit while offering a good or a service that is less expensive and higher quality than the alternatives.
> Because it didn't really seem to make much of a point. Yes government spending priorities could be different and I'm sure there's wastage that could be lessened - although I'd guess less than you think. Cronyism exists in any organisation of more than one person.
But the point was that it isn't capitalism that is responsible for that cronyism. And that the wealthy wanting tax cuts does NOT mean that the wealthy need to dismantle the safety net in order to get their tax cuts. We can afford both tax cuts and a safety net if we eliminate cronyism in the government.
If by “capitalism” you mean the real-world economic system for which that name was coined by it's critical you are wrong.
If by “capitalism” you mean the abstract theory created to provide propaganda to justify that system after it already existed, you are, well, still wrong, because that propaganda tool serves to protect the actual source of the problem.
> And that the wealthy wanting tax cuts does NOT mean that the wealthy need to dismantle the safety net in order to get their tax cuts. We can afford both tax cuts and a safety net if we eliminate cronyism in the government.
The wealthy don't want tax cuts independent of cronyism and social safety net, they want cronyism in their favor, including particular forms of tax and social safety net cuts.
[1] https://www.weeklystandard.com/adam-keiper/in-suicide-of-the...
> The idea that authoritarianism attracts workers harmed by the free market, which emerged when the Nazis were in power, has been making a comeback.
Makes me disappointed for the state of discourse that occurs today. The article itself is better than the subtitle made me infer - ending essentially with a nuanced 'No'.
But these transparent attempts to make you form an emotional response to an issue by eliciting images of Nazi Germany I find borderline disrespectful.
It may not provide much security for individuals, but it is very effective at self-perpetuating the scheme.
Is freedom a threat to democracy? Yes, it can be. Freedom to go around killing your political rivals and their supporters is definitely a threat to democracy. Absolute freedom is anarchy, and it's horrible for anyone who is not the most powerful. It's great for them, though.
That's a hyperbolic example. But the freedom of corporations to completely capture political parties and wrest the nation's tiller away from the people and hog it all to themselves is definitely an existential threat for democracy and our well-being. To allow their absolute freedom is a threat to our basic freedoms.
Therefore if you want a properly functioning democracy you will need campaign finance laws which are inherently restrictions on speech. And even campaign finance reform might not be enough now that we are in an era of constant propaganda that is able to lay the ground work of influencing people outside of election cycles.
uh, how would this not be propaganda against the middle and upper classes?
Capitalism does not appear to have a stable mode with a low Gini coefficient. Power that derives from wealth becomes concentrated, which is clearly anti-democratic.
Democracy is only viable as a decision-making process in societies where everyone is more or less equal. When people gain power at the expense of others, the result is that the system may remain nominally democratic, but becomes more and more of a plutocracy.
In Marx's view, the abuse of the 99% by the 1% would inevitably lead to revolution, violent or otherwise. He then tried to come up with a method of economic organization that could be fair and stable after that revolution. It's not clear that this method has ever worked on a scale larger than a kibbutz or cooperative, but it's also clear that most families are run as communes, though this is rarely discussed.
Somewhere in the trek from startup partnership to corporation there is a shift from commune-like organization to dictatorial/plutocratic organization. I don't know if anyone has done an organized study.
Interesting observation. I'm not saying I disagree but growing up in an Evangelical religious culture (which describes much of America), this was definitely not the case. Men, specifically husbands/fathers were considered superior than other members of the family.
It's still pretty early days but right now you can create your democracy based DAO in a couple of minutes with no programming. You can issue tokens, vote and and tie in any action of a dapp to another action (like transfer of tokens to the result of a vote).
I think it's an interesting vision of a future where you can very easily create programmatic cross-border organisations that can have economic value creation attached to them, and operate based on how the token holders vote.
Hunter-gatherer groups also operate on a cooperative basis where food sharing is an integral part of their social organisation. The trouble is whether this sort of model scales beyond Dunbar's number, something that few political models seem to take into account IMHO.
There is also little evidence that economiclly freeer country are more unequal or that have a lower share of wealth amoung the poor.
> It's not clear that this method has ever worked on a scale larger than a kibbutz or cooperative, but it's also clear that most families are run as communes, though this is rarely discussed.
This is actually not rarly discussed. Capitalist thinkers like F.A. Hayek and Adam Smith did actually think about these problems quite carefully. Sadly people like him are simply ignored by much of the leftist marxist crowd becuase they are just evil capitalist handmaidens.
If you read Adam Smith two books 'Wealth of Nation' and 'Theory of Moral Sentiment' it is quite clear how he fought about this. Hayek made this into a more coherent theory.
As you abserve amoung familiy and friends (evne in tribes) we do not engadge in property rights and trade. The problem is that humans devloped in these communities and to attemed to scale the same way of thinking and organisation to a macro society is impossible because of information and insentive problems.
Hayek makes distinction between micro cosmos and macro cosmos where in the small you would not want to run it like a market, but it would be equally damaging to attemped to apply the micro cosmos rules to macro cosmos.
In fact psycology has made it perfectly clear that humans simply do not have the intellectual capacity to relate to millions of human that they don't know in anywhere close to the same way the do to the humans they know.
If enough people get that change of rules, democracy is pointless.
The core idea of capitalism is that ownership of companies is based on invested capital not people.
Also see https://en.wikipedia.org/wiki/East_India_Company
I think it's better to discuss individual things like private property, capital ownership of companies, monopolies, free markets, consumerism, imperialism (along the lines of Standard Fruit Company) etc. on their own merit, not throwing everything on one pile - even if things interact, influence and lead to each other.
For the love of all that is holy, please don't comment unless you've read the article and want to discuss what it is trying to say.
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Maybe democracy is a fragile construction at its core or maybe all political systems have an inherent fragility to them.
No.
In fact, you cannot have the one without the other.
I swear, an-caps just don't consider the actual consequences of their ideology. Just once I wish y'all would think something through all the way to the end and consider the possibility of non-ideal situations.
No. Human beings who put money and control of land and resources over and above the welfare of other human beings are a threat to us all and always have been.
I wish sociopathic hypergreedy control freaks were viewed the same way we perceive pedophiles instead of being rewarded.
Do we claim that capitalism cannot produce hyper-greedy sociopaths? Because I would argue that it distills those people better than most systems. We need some form of modified capitalism which has some checks and balances. We did have that system for a long while, but the controlling agencies got captured by private interests and we can all plainly see the risk involved there.
But it's pure capitalism. People who say pure capitalism would have an even playing field discount the possibility that the winners on that level playing field would change the playing field to benefit them forever. What is keeping the playing field level? Not the market. The market doesn't limit systemic drift.