The 14 Shortcomings of Capitalism

6 thoughts on “The 14 Shortcomings of Capitalism”

  1. An additional proposal:
    15. Because capitalism is necessarily based on self-interest and competition, it is anti-collaborative at a macro-level (in spite of what conspiracy-theorists would have you believe). As the power of government is subverted in favour of the power of the capitalist corporation, so the likelihood of collaboration around, say, Space Travel or truly Global Issues like Climate Change becomes much less likely.

    1. I agree with your idea that Capitalism is anti-collaborative at a macro-level. It use to be when Leaders of companies had good Christian Morals that government leaders filled that role of collaboration for example when President Kennedy set a national goal of putting a man on the moon. Today with government leaders so focused on their own self interests and not the interests of the nation. I don’t know who can fulfill that role. I am not sure it is up to individual companies to fulfill that role of national leadership. I believe that the US Supreme Court should have never allowed Citizens United to go forward as Corporate Money now has perverted all levels of government and has caused our leaders to adopt this everyman for himself attitude in Congress. No leader in Congress is motivated today to allow an issue before Congress to be resolved quickly because the longer the issue drags on the more lobby money flows in from both sides of the issue to members of Congress who are in a position to effect the outcome. We not only need to fix capitalism but we need to fix How our political system operates. As Corporations have finally succeeded in breaking our political system by the applied use of money.

  2. This list is absurd. Yes, some of these are problems we experience in this country, but you can’t necessarily lay these at the feet of capitalism. We don’t even practice capitalism in this country! Here’s proof:

    1) The Fed attempts to centrally plan the economy by manipulating interest rates, which is directly contributing to rising income inequality. If we were truly capitalist, there would be no Fed and interest rates would be allowed to rise and fall based on the natural availability of lendable capital in the economy. The Fed is the primary reason that the dollar has lost 97% of it’s purchasing power since 1913 – which is a loss of wealth for those who save dollars. It’s also directly responsible for rising income inequality because the new money it creates and injects into the economy benefits the rich and well connected first, who use the money to make themselves wealthier. Once it trickles down into the rest of the economy, it’s robbed the rest of us of our purchasing power. On top of that, the artificially low rates of the past 7 years are robbing savers (like retirees) of their purchasing power for the sake of the big banks. Leftists like to always talk about redistributing wealth, but the Fed is currently redistributing wealth from savers to wealthy banks through it’s policy of low rates!
    2) Too big to fail banks and corporations. If we had true capitalism, GM, Fannie Mae, AIG, etc., would have all gone bankrupt and been liquidated instead of being bailed out by the gov’t. Bailouts are NOT capitalism.
    3) Minimum wage laws. If we had true capitalism we would have wages that rose and fell with the demand for labor. This encourages full employment. Minimum wage laws discourage full employment because it sets an artificially high price on labor. If it’s not worth paying minimum wage for certain jobs, those jobs go out of existence – which is why people don’t get paid to operate elevators anymore, for example.
    4) Cronyism. If we had true capitalism, we would have this system of corporations paying lobbyists big bucks to get laws passed in Congress favorable to their interests. This kind of cronyism creates an uneven playing field and often favors the entrenched and established companies at the expense of new market entrants and consumers.

    We’ve seen an incredible increase in living standards all over the world over the past 100 years. Was that because of socialism or capitalism? Is China becoming wealthier by becoming more communist or by adopting capitalism? Did Japan become the 2nd largest economy in the world (until China took over the 2nd spot) by being socialist or capitalist? What about Venezuela? Why is that nation such a complete failure and dump? It isn’t because it’s capitalist!

    The areas of the world that are most capitalist tend to be wealthiest. The areas of the world that attempt to centrally plan the most tend be poorer. It’s not hard to figure out – the evidence is right in front of us. It wasn’t socialism that created the wealthiest and largest middle class in history in the US during the 20th century.

    The reason socialism utterly fails is because it fails to recognize human nature. It replaces the decisions of the individual with those of a small cabal of central planners who seem to think they know better. People prefer to make their own decisions about their own lives instead of so-called elites making economic decisions for them. Wherever it’s tried, socialism utterly fails. It leads to poverty, misery, corruption, and loss of freedom (look to Venezuela for proof).

    Capitalism is inherently democratic. Instead of central planners making the economic decisions, the decisions are left to the individual participants in the marketplace, who are FREE to make their OWN decisions about what they want to buy and sell. If you value freedom and democracy, socialism should be utterly anathema to you. Capitalism is the ONLY truly democratic economic system – when it’s actually practiced.

  3. You can thank our Political leaders for interest rates where they are. They have run the National Credit card up so high that the only way they can pay the interest is to create inflation to eat away at the debt. The moment that they start to raise interest rates and admit that inflation is out of control they will have to raise interest rates…watch what happens then. Money will get so tight (Because everytime there is a T-bill issuance by the Fed if there are no buyers in the private markets every bank that is a member of the Federal Reserve gets a phone call to let them know what their portion of the issued T-bills they are required by law to purchase that day!

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