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Is Capitalism Sick?

Deskpoet (215561) writes | more than 12 years ago

User Journal 4

These aren't my words, but they certainly speak to me (courtesy of ZNet Interactive.)

Is Capitalism Sick?

by Paul Foot
The Guardian
June 13, 2002

"Is capitalism sick?" inquires a challenging headline in the Sunday Times. The answer, over many paragraphs, is no. Capitalism, the article reveals, is in fine fettle. The only thing wrong with it is the occasional rotten or greedy capitalist.

These aren't my words, but they certainly speak to me (courtesy of ZNet Interactive.)

Is Capitalism Sick?

by Paul Foot
The Guardian
June 13, 2002

"Is capitalism sick?" inquires a challenging headline in the Sunday Times. The answer, over many paragraphs, is no. Capitalism, the article reveals, is in fine fettle. The only thing wrong with it is the occasional rotten or greedy capitalist.

Hank Paulson, chief executive of Goldman Sachs, warned the National Press Club in Washington last week: "Business has never been under such scrutiny. To be blunt, much of it is deserved." The Sunday Times moaned its way through a litany of recent scandals.

First there was Enron, whose disgraced chief executive Kenneth Lay is a close friend of President Bush, whose audit committee was chaired by former Tory minister Lord Wakeham, and one of whose more ideological paid advisers, Irwin Stelzer, still has a weekly column in the Sunday Times.

Now there is Tyco - presumably short for tycoon - whose former chairman, Dennis Kozlowski, is charged with tax evasion and whose director, Lord Ashcroft, is a former treasurer of the Tory party and a generous donor to British state education. ADT College, named after Ashcroft's company, still teaches children in South London, but perhaps now it should change its name, since ADT was swallowed by Tyco in 1997.

Last week there was great news for another great A: Bill Allan, chief executive of a telecoms company ludicrously called Thus. Allan and his fellow directors got bonuses worth 70% of their salaries to mark something called "exceptional business performance", presumably a reference to the 72% fall in the company's share price.

Last week, these heroic As were capped by a sensational B - for Bonfield, the knighted former chief executive of ailing British Telecom, which recently wound up its final-salary pension scheme for ordinary workers, but somehow managed to find a few million to "top up" Sir Peter's already vast pension by another £2,000 a week.

Bonfield has a perfectly good job elsewhere, but when he left British Telecom he took a year's salary (£820,000) and a bonus of £615,000, no doubt as a mark of respect for his record as mastermind of one of the most disastrous privatizations of modern times.

These companies and individuals, Paulson argued, are letting down the system. They are giving capitalism a bad name. If only individual capitalists didn't lie, cheat, perjure themselves in libel actions, stuff their pockets with grossly excessive or ill-gotten gains, deceive the taxman by buying expensive paintings with other people's money and then hanging them on their own walls, if only their accountants didn't spend their extremely valuable time thinking up complicated schemes to avoid tax and then shredding the documentary evidence, then the beautiful symmetry of the capitalist system would shine forth. If only the rotten apples could be rooted out of the capitalist barrels, the full glory of the fruit could be properly appreciated.

The problem with this argument is that it overlooks the central feature of capitalism: the division of the human race into those who profit from human endeavor and those who don't. This division demands freedom for employers, and discipline for workers; high pay and perks for bosses, low pay for the masses; riches for the few, poverty for the many.

Under capitalism the gulf between rich and poor grows wider and wider. The whole point of the system is that it works against equality, against co-operation. It stunts, insults and criminalizes the poor; glorifies, cossets and pardons the rich. All human life is corrupted in the process. So even if you could discipline all the offenders, lock up all financial advisers to the US president, ban from public life all former Tory vice-chairmen, even if company directors spent a year in jail for every bonus they steal, there would still be no hiding place from capitalism. The rotten apples are the barrel.

Reading last week's sermon from Paulson, I was reminded of a brace of challenging headlines in the Guardian on December 10 1993. These headlines highlighted the difference between a group of 26 million people who shared $2.2bn and another group of only 161 people who shared $2.6bn. The first group was the entire population of Tanzania, the second the partners of Goldman Sachs, the company Paulson heads. And however much he lectures his capitalist colleagues about their individual misdemeanors, he cannot and will not correct the intrinsic flaw in the economic system he represents, so starkly symbolized by the greed of the people who run his bank.

Is capitalism sick? Yes, disgustingly so. Its sickness is terminal, and it urgently needs replacing.

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Of course... (1)

neocon (580579) | more than 12 years ago | (#3709996)

... the thing which makes Mr. Foot's comparison asinine is that the only system which has any hope of improving the lot of the people of Tanzania is, you guessed it, capitalism.

See, the thing is, economics is not a zero sum game. If we talk about redividing existing wealth, we invariably end up with systems like the massive failed states of the Eastern bloc, which `fairly' divide an ever smaller pie. In contrast, the US (to pick an example) has a system which has provided improvement at all levels of society by focusing on increasing the size of the pie instead of on increasingly brutal battles over how it should be divided. The result? Growth. For everyone.

To pick the clearest example, the bottom 20% of American society in 1990 had, earned, and consumed as much (adjusted for inflation) as the middle 20% had in 1950. That's growth, that's something only capitalism can provide, and that's the only thing that's going to improve the lot of the people of Tanzania -- if arrogant preachers like Mr. Foot don't succeed in preventing it.

Re:Of course... (1)

neocon (580579) | more than 12 years ago | (#3709997)

See also here [slashdot.org] .

Re:Of course... (1)

Deskpoet (215561) | more than 12 years ago | (#3710166)

the thing which makes Mr. Foot's comparison asinine is that the only system which has any hope of improving the lot of the people of Tanzania is, you guessed it, capitalism.

So say you.

You can throw numbers around all you like; any data can be created and massaged to provide the outcome desired by the proponent of a position. All that "information" can't explain away the despair inherent in a mass-market culture that provides creature-comforted sedation to its adherents while robbing them of any concept of what freedom and justice really means. Yes, I have more things than my father did, but that is only because I have been conditioned from birth to strive for them by a system that absolutely *requires* people to consume like never before. I'm not happier or better off than he is; I just have more stuff. If you feel that is "growth", then it's certainly a narrow definition (but that's the whole point, isn't it?)

Watch Fight Club. It makes this point very clear on a visceral level--and ironically was a mass-market product, too, which should make it easy for you to relate to (that is, if the dogma you have swallowed whole has not completely consumed your ability to reason.)

The greatest form of civil disobedience in today's world is to refrain from purchasing. Most of the things that have contributed to your ersatz percentages are needed only by the economy itself to sustain the current system. The irony is the system as it exists today cannot sustain itself: how can there be "growth" if 90% of the prospective market cannot afford the wares of the capitalist system? How do you convice a starving peasant they need a laptop?

If you can't see the fundamental contradictions and inherent injustice of state capitalism--which is every bit as vile and controlling as state socialism--then there's really nothing else to say. (Which is basically what I said in our previous exchange.)

Re:Of course... (1)

neocon (580579) | more than 12 years ago | (#3710197)

So what are we to determine from this? That you feel guilt at having things? That you think you would be a better person if you had fewer things?

Well, you always have that option. Give away what you have. Buy less. No one can stop you. But an economic system must be judged by the options it gives people. Citizens under socialism (and those Tanzanians who Mr. Foot wants us to believe he cares about) are poor and do not have the option to be rich. You are rich, and can choose, if you wish, to be poor. What is your complaint?

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