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Continuation of an 8-Part Series
Part 1 -
Rethinking Capitalism
R.E. Slater
August 4, 2020
My own politics are generally informed by the desire to live in a ‘good’ society. I’m pretty casual about what ‘good’ means, precisely: some kind of pluralist satisficing compromise borne of reflective equilibrium. Most of us want a society that is free, genuinely meritocratic, absent egregious social strife and inequality (for basic Rawlsian reasons), with just laws and a representative government and opportunities to develop one’s talents and interests without too much interference. - Nicholas McGinnis
I recently completed a post on Extreme Capitalism as expressed by the Objectivist author Ayn Rand through her books, literature, articles, and treatises (Parts 1 & 2 linked above). Today, I'd like to look at another kind of Capitalism other than those which are hedonistic or materialistic or predatory.
When travelling America, one will find both macro- and micro-expressions of capitalism as expressed within a variety of businesses and city/county governments in shared complexity within their diverse business and ethnic cultures.
When travelling America, one will find both macro- and micro-expressions of capitalism as expressed within a variety of businesses and city/county governments in shared complexity within their diverse business and ethnic cultures.
As a Christian, I would prefer the kind of capitalism that encourages, aides, educates, and networks the common laborer towards personal and family success. This type of investment would necessarily include common courtesy, other-mindedness, respect, honest dealing and trading, lawful transactions without seeking harm or any other form of injustice. It would also include sharing wealth with workers and their communities providing a general uplift to all nearby. I suppose we might call this a form of generous capitalism which is benevolent.
Then there is another form of capitalism I would like to encourage which is mostly unknown and just beginning to be thought about. Its a form of capitalism which might take all the best of a generous capitalism and blend it with social justice into an economy one might describe as an "ecological society."
A society which exercises restoration of nature in various efforts of earthcare and earth justice. A society, or civilization, which might do away with currency of any form and trade in energy credits and debits. A society which might become global. And finally a society which justly lifts up all humanity even as it is lifting up the world's polluted environments.
A society which exercises restoration of nature in various efforts of earthcare and earth justice. A society, or civilization, which might do away with currency of any form and trade in energy credits and debits. A society which might become global. And finally a society which justly lifts up all humanity even as it is lifting up the world's polluted environments.
And lastly, we have a catch-all kind of capitalism known as laissez faire capitalism which seeks transactions between parties to have as little interference from outside powers and institutions as possible. Interference such as federal, state, local, school, and community taxation; rules and regulations restricting forms of investment arrangements; taxing subsidies, tariffs, and etc; and basically allowing markets to run without some form of intervention. In a way, this kind of capitalism could be thought of as a Darwinian form of economics.
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| Rethinking the Diversity and Varieties of Capitalism: on Variegated Capitalism in the World Market |
Wikipedia - Laissez-faire (/ˌlɛseɪˈfɛər/; French: [lɛsefɛʁ]; from French: laissez faire, lit. 'let do') is an economic system in which transactions between private parties are absent of any form of economic interventionism such as regulation and subsidies. As a system of thought, laissez-faire rests on the axioms that the individual is the basic unit in society and has a natural right to freedom; that the physical order of nature is a harmonious and self-regulating system; and that corporations are creatures of the state and therefore the citizens must watch them closely due to their propensity to disrupt the Smithian spontaneous order.
These axioms constitute the basic elements of laissez-faire thought. Another basic principle holds that markets should be competitive, a rule that the early advocates of laissez-faire always emphasized. With the aims of maximizing freedom and of allowing markets to self-regulate, early advocates of laissez-faire proposed a impôt unique, a tax on land rent to replace all taxes that they saw as damaging welfare by penalizing production.
Proponents of laissez-faire argue for a complete separation of government from the economic sector. The phrase laissez-faire is part of a larger French phrase and literally translates to "let [it/them] do", but in this context the phrase usually means to "let it be". Laissez-faire capitalism started being practiced in the mid-18th century and was further popularized by Adam Smith's book The Wealth of Nations. It has been most prominent in Britain and the United States in the 19th century. While associated with capitalism in common usage, there are also non-capitalist forms of laissez-faire, including some forms of market socialism.
