Capitalism- Inherently bad or grossly misunderstood?

[derchin]

Many people assume its [Capitalism] bad on the premise that rich are wealthy while the poor and working class suffer.

But on the other hand a handful of the richest, safest, and lavish countries in the world happen to be capitalist.


Opinions?

[ehcks]

Capitalism is the least bad "pure" system, but it's still extremely bad if left unregulated.

Which is why those richest and safest countries have governmental controls on their economy. Controls to protect the poor even though they restrict the rich.

[Tsukasa Buddha]

I dislike that particular country comparison because it doesn't show the whole picture. There are books and books about why poor countries remain poor, the legacies of imperialism (was imperialism capitalism?), and the question of why the same labour receives greatly different pay (the taxi driver in India vs UK).

I also think many of us have a rosy picture because with globalisation we in the developed world have been able to push the more unsightly aspects further away from us (labour, environment, etc.). We have also at the same time changed the kind of environment damage we do from near and acute to world-wide and slow (relative to our lifespans).

This leads to people claiming we will innovate to some almost non-material future economy. I wouldn't hold my breath.

All that out of the way, capitalism is definitely a great drive for innovation and increasing productivity. It also brought us iPods.

I don't run into many who are against capitalism, but many nowadays conflate free market ideology with capitalism and confuse social democracy with socialism, so .

And in comparison, it definitely beats out feudalism, hunter-gathering, or the various and sometimes massive failed experiments of the 19th and 20th centuries.

[Trakar]

Originally Posted by derchin

Many people assume its [Capitalism] bad on the premise that rich are wealthy while the poor and working class suffer.

But on the other hand a handful of the richest, safest, and lavish countries in the world happen to be capitalist.


Opinions?

Like every other -ism I can think of, the closer they approach their ideological perfection the more unworkable and extremist they tend to become in practical expression. There are many -isms that offer beneficial aspects, I think the problem arises when we become too rigid in our ideological considerations and not flexible enough to blend, shift and make changes in our economic and political system to adapt as the real world within which we expect them to function, changes and shifts constantly.
I have no problem at all with private property and am generally in favor of market economies, but I'm also a firm believer in the social contract, and a representative government mostly devoted to protecting and defending individual rights and freedoms.

I don't see pure capitalism as inherently good or bad, merely disfunctional as a pure system in real world application.

[epepke]

Capitalism is great for most areas of life.

The way to tell is this. Capitalism is great when the quality of a service or product doesn't matter much. So, for instance, that $100 video camera I got at Walmart. It's fantastic. But that's because it doesn't matter a hell of a lot if a camera is good or bad. People enjoy bad cameras almost as much as they enjoy good ones, and a camera isn't going to make or break anybody.

When it comes to health care, or dog treats that might kill your dog, or septic conditions, capitalism sucks big hairy donkey penes. That's when you need something else.

[JJM 777]

Originally Posted by derchin

richest, safest, and lavish countries in the world happen to be capitalist.

Measured how? By the poorest of the country?

Third World produces at ridiculous underpaid prices, then the wealthy West buys it and consumes. Then you read a statistics that West is rich and China is poor, without realizing that it is not a merit of the West, it was 3rd world who produced the wealth of the West.

[Robrob]

I find the reverence some people hold for "capitalism" to be silly. Capitalism is no more a "system" than gravity. It's what happens when people interact and exchange things of value without structure. It's the natural state of economics - which is not to say it's the "best" or even "good" just the base. It's like saying "carnovorism is the best survival philosophy" or "survival of the fittest is the best means of evolution."

Yes, you can heat your house with a forest fire but a well regulated and controlled pot bellied stove would do a better and safer job of it.

[Tsukasa Buddha]

Originally Posted by Robrob

I find the reverence some people hold for "capitalism" to be silly. Capitalism is no more a "system" than gravity. It's what happens when people interact and exchange things of value without structure. It's the natural state of economics - which is not to say it's the "best" or even "good" just the base. It's like saying "carnovorism is the best survival philosophy" or "survival of the fittest is the best means of evolution."

