When Capitalism is stupid

The basic good ideas about the concept of Capitalism are:

1. People are rewarded for

• Having good ideas about how to improve quality of life and provide for people's needs,
• For putting good ideas into action,
• For providing for the needs of the people,
• For saving money to pay for providing for the needs of the people

2. A financial structure so that all these can be put into effect.

3. Laziness and selfish extortion can be avoided by competition, to provide an incentive to keep on improving what you do, and so that the people can buy what is the better and the cheaper.

4. Producing for mass markets can cut costs by increased turnover.

5. Quality of life can improve for everyone as a result. Even in the poorest parts of the world today, people are not in rags - because the secondhand market is so cheap.

The stupid things about Capitalism in action, that need to be fixed are:

basically about excess, unmitigated greed, excessive waste, and failures to achieve these five purposes. All these stupidities could be solved.

Judge priorities yourself, reader.

• The 'jungle' of capitalism is not like a natural jungle where the ecology balances out in one way or another so that the jungle can survive for millions of years. Nature is red in tooth and claw because its life is based on the food chain, which recycles. The jungle of capitalism is red in tooth and claw to fatten the greedy. Its single and accelerating direction of 'growth' means that it will destroy its own ecology - and in the foreseeable future.
• Trade wars. Colonialism. Economic imperialism.
• Man-made weather. 'Business cycles' get so out of hand that whole countries and regions can and do suffer economic meltdowns. The stock markets gyrate wildly, currencies going through the floor, businesses crash, mass unemployment means jobless people sit among things needing to be done. Overproduction is a spectre - while most of the world is too poor to buy its needs. Whole countries are at the mercy of business climates, with their cyclones and depressions. And always people make fortunes from the swings.
• Economic waste. The market economy considers only labor and capital and assumes that natural resources are infinite. "Future cost" in use of resources is not factored in.
• Greed that can never be sated. The business of business should be to earn a fair living through supplying needs, not just to 'make money'.
• The rich get richer and the proportion of the poor is increasing. One of the few sayings of Jesus which our society follows faithfully is "To them that have is given more, and from them that have not is taken away even that which they have.
• One 'arithmetic of capitalism' is that the cheaper the labor the more the profits. A consequence is the class struggle. A preferred procedure is to produce goods in places where labor is as exploited as much as possible, and sell them where labor is not quite so exploited so there are mass markets that can afford to buy them.
• Jobs depend upon whether they are profitable for someone rather than what should be the criterion, whether they are useful. If all the jobs that needed to be done were being done, there would be no unemployment, there would be a labor shortage. Instead, millions of people are in useless, or wasteful, or poorly rewarded unpleasant or boring jobs, in order to make profits for others.
• Abuse of the system of stocks and shares. Its useful purpose is to be a means of raising capital for worthwhile enterprises, and reward those who provide that capital with a reasonable reward for taking the risks of losing it, and for saving and providing that money to lend for the enterprises when they could be spending it on their immediate desires. Yet instead, the system of trading in stocks and shares has become the major way for making fortunes to be made. The most riches at present comes from the useless financial dealings in speculation - to make profits by trading shares, not by investment. Yet this travesty of purpose could be •
• Capitalism today depends upon waste and consumption - upon people consuming up the resources of the world rather than using them responsibly. Goods are produced that are deliberately non-durable, non-mendable, non-updatable, with planned obsolescence - an appalling waste. The car industry alone wastes enormous amounts of raw materials.
• Multinational companies have the benefit of being able to provide cheap goods for mass markets - but at what cost do they operate because of greed run rampant. They can be more powerful than governments and seek to control them - for example, by pressures for complete economic deregulation and preventing government protection of labor and environment (eg. the unrelenting pressure for the Multilateral Agreement on Investment)
• Production of what is superfluous or even antisocial and then advertising to build up markets - from cigarettes and other drugs that destroy health, to household cleaners that pollute.
• Excessive interest charges are unscriptural, condemned as usury, oh Christian countries! Banks and governments also manipulate interest rates as if they were the throttle of the economic engine - but whether the rates go up or down, banks and financiers make windfall profits, while others suffer from the unreliability.
• Excessive dividends when there is no risk-taking to reward, as in former government-owned essential enterprises.
• 'Private affluence and public squalor' continues. The 'trickle-down' effect is still a trickle. Although living conditions have vastly improved in the developed world through capitalism, there is still '', and mass poverty. Workers do not make equivalent profits to directors.
• Needed products are still not being made, needed inventions are not being researched, because the capital is not available for the ventures and the enormous advertising required to get a product going today.
• Privatisation of public businesses, infrastructure and utilities, taken to extremes - claiming private owners are always more efficient - whereas around 38% of British businesses failed during one normal year, to take only one example. The big pressure for privatising these is that they are safe industries to invest in - governments cannot afford to let them go broke, however mismanaged.
• 'Commercial confidentiality' which can cover a multitude of misdoings, especially in relation to dealings with governments.
• Related to this is private property extending to privatisation of knowledge, which should be the common property of the world, with due reward to its originators.
• Far too often the wrong people get the rewards for the ideas and the work - not the artists, inventors, innovators, problem-solvers, laborers. Few of the 500 richest people in the world have put in sufficient useful work to justify incomes of any more than $150,000 per annum - yet they will soon own half the wealth of the world. (They may have worked hard to collect the wealth to themselves - but how useful has that been to anyone else?)
• The biggest and most profitable industry under capitalism is armaments - but it is also big in non-capitalist countries, and the enormous drug industry does not require a capitalist system either.
• Forced takeovers. Forcibly taking over healthy businesses in order to reduce competition and strip assets - and the law encouraging this piracy rather than protecting independence.
• Changes in property values are a major source of riches- and harm the people.
• Social corruption by greed. Greed of course is an endemic problem regardless of social or economic system. However, when it is exalted as a prime mover, corruption spreads everywhere with the example of the 'seriously rich'. The prime ambition has become to be seriously rich - yet there is increasing evidence that great wealth can corrupt, and not be used to the benefit of society. Our CEOs need other inducements to work hard and loyally for their companies than increasing emoluments which increase every year on the grounds that every other company is doing the same. The saga of Labor leaders who have become rich is not pretty. The common people who gamble for unimaginable sums have the examples of unimaginable sums before them - and no other way of getting there themselves.
• No ceiling for riches. If it were not for social corruption by the gleam of greed, we could have social sanctions against excessive wealth - over a certain ceiling calculated by comparison with the poorest fulltime workers. Social benefit enterprises to eliminate poverty, philanthropy and taxation would be set means by which shamed plutocrasts could honorably divest themselves. "He who dies rich dies shamed," as the millionaire Andrew Carnegie recognised.

