Capitalism itself has not failed, any more than one could say a crash test on a Toyota failed because it crushed under the weight of a D-10 bulldozer.
capitalism, on the other hand, is definitely a failure. It did not take a psychic to predict it would be.
Capitalism works on a system of checks and balances, and through these rewards hard work, innovation, and efficiency. The same mechanism punishes
laziness and apathy. In a perfect world, everyone who contributed to society would be duly rewarded for their contribution, and those who contributed
the most would receive the most reward. But we do not live in a perfect world. Let me use an example that I believe most here can identify with: ATS
and our benevolent overseer, Skeptic Overlord. This example is purely for illustration purposes.
SO (along with the other partners in crime), has started a marvelous Internet forum company. He has contributed his time and his expertise (along, I
am supposing, with some cash) to make this company what it is. His reward is a job that (again, I assume) pays well, and profit from his initial
investments in the form of company dividends. This is as it should be. Contribution = reward.
But let us suppose for a moment that SO is not as benevolent as he is, and decides he wishes to monopolize the Internet forum industry. He could take
those profits and start buying up smaller forums, operating them as a subsidiary of ATS and therefore controlling the free speech on them. Each forum
he buys out would produce more profit, allowing him to purchase more smaller forums, until he would finally have full control over the vast majority
of forum-based talk on the 'Net.
There would no doubt be holdouts, smaller forums who did not wish to sell. But if SO owned such a vast majority of the available sites that he could
threaten advertisers with refusal to run their ads if the dealt with his competitors, he could effectively strangle out any upstart company that
wished to compete and would not bow to his will. Thus, SO could, in the space of a year or two, completely control the Internet. I am sure most of the
people here would be able to agree that, even knowing SO as we do, this would still not be a good thing.
On the other hand, should things go a different way, another problem would occur. Let us assume that the Internet failed, for some reason beyond
anyone's control at AboveNetworks. 60% of the available lines are down, and traffic slows to a crawl. Advertisers no longer feel their investment in
ATS advertising is worth the cost, and begin to pull their accounts in wholesale fashion. Amid this struggle to survive, let us assume (while we hope
for the opposite!) that SO has a heart attack. Now he can no longer handle the operations of AboveNetworks. In his absence, a lack of control over the
trolls who do regularly frequent these boards (or try to) leads to a breakdown of loyalty among the membership and a further lack of posting traffic
to add to the lack of available traffic. SO's income would drop drastically, and his insurance could easily be canceled for lack of funds to keep it
in effect. Now, the man who brought us all ATS, IMO the best alternate news forum on the Internet, is indigent and saddled with more health care bills
than he can ever hope to pay off. And ATS eventually closes.
Let me re-emphasize that the above are not predictions, hopes, or anything of that nature. They are examples only.
In the first case, capitalism has run wild and corrupted the free trade it is designed to encourage. In the second, capitalism has aided the
destruction of a man's life. Both extremes are unacceptable to a true civilized society. The only way to correct these out-of-control moves is to
artificially discourage them. And that, my friends, is called 'socialism'. Too much socialism will eventually lead to communism, as the lack of any
economic reward or punishment for one's actions will eventually cause the entire system to collapse. But in small doses, it can be used to complement
capitalism and cause it to flourish to the benefit of all citizens.
The question, as I see it, is not whether capitalism should be used, as I along with many other posters already see no reasonable alternative that is
not worse. It is instead how to control the runaway tendencies using some measure of socialistic policies to assure a minimum lifestyle for everyone
who attempts to contribute, and prevent economic slavery through monopolization of an industry.
We already have some semblance of socialism to prevent monopolization in the USA. We use a progressive tax system that reduces profit based on the
amount of income already achieved, and cycles that wealth back into our government coffers. We also have anti-trust laws (poorly enforced at the
moment) that are designed to prevent monopolization through the power of legal intervention. The problem is that these two devices have been perverted
over the years. The tax code system is now ridiculous in length and complexity, leading itself to an artificial industry dedicated to nothing more
than helping average Americans not go to jail for making a mistake in this complex maze of regulation. The entire tax code should be scrapped and
re-instituted with a minimum of regulation. Credits, especially to corporate entities, should each be carefully scrutinized in light of the goal of
stabilizing runaway capitalistic tendencies. Even deductions should be examined in the same light.
Anti-trust laws should be again enforced under the stated guideline of preventing corporate growth to such an extent that it jeopardizes competitive
To combat the other problem, we must have some sort of welfare system. This system, which is designed to enhance capitalistic involvement for those
who are unable to do so for reasons beyond their immediate control, must take into account the fact that those who do not contribute cannot be
rewarded. As such, it must be limited (except in cases of medical disability) and tough, yet also fair. I have such a program that I wrote years ago,
but it is too long and involved to explain here (if others wish to see it, I will gladly type it up in a new thread for review. Simply respond here or
by u2u if you want that). We must also educate our citizenry in how to live under capitalism. Far too many people simply do not realize that
capitalism itself is a type of a voting process, with each penny spent being the equivalent of a vote, and therefore vote for bad situations without
even realizing they are doing so.
Monetary investment must also be strictly regulated, as this is a bastardization of capitalism. Witness the recent oil bubble which spiked fuel prices
so high so fast that it almost destroyed the national economy. Investment must be allowed for capitalism to exist, but it must also be regulated with
the best interests of the people as a whole firmly in mind. This means no more margin purchases, and no more fractional lending. The former can be
accomplished through traditional loans, placing more responsibility on those profiting from the investment game, and the latter is a relegation of the
government's responsibility for financial control to private bankers who obviously care nothing for the economy except as it pertains to themselves.
Yes, this means the Federal Reserve would be abolished, as anything other than a clearing house for bank transactions. Period.
As for medical care, to prevent the potential for disaster that stalks us all, I have already written a thread on this. It can be found
in an abridged form and would make health care a reality for everyone as well as
regulating both cost and performance while not mandating anything on the people at large.
Government does have a huge role to play in preventing fraud and misrepresentation. All contracts should be transparent and between informed parties,
or they should be disallowed in such a way to penalize those who violated the spirit of this requirement. Credit cart companies, for example, who
would attempt to change the terms of their agreement (something I heard a warning about to consumers this morning on CNN; the post I made regarding it
can be found here
) should suffer a penalty up to and including forfeiture
of the debt in full. That may sound harsh tom some, but a law with no teeth cannot perform its function.
We have just experienced a period of time where capitalism's best attributes have been thwarted, while its worst attributes have been encouraged.
This is why I say, capitalism itself has not failed. It was not even a participant in the test.