I work at a large bank in the US. We build websites. Internal websites. The company employs maybe 300k people in the US alone. None of the websites gets more than 10 hits a day! There are 5 websites. And we have 40-50 people to support just that! If all these websites disappeared overnight there would be no difference to the bank. And to the society.
The best part: the bank has been rescued by tax payer money. If it went bankrupt -- as it should have -- I would be working productively somewhere else. Unless "somewhere" else is also supported by the tax payer money and artificially cheap credit, FED rates at 0% full economic cycle now.
The solution is more capitalism, not socialism. I.e. let them go bankrupt! This is what capitalism is all about. You take risks. You win, big payout! You loose, you go bankrupt! This is capitalism, not tax funded corporations. That's socialism for the rich. But don't call that capitalism, please! Interest rates at 0% for 7 years?! Set by whom? Capitalist free markets? Or socialist bureaucrats who know it all better?! Who sets the rates? Mr. Market or Ms. Yellen? Get rid of the FED too. You will see jobs like mine disappearing. And forcing me to do something more productive than slacking off for $120k / year curtesy of the tax payer.
Capitalism in crisis is all about reallocating work force from unproductive work at looser companies to do something great at productive companies! That's what bankruptcies are all about. Yes, my bank should be history long time ago. Its assets should be taken over by a bank that didn't make the stupid mistakes. And smart people who avoided those mistakes. This is what the bankruptcy process is about. Then this new CEO that weathered 2008 crisis making his small bank winning party here and taking over assets of bankrupted banks -- would see that nonsense and fire half of the staff. So they can go do something productive! This is how it works in true capitalism. We don't have it though because we believe in socialism. So yep, pay for your zombie bank (and my salary!) because the people who you voted into the office, didn't let the markets work!
I feel your pain, but we've got to let go of this word. "Capitalism" has meant exactly "tax-funded corporations", and all the other bullshit that you and I don't like, for such a long time, that this is the accepted meaning now. I don't think the phrase "free market" has been spoiled yet, but if we have to have an -ism then we need to come up with a new one. Avoid the adjective "true", because that just opens one to Scotsman accusations.
No, don't, please. Do Not let go of a word and its definition. It has a definition, and you must stick with it and not give them an inch of ground. It's a losing battle, where constant re-definition means that eventually anything applies under the term.
Giving them ground is precisely why you, and others think that we've lost the term "capitalism". For so long, we let individuals use it in bastardized terms to refer to grey-area capitalism, and allowed its use to be in the form of a pejorative.
The term "capitalism" was coined by socialists in the context of criticism of the dominant 19th century system of the developed world, which had all the features of cronyism, etc., that you are trying to exclude here.
The idea that capitalism was ever anything else was an attempt by defenders of that system to whitewash it, distract from the cronyism inherent in it, and discredit critics. But its part of what "capitalism" has meant from day one -- and part of what every actual capitalist system in practice has featured prominently.
Don't take it out on socialism! Under those principles, the banks either would not have existed in this form in the first place, or been allowed to go bankrupt just as you suggest.
What happened with the bank bailout was pure capitalism, the banks simply bought the government!
In fact, large corporate entities are nearly as wasteful and inefficient as the socialist bureaucratic state-controlled monsters from the USSR. Looks like key here is in being monstrous, not in the underlying ideology.
While I sometimes describe myself as "libertarian", this is actually closer to one of my core positions.
Large organizations become large because somehow, at some point in their past, they discovered how to produce some sort of wealth greatly in excess of what they were spending to produce it. This creates security for the entity. This security means that they are no longer getting feedback from the real world about what is working and not working; long before the feedback reaches the people in the organization it needs to reach, it has been absorbed by the buffers of high wealth and a lot of people. Consequently the entity begins acting without feedback from the real world. As control systems theory would teach us, the system begins slowly-but-inevitably spinning out of control until it finally exceeds its buffers and comes down in one or another form of catastrophe.
