Topic: Who’s Afraid of a Free Society?

[DeAutogids]

http://www.huffingtonpost.com/art-brodsky/oh-the-hypocrisy-congress_b_822199.html

Governments want to shut down certain parts of internet to help companies. My understanding is that the way they do that is quite subjective and you (a private individual, a small entrepeneur) cannot "clear" themselves of any wrongdoing. Seems to me both ends here are not for "our" good at all... Which actually makes sense. We tend to think of ourselves first and of others after that (as a generalisation).

[MG]

Here ya go, Opie! An article that clarifies our divergent prospectives. You clearly have the Main Street model in mind, whilst I have the Wall Street  model in mind.

I am all in favor of the Main Street model and only wish that it was actually pertinent to any significant portion of the US economy.   


Published on Wednesday, February 16, 2011 by YES! Magazine

A Real-Market Alternative

The economic choice we face is no longer between capitalism and communism, but rather between Wall Street and Main Street.

by David Korten

In America we are taught from birth that capitalism is synonymous with markets, democracy, and individual liberty. Whatever its flaws, the only alternative is communism, or so we are told.

This sets up a false and dangerously self-limiting choice between two economic models both of which create concentrations of power that stifle liberty and creativity for all but the few at the top.

Communism is dead. As we now look for solutions to our current economic crisis, the relevant distinction is not between capitalism and communism, but rather between Wall Street and Main Street.

The Wall Street economy is centrally planned and managed by big banks and corporations for which money is both means and end. The primary goal is monopoly control of markets, physical resources, and technology to maximize profits and bonuses.

Main Street economy is comprised of local businesses and working people who self-organize to provide livelihoods for themselves, their families, and their communities producing real goods and services in response to community needs. Main Street exemplifies the market economy envisioned by Adam Smith; Wall Street is the antithesis.
The stronger the relations of mutual trust and caring and the more equitably power is distributed, the more the market becomes self- policing and the less need there is for formal governmental intervention.

Smith believed that people have a natural and appropriate concern for the well-being of others and a duty not to do them harm. He also believed that government has a responsibility to restrain those who fail in this duty.

Smith and the political economists who followed in his tradition developed an elegant theory of the market’s capacity to self-organize in the community interest based on a number of carefully articulated assumptions, including the following:

    * Buyers and sellers must be too small to influence the market price and must honor basic principles of honest dealing.
    * Income and ownership must be equitably distributed.
    * Complete information must be available to all participants, and there can be no trade secrets.
    * Sellers must bear the full cost of the products they sell and incorporate it into the sale price.
    * Investment capital must remain within national borders, and trade between countries must be balanced.
    * Savings must be invested in the creation of productive capital rather than in speculative trading.

These are the characteristics of a real market economy. Wall Street capitalism violates them all.

Capitalism is a term originally coined to refer to an economic and political regime in which the ownership and benefits of capital are appropriated by the few to the exclusion of the many who through their labor make capital productive. It describes Wall Street perfectly.
The “free market,” a code word for an unregulated market, is a contradiction.

Markets work wonderfully within a framework of clear rules and a caring community. The stronger the relations of mutual trust and caring and the more equitably power is distributed, the more the market becomes self-policing and the less need there is for formal governmental intervention. An economy comprised of powerful corporations governed by a culture of greed and a belief that their only legal duty is to maximize their profits requires a strong and intrusive governmental hand to limit the abuse and clean up the messes.

The “free market,” a code word for an unregulated market, is a contradiction. A market without rules facilitates and encourages the unlimited concentration and abuse of corporate power unconstrained by market discipline and democratic accountability.

Market fundamentalists selectively cull bits and pieces of market theory to argue that the public interest is best served when economic power is concentrated in unregulated globe-spanning mega-corporations engaged in monopolizing resources and externalizing costs for short-term financial gain. They distort market theory beyond recognition.

Like cancer cells that attempt to hide from the body’s immune system by masking themselves as healthy cells, Wall Street institutions attempt to conceal themselves from society’s immune system by masquerading as agents of a healthy market economy.

The credit collapse penetrated the facade to reveal the inner workings of Wall Street capitalism as a criminal syndicate engaged in counterfeiting, predatory lending, usury, tax evasion, fraud, and extortion. It may be legal because Wall Street buys the politicians and writes its own rules, but it should be illegal and treated accordingly.

A criminal syndicate is “fixed” by shutting it down through the enforcement of laws that protect the public interest. You “fix” a cancer by removing it and rebuilding the healthy tissue. Main Street is the healthy tissue from a healthy real market economy can be built.
This work is licensed under a Creative Commons License

For you to use corporations to describe capatalism shows you don't understand the difference.

For you to suggest that corporations are NOT part of capitalism as most people understand it shows you don't understand what is going ON in the world!  Crawl out from under that rock, sir, and see what's going down!    Corporations ARE the government and the government IS corporations, whether in the US or elsewhere. We may WISH that it were not so, but as my old Irish grandmother used to say, "If wishes were horses, we'd all be kings!"   

