Posts Tagged ‘Milton Friedman

26
Aug
09

Vox Populi… (Part 1)

It has been said that “the customer is always right”. That seems to make sense- after all, in a Capitalist society, supply-and-demand (with the emphasis on the “demand” part of the equation) is the driving force of the economy. Companies, corporations, businesses, entrepreneurs- everyone caters to the consumer. Naturally this sounds like an excellent system- the people demand a product or service and the companies develop and create it. Simple, efficient, and like most things in the Capitalist system, deeply, deeply flawed.

It has also been said that “the voice of the people is the voice of God”, essentially an earlier, Roman version of “the customer is always right”. The problem with that phrase however (and indeed, the entire supply-and-demand theory) is that humans are far from divine. Supply-and-demand looks great until we look at the things we demanded over the past ten-thousand years or so. Slaves, narcotics, war, segregation, excess, genocide, nuclear arms- just to name a few. Let’s use war to study the issue a bit more. Humans love war- we can’t get enough of it. Since the dawn of time we’ve been trying to find quicker and more efficient ways of clubbing each other. Obviously with such a massive demand for war, there are those who- like the good Capitalists they are- make a living off of conflict. They sell mercenaries, arms, guns, knives, mines- anything and everything to anyone willing to pay for it. Naturally, this only intensifies the horrors of war, it perpetuates the violence and weakens the chances of peace and diplomacy. If guns are used to slaughter minorities, or if grenades are pushed into the hands of child soldiers- who cares? If weapons are demanded, then they are supplied- the voice of the people is the voice of God!

Now obviously we can see that this is horribly wrong. Now I am not attempting to argue that any demand is wrong- humans have, after all, basic needs. Catering to humanity’s baser appetites doesn’t satisfy them, it only creates a greater hunger. Regulations? Regulations are an interference with the free market system- a form of “corruption” as Milton Friedman is attributed with saying.

Is supply-and-demand such a great idea? I submit that we cannot have our every whim met, that to supply every human demand would be the equivalent of granting a three year-old’s every wish. Anyone even remotely familiar with human history can tell you that we as a species have a difficult time figuring out what’s good for us.

Quite simply, we can’t always get what we want.

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28
Jul
09

Why I’m Still a Communist

I became a Communist because I believed that it was the only viable political/economic system capable of providing liberty, justice, and security for everyone, rather than just those who can afford it. I have remained a Communist for much the same reason. While one might expect (and many have hoped) that experience would lead me to leave Communism, it seems the more I see of life, the universe, and everything, the more I become confident that my views are correct.

For example, when I was seventeen I took a course on mainstream worldviews (Christian, Humanist, New Age, Marxist). The class turned out to be a series of hyper-Conservative, dogmatic lectures and the textbook wasn’t much more than a seriously biased collection of arguments against any view other than Conservative Protestantism. Despite the waste of time, effort, and money that the class was, I nevertheless found myself affected by it (or at least, an event resulting from the class). While the textbook was full of little cartoons advocating various right-wing stances- one stood out to me in particular. It showed two frames, one in which a wealthy man giving a handful of coins to a poor man, the other depicted the poor man robbing the rich man. The caption claimed (roughly) that in Capitalism, when the rich give to poor it is called “charity” and- no matter what Communist word you use to describe it- when a poor man takes from the rich it is called theft. When I saw this cartoon, it took a while for me to fully digest what it’s implications were. Granted, it seemed reasonable- giving is accepting, taking isn’t. But when one thinks about it, if this were to be applied, the poor would be reliant on the wealthy giving out a steady stream of spare change. Of course, this would mean that the wealthy are willing to give out a steady stream of spare change (and they say that Communism claims humans are basically good). Quite simply, charity doesn’t work- the people need a better way to survive than aid, pity, and welfare. All in all, as a result of reading a simple political cartoon, I became even more entrenched in the idea that Communism offers the solutions for the problems Capitalism simply can’t solve.

Another example would be the game of monopoly (yes, even Communists play monopoly). You gather the players around the board, they compete and trade and make wild gambles but in the end, there is only one winner. Now disregarding the amount of pain and suffering caused by running every competitor out of business, one must consider what it would be like to live in a country with a monopoly on- let’s say- iron. If you want to make anything with iron, you have to pay the monopoly’s price. If your looking for quality, then it’s more or less a game of chance- the monopoly has no reason to sell anything better than its lowest quality product. If you try to import, then it’ll probably a baffling and expensive ordeal- the monopoly has a hefty lobby at the capitol and there aren’t many senators and congressmen and even presidential candidates who wouldn’t mind taking contributions from the monopoly. Regulation laws? This is Capitalism- regulations are, as Milton Friedman is attributed with saying, “corruption”. Communism averts a disaster that Capitalism leads to.

Or yet another example would be that of airplanes. Nowhere is the class system so pronounced as on a transatlantic flight. The same distance is being traveled, the same plane is being ridden, but the differences between the 1st class and coach cabins are massive. Now we must keep in mind that the people in coach are just as human as those in 1st class. Yet, due to a simple lack of money, those in coach have a dramatically different flight from those in 1st class. The food is inedible, the seats are cramped, the cabin is crowded. Why? Because some people are poorer than others and therefore less valuable. The class system is the greatest example of social injustice since the days of segregation and religious persecution. Communism does away with the class system and ensures equality for all- not only those who can pay for it.

In short, while it was the massive tomes of Marx, Engels, and Smith that convinced me to become a Communist,  it is the little things in life- cartoons, board games, traveling- that convince me to stay Communist.

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.