That's just not true. I think you are confusing capitalism with open markets, and even then it is not true. It is distinct from feudalist, agrarian and hunter-gatherer systems that came before. Even Free Market proponents concede that government regulation is needed at base to keep the system working.

[UndercoverElephant]

Originally Posted by derchin

Many people assume its [Capitalism] bad on the premise that rich are wealthy while the poor and working class suffer.

But on the other hand a handful of the richest, safest, and lavish countries in the world happen to be capitalist.


Opinions?

IMO...

It's inherently bad. It means that the rich get richer and the poor are kept poor. It rewards people for already being wealthy rather than being useful to society or particularly good at what they do.

[Virus]

East Germany or West Germany?

End of story.

[Humes fork]

Originally Posted by UndercoverElephant

IMO...

It's inherently bad. It means that the rich get richer and the poor are kept poor. It rewards people for already being wealthy rather than being useful to society or particularly good at what they do.

This claim is contradicted by real-world data.

[UndercoverElephant]

Originally Posted by Humes fork

This claim is contradicted by real-world data.

No it isn't.

[Humes fork]

Originally Posted by derchin

Many people assume its [Capitalism] bad on the premise that rich are wealthy while the poor and working class suffer.

But on the other hand a handful of the richest, safest, and lavish countries in the world happen to be capitalist.


Opinions?

No, many people don't think capitalism is bad. It's more accurate to say that a bunch of Internet crackpots with too much sparetime on their hands think it is bad. In Western democracies there are parties that want to abolish capitalism, yet they are fringe. If capitalism was so popularly disliked, then those parties striving to abolish it would perform much better.

[UndercoverElephant]

Originally Posted by Virus

East Germany or West Germany?

End of story.

Except that wasn't the end of the story. That was then, this is now, and right now it is capitalism which is imploding, not socialism/marxism.

The markets are systematically rigged, not free.

The banks act as parasites, not enablers.

Capitalism is eating itself, just as Marx predicted it would.

[kevsta]

people going on as though we actually have capitalism anywhere.

we have privatized government sponsored profits and socialized losses.

we have already failed zombie institutions everywhere.

we have a centrally planned structurally fraudulent system.

actual capitalism and what we live under now are two entirely different conversations

[Roger Ramjets]

Originally Posted by kevsta

people going on as though we actually have capitalism anywhere.

We do. Capitalism is practiced in almost every country in the World.

Quote:

actual capitalism and what we live under now are two entirely different conversations

Your 'actual' capitalism is unstable when exposed to inevitable real-world influences, and cannot exist in pure form for any length of time. The reason? Because it is created by people.

Perhaps if we were all robots it might work. But we have irrational desires and emotions, and suffer from ignorance and poor judgment. Any economic system that cannot handle these human factors is doomed to fail. Pure capitalism is dependent solely on the independent actions of individuals. It has no structure or organization, no mechanism to keep itself on track despite human influence.

So we have governments and organizations and laws and institutions and planning and social structures, because capitalism by itself is not enough. Of course the mixed economies that we run are not perfect, but if pure capitalism could somehow be kept going, it would almost certainly devolve into something far worse.

Quote:

we have a centrally planned structurally fraudulent system.

No, we have a system that works.

But of course without government, without central planning, without law enforcement, without oversight and guidance, everything would be sooo much better. There would be no need for planning, no failures, no fraud, because everybody would automatically do the right thing and the Magical Free Market always 'knows' what's best for us!

[Londinius]

Originally Posted by derchin

But on the other hand a handful of the richest, safest, and lavish countries in the world happen to be capitalist.

Opinions?

I think you are ignoring the contributions of the progressivists and the socialists here by claiming that capitalists are solely responsible for the advancement of these "first world" countries.

Are we talking about 19th century laissez faire capitalism? This was a period where, for example, a proportion of people were deliberately kept unemployed just so the rich capitalists can easily replace their labour without yielding to their employee's demand for a higher pay, not to mention all sorts of inhumane exploitations being done without much empathy.

Now that was a very different thing from today's capitalism, which more or less has been shaped and influenced by the rise of socialism/social democracy especially during the post-war period.

