The Degeneracy of Today's "Capitalism"

Paul Farrell:

“The world is in a state of drift, transition or even increasing chaos,” writes Brent Scowcroft in the recent National Interest. Scowcroft’s a retired Air Force General and Bush-41 National Security Adviser.

In an update to his 1998 book, “A World Transformed,” Scowcroft says, “once we were viewed as trying to do our best for everyone: now we are seen a being preoccupied with our own special interests,” a myopic vision that reflects the trend among many politicians to govern using Ayn Rand’s extreme capitalism.

Now you know why Grantham warns of capitalism’s total lack of “ethics or conscience” and “its absolute inability to process the finiteness of resources and the mathematical impossibility of maintaining rapid growth in physical output.”

No moral compass. No vision of the future. No grasp of the consequences of their short-term thinking. These three threats are merging into a critical mass that will trigger a scenario that will “bring capitalism down and America with it.”

Bottom line: America’s new Ayn Rand style of extreme capitalism is self-destructive.

For Capitalism to be effective, capital transfer must be a two-way street.  Labor has to be rewarded for its input.  Without the enlightened self-interest shown in realizing that one's employees need to be able to spend enough money to make demand for one's products increase, capitalism will fail.  Also, it doesn't help the cause that fractional reserve banking and ridiculously low interest rates make capital less valuable (which undermines the importance of the capital), and, even according to neoclassical economists (who get very few things right) this will lead to very inefficient investment (bubbles and chasing yield).  Those inefficient investments end up undermining the claim that markets are always right.  Hell, if you listen to capitalists and Republicans, they'll occasionally tell you that a government-controlled "Communist" economy like China is better than a regulated free market like the developed world.  With friends like these, does capitalism need enemies?