Showing posts with label capitalism. Show all posts
Showing posts with label capitalism. Show all posts

Monday, August 16, 2021

Thoughts for the Day: Monday 16 August (that most august date) 2021

 


N.B. The following quotes are taken from Naomi Oreskes Introduction.
The problematic assumptions are thus three-fold: (1) that everything is here for our use, and whoever can find and market that use is warranted in doing so; (2) that the system that created these problems will somehow also solve them; and (3) that technology, enabled by science and fostered by the profit motive and consumerism, is the foundation of progress, prosperity, freedom, and even happiness.

(Location 130)


What [Pope Francis] rejects is the logic that sees the marketplace as the solution to all problems, that prioritizes profits to the exclusion of other considerations, and that privileges individual desire over the common good.

(Location 135)


The failures of communism are taken as total refutation of any attempted intervention in the marketplace, any attempt to guide technological development towards more humane ends. But theirs is the ideology of no ideology. Thus it is significant that the pope’s critique is based not only on theological foundations, but on empirical ones as well. It is based on the simple fact that the system as it currently operates has failed in three important ways. The first is a failure of equity. . . . The second failure is environmental damage. The champions of our current system often say its benefits have simply not yet reached the poor—and therefore we must continue (and even strengthen) the practices that have made the rich rich [sic] until they reach all. . . . The third failure is the spiritual impoverishment of the rich. The cheerleaders of capitalism insist that free markets are not just the best means of delivering goods and services, but the only means that protect our freedom.v In the aftermath of the Cold War, this can be a hard argument to refute, but the pope is a brave man and he takes on the challenge: Our paradigm leads people to believe that they are free “as long as they have the supposed freedom to consume.”

And now for some other voices to round-out our diet: 


The claim that capitalism is the cause of our environmental problems is only partially true, at best. Historically, non-capitalist economies, like that of the Soviet Union, have also caused massive environmental damage; and environmental problems like climate change always have multiple causes— such as people’s psychological tendency to discount future costs— many of which have nothing to do with capitalism.

Socrates’s aim is to teach political moderation and philosophical dispassion to his young interlocutors—that is, to incline their minds to wisdom and virtue instead of ambition for wealth, honor, and power.

Liberalism promised the boons of protection from power and equal respect for all, whoever they were. It said little about who was to enjoy such boons. It fell silent about how far “all” stretched. Democracy, by contrast, insisted on liberalism’s boons for everyone. Democratic liberalism, that is, demanded that protection from power—the power of state, wealth, or social pressures—be available to everyone, whoever they were. The “everyone” here included not only majorities—the less educated, the less well-off—it also included minorities, be they rich or poor, upon whom majorities might prey.

A classical understanding sees the world primarily as underlying form itself. A romantic understanding sees it primarily in terms of immediate appearance.

Although derided by Democratic liberals as a golf-playing do-nothing and by Taft’s followers as a risk-blind globalist, Eisenhower (1890–1969) presided as a skillful chairman over the post-1945 consolidation of American economic and strategic power. As former Supreme Allied Commander in Europe and then US president from 1953 to 1961, the changes he made to New Deal tradition were more in pace than direction.


Monday, August 3, 2015

A Toast to Capitalism--And Now Junk It



David Brooks: defender of capitalism & yet conservative

I want to take up David Brooks’s challenge set forth in his column “Two Cheers for Capitalism”. But let me first state my opening position:

Capitalism is the best form of economic system—ever. And it needs to be replaced. Starting now.

Brooks argues in defense of capitalism that its better than socialism. He doesn’t use the word “socialism”, but it’s implied when he writes “government planners are not smart enough to plan complex systems”. True but trivial. Centralized planning as an alternative to markets lost long ago. No serious commentator wants to restore central planning.