Your pure vision of capitalism is admirable and commendable. It is also unrealistic, sad to say.   

[Ultra]

I expect you to make the distinction between corporatism and capitalism because I know you understand the difference. When you don't make the distinction, consciously or unconciously, you only further the establishments cause of covering corporatism(fascism lite) as capitalism in order to further taint the only path towards liberty and away from the corruption that is government.

[MG]

Hmmmm....you make an excellent point, sir. I'll  have to think on that.   

[DeAutogids]

For once I think I actually completely grasp what you're saying.

I've been probably been tought not entirely properly on the subject, as for me, Capitalism is also survival of the fittest. But it seems that is Corporatism.

[MG]

I've been probably been taught not entirely properly on the subject, as for me, Capitalism is also survival of the fittest. But it seems that is Corporatism.

You beat me to it, sir!

As with any discussion, a definition of terms is critical.

My definition of capitalism is very similar to your own. But I know that Heat has a different definition. I freely admit that my definition carries with it a higher degree of Corporatism than his does.

For instance, we have an acquaintance who is currently employed in a part of the world where sand and heat predominate. This fellow has personal knowledge of a recent visit by a prominent member of the US Congress. The visit was billed as a diplomatic mission, but the truth is that it was ENTIRELY focused on promoting the business enterprise of the Congressperson's spouse. The US taxpayer paid for the whole thing, including the security detail that routinely accompanies prominent Congressional figures.

See, that to me typifies "capitalism" as we presently know it in this day and age. I note, for example, that if a certain Italian restaurant specializing in pizza, potent potables and palaver were to experience a slow down in business, NO government instrumentality would be rushing to ensure its survival or sending Congressional delegations to foreign lands, begging them to order their pizza from Charlie O's.   

Within the terms of my definition, we see that most of the effort of the US diplomatic mission around the world allied with promoting certain favorite corporate clients, who are, in turn, generous campaign contributors.

I see the owner of Charlie O's as an entrepreneur. He believes that entrepreneurship and capitalism are one and the same. And he is probably right, if one looks to a classical definition of capitalism as creating a greater good for society by promoting a division of labor, where one person can concentrate on what he or she does best, thereby accumulating profits which can be used to obtain from others what THEY do best. On one hand, pizza. On the other, shelter and heat and the leisure time to pursue a lifelong love of automobiles.

My point is that what we USED to think of as capitalism has been subsumed, transmogrified and re-invented as corporatism. I think corporatism is every bit as pernicious as communism in economic terms. But those who hold the reins of power define the rules of the game and the definitions that go with them.

I think in most people's minds these days, capitalism is seen as being more Gordon Gekko - Greed Is Good - and less Ayn Rand.

Anyway, an interesting discussion. Nice to get some input from around the globe from other members besides Ultra, OP and me!   

[Otto Puzzell]

What you are calling 'corporatism' has been around since the invention of currency. It is no more pervasive or pernicious in its current form than any of those that went before. Substitute kings, dictators and "elected officials" for CEO's, and voilŕ! When one entity (king, government, corporation, of a combination) controls another's ability to earn or accumulate wealth, the previous has hit the peak of the J-curve, as is already on its way to the scrap heap of history. The market, and the people, win out.

50 years before collapsing in bankruptcy, General Motors was being sized up for dismantling by the Feds, ala AT&T. As kings are time and again brought down by common people, corporations come and go, and are replaced by others. None of them, nor any group of them (think "Big 3") is any more eternal than the 1000 years Reich. The will of people to live their lives for their own sake trumps the power of those who make the rules preventing same.

Let's reconnect on this topic in 100 years, and we'll see who is right.  

[DeAutogids]

As a joke I will reply that in 100 years the internet does not exist anymore or is strictly monitored. We will see the things in Egypt, Tunesia and other countries as a turning point in the freedom of speech. We are not allowed to use the name of engine manufacturer Cummins.

[MG]

Let's reconnect on this topic in 100 years, and we'll see who is right.

Lord, how I wish such a thing were possible.   

As a result of the intellectual energy required by this thread, I am taking myself off to sit on a beach in some distant location for a week beginning Saturday where I will think long and hard on the errors in my life to date and other personal shortcomings.

Warm sand and a temperate ocean can do wonders for the soul.   

[Ray B.]

MG, I was very much interested by the David Korten article that you posted. The concept of Main Street economy vs Wall Street economy seems quite useful and appropriate if one wants to understand what is going on now.
I haven't got much time to comment it now, but it proved me that:
1- I was far from being wrong regarding some ideas that I've explained here and there in this section of Autopuzzles.
2- I also have some ideas that I share with american autopuzzlers here, which is a good thing because I consider them as friends, even if we could be political enemies. But politics isn't all.

Thanks for all this.

[Ultra]

http://mises.org/daily/3735

A "no bull" explanation of the distinctions being discussed here. Hope you gentlemen enjoy it. 