I've phrased this in "wealth" and "feedback" because it has jack-shit to do with "capitalism" or "socialism" or anything else. It's a general problem with things that get too big. (It does so happen to be a special case of this problem that many, many people want to pile everything into one big entity and call it the "government", but the problem is very widespread beyond just that one case.) Everything needs feedback to stay connected to the real world, and any time that an entity gets too large to respond to feedback, trouble is assured. The bigger the entity, the bigger the trouble. Big governments, big corporations, big anything is dangerous. And it's not because of some mystical badness due to largeness, it's very specifically their ability to operate without or even despite feedback from the real world. It isn't magical thinking to think that's trouble... it's magical thinking to think that entity could ever operate without feedback. Despite how this may appear to be ideology, I consider this engineering, and rather simple engineering at that.
Smaller organizations can still do very bad things. My parents happen to live in a township (a local government entity that stands in for a town/city in the rural area they live) that did something very financially stupid and now they've got some disturbingly substantial extra taxes to pay for a few years to pay it off. Smallness didn't prevent the township government from doing something stupid. However, the people who did that stupid thing were immediately outsted and will never serve again... that's feedback. When's the last time you heard that last bit from a big company or government? (Who in the Federal government has ever paid for any of the bad things that you can name in the past 14 years? It's not an empty list, but it's a short one for such a massive entity and long time.) And there's a township full of people now keeping a closer eye on what financial commitments it makes.
So, with that foundation, I'd submit a lot of these bullshit jobs are themselves an expression of the fantastic, astonishing wealth we've generated as a society. We have them because we can afford to have them. And don't forget the fact that the people with bullshit jobs are applying their full human intelligence to the task of looking busy, whether they are doing it on purpose or otherwise. When an entity is large and flush with cash, it lacks the motivation to push through the fog of deception and start ensuring that people are actually generating value.
It's fascinating to me how executives are so often enamored with large mergers and acquisitions, while it seems very rare for such transactions to result in greater overall growth or profitability. I suspect the real reason is to increase the buffer between the CEO and real world feedback. At some level, I suspect the executives instinctively know the real reason to increase the size of the organization is to further insulate them from market feedback.
Certainly makes more sense than the underlying financials in most cases, as far as I can tell.
(self-described libertarian here:) you don't suppose that large organizations often become large because they benefit from government subsidy? Aside from obvious candidates like Boeing and Lockheed Martin, I personally think that the inflation/investment social model whereby individuals are pushed into stock market or mutual funds that trade stocks, is a stealth subsidy that selectively benefits large companies and incentivises corporate aggregation.
Obviously, my post is at best a sketch of a principle rather than a complete description of the economy and government as a whole :)
But the advantage of describing it in the terms that I did is that, yes, government subsidy can be a way that an entity generates more wealth than it is spending to obtain it. But it is only one way. If that particular way is special, it is only due to its especially feedback-isolating effects (being beholden to voluntary customers for money provides more direct feedback than being beholden to another over-large entity), rather than any special "government" badness.
The big difference there is that when a company is wasteful, they do it with their own money. When the state is wasteful, that's my money they are pissing away.
This difference is not that clear. Governments are bailing out failing banks and handing out beefy contracts; pension funds are owning sizeable proportions of the huge, slow, stupid companies, etc. All with my money.
Money is not my only issue. Bullshit jobs are also bothering me, as well as the fact that I'm forced to deal with such inefficient and stupid entities on a daily basis. Banking, shopping, whatever else - you can't hide from the large companies stupidity.
You can't have a government, which is by definition a monopoly backed by a military and police force. And then turn around and blame "pure capitalism" because it appears to have somehow influenced the government monopoly.
Sure you can. "Capitalism" has always been a name for a system in which governments exist, and by which governments structure property rights. Certainly, you don't think that the dominant economic system of the late nineteenth century for which socialist coined the term "capitalism" in their critique of that system (a term later adopted by defenders of that system) somehow didn't feature government as a prominent feature?