The very simple fact that workers rights, which include many things that we take for granted today such as the 8-hour workday, had to be fought and earned through bloodshed just goes to show how inhumane capitalism is inherently as an economic system.

[Humes fork]

Originally Posted by UndercoverElephant

No it isn't.

Yes it is. Look at the data for extreme poverty development in the world:

[kevsta]

Originally Posted by Roger Ramjets

So we have governments and organizations and laws and institutions and planning and social structures, because capitalism by itself is not enough. Of course the mixed economies that we run are not perfect, but if pure capitalism could somehow be kept going, it would almost certainly devolve into something far worse.

it already did, you weren't paying attention.

Originally Posted by Roger Ramjets

But of course without government, without central planning, without law enforcement, without oversight and guidance, everything would be sooo much better.

and with what you laughably call "law enforcement oversight and guidance" in place its just going sooo well, isnt it.

without a bought and paid for government by the crony capitalist system, without central banks attempting to dictate things that the market should set, like the price of capital via interest rates, for decades, you might have a point.

as it is, not really.

[Tsukasa Buddha]

Originally Posted by Humes fork

Yes it is. Look at the data for extreme poverty development in the world:

http://upload.wikimedia.org/wikipedi...%80%932008.png

Just to nitpick, that is a crummy graph .

[Virus]

Originally Posted by UndercoverElephant

Except that wasn't the end of the story. That was then, this is now, and right now it is capitalism which is imploding, not socialism/marxism.

The markets are systematically rigged, not free.

The banks act as parasites, not enablers.

Capitalism is eating itself, just as Marx predicted it would.

Where would you rather live? East or West Germany?

[balrog666]

There are only two ways to gain wealth, farm/produce it or steal it.

Capitalism seeks to reward the farmers and producers as they expand the pool of "wealth" available; socialism seeks to steal from producers, thereby reducing both the "wealth" pool and the incentives for producing it.

I'm with the capitalists.

[Trakar]

Originally Posted by balrog666

There are only two ways to gain wealth, farm/produce it or steal it.

Capitalism seeks to reward the farmers and producers as they expand the pool of "wealth" available; socialism seeks to steal from producers, thereby reducing both the "wealth" pool and the incentives for producing it.

I'm with the capitalists.

If your portrayals were accurate, no reasonable person would choose otherwise. The fact that many reasonable people disagree with your assessment, should lead you to more in-depth consideration of the issue.

[Tsukasa Buddha]

Originally Posted by Virus

Where would you rather live? East or West Germany?

The OP wasn't about comparisons, though it is probably necessary to make them.

But even then, West Germany is not the only alternative that was, is, or could ever be. Comparisons to hunter-gatherer and feudal/agrarian can actually be quite interesting.

It also might help to separate early capitalism and late capitalism, at least in how we've experienced its development.

[UndercoverElephant]

Originally Posted by Virus

Where would you rather live? East or West Germany?

It's an irrelevant question. That was then and there, this is now and here. At that time I would obviously have preferred to live in the west, but you can't use that as a simple, knock-down argument as to why capitalism is better than the alternatives. The real world is much more complicated than that.

As things currently stand, capitalism is destroying itself.

[UndercoverElephant]

I think if we are to make sense of this debate then we need to take a step back and ask another sort of question: What is the economic/monetary system for? What do we actually want it to do? And I think if we try to answer those questions, capitalism will be found wanting. (Although it may depend on how you define "capitalism".)

[UndercoverElephant]

At the risk of throwing this thread off-topic, I think it is important to note that the past is going to be a pretty poor guide to the future at this particular point in the proceedings. 20th-century-style communism is already dead, and 20th-century-style capitalism is in its death throes. Neither of those systems paid any attention to all the most serious challenges facing the human race from this point onwards, and those are how we are going to respond as a society as we shift from an age of cheap resources and long-term growth to an age of increasing scarcity and long-term contraction (or "de-growth"). These issues are so important that they blow the old 20th-century oppositions between "communism" and "capitalism" right out of the water: the game is about to change completely...or rather it has already started to change.