After the article by Umair directly below there will be found the many other forms of capitalism with explanation. Following today's post I wish to nuance my thoughts a bit further building on posts 1 and 2 towards posts 4, 5, and 6. By post 6 I can begin leaning into a replacement economy for what we see presently in our postmodern era as it clashes into the Trumpian era of post-postmodernism consisting of post-truth elements, chaos, and anarchy.
Peace,
R.E. Slater
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Economists, political economists, sociologists, and historians have adopted different perspectives in their analyses of capitalism and have recognized various forms of it in practice. These include laissez-faire or free-market capitalism, welfare capitalism, and state capitalism. Different forms of capitalism feature varying degrees of free markets, public ownership,[9] obstacles to free competition, and state-sanctioned social policies. The degree of competition in markets, the role of intervention and regulation, and the scope of state ownership vary across different models of capitalism.[10][11] The extent to which different markets are free as well as the rules defining private property are matters of politics and policy. Most of the existing capitalist economies are mixed economies that combine elements of free markets with state intervention and in some cases economic planning.[12]Capitalism is an economic system based on the private ownership of the means of production and their operation for profit.[1][2][3][4] Central characteristics of capitalism include private property and the recognition of property rights, capital accumulation, wage labor, voluntary exchange, a price system and competitive markets.[5][6] In a capitalist market economy, decision-making and investments are determined by every owner of wealth, property or production ability in financial and capital markets whereas prices and the distribution of goods and services are mainly determined by competition in goods and services markets.[7][8]
Market economies have existed under many forms of government and in many different times, places, and cultures. Modern capitalist societies—marked by a universalization of money-based social relations, a consistently large and system-wide class of workers who must work for wages, and a capitalist class which owns the means of production—developed in Western Europe in a process that led to the Industrial Revolution. Capitalist systems with varying degrees of direct government intervention have since become dominant in the Western world and continue to spread. Over time, all capitalist countries have experienced consistent economic growth and an increase in the standard of living.[13]
Critics of capitalism argue that it establishes power in the hands of a minority capitalist class that exists through the exploitation of the majority working class and their labor; it prioritizes profit over social good, natural resources and the environment; and it is an engine of inequality, corruption and economic instabilities. Supporters argue that it provides better products and innovation through competition, promotes pluralism and decentralization of power, disperses wealth to people who are able to invest in useful enterprises based on market demands, allows for a flexible incentive system where efficiency and sustainability are priorities to protect capital, creates strong economic growth and yields productivity and prosperity that greatly benefit society.
[Excerpt]
Types of Capitalism
There are many variants of capitalism in existence that differ according to country and region. They vary in their institutional makeup and by their economic policies. The common features among all the different forms of capitalism is that they are predominantly based on:
- the production of goods and services for profit,
- the market-based allocation of resources, and
- the accumulation of capital.
ADVANCED
Main article: Advanced capitalism
Advanced capitalism is the situation that pertains to a society in which the capitalist model has been integrated and developed deeply and extensively for a prolonged period. Various writers identify Antonio Gramsci as an influential early theorist of advanced capitalism, even if he did not use the term himself. In his writings, Gramsci sought to explain how capitalism had adapted to avoid the revolutionary overthrow that had seemed inevitable in the 19th century. At the heart of his explanation was the decline of raw coercion as a tool of class power, replaced by use of civil society institutions to manipulate public ideology in the capitalists' favour.[119][120][121]
Jürgen Habermas has been a major contributor to the analysis of advanced-capitalistic societies. Habermas observed four general features that characterise advanced capitalism:
Main article: Advanced capitalism
Advanced capitalism is the situation that pertains to a society in which the capitalist model has been integrated and developed deeply and extensively for a prolonged period. Various writers identify Antonio Gramsci as an influential early theorist of advanced capitalism, even if he did not use the term himself. In his writings, Gramsci sought to explain how capitalism had adapted to avoid the revolutionary overthrow that had seemed inevitable in the 19th century. At the heart of his explanation was the decline of raw coercion as a tool of class power, replaced by use of civil society institutions to manipulate public ideology in the capitalists' favour.[119][120][121]
Jürgen Habermas has been a major contributor to the analysis of advanced-capitalistic societies. Habermas observed four general features that characterise advanced capitalism:
- Concentration of industrial activity in a few large firms.