Many capitalists (myself included) tend to not support corporatism. Capitalism assumes individuals owning smallish businesses. The minute a business becomes large enough to influence the federal government, things get weird and I'm not sure the system works as intended.
In addition to your misuse of "corporatism" as identified by tatterdemalion, you seem to be redefining "capitalism" to mean "what deelowe likes"; capitalism historically -- from the time that name was first given to an economic system by nineteenth century critics of the then-existing system in developed countries -- has always referred to a system which features unfettered accumulation of capital, and it is a system which was formed by cpaital accumulating so much in the hands of a few wealthy influencers outside of the feudal aristocracy despite feudal rules that restricted many kinds of capital flows that the elite of that new capitalist class were able to influence the existing governments to remove the feudal restrictions. The exact thing that you say is "weird" and doesn't seem to be capitalism working as intended is the origin and essence of capitalism, and the thing which motivated its early critics to bother criticizing -- and in the process naming -- capitalism.
You seem to be repeating this idea over and over - that this is what a few people 200 years ago meant when they said "capitalism", and therefore that's what capitalism is. But that is not exactly what most people today mean by the term. Even if you were right 200 years ago, you're wrong today.
Your approach therefore winds up changing the use of the term, to make it more useful for your side of the debate. That's not an especially valid debating tactic...
> You seem to be repeating this idea over and over - that this is what a few people 200 years ago meant when they said "capitalism", and therefore that's what capitalism is.
You have misunderstood. It is not that it is what "capitalism" means because it was what the term was first coined for, its because it was both what the term was first coined for and what it has been used predominantly for since -- both in criticism of that system and other systems sharing its salient features, and in describing (with or without criticisms) actual current systems by how they differ or continue capitalism (both aspects are frequently seen in the descriptions of modern mixed economies.)
The use of "capitalism" for either some other real system that has existed (other than by reference to shared features with the original capitalism) or for some idealized utopian objective that does not exist and has not existed -- whether one in which, as in Marx's Communism, the State has withered away, or one which has a active State with narrowly-circumscribed functions and goals -- is a distinct minority use, and any particular ideal is an even smaller minority use.
For example, you talked about cronyism. You said that it's inherent to capitalism. For authority for that claim, you said (but did not cite) 19th-century critics of capitalism.
I don't believe you that this is inherent to capitalism. Do you have anything this century (21st, not 20th)? An actual citation, not just a claim that this is what they said? Some kind of a study of the degree of cronyism in capitalism, preferably across countries? Something besides just an un-evaluatable claim that depends on the "everybody knows" and the definitions used by unspecified people two centuries ago?
The capitalism that we see today is not qualitatively different from any capitalism that has ever existed. They've all had cronyism, they've all had different rules for different types of firms, and most of them have had banks. Thus, if "capitalism" was a good name for whatever they had back then, it's a good name for what we've got now. This better system of which we're dreaming deserves better marketing than a name so shabby as "capitalism".
Tea Party members voted against bank bailouts. Not democrats, not old-republicans. My point is, yes, you can buy democrats and some republicans to vote in favor of more government spending. But you apparently can't buy them all to do it.
During cold war you could try to buy Moscow communists as much as you wanted so they allowed you open bank branch in USSR, but this would never happen.
You can try buy guys like Ron Paul all day long in attempt to get bailout, but you won't get it.
The problem is with the voter. If the feeling at the Capitol was that there will be severe punishment for the bailouts, our beloved Senators and Representatives would be too worried to loose their office to vote for that nonsense. Mind you they can sell their services to other industries too and make money in the process without the risk of loosing office (aka "everything"). The voter allowed them to do that. Because voter doesn't understand that bankruptcy and crisis are important parts of economic cycle. And are needed! To remove excesses from the system. To relieve workers from BS jobs too! So you can start over after 1-2 years in healthy economy without zombie banks. We didn't allow capitalism to work. Blaming capitalism for that doesn't add up.
