The Future of Capitalism

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The failure of capitalism will not be caused by its inherent nature. It will be the result of human extremes — greed, misinformation and misunderstanding.


. . . I am thinking differently and I am thinking of capitalism for the common good, not for the elite few.


. . . the label “socialist” became an accusation, a scare-tactic, a pox hurled like a weapon of economic war. It has also prevented us from thinking social when we think economics.


And that’s why capitalism became — and I use this word cautiously — antisocial.


Today, it is communism and capitalism that are happy bedfellows.


Russia, sold its assets for dirt-cheap prices to the favored few, to the oligarchs.


How different is that than the current condition of capitalism in a democratic country like ours?


If American-style capitalism is dead or dying, we need to understand what our capitalism has become and what needs to be done to make it right.


It takes a crisis in economics and in politics before a change begins.

Capitalism Is Eating Its Own Tail

If capitalism continues on its present course, some say it will self-destruct in 20 or 30 years. Others say much sooner. Some say it’s already dead. Regardless, the actual death of capitalism would be a disaster for all of us. We must save it and change its purpose.

Although capitalism is among the many isms that are inherently extreme — racism, sexism, barbarism for example, the character of capitalism is inherently positive, the most powerful creator of wealth the world has ever known.

We Are Killing Capitalism

The failure of capitalism will not be caused by its inherent nature. It will be the result of human extremes — greed, misinformation and misunderstanding.

As capitalism fails, we are hearing about the opposite isms again — socialism and communism, two alternatives that frighten most people and don’t offer much of an alternative anyway. But there are elements of these opposing isms that are worth thinking about — some good, some bad.

Socialism is a political and economic theory of social organization that advocates that the means of production, distribution, and exchange should be owned or regulated by the community as a whole.

Well, that’s as American as apple pie! Hear these words from our Constitution — “of, by and for the people.”

But it’s the complete opposite of capitalism, which as you should recall, is an outgrowth of laissez faire and makes no social promises like the Constitution does. The concept of a people-oriented economy scares capitalists half out of their minds. The government goes hysterical and treats anything that smells like socialism as a criminal act.

I’m a little paranoid about that myself and so I pause here to deny that I am advocating socialism per se, but I am thinking differently and I am thinking of capitalism for the common good, not for the elite few. That’s the key. That’s where capitalism goes wrong.

Taint of Socialism

The term socialism was coined at the same time as capitalism and was cast as capitalism on steroids. It immediately became the whipping boy of the capitalist who painted visions of communes with clones and dead-end wages regardless of the value each person might contribute. A system without personal freedom, incentives or opportunity to excel as an individual.

Governments still get hysterical at the mention of the word and patriotic parrots go cross-eyed. Loaded with propaganda, they blindly label socialism as evil when its intentions are to serve the common good. The critics are adamantly opposed but don’t mind cashing their welfare, childcare, healthcare, unemployment or Social Security checks and then beg for more. We are schizophrenic about socialism because we have been programmed that way.

During the American Industrial Revolution when most people were not seeing the face of economic injustice first hand, socialism never had a chance and the word continues to induce fear and anxiety today.

The Commie Scare

In the 1950s communism was characterized as an even worse form of the dreaded socialism, even though there’s nothing social about it. Communism became the “heavy” in the good-guy, bad-guy game during the public relations campaign called the Cold War following World War II. We had to have some kind of faux war to sustain the military-industrial complex.

The government scared the people into building bomb shelters while building its own defenses against an imaginary attack from the communist world.

Surely you’ve heard of the witch-hunts that were carried out in Congress under the guise of an “un-American activities committee.” People who thought differently were stalked and persecuted both inside and outside government without cause or justice. Among them were thought leaders, actors and comics.

It turns out the commie scare was uncalled for but it heightened the view that communism and socialism were bedfellows, painted by the same brush. Never mind that one was democratic and one was totalitarian.

And that’s why capitalism became — and I use this word cautiously — antisocial.

If these facts surprise you, then this will shock you. Today, it is communism and capitalism that are happy bedfellows. That’s right. Russia is now considered a capitalistic country run by the state and owned by government-sponsored capitalists, the oligarchs.

The transition began with Glasnost, when the U.S.S.R. declared itself an “open” country in the 1980s. But when former “colonies” began to withdraw, the soviets disbanded the U.S.S.R. altogether and the new country, Russia, sold its assets for dirt-cheap prices to the favored few, to the oligarchs.

