A Lesson In Moral Hazard - Blaming Capitalism Is Wrong

reply to post by Quickfix


OK dude, I'm done arguing with you. You're only making yourself look foolish by stating the private sector is responsible for tax payer funded bailouts.

The level of Orwellian thinking required to reach that conclusion is beyond all reason.



[edit on 18-1-2010 by mnemeth1]

reply to post by mnemeth1


Hahaha, Its okay if you don't believe me.

www.marketwatch.com...

See for yourself.

Originally posted by mnemeth1
reply to post by Quickfix

 

I don't think you understand the economic forces at work here.

Any time government involvement is to blame for economic problems, it has nothing to do with capitalism.

Capitalism involves NO government at all.

In a capitalist system, governments ONLY role is to prosecute fraud and uphold contract law.

Subsidies, bailouts, tax breaks, government contracts, handouts, etc.. etc.. etc.. are SOCIALIST or FASCIST in nature.


[edit on 18-1-2010 by mnemeth1]

Well I would say governments role has expanded greatly any way you slice it, so your assertion is not based upon the current state of affairs.

The markets which allowed for this disaster were the creation of capitalist idea's and this very state of the union is a bi product of the initial document. Capital was the primary tool of this desecration and was the primary motivator in the entire scam.
I am not sure how you expect this country to shed all these layers that have accumulated. In very simple terms it is utopian and would require a massive destruction
at which point you might argue reinstating ideas that were so easily subverted with such slow and low pressure.

I am not sure when capitalism ends, where socialism begins and where oligarchy takes over. Interesting enough China the worlds socialist bastion was the largest thorn in the side of C&T, an alleged socialist plot. I am not sure if you will ever see the America you envision, I am not even sure if this nation can operate as prescribed in these modern times. Long gone are the days where a man can journey and stake a new piece of land, or drink water sourced from any natural water way. Way back an infection was a death sentence, now it is a random act of nature with sentencing passed by our measure of freedom; output/laziness, net worth and backbone.

Things get perverted, Jimi Hendrix may not be be Mozart, but they both dealt in the same language, used the same available pitches and adhered to the same tenets of theory and time.



[edit on 18-1-2010 by Janky Red]

Originally posted by mnemeth1
reply to post by Quickfix

 

OK dude, I'm done arguing with you. You're only making yourself look foolish by stating the private sector is responsible for tax payer funded bailouts.

The level of Orwellian thinking required to reach that conclusion is beyond all reason.



[edit on 18-1-2010 by mnemeth1]

I think you are going off half cocked, a portion of the private sector IS responsible for creating and implementing the devices of the market that produced this failure, with an assist from the government. Did they not happily deal, invest and trade in trillions of this stuff sir? Sounds like you think AIG was forced to over leverage and insure their own speculative assets... Such practices were born because their was a market for them, good ol uncle Sam primed the other side and they had a little bit-o fun with the
entire economic health of the globe. Not very many buyers were aware across the board, there did not seem to be any moral hazard coming from the board either.

My old company did 1,400% quota of its sub prime
ticks, such nice guys that they went 14X's beyond the call of duty. I sold bundles of this crap and didn't see a fooking fed in the joint. Nor, I did not see an of those computer totting analysts with any guns to their heads forcing them to purchase this clear and present turd. In other cases I witnessed a few bidding wars to gobble up 300 + of these monsters, once again no fed, no SS, - your assertion is that the private sector is a 100% great, flawless cut portion off of gods heart meat... I suspect because your ideas depend on the virtuous nature of the private sectors, you also need copious denial to season the current failures at the pinnacle of your doctrine. Capitalism has turned into a monster, just as socialism feeds upon the people it is intended to nourish.

I must say if this fellow deals in Orwell you must deal in Huxley...



[edit on 18-1-2010 by Janky Red]

It seems the economic systems that we have in place today are so perverted and convoluted from their original ideas that they have morphed into something that pushes the boundaries of what the old rules would allow them to get away with legally. How about Sociapitalism??

What frustrates the bejeesus out of me is how co-dependent capitalism is with conspicuous consumption or more aptly consumption in general. Thoreau states that, " a man is rich in proportion to the number of things in which he can let alone." However, conspicuous consumption dictates that we must keep up with the Jones, because buying what the Jones have is good for the Smith's company and so on and so.

So the rich and wealthy increase their status by accruing "cultural capital" by collecting newer and more lavish things, which in turn is good for the economy. This disease of buying becomes a defining point of our identity and culture. Instead of practical/useful needs, products become cultural wants. Just what capitalists dream about, ie. making things that people want instead of need or making things that people think they need. (You'll be slap, slap, slapin' your troubles away...you're goin love my nuts...

This then results in run away trains of unsustainable, and unpredictable production, manufacturing, and supply and demand, which can cause chaos and opportunistic fraud.

Why can't a neo-capitalist society come to the conclusion that enough is enough, level off its rates of consumption, and have this decision not run the risk of throwing it's economy into a shambles?? Consume, consume, consume. There must be a way for a society to prosper without having to be constantly in a state of consumption. No wonder the Earth is running out of resources.

