Lust, anger, and greed. We all know how wicked these passions are. In any religion, these are the weighty ones -- what the church I grew up with calls "cardinal sins."
But thundering about sins from the pulpit distracts us from recognizing that we were all born with "lust, anger and greed." We didn't inherit them; in my opinion, God made us this way -- it's part of the baggage of life.
We love to read and hear about other people's "sins" -- partly to feel elevated above that sort of thing, and partly because we're voyeuristic. It helps us push to the back of our minds any awareness of our own indulgences. Indeed, some of us do cope better than others with sins of passion. But when given the temptation of a good financial opportunity?
Oh, not me, we say to ourselves. Look at those guys on Wall Street. What about those bonuses they pull down? And for doing what? Skinning us? Well, in fact, skinning the next guy has more polite names: competition, free enterprise, capitalism. These are not just words from the dictionary; they are political symbols. We are a culture obsessed with money. How much money one makes is our basic measure.
Nevertheless, I still think capitalism is the most effective economic system we have yet devised -- and it is also probably the most effective way of channeling greed that we have yet tried.
The problem with capitalism is that it can quickly get out of control. An instrument of capitalism, such as a bank, for example, intended to provide a service, can move on to fleece those it supposedly serves. Since maximizing profits is considered a virtue, free enterprise can move with alacrity towards the kind of disaster that causes bankruptcy and job losses -- even nationwide and throughout the world. That is the genesis of the Great Depression and the current (yes, still current) Great Recession.
There are only two solutions to limiting this exercise of greed: instituting restraints that are enforceable by law (with penalties that bite), or using fear to repress greed, just as we repress lust. When I was a lad, our fear of venereal disease was indeed considerable, just as it is with HIV today.
Repressing greed is difficult. In our present culture, greed is held aloft, admired as "success" or "winning." Free enterprise is revered as if it were a religion. Criticism of capitalism is close to being unpatriotic ("Watch it, Buster!").
Now, back to my favorite reference, my grandfather, Franklin Roosevelt. He didn't wince or mince words when criticizing big business and the financial community, or the Republican Party. Arthur Schlesinger Jr. sets the scene clearly in The Politics of Upheaval, 1935-1936:
As Roosevelt looked back over his administration, he thought he had displayed great forbearance. The New Deal, he believed, had saved the position and the profits of the businessmen. He had forgiven their errors of the past and their lack of ideas for the future. And now organized business was assuming what he [FDR] regarded as a posture of indiscriminate, stupid, and vindictive opposition.
Schlesinger went on to quote Elmer Davis, a well known reporter and political pundit at the time: "[I]f anybody ventures to imply some lack of confidence in Business, Business is terribly hurt, and calls him a crackpot and a Communist." Schlesinger continued, "The rich may have thought that Roosevelt was betraying his class; but Roosevelt certainly supposed (as Richard Hofstadter has suggested) that his class was betraying him."
Over and over again those with power, through their control of the institutions that manage money, take advantage of the rest of us. A book detailing this repetitive phenomenon has just come out, Jeff Madrick's Age of Greed: The Triumph of Finance and the Decline of America, 1970 to the Present. It is such a good geography of our current landscape that major columnists are reviewing it.
Paul Krugman, reviewing it in The New York Review of Books with Robin Wells, wrote:
As Madrick quotes [Milton Friedman], "The Great Depression, like most other periods of severe unemployment, was produced by government management rather than by inherent instability of the private economy." Replace "Great Depression" with "the financial crisis and its aftermath," and it could be John Boehner today, rather than Friedman in 1962, speaking these words. Like Reagan, Friedman proclaimed a creed of greedism (our term)--that unchecked self-interest furthers the common good.
The major beef I have with President Obama's administration, as I have outlined in previous posts, is its lukewarm efforts to impose restraints on business and, worse yet, refusing to push public understanding of just who is responsible for our current economic crises.
"President Obama is taking a populist turn with his assault on tax breaks for corporate jet owners," reported The Hill earlier this month. My, that sounds risky!
