Posts Tagged ‘Free Trade

28
Jul
10

A Communist Response to the Tea Party

The Tea Party has made a point of lambasting the Communist movement. Pictures of Obama (for the last time- not a Communist) are adorned with the hammer-and-sickle emblem, or set up alongside pictures of Marx and Lenin. There are picket-signs with such slogans as “Revolt Against Socialism”-in short, it’s the largest anti-leftist movement since McCarthyism. And not without reason, either. It’s undeniable that there’s a certain appeal to the Tea Party movement. Joining the fight against the [alleged] looming threat of an authoritarian state, bringing the country back to its original values, lowering taxes for the middle-class-everyman- who wouldn’t want in? But as with every political/social/economic movement you have to cut through the buzz words and slogans and examine the core principals and goals.

The Tea Party seems to be focused around three central issues, (1) the limiting of government power, (2) the restoration of Free Market Capitalism, and (3) through these two goals bring America back to the values of the Founding Fathers. In and of themselves these principals seem perfectly reasonable- admirable even. Until you look at history.

Limiting government power? Hey- Communists are all for it. One of the principal goals of Marxism is the abolition of the state. Indeed, despite the Tea Party’s pictures of Democrat politicians with the hammer-and-sickle superimposed on them, Communists have more in common with Libertarians- as far as governmental issues anyways. The problem with the Tea Party is that there not against big government- they’re against big Democrat government. The Patriotic Act was one of the greatest expansions of government power since the Civil War- did the Tea Party protest then? In the Tea Party’s defense though- this is a problem on both sides of the political spectrum; those who protested the Patriot Act have remained strangely silent about the issue now that Obama is in power.

As for the restoration of Free Market Capitalism- there’s a reason regulatory laws and branches have been developed. Before the advent of market regulation, the state of things was appalling. Child labor, strike-breakers, low wages, dangerous work conditions, false advertising, a complete lack of product safety and quality control, rampant pollution- to put it mildly, it was nightmarish. And even despite regulatory laws, corporations continue to pollute and exploit- look at third-world sweatshops and the continued destruction of the environment! If things are bad now, how much worse will they be without laws to protect the workers and consumers?

And lastly and most importantly, there’s the issue of the founding fathers. If you listen to far-right pundits (Glen Beck would be a prime example), you’ll hear repeatedly that the US must be returned to the plans the founding fathers had for it. A closer look at the writings of America’s founders, however, suggest that they might not have been as wild about Capitalism as conservative pundits and Tea Party members make them out to be. Thomas Jefferson, for example, had this to say about private property:

It is agreed by those who have seriously considered the subject, that no individual has, of natural right, a separate property in an acre of land, for instance. By an [sic] universal law, indeed, whatever, whether fixed or movable, belongs to all men equally and in common, is the property for the moment of him who occupies it, but when he relinquishes the occupation, the property goes with it.

Or look at this statement by Thomas Paine (technically not a founding father, but his influence of the Revolutionary War and the formation of the American government is immeasurable):

Men did not make the earth… It is the value of the improvements only, and not the earth itself, that is individual property… Every proprietor owes to the community a ground rent for the land which he holds.

and

…To pay as a remission of taxes to every poor family, out of the surplus taxes, and in room of poor-rates, four pounds a year for every child under fourteen years of age; enjoining the parents of such children to send them to school, to learn reading, writing, and common arithmetic; the ministers of every parish, of every denomination to certify jointly to an office, for that purpose, that this duty is performed… By adopting this method, not only the poverty of the parents will be relieved, but ignorance will be banished from the rising generation, and the number of poor will hereafter become less…

Even half a century later, Lincoln (not a founder, still an important figure in the shaping of American politics) gave us this warning:

As a result of the war, corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed.

Quite simply, as far as the founders go, I doubt their ideologies would have mixed too well with those of the Tea Party.