Brooks ignores the extent that business and government are  intertwined in early 21st century consumer capitalism. We delude ourselves in believing that mainstream economics, which provides the intellectual infrastructure for capitalism, could ever escape political economics. An economy is always nested within political and cultural systems. The most important intertwining of politics and government in the U.S. today has to do with regulatory capture, not regulatory restraint. Big government today is controlled by Big Money. Big Money includes individuals (yes, think Koch) and aggregates (trade organizations, corporations, etc.). Adam Smith, the intellectual godfather of capitalism, pegged it when he observed that when two or more merchants meet, the conversation would inevitably turn to restraint of trade. We could add "politicians" to any merchant or private interest, and we'd get the same effect. This happens--often--and we ordinary folks suffer for it. (For an enlightening—and frightening—discussion of regulatory capture and flaws in economic thinking, read Dr. Robert H. Lustig’s Fat Chance: Beating the Odds Against Suger, Processed Food, Obesity and Disease (2012) (review forthcoming)).

Brooks is correct that capitalism has lifted more people out of poverty than any time in history. As one currently living in China, I see proof everywhere of the power of consumer, market capitalism (for good and ill). But will it last?

Here I come to my greatest critique of contemporary capitalism: can this ride last? I do not (now) fear the backlash of resentment that growing inequality can spawn. Only a little of this has occurred yet. Humans are not the biggest challenge to the system, although this could change quickly. Rather, Mother Nature is the ultimate judge of capitalism.

I know that you’re thinking, “Yea, yea, and you forget the Ehrlich-Simon bet and how Ehrlich lost it—big time.” No, I don’t. Ehrlich lost within the time frame set for the debate, but Mother Nature doesn't recognize such puny time frames.

Every economic system extracts energy from the environment and returns entropic waste. Contemporary capitalism and its civilization do this more effectively than any other civilization. According to Dr. Joseph Trainer, Dr. Thomas Homer-Dixon, Dr. Jared Diamond, and Dr. William (Patrick) Ophuls, among others, no civilization has escaped the limits of the environment and entropy. It’s a social and environmental-economic challenge that capitalism has met better than any other system by using industrialization, rationalization, and technology. But no system—not even contemporary capitalism—can negate these limits. We’ve known about these limits in the form of global warming from dumping waste into our environment for over 20 years, but we've attempted to ignore it. Even the Pope, head of an organization not known for its embrace of cutting-edge science, has recognized the problem. (Pope Francis and his predecessors have long-recognized the corrosive social costs of capitalism.)

John Stuart Mill wrote about the need for a steady-state economy in the mid-19th century, well ahead of his time. We need to address these issues now. Endless acquisition and endless growth don’t square with the limits placed upon us by the natural world—the world of our atmosphere, our oceans, our lands, and our societies.

The hope I have is not for a revolution (or  rather only one seen only in the rearview mirror in slow motion). Nor am I a Luddite. Rather, we need to improve our lives by using what we have, consolidating our gains, and re-thinking some of our fundamental beliefs. This will be an immense challenge, but it’s a project that conservatives, like David Brooks (to the extent he’s really a conservative), should embrace. Not the factory, but the garden should serve as our guiding metaphor: we prune and graft and cultivate with the seasons, we don’t lay waste and move on. This is how capitalism must become something new. If grafted and cultivated along with democracy—real democracy—it could become something of lasting value. 

Friday, December 9, 2011

Ken Rogoff on Capitalism

This article by Ken Rogoff in a very short space addresses some of the pressing problems with contemporary capitalism. His first point, and one that bears remembering, is that we have no better alternative. To paraphrase Churchill, capitalism is the worst form of government except when compared to all of the others. Does Europe (certainly not!) or China (still young) have a better model of capitalism? No, not really; different, not without significant problems. Rogoff notes, in a very brief and succinct article, five areas where contemporary capitalism has problems: health care, finance, inequality, under valuation of common goods (air, water); under valuation of the future, and consumerism (we sell a lot of food ("good"), and we get fat. Very thoughtful. I think capitalism, with about every system, has a real agency problem, but I don't know the best cure.