Those societies which have the best prospects going forwards are not going to be those that encourage mindless consumerism and parasitical high finance, or treat the free market as some sort of end in itself, or allow their agendas to be set by big business or even the profit motive in general. No...the ones with the best prospects will be those which learn best how to cope in a completely changed world where suddenly what matters is how sustainable the local systems are, how durable the products are and how well-attuned the general strategy is to cope with increasing scarcity. Free market capitalism is no good for any of these things. What is required instead is a controlled economy, except with sustainability as the primary goal rather than the idea of building a utopia for the poor.

Waiting for free market capitalism to solve the serious problems we face is like waiting for free market capitalism to arm yourself while Hitler arms Germany.

[Virus]

Maybe you should respond to the fact that global poverty is on the decline before giving more overblown dogmatic lectures.

[Trakar]

Originally Posted by Virus

Maybe you should respond to the fact that global poverty is on the decline before giving more overblown dogmatic lectures.

This is only approximately accurate if you include the chinese population which isn't reliant on what most consider to be "capitalistic" economic processes. The UN numbers are also based upon some rather creative accounting (redefining the MDG1, restructuring consumer price indices (CPI) and purchasing power parity (PPP), etc.,).

[kevsta]

Originally Posted by Humes fork

Yes it is. Look at the data for extreme poverty development in the world:

http://upload.wikimedia.org/wikipedi...%80%932008.png

from the document, are you trying to portray this as some kind of policy success somewhere?

Quote:

For the first time since this monitoring task began, the data indicate a decline in both the poverty rate and the number of poor in all six regions of the developing world

 Between 2005 and 2008 the percentage living below $1.25 a day and the number of people fell in all six regions. This is the first time this has happened over three-yearly intervals since 1981.

 The overall percentage of the population of the developing world living below $1.25 a day in 2008 is 22%, slightly more than half its value in 1990, while 52% lived below $1.25 in 1981.

 That means that 1.29 billion people in 2008 lived below $1.25 a day, as compared to 1.94 billion in 1981. 2.47 billion people in 2008 consumed less than $2 a day, as compared to 2.59 billion in 1981.

 The trend decline in the $1.25 a day poverty rate was 1.05% points per year (standard error=0.06% points). But trend is much lower—0.54% per year—if one excludes China.

and it strikes me they dont seem to consider inflation, $1.25 in 1981 was a lot more than it is now, and counting China in the stats isnt really very relevant to a conversation about capitalism is it?

[UndercoverElephant]

Originally Posted by Virus

Maybe you should respond to the fact that global poverty is on the decline before giving more overblown dogmatic lectures.

The entire western world is bankrupt.

[Virus]

Originally Posted by UndercoverElephant

The entire western world is bankrupt.

Some of them are. From governments spending beyond their means.

It's interesting that you aren't fleeing from a capitalist country to a place with pre-capitalist or socialist economy though.

[balrog666]

Originally Posted by Trakar

If your portrayals were accurate, no reasonable person would choose otherwise. The fact that many reasonable people disagree with your assessment, should lead you to more in-depth consideration of the issue.

Feel free to expand the discussion ...

[balrog666]

Originally Posted by UndercoverElephant

The entire western world is bankrupt.

Not at all, only Western governments are bankrupt; can you tell the difference?

[AlBell]

Originally Posted by UndercoverElephant

At the risk of throwing this thread off-topic, I think it is important to note that the past is going to be a pretty poor guide to the future at this particular point in the proceedings. 20th-century-style communism is already dead, and 20th-century-style capitalism is in its death throes. Neither of those systems paid any attention to all the most serious challenges facing the human race from this point onwards, and those are how we are going to respond as a society as we shift from an age of cheap resources and long-term growth to an age of increasing scarcity and long-term contraction (or "de-growth"). These issues are so important that they blow the old 20th-century oppositions between "communism" and "capitalism" right out of the water: the game is about to change completely...or rather it has already started to change.

Those societies which have the best prospects going forwards are not going to be those that encourage mindless consumerism and parasitical high finance, or treat the free market as some sort of end in itself, or allow their agendas to be set by big business or even the profit motive in general. No...the ones with the best prospects will be those which learn best how to cope in a completely changed world where suddenly what matters is how sustainable the local systems are, how durable the products are and how well-attuned the general strategy is to cope with increasing scarcity. Free market capitalism is no good for any of these things. What is required instead is a controlled economy, except with sustainability as the primary goal rather than the idea of building a utopia for the poor.

