Posts Tagged ‘wages

16
Nov
10

The Point Of It All

I’m not feeling so great. I’ve been up since six this morning with no real sleep for the past two days. My stomach is aching from a combination of stress and oily, fatty college cafeteria food. I’ve spent the past three hours having my brain clubbed into a gooey pulp by a statistics test, and I’ll be having to write up a major presentation and memorize it by tomorrow evening.

 

I have it easy.

 

There are millions of people out there who would sell their own children to be in my place. Thousands of people have sold their own children to have a chance at being where I am. There are millions of people who, no matter how hard they work or how long or how well, will never be where I am.

 

That’s just a little something to put things in perspective.

 

I’m sitting here, eyes-bloodshot, stomach churning, neck-aching and I’m wondering why? Why am I putting myself through this everyday (sure it’s nothing compared to other people’s hardships, but let’s stay focused here)?

 

Why do people go to college? Well, some people are in college because they want to party for four years before the responsibilities of life and the universe hit them. Some people are here (at my college especially) to find someone to marry, but in general, the overwhelming number of us are in college to get degrees so they can get jobs.

 

Not sure, you don’t need a college degree to get a job. You don’t need to know how to find a t statistic for related samples or the definition of a theodicy to get a career in a textile mill or as a janitor. Only problem for those who try going down this road is that in the West, the vast majority of jobs you would be able to get without a degree can be done infinitely cheaper by a twelve-year old in Indonesia or an illegal immigrant. Sure there are still jobs out there for the degree-less, but it’s hard to support yourself, let alone any sort of family, working the grill at McDonalds or mowing lawns. There’s always the army, but considering the pay isn’t much better and the work is slightly more than hazardous, it’s a bit of a gamble.

 

So that’s where degrees come in. You want to have a decent-paying job at some point, you’ll need a degree. I’m at college to get a degree and chances are that you were/are/will be at college to get a degree. But is that really enough? I can’t help think back to a Peter Kreeft book where the resurrected philosopher Socrates approaches a college student to figure out why he’s attending college. I’ll paraphrase it briefly:

Socrates: Why are you here?

Student: To get a degree so I can get a job.

Soc: Why?

Stu: To make a lot of money so I can have a family and send my children to college.

Soc: Why will you send them to college?

Stu: So they can get degrees and get jobs.

 

It goes on like that.

 

Now this is really what I’m seeing here at my college. Students come in from generally the middle-class/upper-class to get degrees, get jobs, and return to being part of the middle-class/upper-class. People will take jobs on the basis of pay, whether said jobs are fulfilling or not, and spend the next forty years or so grinding away at their jobs. Why? To do what they really want to do. To go fishing, to take care of a garden, to spend time with family, to paint, to read, to tinker with cars, to cook, to write, and so on. It’s seems to me to be awful rate of exchange if we’re working sixty-plus years at jobs we don’t care about (or even hate) to spend our old age desperately trying to do the things we we wanted to do from the beginning (indeed, the things we were born to do). I don’t want to work on the machine that going to sap me of my life, rewarding me with the chance to do what I love doing when I’m too old to do it! I don’t want to have wealth, I want to have purpose.

 

That, I think, is the point of it all.

The only question we’re left with is “what purpose”?

 

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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.

07
Jul
10

Norman Rockwell’s America (is Dead)

If you’re familiar at all with contemporary art, then you’ll no doubt have heard of Norman Rockwell. Indeed, chances are if you’ve lived anywhere in the West you’ll have come across one of his iconic paintings (as an original or as a recreation). For the few of you who might not be aware of his work, Norman Rockwell created paintings depicting (most often) bourgeoisie life in idyllic Middle-America*. There’s the family farms and small, private businesses that politicians love to talk about (see Sarah Palin’s “Real America” speech) and Capitalism tries to market to you (see ‘Aunt Jemimah’, ‘Uncle Ben’, ‘Quaker Oats’, ‘State Farm‘, ‘Pepperidge Farm‘ etc.). For many it’s the very face of Capitalism- just look at this 1948 “instructional” video of (exclusively white) high-school teens discussing Capitalism.