- Constant reliance on the state to stabilise the economic system.
- A formally democratic government that legitimises the activities of the state and dissipates opposition to the system.
- The use of nominal wage increases to pacify the most restless segments of the work force.[122]
CORPORATE
Main article: Corporate capitalism
See also: Crony capitalism and State monopoly capitalism
Corporate capitalism is a free or mixed-market capitalist economy characterized by the dominance of hierarchical, bureaucratic corporations.
FINANCE
Main article: Finance capitalism
See also: Capitalist mode of production (Marxist theory)
Finance capitalism is the subordination of processes of production to the accumulation of money profits in a financial system. In their critique of capitalism, Marxism and Leninism both emphasise the role of finance capital as the determining and ruling-class interest in capitalist society, particularly in the latter stages.[123][124]
Rudolf Hilferding is credited[by whom?] with first bringing the term finance capitalism into prominence through Finance Capital, his 1910 study of the links between German trusts, banks and monopolies—a study subsumed by Vladimir Lenin into Imperialism, the Highest Stage of Capitalism (1917), his analysis of the imperialist relations of the great world powers.[125] Lenin concluded that the banks at that time operated as "the chief nerve centres of the whole capitalist system of national economy".[126] For the Comintern (founded in 1919), the phrase "dictatorship of finance capitalism"[127] became a regular one.
Fernand Braudel would later point to two earlier periods when finance capitalism had emerged in human history—with the Genoese in the 16th century and with the Dutch in the 17th and 18th centuries—although at those points it developed from commercial capitalism.[128][need quotation to verify] Giovanni Arrighi extended Braudel's analysis to suggest that a predominance of finance capitalism is a recurring, long-term phenomenon, whenever a previous phase of commercial/industrial capitalist expansion reaches a plateau.[129]
FREE-MARKET
Main article: Free-market capitalism
See also: Laissez-faire
A capitalist free-market economy is an economic system where prices for goods and services are set entirely by the forces of supply and demand and are expected, by its adherents, to reach their point of equilibrium without intervention by government policy. It typically entails support for highly competitive markets and private ownership of the means of production. Laissez-faire capitalism is a more extensive form of this free-market economy, but one in which the role of the state is limited to protecting property rights. In anarcho-capitalist theory, property rights are protected by private firms and market-generated law. According to anarcho-capitalists, this entails property rights without statutory law through market-generated tort, contract and property law, and self-sustaining private industry.
MERCANTILE
Main article: Mercantilism
See also: Protectionism
Mercantilism is a nationalist form of early capitalism that came into existence approximately in the late 16th century. It is characterized by the intertwining of national business interests with state-interest and imperialism. Consequently, the state apparatus is utilized to advance national business interests abroad. An example of this is colonists living in America who were only allowed to trade with and purchase goods from their respective mother countries (e.g. Britain, France and Portugal). Mercantilism was driven by the belief that the wealth of a nation is increased through a positive balance of trade with other nations—it corresponds to the phase of capitalist development sometimes called the primitive accumulation of capital.
SOCIAL
Main article: Social market economy
See also: Nordic model
A social market economy is a free-market or mixed-market capitalist system, sometimes classified as a coordinated market economy, where government intervention in price formation is kept to a minimum, but the state provides significant services in areas such as:
Main article: Corporate capitalism
See also: Crony capitalism and State monopoly capitalism
Corporate capitalism is a free or mixed-market capitalist economy characterized by the dominance of hierarchical, bureaucratic corporations.