To summarize, the Tea Party may have a heroic and patriotic veneer, but that’s all that there is- catchphrases, dire warnings about an apocalyptic future, and desperate attempts to restore a past that never existed. And the truly tragic thing is there’s a lot in the Tea Party that could be used for the betterment of the American public. The rejection of big government is admirable- just make sure that you’re not substituting one lack of liberty for another. The desire to restore prosperity is good- Capitalism isn’t the way. The attempt to restore the country to the principals of the founding fathers is commendable- but only so long as you know what those principals were.

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06
Jun
10

[Not] Free to Choose

Despite a growing dissatisfaction with Capitalism, there are many who refuse the concept of doing away with the system altogether. Such individuals tend to advocate “happy mediums” between free market Capitalism and state regulation. For example, the 2009 documentary Food, Inc. attempted to expose issues within the American food industry. While the film was highly critical of the some major food corporations in the US and the general way the industry is set up, the film advocated not the abolition of the Capitalist system that has allowed the situation to come to be, but rather the idea that through selective consumption, the food industry will be forced to alter its practices and products. For example, in this new system, one would choose to buy only “green” products, showing corporations that (1) the consumers will no longer buy ecologically harmful products and (2) there’s a profit to be made by selling eco-friendly merchandise.

It’s a painfully flawed system.

First, we must recognize the central role profits play. A product that is eco-friendly, made well, and made by laborers who are being paid decent wages is going to be substantially more expensive than a product that is made with no regard to the environment, the health/well-being of the consumer, and made by sweatshop workers. Products that have the qualities of the former are either too expensive to be profitable (enough) for the corporations producing them or too expensive to be purchasable by the majority of consumers. While there is some degree of public choice involved, overwhelmingly other factors such as the poverty of the consumers make this system impossible to realize.

Second, we must understand that Capitalism is in no way, shape, or form a democratic system. A while back, I had a conversation about Capitalism’s displacement (and to a degree, eradication) of local cultures. The person arguing with me made that claim that if the people of a country didn’t want McDonalds springing up across their nation, they would have only to stop eating there and the McDonalds, seeing no profit, would withdraw. The issue with this is that even if 95% of a population is against there being a product sold, if the remaining 5% buys enough to allow the company to make a profit, they will keep selling.

To recap the situation, product A is bad but cheap, product B is good but expensive, you will probably only be able to afford product A, and even if you manage to purchase product B, your ability to purchase other good products like B will be reduced because B is still expensive. But if you were somehow to rally the public and declare a boycott of product A, the fact that you’ve managed to get 75% of the populace to stop buying A doesn’t mean that A will cease to be a source of revenue. Short of getting a universal ban on product A, there’s not a whole lot you can do.

Now don’t misunderstand this post- I’m not arguing that because you don’t have much choice, you should capitulate to unethical business practices. On the contrary, out of principal, when it is your choice, you ought to spend money on the eco-friendly, fair-trade products rather than harmful or slave-labor products. I’m merely showing that Capitalism cannot be controlled by popular choice. Capitalism cannot be moderated so long as it remains based entirely on the acquisition of capital– and any change to this- the most fundamental aspect of Capitalism- would be an abolition of the Capitalist system altogether.

If you’re not free to choose within Capitalism, maybe you ought to considering choosing something other than Capitalism.

16
Oct
09

War for Sale

War has plagued humanity since one caveman discovered that using a heavy stick got him what he wanted a lot quicker than his fists did. Since that discovery, humanity has come a long way in the development of weapons, from bronze spears to compound bows to cannons to nuclear missiles. Now of course, there is nothing wrong with this- be it saber-tooth tigers or serial killers, humans will always have something to fight. What is wrong with this, however, is that there are those who take advantage of this fact. I’d call them “human vultures”, but that would be an insult to the birds- after all, vultures don’t attempt to instigate, prolong, or exacerbate conflicts. You probably know these people as the “Industrial-Military Complex”.