Coronet Instructional Films “What Is Capitalism?”, 1948

This is a prime example of the twisted understanding of Capitalism many have, but even in this video we can see the roots of the disparity between the Rockwellian portrayal of Capitalism and the harsh reality. Throughout the film, one word stands out: Competition. The young woman to Jimmy’s right describes how the shop-owner, Mr. Brown, agrees to lend out his truck to ensure she and Jimmy buy from him, rather than the competition. She asserts that Mr. Brown’s interests aren’t in providing service but in making a profit, and it is here we have the crux of the matter. Mr. Brown wants to make profit- the sole existence of his business is to make profit, and so Mr. Brown does whatever he can to ensure his merchandise is sold, rather than the merchandise of his competitors. In short, Mr. Brown is trying to run the other shops in the community out of business to maximize his profits. I’m not arguing that Mr. Brown is morally corrupt (though let’s not rule out of the possibility), we have to understand that in a Capitalist system, the rules of competition apply to everyone. Mr. Brown has to run his competition out or his competition will run him out. Eat or be eaten. At the same time, if Mr. Brown is indeed concerned not with his own livelihood but with his profits, if he does succeed in running his competition out of business he will have a monopoly and Jimmy and his friends will be forced to buy “weenies” at whatever price Mr. Brown sets.

Melodramatic? Consider this:

Starbucks was a small, privately owned coffee shop that has burst into a world-wide empire that has obliterated competition. Walmart also started as a small shopping center before expanding to the point where it has replaced nearly all beloved mom-and-pop stores you see in Rockwell’s art. McDonalds didn’t start out was a global food-chain but just as a privately owned restaurant. Coca-Cola started out as a tonic.

Now of course, there’s the temptation to side with corporations on this issue. One might argue ‘Hey, the fact is that Starbucks, Walmart, and other stores became economic empires by being better than the competition- they deserve the power they have!’. This argument forgets, however, that most corporations don’t get to where they are by simply having better products. The Mr. Brown of the video might run his competition out of business by offering lower prices by (1) temporarily lowering his prices so that his competition will be destroyed and he will make more money in the long run, (2) lowering the quality of his goods, (3) smearing competitors (and if you don’t think this happens, look up a Mac vs PC commercial), (4) lowering the wages of his workers, (5) sabotaging his competitors (corporate espionage), (6) convincing the public that his products are better (actually making them better would decrease profit), or even (7) collaborating with other businesses to harm competition (just look up the tactics of J.D. Rockefeller). Now out of these seven options, do you think that Mr. Brown is going to go with the one that lowers his immediate income? And what happens when Mr. Brown gets a monopoly? Is he going to lose his customers to cheaper options in other towns? Of course not- the astute Mr. Brown is going to open a shop there, and use his profits to undersell his competitors into working for him.

It’s a sad but simple fact. No matter how much we swear by the good, ol’ family farm or shop, small businesses inevitably become big businesses, which become global corporations with a reputation for low prices and even lower wages, product safety standards, and environmental consciousness. To answer the question of the video, what is Capitalism? This is Capitalism: pointless competition, exploitation, monopolization, and the general degradation of all the values we see in Norman Rockwell’s paintings.

*Admittedly, he did do a few pictures of working class Americans and even school children in Soviet Russia- but overwhelmingly his paintings were of the bourgeoisie.

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.

01
Dec
09

The Myth

Perhaps the greatest lie originating (and arguably, perpetuated by) Capitalism is the idea that the wealthy are wealthy because they are intelligent, disciplined, and hardworking and the poor are poor because they are ignorant and lazy. As a result, if a man in a business suit and flawless grammar knocks on your door and asks if he can use your bathroom, chances are you’ll let him. You probably wouldn’t do the same for a man in a ragged bathrobe whose grasp of the English language was sub-average. Indeed, the quality of treatment you offer people is usually determined by what social class they hail from. We make assumptions about people based on whether or not they seem to be poor, middle-class, or wealthy.

Quite simply, we’re bigots.

And not without reason either. If a person is less willing to let a homeless man into his house than a man who is (or at least, seems to be) doing quite well for himself, then the person’s fear is not completely unfounded. A wealthy man has less reason to rob you than a poor man. Crime rates, alcoholism, and drug abuse are highest among the lower classes. Likewise the poorer classes tend to have the lowest levels of education. Statistically speaking, yes, you are more likely to be mugged by a poor person than a rich one, but so what? Bigotry is never tolerable, no matter what. So what if you’re more likely to be mugged if you get a poor guy into your house instead of a rich one? You don’t know either man. Maybe the man in the bathrobe is an honest, honorable person who’s had a run of bad luck. Maybe the man in the suit is a sociopathic murderer or a con artist. Judging people according to how wealthy they are is, no matter how you look at it, wrong!

So why is it that we’re prejudiced to trust the middle-class and wealthy rather than the poor? Is it because the poor are ignorant and criminal while the wealthy are intelligent and decent? Of course not! The poor aren’t poor because they’re criminals; the poor have high crime levels because they are poor. Sure the poor man is more likely to mug you, but is that because of him or the fact that he’s cold and hungry? Obviously there are those who are poor because of their own issues- all humans have a propensity towards greed and indolence. At the same time, it is ridiculous to claim that the poor are only poor because they’re lazy. It’s the poorest of the poor who have the heaviest workload. Across Africa, Asia, Latin America and yes, even Europe, Australia, and North America there are millions of those who for ten hours a day for wages of less than a dollar a day! There’s a reason we call them the Proletariat– the working class! It’s because they’re the ones doing all the actual work. They do the farming, the mining, the sweeping, the building, the cleaning, the producing and manufacturing! Why on earth would we even dare to consider these people to be lazy?

Because we’re lazy.

As I’ve said, humans are lazy. More often than not we don’t take the time and effort to investigate something for ourselves; we simply make assumptions or believe whatever our leaders and the media feed us. Since the poor are poor and unable to afford decent (if any) healthcare, we immediately assume that the poor are simply dirty. Since the poor can’t afford decent (if any) educations, we immediately assume that the poor are ignorant and stupid. Since the poor are poor and can’t always afford food/medicine/etc., many are forced into lives of crime- we immediately assume that the poor are naturally criminal. But laziness isn’t the only reason we don’t ask why the poor live in poverty.

Humans are also naturally arrogant. The idea- no, the myth– that the poor are poor because they are lazy makes us feel better about ourselves. We’re where we are because of our efforts! We’re wealthy because of our intelligence, our skill! We’re where we are because of our work-ethic, our self-discipline, and our decency!

Egotistical lies.

We’re where we are because of our own efforts and the efforts of our parents and their parents before them and because of the state of the world we live in and the class we were born into. Personal effort makes up about ten percent of it- the rest is accident of birth and dumb luck. A person pulling himself to the top from nothing is such a rare event that we make a major Hollywood film out of it. If you’re born poor, chances are you’ll stay poor no matter how hard you work unless you get not one but a whole chain of lucky breaks. If you’re born into a middle-class family, you’re probably going to stay middle-class unless you get a bunch of lucky breaks (though less than if you were poor). If you’re born into wealth and privilege than you haven’t done anything to deserve your life and don’t have to do anything to maintain it. Like I said, it really comes down to accident of birth. If you’re lucky, you’re wealthy, if you’re not, you’re poor and probably will be poor for the rest of your life. The Caste System isn’t exclusive to Hinduism.

So in short, don’t believe in the fairy-tale that the wealthy are the best of society and the poor are the worst, or that the poor are poor only because of their own efforts. We are, for the most part, fixed in our place by statistical chance- individual effort has very little effect on us.

It isn’t fair, is it? Only a sadist or an idiot could honestly state that this is an ethical system. Most of us simply shrug our shoulders and say that “life isn’t fair” or “that’s just the way things are…”. I say that when someone’s been murdered, we can’t stick our hands in our pockets and say “life isn’t fair”. I say that when any injustice has been committed, no matter on what scale, the only ethical course of action is to establish justice. Yes, life isn’t fair- but maybe that’s because no one’s doing anything about it!

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.

30
Jun
09

Communism, Capitalism, and Competition

Capitalism is a lot like a game of monopoly. Brutal competition, endless buying and selling and trading, a massive luck factor, and above all, the only way you can “win” the game is if everyone else loses. It’s survival of the fittest where only the most lucky and savage win- anyone else is crushed like the grass between two charging elephants.

So it is with our Capitalist system- though to get a capitalist to admit it is far from easy. Take Henry Ford, for example. Henry Ford is popularly credited with stating “There is but one rule for the industrialist and that is: Make the best quality of goods possible at the lowest cost possible, paying the highest wages possible.”.

This statement, of course, is vile propaganda- pure and simple. Unless a monopoly controls the product in question, the profit that can be made off selling said good is reduced dramatically. In simpler terms “Since the purpose of Capitalism is to get the most money possible, increasing the quality of a certain good (which would cost more to make), lowering the cost of that good (reducing the immediate profit), and paying the highest possible wages to those making the good (increasing the cost of production even more) all lower the profit, then the application of Henry Ford’s quote would defeat the purpose of going into business in the first place.