FINANCE
Main article: Finance capitalism
See also: Capitalist mode of production (Marxist theory)
Finance capitalism is the subordination of processes of production to the accumulation of money profits in a financial system. In their critique of capitalism, Marxism and Leninism both emphasise the role of finance capital as the determining and ruling-class interest in capitalist society, particularly in the latter stages.[123][124]
Rudolf Hilferding is credited[by whom?] with first bringing the term finance capitalism into prominence through Finance Capital, his 1910 study of the links between German trusts, banks and monopolies—a study subsumed by Vladimir Lenin into Imperialism, the Highest Stage of Capitalism (1917), his analysis of the imperialist relations of the great world powers.[125] Lenin concluded that the banks at that time operated as "the chief nerve centres of the whole capitalist system of national economy".[126] For the Comintern (founded in 1919), the phrase "dictatorship of finance capitalism"[127] became a regular one.
Fernand Braudel would later point to two earlier periods when finance capitalism had emerged in human history—with the Genoese in the 16th century and with the Dutch in the 17th and 18th centuries—although at those points it developed from commercial capitalism.[128][need quotation to verify] Giovanni Arrighi extended Braudel's analysis to suggest that a predominance of finance capitalism is a recurring, long-term phenomenon, whenever a previous phase of commercial/industrial capitalist expansion reaches a plateau.[129]
FREE-MARKET
Main article: Free-market capitalism
See also: Laissez-faire
A capitalist free-market economy is an economic system where prices for goods and services are set entirely by the forces of supply and demand and are expected, by its adherents, to reach their point of equilibrium without intervention by government policy. It typically entails support for highly competitive markets and private ownership of the means of production. Laissez-faire capitalism is a more extensive form of this free-market economy, but one in which the role of the state is limited to protecting property rights. In anarcho-capitalist theory, property rights are protected by private firms and market-generated law. According to anarcho-capitalists, this entails property rights without statutory law through market-generated tort, contract and property law, and self-sustaining private industry.
MERCANTILE
Main article: Mercantilism
See also: Protectionism
Mercantilism is a nationalist form of early capitalism that came into existence approximately in the late 16th century. It is characterized by the intertwining of national business interests with state-interest and imperialism. Consequently, the state apparatus is utilized to advance national business interests abroad. An example of this is colonists living in America who were only allowed to trade with and purchase goods from their respective mother countries (e.g. Britain, France and Portugal). Mercantilism was driven by the belief that the wealth of a nation is increased through a positive balance of trade with other nations—it corresponds to the phase of capitalist development sometimes called the primitive accumulation of capital.
SOCIAL
Main article: Social market economy
See also: Nordic model
A social market economy is a free-market or mixed-market capitalist system, sometimes classified as a coordinated market economy, where government intervention in price formation is kept to a minimum, but the state provides significant services in areas such as:
- social security,
- health care,
- unemployment benefits, and
- the recognition of labor rights through national collective bargaining arrangements.
Rhine capitalism is the contemporary model of capitalism and adaptation of the social market model that exists in continental Western Europe today.
STATE
Main article: State capitalism
State capitalism is a capitalist market economy dominated by state-owned enterprises, where the state enterprises are organized as commercial, profit-seeking businesses. The designation has been used broadly throughout the 20th century to designate a number of different economic forms, ranging from state-ownership in market economies to the command economies of the former Eastern Bloc. According to Aldo Musacchio, a professor at Harvard Business School, state capitalism is a system in which governments, whether democratic or autocratic, exercise a widespread influence on the economy either through direct ownership or various subsidies. Musacchio notes a number of differences between today's state capitalism and its predecessors. In his opinion, gone are the days when governments appointed bureaucrats to run companies: the world's largest state-owned enterprises are now traded on the public markets and kept in good health by large institutional investors. Contemporary state capitalism is associated with the East Asian model of capitalism, dirigisme and the economy of Norway.[130] Alternatively, Merriam-Webster defines state capitalism as "an economic system in which private capitalism is modified by a varying degree of government ownership and control".[131]
In Socialism: Utopian and Scientific, Friedrich Engels argued that state-owned enterprises would characterize the final stage of capitalism, consisting of ownership and management of large-scale production and communication by the bourgeois state.[132] In his writings, Vladimir Lenin characterized the economy of Soviet Russia as state capitalist, believing state capitalism to be an early step toward the development of socialism.[133][134]
Some economists and left-wing academics including Richard D. Wolff and Noam Chomsky, as well as many Marxist philosophers and revolutionaries such as Raya Dunayevskaya and C.L.R. James, argue that the economies of the former Soviet Union and Eastern Bloc represented a form of state capitalism because their internal organization within enterprises and the system of wage labor remained intact.[135][136][137][138][139]
The term is not used by Austrian School economists to describe state ownership of the means of production. The economist Ludwig von Mises argued that the designation of state capitalism was simply a new label for the old labels of state socialism and planned economy and differed only in non-essentials from these earlier designations.[140]
The debate between proponents of private versus state capitalism is centered around questions of managerial efficacy, productive efficiency and fair distribution of wealth.