Now of course, “Industrial-Military Complex” is a term often misused. Conspiracy theorists warp the definition to describe supposed shady corporations controlling the military, or vice versa. In reality, however, the term “Industrial Military Complex” is simply used to refer to companies and corporations that develop and/or sell weapons for combat (as opposed to hunting and recreation). Now is there anything wrong the research and manufacturing of arms? Of course not- every government in the world has a need to defend itself- to spend money and effort on maintaining a strong defense force is both right and natural. The problem is the Capitalist system allows for all forms of commerce, from advertising to research to fast-food to prostitution. Anything and everything can be produced and sold- including weapons.

Now the issue here should be obvious- if a corporation creates a products (a fighter jet, for example), it isn’t enough to simply have a  supply of the product- you have to sell it; to sell something, there must also be a demand. As you can imagine, a fighter jet isn’t exactly cheap- selling it is going to make you a massive profit. Of course, you’re going to need someone to sell your fighter jets to, and let the facts be faced, people aren’t going to wake up one morning with a sudden urge to buy one. So now you have two options: (1) scrap trying to sell fighter-jets and sell something else or (2) create a demand for fighter-jets (and whatever other weapons you might be selling).

Now let the facts be faced; people who feel secure don’t attempt to fortify their houses or stock up on assault rifles. People only raise the drawbridge when they feel threatened– either by violence or the fear of violence. Of course, it is in the interests of those selling the weapons to promote either (1) violence or (2) fear (which, incidentally, is the definition of “terrorist”). How does one go about doing this? There are a number of ways. You could make sizable campaign contributions to “hawk” (pro-war/pro use of military action as a first resort) politicians. You could make sizeable campaign contributions to politicians in hope to buy their sympathies. You could advertise- try to convince the public that they live in a dark, scary world filled with monsters they need to protect themselves from. You could attempt to- through any number techniques- disrupt the attempts of peace negotiations (after all, the more war, conflict, and violence there is, the more weapons people will pay for).

Now this obviously isn’t right. To feed off of fear and conflict and escalation is- frankly- sick. War is and always will be a tragic but often necessary event in human history. To incite, encourage, prolong, or exacerbate violent conflict for profit is perhaps the height of immorality, and yet by the Capitalist standard the industrial-military complex is not an abomination but simply free trade- the production and exchange of goods for capital (money).

Now my message here is simple. War is being sold to you- don’t buy into it. Don’t be frightened by stories of monsters under the bed when you have the real monsters trying to scare you into buying their automatics and Kevlar. Don’t be imprisoned by paranoia.

Be brave.

24
Jul
09

The Many Faces of Capitalism

Throughout the blog I have been discussing various aspects of Capitalism, however, one must keep in mind that Capitalism isn’t so much an economic theory in and of itself but rather a general category of economic theories based around capital (money). For one to describe Capitalism without making note of the various schools of thought within the system would be the equivalent of describing Christianity without mentioned the beliefs of Catholics, Orthodox, and Protestants, or describing warfare without noting the invention of gunpowder. So, in the interests of clarity, listed below are the descriptions of the major classes of Capitalism.

Classical Capitalism

While the actual term “Capitalism” was coined by Karl Marx, the first comprehensive work on the subject of Capitalism (or “commerce”, as it was simply known as) was penned by British economist Adam Smith, in his The Wealth of Nations (considered by many to be the “Bible of Capitalism”. Smith’s essential argument was that humans ought to work in their self-interests which would create a strong and healthy society. Smith stated that if one person owns a product and attempts to sell it, the purchaser will buy it for whatever he deems it to be worth, leaving both seller and buyer richer and happier than before their transaction. Throughout his work, Smith advocates this concept of self-interest as the foundation of commerce, stating that “We address ourselves, not to their humanity, but to their self-love, and never talk to them of our own necessities, but of their advantages.”. Additionally, Smith claimed that it is in the best interests of the economy and the government for the government to interfere as little as possible with the economy (see “Free Trade” below).  Today, Adam Smith is viewed by many as the founding father of Capitalism and one of the most important economic theorists in the history of the world.