Waiting for free market capitalism to solve the serious problems we face is like waiting for free market capitalism to arm yourself while Hitler arms Germany.

What do you think armed the free world for WWII if not capitalism?

[autumn1971]

Originally Posted by AlBell

What do you think armed the free world for WWII if not capitalism?

Governments played a large role.

[Tsukasa Buddha]

Originally Posted by AlBell

What do you think armed the free world for WWII if not capitalism?

Actually, that was probably the time we were least capitalist. We had price controls, government rationing, wage control, etc. The government was able to push industrialisation to unheard of limits. It was essentially a command economy.

[McHrozni]

Originally Posted by UndercoverElephant

Except that wasn't the end of the story. That was then, this is now, and right now it is capitalism which is imploding, not socialism/marxism.

First of all, socialism/marxism imploded over twenty years ago. But a few countries in the world claim to practice it anymore, but none do. It died a gruesome death. I assure you you can't resurrect it by wishful thinking and even if you could, it would just die again.

Secondly, capitalism isn't imploding. A number of countries have financial and growth issues, that is true, but that's where it ends. The situation was much worse 80 years ago, when marxism was at it's strongest, and look at how that turned out.

Quote:

Capitalism is eating itself, just as Marx predicted it would.

Marx predicted capitalism would be destroyed as the number of laborers grew so vast they would be unstoppable. His prediction is already falsified by history, as he failed to foresee an emergence of the middle class - which is by now dominant. His predictions aren't worth the paper they were written on.

McHrozni

[UndercoverElephant]

Originally Posted by McHrozni

First of all, socialism/marxism imploded over twenty years ago. But a few countries in the world claim to practice it anymore, but none do. It died a gruesome death. I assure you you can't resurrect it by wishful thinking and even if you could, it would just die again.

Secondly, capitalism isn't imploding. A number of countries have financial and growth issues, that is true, but that's where it ends. The situation was much worse 80 years ago, when marxism was at it's strongest, and look at how that turned out.



Marx predicted capitalism would be destroyed as the number of laborers grew so vast they would be unstoppable. His prediction is already falsified by history, as he failed to foresee an emergence of the middle class - which is by now dominant. His predictions aren't worth the paper they were written on.

McHrozni

McHrozni...

Capitalism is eating itself while the world watches. You can wail and moan all you like about how Marxism is already dead. It doesn't matter now because Capitalism is eating itself while the world watches.

For the last three decades, people on the right wing have assumed that because 20th-century style communism could not compete with 20th-century style capitalism, that capitalism had "won". This viewpoint was championed by people like Francis Fukuyama, who claimed that US-style economic/political systems represented "the end of history". He truly believed that humans had invented the best possible economic/political system and that no major changes remained to happen. Well, Fukuyama and his right-wing buddies were wrong. You may not believe this yet, but if that is so then you have some major surprises coming your way before very long.

[UndercoverElephant]

Originally Posted by Virus

Some of them are. From governments spending beyond their means.

No, not just that. Have a look at the total debts of the UK, for example, and you will find that by far the largest proportion of it is bank debt. The same is true, on a smaller scale, in Ireland. The same was true in Iceland, which has already defaulted.

So this is more right-wing claptrap. The problem here is not the socialist tendencies of some government, but the capitalist system itself.

Quote:

It's interesting that you aren't fleeing from a capitalist country to a place with pre-capitalist or socialist economy though.

No, that's not interesting at all. It is totally irrelevant. Not only is there no point in me fleeing to another country, there isn't even any point in me moving to another part of the UK. The reason for this has nothing to do with politics and everything to do with the fact that my only realistic means of earning an income requires an intimate knowledge of the local countryside and flora. If I were to move, I'd lose the benefit of 20 years of local experience. Many other people have little choice about where they live for similar sorts of reasons.

I might also point out that running away to another country is the option for those who care only about themselves, and not about the plight of their compatriots. The honourable thing to do is stay put and fight for change, not run away.