WELFARE
Main article: Welfare capitalism
See also: Economic interventionism and Mixed economy
Welfare capitalism is capitalism that includes social welfare policies. Today, welfare capitalism is most often associated with the models of capitalism found in Central Mainland and Northern Europe such as the Nordic model, social market economy and Rhine capitalism. In some cases, welfare capitalism exists within a mixed economy, but welfare states can and do exist independently of policies common to mixed economies such as state interventionism and extensive regulation.
A mixed economy is a largely market-based capitalist economy consisting of both private and public ownership of the means of production and economic interventionism through macroeconomic policies intended to correct market failures, reduce unemployment and keep inflation low. The degree of intervention in markets varies among different countries. Some mixed economies such as France under dirigisme also featured a degree of indirect economic planning over a largely capitalist-based economy.
Most modern capitalist economies are defined as mixed economies to some degree.
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The Origins of America’s Unique and Spectacular Cruelty
https://eand.co/the-origins-of-americas-unique-and-spectacular-cruelty-74a91f53ce29
What Happens When Societies Don’t Invest in Civilizing Themselves?
by Umair Haque
June 1, 2018
A friend, recently, told me a very interesting and telling story. She’d recently been in the States, where she was taking the subway to work, and she fell down, injuring her wrist. Not a single person helped her up — they all stared at her angrily as if to say: “you are going to make us late for work!!”. (Ironically, the train was full of doctors, nurses, and healthcare workers).
She contrasted that with London — where, the last year, when she’d broken a limb, and had a cast on, people would regularly, and very courteously, give up their seats on the tube.
It’s a tiny example. And perhaps you will say it’s just a meaningless anecdote. But by now, American cruelty is both legendary — and one of the world’s great unsolved mysteries. Just why would people in a rich country leave their neighbours to die for a lack of basic medicine, their young without good jobs or retirements, make their elderly work until their dying day, cripple students with lifelong debt, charge new mothers half of average income just to have a baby — not to mention shrug when their kids begin massacring each other at school? What motivates the kind of spectacular, unique, unimiaginable, and gruesome cruelty that we see in America, which exists nowhere else in the world?
See that pic above? It’s kids huddling under bulletproof blankets, doing “active shooter drills”. That’s what I mean by “unique and spectacular cruelty”. No kid should — ever — have to be traumatized and victimized like that, and indeed, even kids in Pakistan and Iran aren’t.
(And no, I don’t mean “all Americans”. I just mean something like “more” or maybe “enough”, if you want to think statistically, that the distribution of cruelty has fatter tails and a higher peak.)
My answer goes something like this. Americans, you must remember, grew up in the shadow of endless war. With two “sides” who championed atomic individualism, lionized competition and brutality, and despised weakness and fragility. And thus, America forgot — or maybe never evolved — the notion of a public interest. Each man for himself, everyone against everyone himself. So all there is left in America is extreme capitalism now. Few championed a more balanced, saner, healthier way of life, about a common good, about virtue, about a higher purpose. And in that way, America has become something like, ironically enough, a mirror image of its great enemy, the Soviet Union. It is a totalist society, run by and for one end — only a slightly different one: money.