BTW, I respect socialism and socialist movement. I'm liberal on social issues as liberal you can get. But for the economic issues Right just gets it.
Wow. Are you saying that you adhere to the Libertarian/Ayn Rand philosophy of personal responsibility, equitable rewards for creating value to society, and all that jazz? You know, the type of philosophy that purportedly values personal integrity and creativity above all else?
... And yet you happily pull down a six-figure paycheck for a job you believe is worthless?
Because, if so, you should know that the sense of moral superiority that you seem to share with most modern Randroids is outstandingly hypocritical.
Who is a hypocrite here? I thought you would be happy to hear I'm exploiting these evil big banks, too big too fail.
I like Ayn Rand but don't agree on everything she said. But for the sake of argument let's say I agree with her 100%. So, then:
I use the company's money and time to work on my own Projects. I selfishly exploit stupid and weak that should die in the natural capitalistic process, but democratically elected Government didn't let it happen. I'm a parasite on the sick system because I want it to die. I don't see anything against Ayn Rand philosophy here. But then again, I'm not her cult follower or whatever.
And then being in this position I also see that the party can't go on forever and probably the day of reckoning will come. Most of these 300k employees wasting their time on BS jobs now, will eventually loose them. Maybe as soon as next year granted the FED raises interest rates substantially.
"I'm a parasite on the sick system because I want it to die. I don't see anything against Ayn Rand philosophy here."
Oh, I agree with you completely. Most of her critics will say that her system is obfuscatory bullshit to distract from the fact that it's no more sophisticated than the plain old selfishness that you see in every preschool. It's just that Randroids don't usually admit that they are societal parasites, so your candor is refreshing.
Also, to be clear, I'm not sure if you're joking about exploiting the banks. Isn't your beef with Congress that they used taxpayer money to bail the banks out? Is it really that hard to see that you're exploiting the taxpayers, too? Don't you see that "the banks" are nothing but a bunch of people just like you, thinking they're not part of the exploitation of the taxpayer?
Well, she just says that people are selfish and following selfishness (your own) in the sphere of economy makes economic sense. You guys have your own delusions, like utopias were people are equal. And if not -- we will put them into reeducation camps, so they don't want to have more than their neighbor anymore. This never worked. What I like about Right is that it takes people as they are, the good, the bad, and the ugly and tries to build the system using what it has at hand. The Left usually expects people to be different than in reality they are. It's good to dream, but exchanging dreams for reality (i.e. utopias) ends up with tyranny. What, they still have private property? Shoot them! Bam, 7 million dead kulaks. What I don't like about Rand philosophy is that it is like the Left in the sense that it is a bit utopian, dream-like. People will go there and vote for nonsense, we need to remember that. We can't get pure capitalism as we can't get pure socialism too. But the important thing to remember is to know how the markets and economy work (Right). And to live and let live others (Left).
Then the rest of your rant really is, like, what do you mean? What did you expect? The government spending to be effective? To have people busy working in zombie banks or unionized companies? Sorry, turns out doesn't work that way. Socialism doesn't work, the only rational thing to do when working at zombie bank and is to put your time to more productive tasks. If a dreamer like you voted for that spending and is ready to spend his tax money on it... who am I to judge it? I'll gladly take it. Sure it is better than sweating 80 hour weeks at productive place like Apple. What did you think? Where Im coming from we have this saying: if someone wants to fight with you, run away. If someone wants to give you something, take it. Thank you! And don't forget to vote for even higher taxes and even more Government spending. 120k/year with all the slacking I do still doesn't get me the Land Rover I wanna have.
And if I can't afford the payment because the bank goes bankrupt next year. Please don't forget to support measures to "distress families with debt"... I mean I didn't want this car, bankers told me to buy it. We did that with housing, why not continue once this bubble pops? Raise taxes, pay even more, so I can still stay at the house I can't afford, driving a car I shouldn't have bought in the first place, all from your tax money already. But you don't care, as you know -- it is all bankers fault!!! - so bail me out brother! ;-)
Must be stinky rich to have this type of philosophy in life.