Just like us, the Russian people simply don’t have the access to the riches of capitalism that the oligarchs do.

Let’s be clear about oligarchy. It is a small group of people who have control of a country, organization or institution. In Russia today, the oligarchy is an alliance between those who control the country and the oligarchs who control the economy. The perfect combination if you don’t care about social purpose.

How different is that than the current condition of capitalism in a democratic country like ours? Well, in a way it is different. In Russia, the country controls the oligarchs. In the U.S. the oligarchs control the country.

I’m telling you this because you need to get over the isms. They all contain both good and bad intentions and elements. If American-style capitalism is dead or dying, we need to understand what our capitalism has become and what needs to be done to make it right.

Imagine Future Without Capitalism

Now, with that perspective, let’s imagine a future without capitalism — any type of capitalism. Let’s say it really is dead.

Actually, we don’t have to imagine it. When America’s oldest Big Box closed its doors in Canada after first declaring bankruptcy and then failing to find a viable buyer, the result was devastating.

Following liquidation of the remaining Canada Sears stores, twelve thousand employees lost their jobs. The impact was best described by their lawyer, Susan Ursel:

“This company has touched the lives of generations of Canadians,” she told the court. “For employees and their families, it has been a source of livelihood, community, camaraderie and pride. That we’ve come to this juncture is a source of frustration, anger in some corners, and apprehension for many.”

Customers felt the same way, mourning the loss of a family tradition that had gone on for generations. One said, “I don’t know what we are going to do without Sears.”

Whether the employees will retain their earned benefits is a matter for the courts to decide. As for the company, it will surely use the money left from liquidation and either re-invest it or cash it in. It’s not the end of the world for the owners and executives. They will not be looking for their next meal. They probably have enough to live on comfortably for the rest of their lives.

But imagine what would happen to any country if all the elite capitalist enterprises suddenly shut down. Walmart is the modern day “Sears” for millions of customers, not for its culture but for its low-priced, mostly Chinese products.

We may not like that as a matter of justice, but unrestrained capitalism is actually enjoyed by most customers who don’t enter the Big Boxes to make a political statement. They are unknowing, unthinking. It’s not about tradition either. It’s about survival. They depend on the Big Box business model because they are on the low end of the economic treadmill. They don’t believe they have another choice. As consumers they like the Big Box and, if you take it away, they will not be grateful.

You see, unrestrained capitalists have the advantage. They are the kingpins of economics, whether we like it or not. They hold economics, they hold us in their own hands. When we look at it that way, we can understand why the economists and the politicians point to Wall Street — not Main Street — as the primary indicator of the nation’s economic health. And we understand how these oligarchs get away with stealing our democracy, as well as our money. Our behavior as consumers is part of it.

If we extrapolate the closure of Sears Canada into a picture of the predicted death of capitalism as a whole, we will see the Great Depression multiplied. We will see people in the streets without even an insufficient paycheck, looking for a handout; a decaying business infrastructure collapsing around them, skyscrapers collapsing of their own accord; and the death of the wealthiest nation in the world close at hand.

Wall Street’s False Economy

That’s why politicians and policy wonks worry about Wall Street. It may not be the indicator of the people’s economy, but it is — like it or not — what makes our world go ’round.

And that’s why those of us who fight unrestrained capitalism should not be on a mission to kill capitalism itself. Unrestrained capitalists are doing a good enough job of that on their own. Helping drive the last nails into capitalism’s coffin would be like sawing off the limb we’re out on. We need to save capitalism, fix it before it really does self-destruct. Or else find something better.

Some say it’s too late, but not me. It takes a crisis in economics and in politics before a change begins. With the epitome of unrestrained capitalism in the White House, Washington in chaos and the people in turmoil it is not at all too late. The time has come. I see the situation as an opportunity.

To conclude this segment I’ll prove what I said before — that your professor is not a know-it-all.

For the life of me I cannot understand how anyone can believe that an economy can be sustainable if it is intent on squeezing as much money as possible out of circulation and follows a predatory business model that antes up as little as possible into the economy through wages and benefits.

It reminds me of the image drawn by an alchemist in ancient Egypt showing a serpent eating its own tail.

Please go to the next essay
Minimum Wage for All

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Not My EconomicsThe Future of Capitalism