The lead article at Slate today is about how American corporate
managers have become the laughingstock of the world because they can
no longer manage "complex systems" as they were once famous for doing.
If you want to read it, you can go to the link, but really, I thought,
what's so hard to understand? The economy we have, with all its
volatility, is exactly the economy any sane person would have
predicted after the wholesale decline of regulation, as both a reality
and an idea, in the eighties and nineties. And who has kept up the
drumbeat for deregulation, not only here but everywhere, if not those
screwy, and tenured, free-market economists? Their whole job for the
last thirty years has been to prop up the egomania and greed of
corporate CEOs by making that greed and ego-mania look both positive
and unavoidable. As a result, the gambling side of capitalism has
driven every other side away, to a chorus of bleats from the left
that, Gosh, something big and bad was bound to happen, and an
accompanying chorus from the right that even saying such a thing was
treason.
Let's review. At the end of the 1970s, it was decided by some people
that they weren't getting rich enough fast enough, and that they were
tragically hampered in their efforts by government regulations that
dictated, for example, that foods called by some generally understood
name, such as "milk" actually had to be milk--not a milk-like product,
not a milk-containing product, but truly milk, from cows. We had
"stagflation" I remember it well. It might have gone away, or the
shock of oil prices at the time might have induced "entrepreneurs", as
they called themselves, to invent something new, but they went whining
to the Republicans and the Republicans installed that phoney, Ronald
Reagan, who installed another bunch of phonies in various offices of
the regulatory agencies, and those phonies said that businesses were
perfectly capable of reglating themselves, which everyone knew was a
crock, since they had never regulated themselves and were openly
getting rid of regulations so that they wouldn't have to regulate
themselves or be regulated by anyone. Yes, capitalism is a shell game
and all salesmen have a little of the snake-oil in them, which is what
makes it fun and profitable, but also makes it persistently
unscrupulous. The apologists for the "Reagan Devolution" were "Free
Market" economists, whose idea of a human being, based on their
experience of themselves, was a perfectly rational and isolated male
who always acts in his own selfish interest. In addition to
themselves, they were, of course, describing people with sociopathic
personality disorder. These economists did what was in their selfish
best interests to do -- they promoted and excused all the aspects of
human nature that Jesus himself had found abhorrent and they made the
world we have today.
The managers of our businesses learned what they know from these guys
in their business schools, and guess what, that's why they can't
manage their way out of a paper bag, because they're unregulated! The
purpose of regulations is three-fold. 1. They prevent the "failure of
the commons", a concept that describes why unregulated markets become
more and more criminal -- if the unscrupulous run things, then the
scrupulous have to give up some of their scruples just to save
themselves, and so the whole system gets more and more criminal. 2.
They give customers assurance that the things they spend their money
on are more or less reliable. and 3. They keep the system relatively
simpler than it is when there are no regulations, so the system is
easier to understand and manage. What was it they said about the
subprime mess? Oh, yeah, neither the buyers or the sellers of sliced
and diced mortgage-backed securities knew what they were buying or
selling. And they were the experts!
I don't hate capitalism. Capitalism has enabled the printing of lots
of good books that had been out of print for a long time and also
the spread of redleaf lettuce and those delicious blue potatoes that I
like so much. But unregulated Capitalism has done a wonderful job of
certain other things, too -- consolidating the ruling class, increasing
the class divide in our country and around the world, destabilizing
lots of third-world governments, and accelerating the pollution of the
natural world, climate change, and population growth, while worsening
the physical health of almost everyone. It has also provided us with a
lots of cheap entertainments and goods that we didn't know we needed
(Bratz dolls, anyone?). But the failure of economists to understand
human nature, especially the complexity of relationships and the
interplay of self-interest and morality, has enabled them to fatally
simplify our world and exalt such dopey ideas as "creative
destruction". They have led the government down the dead-end path of
thinking that the government serves the economy rather than vice
versa.
When I read about rightwing jerks attacking Rev. Wright for telling
the truth when they themselves have created the mess we are in (huge
expensive war, nose-diving economy, rotting infrastructure, climate
change dead ahead, Constitution in shambles, White House occupied by
delusional idiot) I know we have entered, not the golden age that the
shallow, ignorant economists predicted, but a true iron age of
conflict, death, and destruction.