I'm not sure if I agree with that assessment but I do think that they have the same enemy.
The collusion between big business and big government is the root of the problem that they both rail against.
The Tea Party focuses on the government part and Occupy focused on the business part. They'd be a lot more effective if they focused on their common ground.
Many people in both movements correctly identified that they aligned on some issues -- particularly top-heavy bank bailouts. But, in fact, they generally were and are not on the "same side"; even ignoring for the moment any truth their might be the notion that one or the other movement is largely a front for right- or left-wing establishment interests (which opponents of both have made, more of the TPP being a front for right-wing establishment entities, but sometimes also of Occupy being a front for left-wing establishment entities), its pretty clear that there is a significant ideological divide and that TPP is right-libertarian in its overall ideology and agenda while Occupy, while decidedly less focussed, is more left-wing (spanning, really, from left-libertarian to more traditional democratic socialist).
One can imagine that if the US had a parliamentary system that, at their height of influence, the two movements could have each won seats and ended up in the same coalition because of alignment on issues with transitorily pre-eminent saliency, but the alignment was on a very narrow set of issues that were a very small subset of the issues that members of each movement cared about (and, especially in the TPP case, a very small subset of the issues that the organization as such cared about), and even then the alignment was mostly an alignment about opposition to particular policies rather than on what substantive policies should be in place.
They really aren't on the same side and were mostly orthogonal to each other. Of course, both movements share some common grievances against the government, but the concrete ideas of both groups are just about 100% incompatible.
As a glaring example, consider the Citizen's United case; Occupy supporters would almost unanimously point to the Citizen's United ruling as extremely damaging to American democracy, Tea Party supporters on the other hand overwhelmingly side with the government regarding the treatment of money as speech.
Pick pretty much any issue and you'll find that the two movements bitterly disagree, just about the only thing they can agree on is that the government is corrupt and the country is moving in the wrong direction, but that's a universal platitude that everyone will nod their head at.
> As a glaring example, consider the Citizen's United case; Occupy supporters would almost unanimously point to the Citizen's United ruling as extremely damaging to American democracy, Tea Party supporters on the other hand overwhelmingly side with the government regarding the treatment of money as speech.
Side with the court -- the government (specifically, the Federal Election Commission) was the losing party in Citizen's United, so siding with the government would be the position you ascribe to Occupy, to wit, seeing the ruing as damaging to American democracy.
I think the racism of the Tea Party and the hooliganism of the Occupy movement were deliberately overplayed in the media to keep the two groups from seeing each other as allies.
How can the voters exert punishment when who's even running for office is determined by the amount of money available for campaigning? Even disregarding direct corporate sponsorship, the rich who mostly contribute are still affiliated with the industry & finance sector. Average Joe can vote for puppet A or puppet B. People like Ron Paul, with firm principles, and the means to finance themselves despite sizable opposition, are the rare exception.
Add to that the fact that no ordinary citizen directly voted for the bailouts, how can you blame this on the voter? The problem is not the voter, but the system.
There's nothing stopping you the voter from voting for anyone running, even the person with no monetary support. The fact that you vote for one of the people with the most ads is your failing, not the system's.
> How can the voters exert punishment when who's even running for office is determined by the amount of money available for campaigning?
There are a few issues I have with this statement, hence I decided to slice your post. I hope it is ok. Here is what I can't agree on:
1. From the very sentence above my understanding is that you notice something very important here: is it that in your opinion democracy doesn't work? You see this point you make isn't about capitalism. It's all about Democracy. Your claim here is that (sorry for vulgar interpretation): democracy doesn't work because I see elections after elections that voters vote for guys with most money for the campaign. But that's issue with democracy. Not capitalism. As long as money exists, rich&poor exist -- democracy won't be perfect. I take different view than that on this. I think you need more than just money to kind of "cheat" in democracy. You need stupid populous too. You need dumb people who care just about 6-packs and entitlements. So whoever promises them the most for the vote casted, gets elected. And then that gets funded by cheap credit, forever low interest rates (FED) and public spending. No wonder both parties do the same. This is late stages of democracy though. Not issue with capitalism. Last time I checked capitalism worked fantastic for a country - namely China -- but without the fallacies of democracy.