Laisseiz-Faire

Laisseiz-faire (literally “Hands-off” or “Let-do”) can perhaps best be described as an aspect of Capitalism (Classical Capitalism, to be precise) rather than a school of Capitalism. Based on the works of Adam Smith, Laisseiz-faire is a philosophy that states that the government should never interfere or attempt to regulate the economy which- according to the advocates of Laisseiz-faire- functions best without outside influence. While developed separately from Adam Smith, the philosophy of Laisseiz-faire and Classical Capitalism are often combined or associated with each other. While Smith primarily objects to government tariffs, Laisseiz-faire has historically opposed government interference in the form of anti-monopoly laws, minimum wage, and unions.

Christian Capitalism

While the US and much of Europe has never had any theocratic rule since the end of the Renaissance, it is undeniable that in the West, a Christian concept of Capitalism has existed for some time. Of course, this “Christian Capitalism” by no means applies to all Christians, but the fact remains that this philosophy does indeed exist. Christian Capitalism attempts to reconcile the self-focused, competitive tenets of Classical Capitalism with the rather community-focused, anti-materialist teachings of the Christian religion. The end result is what one might call a “moralistic Capitalism”, where competition and materialism do exist, but are tempered by ethics. Those within the system are free to make a profit, but gouging the buyer, deceiving the competition, or tricking the seller is considered to be unacceptable. Charity is advocated but not mandated (as opposed to other religious economic theories to be discussed later). While this form of Capitalism is often considered to be the ideal, there are many split on issues of what is and is not moral (what are the limits when trying to outsell a competitor, for example).

Regulated Capitalism

Contrary to common belief, regulated Capitalism is not a form of Communism or Social but simple government interference. Regulated Capitalism, like Laisseiz-faire, isn’t so much a theory of Capitalism but an aspect of Capitalism. Teaching the very opposite of Laisseiz-faire, regulated Capitalism states that economies require some form of control in order to flourish. This “control” can range from basic laws on minimum wage and worker-safety (such as in post 1940s America) to major government control (as in 1920s and 1930s Italy). While regulation is often confused with Socialism, one must keep in mind that so long as the state does not own the company, the products it sells, and the revenue generated, it does not count as Socialism.

Keynesian Capitalism

British economist John Maynard Keynes could perhaps be described as the most anti-Capitalist Capitalist the world has ever known. Keynes held that Capitalism is “the astounding belief that the most wickedest [sic] of men will do the most wickedest of things for the greatest good of everyone.”, and yet was himself a Capitalist. From a philosophical standpoint, Keynes despised Capitalism and yet saw it as the only option. As a result of this, his economic theory (known as “Keynesian economics”) attempts to protect the public from Capitalism’s costs while maximizing its benefits. Keynes advocates government regulation to protect the public while stating that the public, in order to prevent recessions and depressions, should spend their money without excessive investment or saving. Currently, Keynesian economics are often criticized by other schools of Capitalism as requiring too much collective and government interference.

Ayn Rand Capitalism

Also called “tooth-and-claw Capitalism” “Anarchist/Anarcho-Capitalism”, and “Social Darwinism”, this form of economics focuses on individualism to the point of egotism (or as Rand dubbed it, rational self-interest). Theorized by novelist Ayn Rand (most famously in her books The Fountainhead and Atlas Shrugged), this form of Capitalism is perhaps the most brutal. Rand’s philosophy vehemently opposes all forms of government interference, charitable aid, altruism, and religion. While never explicitly stated in her works, Rand’s economic theory holds that the wealthy and privileged are wealthy and privileged because they earned it, while the poor and proletariat are at the bottom of the economic food-chain because they are lazy or simply choose to be poor. In her book Atlas Shrugged, Rand submits that the wealthy and powerful are the most productive and useful members of society, capable of bringing the world to a sudden halt by going on strike. While Rand’s theories are essentially Capitalist, many other schools of Capitalism look down on Rand’s theories as barbaric, excessively anti-charity, and basically flawed. Despite public criticism, many hold that Rand’s Capitalism is by far the most pure form of Capitalism.