Unions

Unions are discussed under capitalism, not under socialism, because they are a response to the dichotomy of Capital and Labor. Unions can be stupid in many ways but chiefly

a) Alternatives to strikes are needed in order to obtain justice in public service industries, where strikes 'hold the public to ransom' and generate hostility to unions that harms their interests greatly. Strikes in public service industries are indeed using the innocent as a blackmail. What else is possible?

b) Inequality. Strong unions obtaining great advantages to their workers while weaker workers remain exploited and suffering.

c) Ambit claims that are outrageous and generate public hostility, since the rest of us can have no such conditions yet. Ambit claims are still needed because of the way negotiations work, but should be opening the way realistically for such conditions for all.

d) Fatcat union leaders. It is necessary for them to live more like their workers than like the bosses. (cf Animal Farm)

e) Strung-out negotiations. Union leaders and management bosses can benefit by stringing out negotiations in endless talks - but it is a highly inefficient way of doing business.

e) The union movement's future must include the welfare of the whole people, not just their own sector. Workers' needs must be considered as the users of products not just the makers. Then unions and the people can all prosper.

Summary: Improving capitalism

1. Some of the areas for concern and improvement

• The basic reason for having industry and business at all.
• Economic concepts for the 21st C
• Human rationalism rather than economic rationalism
• Free Trade and Freedom
• The former Global Ideal and the present Global Reality
• Alternatives to the ideal of Growth and its consequences
• Taxation
• Jobs that are really needed
• Stopping wealth pouring into sinks
• Competition and Co-operation
• International economic co-operation
• Magna Carta for the nuclear age
• 'Thick Face, Black Heart' - business ethics
• Sociodiversity
• Robber barons and the nation state
• Reforming the stock market
• Resources - the forgotten third factor with capital and labor
• Economics models and muddles
• The calculation of Future Cost in economic models
• Poverty prevention
• The sustainable economy
• Reform and problems of the developed countries
• Reform and problems of the undevelopd countries
• Waste and its prevention - Waste of food, waste of people
• Disasters and Emergencies - how can capitalism prepare?
• Nations and national divisions
• A Nations' Agreement on Investment (NGOI) rather than the Multilateral or Bilateral AI
• Population -
• Social movements - their social psychology

• Wealth distribution
• Unemployment prevention

2 improving political aspects of democratic capitalism

• Freedom in the next century
• Global politics
• The armaments industry
• Tackling causes of future wars
• Elections
• Reforming government structures
• Trade and industry legislation
• Political Psychology of groups
• Politics of discontent

If these reforms are impossible, a different economic system is needed.

You can think of what I have missed out.