I believe you get what you pay for. But that doesn't mean I have to keep replacing my 3 year old SUV with a brand new one just because the latest one has bluetooth or alloy rims. Or an old parka that still keeps me warm but is not the latest color scheme for fall.

Ahh, I have a headache

en.wikipedia.org...

I just found this: Hillarious
www.youtube.com...




[edit on 18-1-2010 by sparrowstail]

reply to post by sparrowstail


Yeah, its called market controlled interest rates.

You know, that thing the Fed over-rides.

Capital investment comes from savings. In order to have savings, you need high interest rates.

What the fed has essentially done is given the country a gigantic credit card and forced the interest rates down to zero.

People have zero incentive to save their money rather than spend it. Because we have inflation, people must spend their money or it will cost them in inflation.

Once again, our corrupt fascist monetary system rears its ugly head.

Capitalism demands market controlled interest rates and market controlled money supply. The reason why there is no savings and why we consume like crazy is strictly because of the federal reserve.

Remember, it was Marx that demanded a central bank to control the issuance of credit. The monetary system we have today will always result in failure because it is not market based. It has nothing to do with capitalism. So stop blaming capitalism.



[edit on 18-1-2010 by mnemeth1]

I think everyone on this thread needs to do some history lessons first before slanging around arguments.

Central banking has nothing to do with Marx. Central banking was created in the 17c by the Swedes and used by the British as an effective way of wagging war without the need to initially raise taxes, it was a War credit card.

The people that invested in the Central Banks - they are private - pull the strings. The majority of the people that controlled these systems were instrumental in designing and funding Communism as the anti to the industrial capitalist model. Communism with a central bank and central planning office as Orwell wrote leads to the 'some are better than others' paradox. The only real difference was property ownership, that is the key to the experiment, the rest is actually the same. They would not have allowed a seperate movement without the control they need to allow this to happen.

It can be shown that in fact the failure of capitalism leads to Fascism, not communism as the case was in the earlier 1920-30's when countries all across the globe faced a crisis of confidence in the Capitalist system.

What is happening now is the crisis of confidence, the war on terror and the global nature of the world leading towards a global fascist state which I for one want to educate myself to ensure I know what is happening.

The argument is not capitalism, socialism or Communism its how does a global society structure itself for the ethical benefit of all. I'm afraid that means the US and Britian must stop controlling the world through the central bank mechanisms and we need a re education of society to understand that we do not need 5 cars, Yatchs, huge mansions and enough food to make 1/3 of the population obese whilst others live in huts and starve.

reply to post by queuepolitely


I beg to differ.

The failure of capitalism does not lead to fascism.

In fact, the failure of capitalism is caused by fascism.

Our government has completely ignored its constitutional limitations, created a fiat monetary system run by a private cartel of commercial banks, and has done nothing but extort money from the private sector for their own political gain.

Capitalism necessarily involves no government at all. Governments only role in a capitalist system is to prosecute fraud and uphold contract law.

So stop calling this a failure of capitalism, because that's not what is at fault here.

You can't have a capitalist system when you have a central bank planning interest rates.

And yes, Marx has everything to do with central banking! For Christ sake he thought it was so important he made it a plank in his manifesto! Central banks mean centralized control, which is what Marx was all about.




[edit on 18-1-2010 by mnemeth1]

But the Wall Street IS capitalism!!!

[edit on 18-1-2010 by masterp]

reply to post by masterp


Wall street colluding with government is not capitalism.

Capitalism requires risk.

reply to post by mnemeth1


Hi mnemeth1, I think I understand what it is your trying to say. Franz Oppenheimer, in The State, said, there are only two ways for men to acquire wealth. The first method is by producing a good or a service and voluntarily exchanging that good for the product of somebody else. This is the method of exchange, the method of the free market; it’s creative and expands production; it is not a zero-sum game because production expands and both parties to the exchange benefit. Oppenheimer called this method the "economic means" for the acquisition of wealth. The second method is seizing another person’s property without his consent, i.e., by robbery, exploitation, looting. When you seize someone’s property without his consent, then you are benefiting at his expense, at the expense of the producer; here is truly a zero-sum "game"--not much of a "game," by the way, from the point of view of the victim. Instead of expanding production, this method of robbery clearly hobbles and restricts production. So in addition to being immoral while peaceful exchange is moral, the method of robbery hobbles production because it is parasitic upon the effort of the producers. With brilliant astuteness, Oppenheimer called this method of obtaining wealth "the political means." And then he went on to define the state, or government, as "the organization of the political means," i.e., the regularization, legitimation, and permanent establishment of the political means for the acquisition of wealth.

In other words, the state is organized theft, organized robbery, organized exploitation. And this essential nature of the state is highlighted by the fact that the state ever rests upon the crucial instrument of taxation.

