Part Four in a finally ending series with which Michael puts the final nail in the coffin containing any hopes of being Facebook Friends with Larry Summers.
Part One: Most Americans are not capitalists. They might want to be capitalists, but no matter how much you, or that hardworking barista, that well paid techno-nerd, small farmer, or gangsta-rapping bank teller may want to be capitalists, you are not capitalists. You are workers.
Part Two: If your car ran like Capitalism -- some days humming along great, other days needing a government tow truck to get it to a shop where the mechanic can only promise more booms and breakdowns after it's "fixed" -- you wouldn't call your car "self-regulating." You'd call it junk.
Part Three: Such blind greed should have been rebelled against decades ago: villagers with torches, workers with hammers, farmers with sickles, let-them-eat-cake capitalist swine chased naked and screaming through the streets, and high paid corporate heads high on sticks held aloft by gleeful children.
What Is Capitalism?
Unregulated, it is a Ponzi Scheme. This is a term that's been tossed around quite a bit recently, and not everyone knows what it is. A Ponzi Scheme is like a Pyramid Scheme: Someone promises a return on an investment ("Give me twenty bucks, and I'll pay you a dividend of one buck each week for a year"). $52 for a $20 investment? How do they do it? (It's a secret! I have special investments that have great returns!) So you give them your money, and when the dividends start rolling in you tell two friends, who rush to be a part of the bonanza, and in turn each of them tell two friends, etc...and, just like that old shampoo commercial, a pyramid grows. But the truth of the Ponzi Scheme is there are no special, ultra-secret investments, or even cleaner, silky hair. The first investors are simply paid off with the money from the later investors, who are in turn paid off with the money of the latest investors. Ponzi Schemes, just like Pyramid Schemes and Multi-Level Marketing Schemes, require an ever-expanding pool of investors to keep going -- which must grow geometrically. (Hence the term "Pyramid.") But when the inflow of cash stops -- and it always does with a Ponzi/Pyramid scheme because at some point you simply can't find enough new people -- the whole thing collapses...normally right after the people who started it have cashed out and flown the coop.
And so it is with the Market. It's all about fast talkers and greedy suckers. A broker says "Hey, I've got a hot property! It'll go through the roof soon!" So a bunch of people buy it, which pushes the price up. Other people see the "value" going up, they want to be part of the bonanza, and when they buy the price goes up even more! Mind you, during all of this frenzied buying the actual company may not have changed at all -- nothing may have actually changed except the Capitalist's manipulation of the public perception of the value of the stock. Then, when the Capitalists think the run is over, they sell. Remember, the Capitalists make money buying low and selling high -- selling you stock after they've driven the price as high as they can. And when they sell, the price starts to drop. Seeing the price go down, other people lose confidence and sell, which makes the "value" go down even more. People who bought high are selling low, and the latecomers are wiped out. It's like when those people at the top of the Pyramid Scheme top out, or the early investors in the Ponzi scheme cash in, leaving everyone else wondering where their money went. The only difference is Capitalism's victims never want to believe that the underlying scheme, Capitalism, is the actual scam.
We were all told real estate values would never go down. Buildings, land, location -- nothing had changed, but suddenly everything had more value, and low interest rates meant this was a chance for everyone to own a piece of the American Dream! Despite the fact that real wages had been going down for thirty years, while prices for everything have gone through the roof, we were all encouraged to buy! It was Bush's "Ownership Society" (remember that?) Buy now, and watch your equity grow! It didn't matter it was a 50-year mortgage you'd die before paying off -- you would have a house that only increased in value, and the Ponzi scheme would have a new stream of cash.
And who were the last invited to this particular round of Ponzi-mania? High-risk loan applicants. Make no mistake, they were a tiny, tiny drop in the actual financial slop pot, but the Capitalist Bankers scanned the financial horizon, and realized they had expanded their pyramid as wide as they could with people who could reliably pay. Again, a Ponzi scheme must grow, or collapse. But finally workers in underpaid, minimum wage America just couldn't even afford the freakishly low payments on monstrously overpriced homes, and the money stopped flowing. Properties were sold, prices dropped, and the whole thing collapsed. There simply wasn't enough money coming in to keep the Ponzi Scheme going. And now, with promises of change and lessons learned, the Capitalists hope all the wannabe Capitalists will blame a few bad players, and not notice it was the Scheme itself that caused the misery. And after the bailouts and pardons, they hope they can start it all over again.