The New York Times wrote:
Federal prosecutors [in the summer of 2008] officially adopted new guidelines about charging corporations with crimes -- a softer approach that, longtime white-collar lawyers and former federal prosecutors say, helps explain the dearth of criminal cases despite a raft of inquiries into the financial crisis. Though little noticed outside legal circles, the guidelines were welcomed by firms representing banks.
The Justice Department in this way lets the banks off practically scot-free. The Administration's support for major banking reforms seems to be in name only, as it just pecks at the problems. We never hear the kind of plain statements condemning the business and financial communities for their misdeeds that Reich, Krugman, Rich, Sachs, and other columnists record in detail.
In contrast, FDR said, "Practices of the unscrupulous money changers stand indicted in the court of public opinion." And my favorite: "Private enterprise, indeed, became too private. It became privileged enterprise, not free enterprise."
Even Herbert Hoover remarked, shortly before his exit, "You know, the only trouble with capitalism is capitalists--they're too damn greedy."
Their comments are as relevant today as they were during the Great Depression. Must we hark back to Roosevelt and Hoover in our search for political leadership?
Rick Hamlin: Pray for the Unemployed
That said... I still think it's one of the most viable forms of government.
These resources should not be the purview of those seeking profits like banks and wealthy hoarders. Their greed destabilizes populations, and creates civil unrest, hunger, homelessness and worst of all wars. It certainly is responsible for an abundance of misery in this world of which much would be controlled by simply making it the right of each new citizen to own viable land and the other resources necessary for life, liberty and the pursuit of happiness. It is easy to fix.
Stress and danger will cause us to revert to our Animal Instinct. This is reflexive. Our politicians know this. They create stress in our lives and in our politics so that we will revert to our Animal Instincts and forget our Spiritual Instincts.
Comfort and satisfaction will allow us to express our Spiritual Instinct. But, this is much more difficult to acheive. Our politicians do not want us to pursue our Spiritual Instinct, because, they would loose control of us.
I can only conclude that the predominance of Capitalism in today's politics is the result of political manipulation through stress, danger and fear and that this will only change when we, as individuals, separate ourselves from the rhetoric and begin to listen to our Spiritual side.
Goes well along with Social "Darwinism" (sorry, Darwin!) of Herbert Spencer, Nietzsche, Ayn Rand and, well, Ronald Reagan.
Kai, you are wrong. But, the reason that you are wrong has little to do with the attributes and drawbacks of pure Capitalism.
Pure Capitalism does work. But, in the process, the weak are left behind to be devoured by the lions. To people like Social Construct and me, this is not acceptable. You are like the leader of the herd that is in the front of the pack and never sees what is happening to the weakest at the back of the pack. What separates Social Construct and me from you is a conscience. You do not see how your beliefs cause the undeserved misfortunes of others and worst of all do not seem to care. I, for one, cannot stand by and allow the greed of some cause the misfortune of others.
As I said earlier, "Success of a nation is not measured by the state of it's wealthiestÂ, but, by the state of it's poorest.
The only thing I would add is that not that free-market fundamentalists must (by definition) lack a conscience. Although some do lack one....the vast majority have a fully functional one.
The issue is HOW ONE DEFINES "right", "wrong", and "just".
You---like myself---define it in terms of the CONSEQUENCES that applying a principle generates. So I cannot see myself as a "good leader" if I'm leaving large numbers of people to be ripped apart by the wolves.
The market fundamentalist, OTOH, defines "right" and "just" in terms of adhering to a particular principle REGARDLESS of the specific outcome it generates. So therefore the he's (in his mind) a "good leader" as long as he follows the "clearly defined" "rules" of being a good leader. If most of his charges come to ruin, then it is not his fault...because he followed the rules.
The poor outcome is simply rationalized as "bad luck"...or as an indication of the "poor character" of those who were left to the wolves.
IOW, it is not a lack of conscience. It is a by-product of a MORAL BLINDSPOT that is implicit to a particular way of looking at the world.
In Germany if you sick you are treated. and guess what the First question is when you visit the Dr. "Where does it hurt" and not "How are you going to pay for it" like here in the US.
America has lost its moral because of its greed. A nation like the US was many years ago should have controlled the top 2 %, then maybe we would not look Capitalism in a bad way.