[MG]

A MOST interesting and worthwhile read, which focuses on this observation:


State capitalism consists of one or more groups making use of the coercive apparatus of the government — the State — to accumulate capital for themselves by expropriating the production of others by force and violence.

Those words should be inculcated into all citizens through the education process.    :2˘:

[Ultra]

You finally read a little Rothbard and call it "most interesting."

Read the Rothbard archives at mises.org and lewrockwell.com. I beg of you.

[Ray B.]

http://mises.org/daily/3735

A "no bull" explanation of the distinctions being discussed here. Hope you gentlemen enjoy it.  

  Please, not the reading list again!

[MG]

Yes, Ray. The dreaded reading list!   

And Ultra, you sure have a funny way of giving positive reinforcement.     You are one of the few people I know (probably the ONLY one) who would post that article and I am one of the few people you know (maybe the only one) who would actually read it!   

But it clearly shows how OP and I crossed swords earlier in this thread - or some other related thread. Who can keep track? - because we were each using different definitions of "capitalism".  It is SO important to define one's terms before engaging in debate. This article does a good job of distinguishing MY definition of capitalism from OP's.   
















I think.......

[Ray B.]

State capitalism consists of one or more groups making use of the coercive apparatus of the government — the State — to accumulate capital for themselves by expropriating the production of others by force and violence.

Well, this seems to be a rather adequate description of what governor Walker and the Koch brothers have in mind in Wisconsin right now.

[Ultra]

State capitalism consists of one or more groups making use of the coercive apparatus of the government — the State — to accumulate capital for themselves by expropriating the production of others by force and violence.

Well, this seems to be a rather adequate description of what governor Walker and the Koch
brothers have in mind in Wisconsin right now.

I agree, Ray. Wholeheartedly.

[MG]

Governor Walker was bought and paid for by the Koch Brothers. Looks like they are getting an excellent return on their investment.   

In America, we are proud to say we have the best government money can buy.......

[Otto Puzzell]

In America, we are proud to say we have the best government money can buy.......

Walker's opponent's extended hideaway in Illinois? The best dereliction of duty money can buy (thank you George Soros and Lynde Uihlein). The political equivalent of covering one's ears and repeating nya-nya-nya-nya I can't hear you.

While everyone knows anything wrong in the US is a far greater wrong than when it happens anywhere else, but politicians being bought off is hardly unique to the US, BTW,

[MG]

I did not mean to suggest that America had an exclusive patent on corrupt politicians. Rather, I wanted to point out that we have taken ordinary human veniality and burnished it to such a high art that we do it gooder than just about anyone else.

Please tell me that you don't for one second think the government of the United States or of any of the individual states, towns, municipalities, boroughs, counties or commonwealths give a flying flapdoodle about your narrow ass or what might possibly be in YOUR best interests?

We are slaves to our government. It wasn't supposed to be this way.   

[Otto Puzzell]

Agreed.

However, my ass isn't narrow

[Ray B.]

By the way, aren't the Koch brothers dedicated libertarians ?

There must be something wrong here.

[Ultra]

By the way, aren't the Koch brothers dedicated libertarians ?

There must be something wrong here.

No. They call themselves Libertarians in a classic political bait and switch. They are neo-con republicans attempting to cloak their true selves.

[Ray B.]

I'll remember that.
I see in Wikipedia that David Koch was the Libertarian Party's vice-presidential candidate in the 1980 presidential election, hence my remark.

But I alsor red this; In August 2010, Jane Mayer of The New Yorker wrote on the political spending of David and Charles Koch: "As their fortunes grew, Charles and David Koch became the primary underwriters of hard-line libertarian politics in America."

I also know that he is one of the main financers of the Tea Party...

So, Ultra and Otto, can you help me have a clear idea of all this (and no reading list, please . To an old liberal like me, also living far away across the ocean, there seems to be a very thin difference between neo-cons, Tea Party and libertarians. From the Bush era I remember that neo-cons were a special breed, but they don't seem so different in this light. I am not telling that I will take everything you say for granted. But I am always interested to hear what people who appear to have very different ideas have to say.

[MG]

always interested to hear what people who appear to have very different ideas have to say.

Which is what marks you as a superior being with exceptional intelligence. We have an online friend who likes to append this phrase to his posts:

I have never learned anything from a man who agrees with me.

I don't always agree with Ultra, OP doesn't always agree with me. And so it goes. But we have been exchanging information and ideas online for a decade or so now. I have learned much from both of them.

The worst situation is to live in an echo chamber, where everyone agrees with everyone else and ideas from outside the groups are disparaged and/or rejected out of hand because they do not conform to the "group think" norm. This is what happened in the US during the BushLite years, when the government was staffed top to bottom with people who all thought the same way. We called them Neo-Cons, but they were really staunch advocates for the notion of American Exceptionalism, which holds that none of history's lesson apply to US!   

Here is my answer to the theory of American Exceptionalism: