15 May 2015

A thought on capitalism

Some people on Facebook were blaming "capitalism" for exploitation of workers. I disagreed with this:
Capitalism is a system in which people compete for profits in markets. Capitalism can be distorted by rules that favor some over others (on the production or consumption side). Capitalism is unhelpful when (negative) externalities are significant.

Capitalism is NOT about fairness of inputs, outputs or outcomes. Fairness is best addressed via politics (sharing, rather than competing).

Corruption can be "measured" by the degree with which politics is influenced by money AND vice-versa (e.g., the Natural State vs. the Open Access State, North et al).

Alternatives to capitalism (more command, less competition) can be better or worse, but they can also be poisoned by corruption.


Eric said...

Nicely stated.

Thomas Oberhäuser said...

My question would be "for what?". - For what do we have state and economy? If the economy would provide the single inhabitant with those goods and services, he needs, then the state should enact laws and rules to guaranty a fair distribution of this net domestic product.

And when official workers do their job, because we have them given the task to do something, then their work must be transparent to all of us, via Internet. So we can see, how they work and that they use the money well.

But the state is "we". - Society members will nominate people to do a job. For instance, water distribution. - If we are not satisfied with the results of the commissioners work, we should dismiss those people. - At last, in a country and society, always the people are the sovereign. - Between decisions and the sovereign, there is nothing, if the people do not wish. Parliament, voting, parties, politicians are obsolete. - In Switzerland, you have direct democracy. - The future belongs to those forms of a state organisation.

In my opinion, the majority of society members are not interested in competing with others for profit. They only want to live a healthy life. So, in whose interest is capitalism, when the effect of this form of economy is, that a greater part of the society lives in slavery, poverty and other dangerous circumstances?

We should find a "third way" to live. Not communism, not capitalism, but a mix of both in a form of a basic income society.

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