After all Germany France England the Netherland and many EU nations also are called Capitalist countries. But their government is looking out for their own people. While here in America we only have a few that our government is looking to protect. It is called the top 2%. The rest of us don't count anymore.
You ascribe many problems that have occurred despite capitalism, not because of it. In many cases it is because the government has opted to subvert capitalism for some nanny-state reason.
a) Workers are not exploited. They own their labor and they are free to sell it at any price they can get for it. Free will and free exchange between two willing parties is a principle of capitalism and is not exploitation.
b) The dollar has decreased in value. That is due to the Fed and loose monetary policy, not capitalism. Under capitalism the value of money would be set by supply and demand and markets would correct naturally.
c) Despite that, capitalism has ensured an increasing standard of living and things are cheaper than they were 50 years ago. Cars, food, clothes, etc are cheaper in man-hours of labor required to purchase them then they were then.
d) Germany is broken. Pick a better example.
e) I agree. America has lost its morals because of greed (of other people’s hard-earned wealth) since it is easier to demand that your government take from someone else and give you rather than earn it yourself, and it is easier to blame others for your own bad life choices. Totally agree with you.
f) The countries you have mentioned are more socialist than the US and they pay the price for that.
Kai
You are actually beating a dead horse (laissez faire). a) c) and e) are very old, totally discredited statements, seriously repeating them is funny - reminds me of Colbert, he says the same, but he is a comedian.
You are inviting Social Construct to disprove you - makes no sense at all, each one of the points was adressed and disproved on these pages and in other media countless times.
Actually, really, why don't you send you points to Colbert to use in his show?
The other thing worth mentioning is that "capitalist" greed for money cannot be separated from political power - both are the links of the same positive feedback loop working in the present system. More money => more power => more money => more power... ad infihitum.
A healthy society requires a balance of the two extremes, it requires a balance of capitalism and socialism. We need to move towards a healthy society now.
An easier way to describe a balanced system is to define Capitalism as Competition and Communism as Cooperation.
The Economy/Society should be organized so that cooperation is the method to satisfy the needs and competition is the method to satisfy wants. And, when in doubt, lean towards cooperation, because, competition will always tend to indrease it's influence.
People of virtue and character should not be punished financially, and the wolves and vultures should not be given the advantage. We need strong controls of human greed.
I think we can build a better economic system than that, and we have the power to do it. Make it so.
You missed the largest and most effective restriction on greed, open competition. Target can not charge what ever it wants because WalMart is just down the street and greed motivates them to compete.
As far as laws and regulations with teeth. These fail almost universally because of regulatory capture. Once an agency exists to regulate an industry it is only a matter of time until the largest players control the agency. Then the largest players use the agency to craft rules that restrict competition.
Banks, insurance, oil industry, meat packing ... All are heavily regulated industries, but you would not know it by their ability to do whatever they want without penalty. Why? The big players have captured the regulator.
Banks get bailouts from the Fed. The ratings agencies do their bidding (only 3 ratings agencies - restricted by law)
Insurance companies face little competition (try to buy health insurance from a provider in another state)
oil companies write the rules and create government backed spill insurance.
The list is endless. The governments role should be to create rules that encourage competition. Free trade between states and countries. Eliminate subsidies to business of every kind. Eliminate any rules that reduce the risks and liabilities of the company owners, shareholders or financiers.
Allow greed to check greed.
Competition, cooperation and innovation. These are the things that drive improved living standards for us and future generations. Markets encourage all three.
Think you are saying our country is being led by people with arrested psycho-social development. That's not against the law, of course.
Unrestricted Free Trade Capitalism is the best system to reverse our standard of living.
One must understand the definition of unrestricted free trade which is a economic system that gives a competitive advantage to the corporation that gets away with treating its employees and the environment the worse. Everyone is no longer forced to play by the same minimum rules. Corporations could mover their manufacturing where they could get away with treating their employees and the environment worse for profit.
The question becomes why encourage this system? What advantages does it bring to the average American long term?
Cheap products from big box stores? You still have to have money!
With the realitys of peak oil and automation of the global work force, it is not possible that capitalism can continue.
Welcome to the future.