Murray N Rothbard puts is so "the Industrial Revolution, saw an enormous outpouring of productive energies, an outpouring that constituted a revolution against the mercantilist system of the seventeenth and eighteenth centuries In fact the mercantilist system is essentially what we’ve got right now. There is very little difference between state monopoly capitalism, or corporate state capitalism, whatever you want to call it, in the United States and Western Europe today, and the mercantilist system of the pre-Industrial Revolution era. There are only two differences; one is that their major activity was commerce and ours is industry. But the essential modus operandi of the two systems is exactly the same: monopoly privilege, a complete meshing in what is now called the "partnership of government and industry," a pervasive system of militarism and war contracts, a drive toward war and imperialism; the whole shebang characterized the seventeenth and eighteenth centuries. The really key difference is that they didn’t have a gigantic P.R. apparatus; they didn’t have a fleet of intellectuals trumpeting to all and sundry the wonders of the system: how it promotes the common good and the general welfare, how this is Liberalism In Action. They said, "We’re out to shaft the public and we’re doing it!" They were very honest in those days. It’s really refreshing, by the way, to go back and read the material before 1914 and bask in the honesty of the period.

What happend after the first world war was the invention of PR by the man Edward Bernaes and we started to believe the hype surrounding capitalism, or so called capitalism. In the great crisses of those times the Sudo capitalistic PR machine began to collapse in places such as Italy and Germany as the people looked for a better alternative than capitalism, this vacum of power left it ripe for facism to rise, in paritcualr when a nation is being subdued by other more powerful nations, the only retort is to establish one's self as a alternative to the existing paridagm, challenge the general concensus. TPTB created a triangle of power, facist, communist and state capitalism and set those forces free. What we face now is not facism, its an assault on liberties, dont confuse this with a state that offers only one view point, one paridagm of existince. The whole point of our consumer capitalist is to democratise view points, i.e. create the 2 party, 2 belief state that offers indvidualism that is controlled.

Onward and according to Wiki Capitalism is the control of Commodities, Money, Labour power, Means of production and production. From what you are stating I believe you are pointed to the idea that all these should be freed from government control is that correct ?

So if Governments exist to create the laws that bind the exchange of contract, what laws do they create if they have no control over the means of exchange, money ?

The fault of capitalism is that those that control the Money, can dictate the volume of commodites within the system. The Labour power is limited by the volume of people in your production area and the cost of that labour dictates were production is based. Hence the move to globalisation. Capitalism is a system designed by the Elites to protect thier assests, it has been joined / merged with PR to blind the people to believe that capitalism is the only way forward, when in fact it exists to peretuate a form of growth (exponential) that is controlled by those at the top who control the mean of production.

My 2 cents

reply to post by queuepolitely


Well you started off great but then finished with a thud.

Capitalism demands market set interest rates and market control of the money supply.

As soon as you take interest and money creation out of the market, you no longer have a capitalist system of any kind under any definition.

Market control of interest rates and money is MANDATORY in a capitalist system - so STOP CALLING IT CAPITALISM!@@!!!

I can't believe you read Rothbard and still think what we have is a "capitalist" system.

Its a FASCIST system - specifically akin to Italian fascism advocated by Mussolini. The left has warped Mussolini's fascism into involving racial hate and national pride, which as nothing to do with the economics of fascism.

Hit the books:

What I mean when I say "fascist":

VC reader Steven Hamori thinks that Leiter (like many contemporary commentators and perhaps the editors of the American Heritage Dictionary as well) is confused about the definition of fascism, and misinterprets the oft-repeated Mussolini/Gentile quote that "Fascism should more appropriately be called corporatism because it is a merger of state and corporate power." Hamori writes

[The quote] has circulated in the left wing blogshere for as long as I can recall… I believe it to be a real one too although some credit it to Giovanni Gentile (Mussolini allegedly took credit for it while not originally uttering it).[According to Wikipedia:]"Gentile, described both by himself and Mussolini as ‘the philosopher of Fascism’, was the ghostwriter of ‘A Doctrine of Fascism’ which, signed by Benito Mussolini, described Fascism in the Italian Encyclopedia (which was edited by Gentile)."

The problem is that a ‘corporate’ in Italian of the period is not a business organization. A corporate is a production planning board made up of workers, owners, and others involved in production advocated by the syndicalist school of socialism. Their beloved quote is actually Mussolini (or maybe Gentile) making a connection between fascism and socialism . . .

[Again, Wikipedia]"Historically, corporatism or corporative (Italian corporativismo) is a political system in which legislative power is given to corporations that represent economic, industrial and professional groups."

"Under Fascism in Italy, business owners, employees, trades-people, professionals, and other economic classes were organized into 22 guilds, or associations, known as "corporations" according to their industries, and these groups were given representation in a legislative body known as the Camera dei Fasci e delle Corporazioni."

Hamori concludes:

I doubt Leiter knows anything about the history of fascism. Intellectually, the progressive left has a lot more in common with it than the ‘libertarian right’ (the real liberals). . . . If anyone advocates a merging of ‘business corporate’ and state it is the regulation happy / anti competition left. The average ‘right winger’ says let an uncompetitive business fail.

[edit on 20-1-2010 by mnemeth1]

have to have a read of this dude but late in the UK !

www.abovetopsecret.com...

I'm thinking you are making some good points here. Must find more time to read up.