That created a society in which there is no real opportunity to cultivate, nurture, or develop kindness or gentleness, which as we will see, are qualities, that a society needs to invest in, too. The American economy is extreme capitalism, through and through. For example, in other rich countries, at least half the economy is not for profit, sometimes more. But in America, it’s just a few percent. So American life is made mostly only of the values of predatory capitalism now — bruising competition, domination, greed, punishment, discipline, cunning, ruthlessness, egotism. We might call them malignantly narcissistic values. But when the sole end of all thought, action, and effort is making money, even at the detriment of others, what else can exist?
Hence, today, there is almost no sphere or arena of American life in which the values of predatory capitalism don’t predominate or monopolize. Because society is made up more or less only of predatory capitalism, only those values can ever be expressed. Not even in, say, media, not healthcare, not education — which, in other rich countries, because they are not run for profit, are arenas in which softer and gentler qualities can be expressed, like decency, reason, dignity, purpose, meaning, belonging, truth, care, mercy.
But because most of America is now managed by and predatory capital — even its healthcare, media, and education — there is little room, space, opportunity, chance to discuss and suggest and educate people about higher ideals, values, and purposes. For example, on the BBC, I can watch endless documentaries by academics on everything from Renaissance art to French literature — but in America, I’m stuck with Ancient Aliens, poverty porn, police-state reality shows. What is that going to teach me, show me, induce in me — except ignorance, paranoia, resentment, and spite?
The result is a kind of impoverishment we don’t often discuss. A lack, or deficit, of civilizing mechanisms. You see, in other countries, things like media, healthcare, and education, do more than just “provide a service”. Because they’re public goods, are also things that bind people together, connect them with history, bring out their better selves — not just their inner predator. Through them, by treating each other with care and respect as we share them, we learn what it is to be gentle, civilized. They educate us, in that way, about what is to be kind.
Remember my Tube story? Americans don’t often know this unwritten code of conduct — give your seat up to an elderly or injured person. But the Brits pride themselves on it. Now, such codes evolve best and most where there are public goods — because people need to develop ways to share them fairly. So on the Tube, we give up our seats, to make it work for everyone, because it belongs to everyone. We learn, and enact, a kind of tiny but mighty moral lesson in this way. It’s a little but beautiful thing, that almost invisible civilizing mechanism.
Now imagine that everything in a society is run by and for the rules of predatory capitalism. Everything. What reason is there to treat anyone with decency, respect, fairness, dignity? You don’t give up your first-class airline seat to an old woman if you’re an aspiring hedge fund asshole, do you? Why would you? So there’s little need for such norms and codes of gentleness and kindness to develop, evolve, and grow unless a society has public goods. In econ-parlance, we’d say that an “positive externality” of public goods is that they are civilizing mechanisms, which produce norms and codes of gentlenss and kindness and respect and dignity.
But the reverse is also true: a purely capitalist society will never really learn how to be civilized. It’s institutions will all be “profit centers” — but none will evolve to be civilizing mechanisms, which teach people how to cooperate, respect one another, treat one another with dignity.
So if most everything is purely capitalist, a society cannot really invest in gentleness and kindness. The only lesson that people will really learn is that their neighbours and peers, young and old, are commodities. Things. Objects. Means. To be used, abused, and discarded, the moment that they are no longer profitable. But no one will give up their seat when anyone else falls down — because that requires a higher set of values: empathy, courage, imagination, grace, mercy, humility.
Those things, those great virtues, do not really exist in America anymore, except maybe in church sermons, which is to say, not in the real world. So when we speak of American cruelty, we are really speaking about a lack of civilizing mechanisms, which encode, normalize, sustain, and nurture higher values, or enduringly good human qualities, however you want to put it. These things which define the best in us. Nobility, truth, beauty, justice, service, if you would like me to add to the list above.
Americans seem to have forgotten that these things, these life-giving and life-changing virtues, exist at all — and that they must be, like anything else in society, nurtured and invested in, if we wish them to exist. And the strange thing is that no one appears able to teach them, certainly not me: they don’t have to live like that.
- Umair