2. You are not the only one who notices that. US Government noticed that as well. And compared to China, it seems democracy and capitalism aren't as effective as authoritarian system and capitalism. It's not only China. Look at South-East Asia in general. If you ask, why we have more militarization of police, huge prison population, NSA eavesdropping, etc, etc -- it's all about the elites in the US seeing on the example of China that democracy doesn't really work.
3. Another issue with the statement: would you voted for Hitler given he had the most money in elections in 1933 ? Right, democracy isn't idiot-proof. That's the real problem with it. You can't really let 6-pack-joe voting, that's idiotic notion. Again, nothing to do with capitalism.
>Add to that the fact that no ordinary citizen directly voted for the bailouts, how can you blame this on the voter? The problem is not the voter, but the system.
Democratic system that is. Ordinary citizen not knowing how to vote. Poor idiots. Almost like Jews voting for NSDAP. (Sorry, couldn't help myself). Your disbelieve in American voters is mind blowing! The distrust in democracy horrifying!
I don't distrust the American voter in particular, don't worry. Maybe you could say the problem is simply entrenchment.
Voters don't go and seek out candidates with the most money, it's the other way around. Somebody with small funds simply can't reach as many voters as somebody with a huge war chest.
A capitalism where money is the outmost metric doesn't work, just like communism with absolute centralization and discounting all ownership doesn't work. Sidestepping the need for social responsibility, a very important factor, that people tend to ignore, about free market theory is that it's based on the premise that all information is available to you when you make an economic transaction. In that case, the market can be self-regulating. But in reality, this is by a large stretch not the case. Especially in politics.
So there you have a democratic system where money is power to to spew your viewpoint to as many people as possible. The voter doesn't have to be particularly ignorant for this to work, as this subverts the usual social channels. You always have incomplete information about the world, even without the help of politics. Money is an undeniable influence factor. A free market can only work if both sides to a transaction disclose all relevant information, be it money or politics.
My problem with "The System" is that the influence of money (and other hidden factors) is hushed under the table, and thus, in the vein of the previously mentioned free market principles, self-regulation ceases to work, and you have entrenchment.
So that is the dichotomy perpetrated by "pure" capitalism with regards to democracy. If you want money to win, there you have it. Those in power rescued the banks, themselves, effectively, to keep their money and their power, at the cost of the people at the lower rungs being disenfranchised. This has nothing to do with socialist principles.
Coming back to the beginning, the two-party system is already biased towards entrenchment, effectively barring small upstarts from entering politics. The mechanics of how this comes about are subtle and evolutionary enough that nobody notices it until its too late. The system is already too broken (maybe only almost...) to allow reform from within, eg. by the regular mechanism of voting and elections. There is also a huge amount of technical debt from the before the information age, that needs to be shed, as well as legal debt from at least two centuries of evolutionary lawmaking.
TL;DR: reform is needed, but the system is too encubered to let it happen.
Capitalism in crisis is all about reallocating work force from unproductive work at looser companies to do something great at productive companies! That's what bankruptcies are all about. Yes, my bank should be history long time ago. Its assets should be taken over by a bank that didn't make the stupid mistakes. And smart people who avoided those mistakes. This is what the bankruptcy process is about. Then this new CEO that weathered 2008 crisis making his small bank winning party here and taking over assets of bankrupted banks -- would see that nonsense and fire half of the staff. So they can go do something productive! This is how it works in true capitalism. We don't have it though because we believe in socialism. So yep, pay for your zombie bank (and my salary!) because the people who you voted into the office, didn't let the markets work!