Free Trade

Free trade, like regulated Capitalism and Laisseiz-faire Capitalism, is a concept- not a theory. Free trade essentially is the belief that international trade should not be regulated or controlled by governments. Outsourcing, the import/export of resources and goods, multinational corporations, and international investment are all aspects of Free Trade that its advocates state will produce higher profits, lower production costs, more jobs, more demand, and generally stronger economy.

Protectionism

Protection (perhaps more of a political concept than an economic one) demands the very opposite of Free Trade. Protectionists believe that jobs should go to citizens of the country the company is in, that resources and products should be obtained and produced locally and that massive export and import tariffs should be maintained for the purpose of preserving jobs for the citizens of the country. Protectionists will often also oppose immigration for the same reason.

06
Jun
09

Capitalism Defined

While Communism may summon unbidden images of dictatorships, oppression, and poverty; Capitalism brings to mind images of freedom, wealth, and luxury. Like Communism, Capitalism does not deserve the reputation it has.

Capitalism, in its simplest definition, is this- a social system in which the end purpose of politics, labor, business (and indeed, life in general) is capital, i.e. money. When a person works, he or she works for the highest wages possible. When a business sells a product, the product is sold for the highest profit possible. When a government acts, it acts in such a way as to create the highest inflow of cash possible (though admittedly, Smith states that the best way for this to happen is for the government to stay out of economy altogether).

According to Capitalism’s advocates, this system creates a healthy, strong society where everyone is rewarded according to their individual efforts and intelligence. The inventive and hard-working move to the top while the stupid and lazy are left behind.

Now in theory this sounds like a good system, but how does it work when put into practice?

In reality, this system creates a survival-of-the-fittest that not even Darwin would’ve imagined possible. Individuals engage in brutal competition with each other for high-paying jobs, businesses war with each other to sell their products and services, and so on. Even Smith himself states that “But man has almost constant occasion for the help of his brethren, and it is in vain for him to expect it from their benevolence only. He will be more likely to prevail if he can interest their self-love in his favour, and shew them that it is for their own advantage to do for him what he requires of them… Every man is, no doubt, by nature, first and principally recommended to his own care; and as he is fitter to take care of himself than of any other person, it is fit and right that it should be so… Every man is… first and principally recommended to his own care… it is fit and right that it should be so.”. In other words, “let each and every person act in his own interests”.

“Harsh but fair.” you might argue, “it is a jungle out there and it’s only natural that the fittest survive.”

That’s all good if you’ve got a steady occupation and decent health- but what if that changes? If you suddenly were fired (maybe the company can make a better profit without you) then survival-of-the-fittest system doesn’t sound so great anymore. If you come down with some disease and the treatment is expensive, what are you going to do if you can’t come up with the cash? This is Capitalism- you can’t expect the doctor to save your life out of human compassion! Or worse yet, what if you’re born to a lower class? In that case, you’re stunted from birth- cursed with a worse education than your bourgeois and elite counterparts (after all, education’s a marketable service- the best educations go only to those who can afford it). You’ll be lucky to get a job at all.

Capitalism still sound great? It gets worse.

With all of this going on, now add on the fact that you yourself don’t count as a person in grander scheme of things. For the employer, you don’t exist as a person but as a source of revenue- a money-machine. If you “break down” or if an “upgrade” comes along, you can be replaced. That means in addition to struggling to keep your head above water in a system where you’re being squeezed for every penny, you have to fight tooth-and-claw with your fellow man for each and every opportunity. If you and a co-worker are competing for sales, what’s to stop the co-worker from lying about the product to potential buyers in order to ensure that the product is sold? He’s making money for himself and for his bosses and if the buyer’s a gullible enough to fooled, then that’s just Capitalism. The smart (or at least, those who could afford an education) and hard-working (or unscrupulous) move ahead and the stupid (or those who couldn’t afford college) and lazy (or those with mental/physical disabilities or those who simply won’t lie and cheat) are left in the dust. And what about cases where a profit can be made from direct exploitation, such as prostitution, pornography, sweat-shops, and pure and simple slavery? Since the end goal is money, is is justified to con a person or to bribe a public official for profit?

Does Capitalism still truly deserve its reputation? I submit that it does not.