Didn't we go over this? No, no it doesn't! And despite what Obama, Clinton, Summers, or any of these brilliant fools think , it cannot be fixed. It's like bailing out a boat that has proven itself no longer seaworthy, and repeatedly sinks. Capitalism was created in a different age, to solve different problems. It did it's job, but society has evolved past it, and it cannot be "fixed" to catch up with our current needs.
It doesn't work anymore. Not by itself.
Here's the thing: we now live in a three-part society.
One aspect is Capitalist: people with money making investments in companies that produce consumer goods and services. (Michael says this while checking out the new Huffington Post app on his for-profit produced iPod Touch!)
One aspect is Socialist: Commonly owned resources -- parks, schools, libraries, clean air, clean water, etc., and commonly provided services -- education, law enforcement, etc., which we collectively pay for and provide for ourselves. (Michael takes a deep breath of federally regulated, cleaner-then-it-would-be-if-left-up-to-Wall-Street air.)
One aspect Communist: Self/Worker owned businesses. (Remember -- all that Stalinist shit wasn't communism. That was Totalitarianism, mixed with "For the People" slogans. Communism simply means the workers own the means of production, and Marx said the Communism without Democracy was unthinkable. Michael thinks Stalin was a punk who gave every worker-owned barbershop or art collective a bad name.)
The big problem of modern societies has been the battle between each of these important aspects for primacy. It's like the movie "Highlander," and the life and death struggle between immortals because "There can be only one!" The battle between Unregulated Capitalism vs. State Socialism vs. the Dictatorship of the Proletariat. Some countries have worked towards a balance, but in the United States Capitalists have fought long and hard against common ownership of anything (except their debts), and in the 1980s the Free Market Zealots started going freaky maniacal against anything that did not turn a profit.
The fact is we all slide fairly effortlessly between each of these seemingly incompatible economic systems each day. We check our Capitalist 401(k)s while driving down publicly financed streets to get our kids to our essentially Socialist schools before we go to the Communist owner-operated/worker owned coffee shop on our way to a corporate cubicle. Even the biggest Capitalists in the country, who blast Federal spending on services, rely on the Socialist network of roads, schools, environmental protections to keep their workers or consumers from rising up in rebellion. What we need, and the only salvation for our society, economy, and our children's future is to stop the battle, and create a new system in which each of these philosophies is responsible for its aspect: A well-regulated market to generate investment in innovation, a government big enough to provide all the services (and that includes Health Care, Transportation, Energy, and Basic Nutrition) a modern society needs for life, liberty, and the pursuit of happiness, and an intercommunal spirit of worker-ownership and responsibility.
How about CapiCommieSocialism? The cool thing is you can put them in any order, which ever you prefer. CommuSocialCapitalism! SocialCapiCommunism! Your turn! The point is we need and use all three all the time. The Stock Market should never be the dominant factor in any nation's economy - it should be a component. A limited, regulated market has it's place, but that place cannot be at the front.
What Is Capitalism?
It is a system of investment in which profit is shared among those who invest their Capital, while those who invest their Labor are considered an unfortunate cost.
What Is Capitalism?
It's the siren song of the Free Marketeers, who've repeatedly crashed our Ship of State on the rocks of Capitalist Greed. And each time the Captains of Wall Street have struck up a new song, convincing the surviving galley slaves to rebuild the ship with their own money and row again -- row -- as they sit in filth, row -- as their homes sink, row -- as their children starve, row -- to a fantasy tomorrowland where all their suffering and sacrifice will be forgotten because they, too, will share in the Capitalist Dream!
What Is Capitalism?
It is a bankrupt casino. And if we bail it out, try to "fix" it without evolving it to our actual needs, our country will be saddled with it's lies, crimes, and mob bosses until it breaks down again, next time sucking the money out of our children's economy.
What Is Capitalism?
As the dominate force in the economy, it is a failure. Milton Friedman was wrong, and I hope somewhere Karl Marx is sitting on Friedman's creaky chest, flicking beard fleas into Milton's dry, cracked piehole. I'm not saying we should spit Capitalism out like the mouthful of rabid maggots it clearly is... okay, I kinda am saying that. But I'm also saying we need first to understand and acknowledge it's failures before we can start to create a new system that addresses the needs of the working many rather than the Capitalist few. Then we need to move on.