And Henry Ford knew this. Ford’s genius was by no means limited to his inventive or economic prowess. Ford was also a brilliant wordsmith who could appear to say one thing, when in reality he was affirming the opposite. “People can have the Model-T in any color, so long as it’s black” is one of his better known quotes. Technically the “Do what you want (provided that it’s what I want)” statement isn’t a logical fallacy. There isn’t any contradiction- just a clause. The equivalent would be a TV advertisement promising to “cover all medical expenses”. While some healthy, attractive (and well-paid) actor is making these promises, for a brief moment at the bottom of the screen, some fine print letters appear to inform you that the service or product will “cover all medical expenses” except a long list of expenses. When Henry Ford made his statement about the goal of industrialists, one must remember to keep the emphasis on the repeated word “possible”. Possible can mean any number of things or situations. “Possible without violating moral standards”, “possible without charging over one US dollar”, “possible without actually hurting the profit you make”, and so on, though the last “possible” is the most probable. Ford made both a fortune off of his industry and appeared to the public of his time to be a generous, witty, and fair-playing man (and that reputation lasts to this day, the vast majority of Americans being uninformed of Henry Ford’s virulent anti-Semitic and anti-immigrant views).

And that’s the way it is with Capitalism. Every corporation or company or individual with a product to sell or a service to hire out follows the Capitalist doctrine of profit (by any means possible). Like a player in the game of monopoly, the capitalist attempts to make the best quality of good possible (possible meaning “just superior to everyone else’s product to be more marketable) at the lowest cost possible (possible meaning “just enough lower than the competitor’s product to be more marketable), paying the highest wages possible (possible meaning “just high enough to tempt employees away from the competition”).

Now one might be fooled into thinking that this is somehow good- that competition will inevitably raise quality and wages, and lower the price of the product. A nice illusion- but it simply isn’t true. Corporations will raise and lower their prices and raise the quality of their product or service but rarely at the same time! If one corporation lowers the price of it’s product by ten cents, the competing company has the option of trying to undercut the new price or attempt to raise the quality of their product. “Quality”, however, is a tricky word. “Quality” might mean anything from a new toothpaste formula to a brighter toothpaste tube cover. The company might boast “new, brighter, better!” but since all of these words are totally relative, the don’t really mean much of anything. Sure one company could sell toothpaste for less and another could maintain the same price but promise “whitening power” but in the end, the goal of both companies is to make a profit. They’ll only undercut and outdo each other to a certain extent. As for paying higher wages- that part of Ford’s statement no longer applies. In this time of globalization, corporations can sell products in the West and manufacture them in the third world, where the workers are so destitute that they’ll take whatever job they can get- even working sixteen hours for a dollar a day. Corporations have a stranglehold on these people and since there’s more than enough cheap labor to go around, no reason to raise the wage (or provide healthcare or pensions, for that matter). Additionally, corporations- already locked in a barbaric struggle with each other- have no desire for new competition to enter into the market. Small businesses can be bought out by larger ones. Unless working on a very local level, small (and often family-owned) industries have no way of competing with larger ones (take, for example, the extermination of so-called “mom-and-pop” stores by massive chains such as Wal-Mart and Target). “So some small, private stores went out of business- that’s part of the free market system!” one might argue, “If these companies can give me lower priced goods, why should I complain?”. The answer is simple- the price isn’t lower. If you work for a company that makes a product (shoes, let’s say) you might be led to believe that the shoes you make are being sold to corporations like Target. Actually, Target is getting shoes from a sweat-shop in Taiwan for a fraction of the price your company’s selling them at. Your company, unable to compete with virtual slave-labor, is forced to lay-off thousands of employees (including you) because it can’t sell shoes for the same price. “But I don’t make shoes! It’s not my problem!” you might retort. But keep in mind that stores like Target, Wal-Mart, and so on are selling virtually everything now, from toothbrushes to garden fertilizer to suites to frozen turkeys to optometrist appointments. Whatever you’re manufacturing- whatever product or service you sell- you can bet that a massive corporation is selling it for less.

How’s competition sound now?

And that’s only how competition affects you. Imagine that you own a business and you’ve successfully run the competition into the ground. That’s great for you but what about everyone who’s just been put out of business? They’ve been forced to compete with each other for whatever jobs are available, no matter how low paying or exhausting those might be. And what about their families? If the daughter of one of the recently laid-off workers comes down with some disease, her family won’t have the medical insurance to pay for her treatment. Are we really part of such an egocentric society that the suffering we cause to others is justified as “part of the system”? Are we so obsessed with this “survival-of-the-fittest” economy that every moment of life is a vicious struggle to stay at the top of the food chain?

I propose an alternative: Communism.

As legendary economist John Maynard Keynes once put it “Capitalism is the astounding belief that the most wickedest of men, will do the most wickedest of things for the greatest good of everyone.”. Since we have seen that the good of the individual is not equivalent to the good of society (in most cases, it’s detrimental) I submit that we try the reverse. By cooperating, rather than competing, we can ensure that everyone is provided for, that the wages are fair, and that quality is controlled by the consumer, rather than the corporation. Sure some people won’t rise to the top, but at the same time, we can prevent anyone from being trampled below.