The Problem With Capitalism

The problem with capitalism is that it doesn't exist.  Perhaps it never truly has.  By making this argument, I run the risk of coming perilously close to sounding like the purists of communism who will make the same argument, and I suppose that when it comes to capitalism, I am purist, but in truth, I am a purist in language.  Martin Heidegger once asserted that we do not speak language, that language speaks us, and while there is plenty of evidence to support this truism, it is hardly the truth.  We can all fall prey to language speaking us, and us not speaking language, but we should never accept this flaw as being one of the natural problems of language, or of humanity.  We are all more than capable of speaking language and not allowing that language to speak us.  It requires due diligence, and plenty of critical thought, but we are no less capable of such efforts. 

If we are to speak language, not allow it to speak us, then it becomes necessary to clearly define the words we use in the language we speak.  The modern proclivity - at least in terms of the English language - is to use words as if they are pliable and can take on multiple meanings.  Such a proclivity tends to pollute the lexicon and undermine the very purpose of language, which would be to communicate clearly.  The word "capitalism" is just one such example.   When we are speaking language  words mean what they mean and A is A.  When language is speaking us words mean whatever the speaker means by them, whatever that means.  When people use the word "capitalism" it is rarely clear what they mean by that word. 

The problem with capitalism is not a problem with the economic system known as capitalism, it is a problem with the way we allow language to speak us.  This problem gets so bad that when the inevitable confusion that will surely follow arrives, instead of correcting the problem by clearly defining what we mean by using appropriate words, we complicate the problem even further by qualifying the word we are using inappropriately, as if one inappropriate action will cancel out the other.   Thus, we hyphenate capitalism to clarify what we mean.  People reading this will surmise that what I am speaking to is a "laissez faire - capitalism" as opposed to a "Keynesian - capitalism", or incredibly as opposed to corporatism.  Yet both "Keynesian - capitalism" and corporatism are very much considered to be capitalism.  Neither are, but this doesn't matter in today's vague and meaningless lexicon. 

What then is capitalism?  In its simplest terms, capitalism is an economic system where a free and unregulated market place allows for massive competition to flourish, and a form of currency backed by actual wealth is used so that buyer and seller alike have a convenient means of exchange that all parties can agree upon its value.   A free and unregulated market, massive competition, and a currency backed by real wealth used as the means of exchange.  In the United States today, and arguably since this nations very beginning, capitalism is nonexistent.  The United States does not have a free and unregulated market, massive competition is disappearing year after year under the heavy burden of corporatism, and the U.S. dollar is a fiat currency not backed by wealth at all.

Under an actual free and unregulated market, as opposed to the presumed "free market" in the U.S., licensing schemes would be nonexistent.  Under an actual free and unregulated market much of the so called "alphabet agencies", such as the FDA, the USDA, the FCC, the FAA, the EPA, and so on, would be virtually nonexistent.  Under a genuine free and unregulated market, massive competition would carry the day and not just be an ideal that politicians pay lip service to.  Of course, many will take my assertions and declare; "But that's the problem with capitalism!"  They will lecture on how without licensing schemes people are in danger of all types of ills, including threats to their very lives, and those lecturing us on this hypothetical will ignore the fact that in reality under a heavily regulated marketplace where professionals are regularly licensed people remain in danger of all types of ills, including threats to their very lives.  One of the best kept secrets in the United States is that iatrogenocide (death by doctoring - licensed professionals) is the third leading cause of death in the U.S.

Iatrogenocide is just one example of the complete failure of licensing schemes and regulation to do what it purports to do.  Under regulation, greed is still greed, poorly made products remain poorly made products, and potential health problems remain potential health problems, and the beauty of all this regulation is that it is government regulation, a monopoly that insists on immunity from its own failures.  Under a free and unregulated marketplace buyers have the option of buying goods and services from the sellers they perceive to be the best.  If a seller develops a reputation for not delivering on his promise, chances are, under a free and unregulated market, his business will fail.  When the government develops a reputation for not delivering on their promise, we shrug our shoulders and declare it politics as usual.  Under the heavily regulated marketplace of today, when a business begins to fail because of their failure to deliver on their promise, if that business is a corporation, government declares them "too big to fail" and bails them out. 

Ah, but the detractors of capitalism will point out that it was "deregulation" that led to the corporate bailouts.  This is nothing more than smoke and mirrors, of course.  The anti-capitalist crowd will use the term deregulation as if it is a shining example of all that is wrong with no regulation, as if deregulation could be equated to a free and unregulated marketplace.  Deregulation, by definition, means that regulation exists.  Deregulation becomes a sort of Orwellian language and is very much in line with the proclivity towards a vague lexicon.  Deregulation is not unregulated, it is merely a relaxing of certain regulatory rules.  However, this is not the only effect of the smoke and mirrors parlor trick of using deregulation to demonize capitalism, the greatest trick lies in its simple deflection.  It was not deregulation that led to government bailouts.  Regulated, or "deregulated", government is under no obligation to bail out a failed company. 

Of course, government knows full well it is under no obligation to bail out a failed company, and small to mid-sized businesses fail every day and the government feels no compunction to step in bail them out.  Indeed, small to mid-sized companies that make the mistake of incorporating very well may discover how quickly government is willing to revoke that charter of incorporation for the slightest of offense, but the corporate malfeasance of a major corporation will rarely - if ever - result in charter revocation, as the symbiosis between the government that created this artificial entity we call the corporation, and the corporation itself is a match made in hell.  Government stands to gain much revenue from corporate malfeasance through fines.  Yet, the anti-capitalist will point to this hellish relationship and declare this is what is wrong with capitalism! 

Corporatism is not capitalism.  Keynesian capitalism is not capitalism, and calling capitalism "laissez faire capitalism" is akin to calling redundancy repetitive redundancy.  Expert after expert will put great effort into explaining all that is wrong with capitalism, but the real problem with capitalism is clear.  The problem with capitalism is that it just does not exist.