Galbraith on Taming Predatory Capitalism

[malaise]

http://www.thenation.com/doc/20060417/forum/4

The nation has a great series of articles here.
<snip>
The predators are everywhere unleashed; and the institutions built to contain them, from the United Nations to the AFL-CIO to the SEC, are everywhere under siege. Predation has again become the defining feature of economic life. Our first problem is to grasp this reality in full.

Corporate and financial fraud and political corruption form the second great domain of predatory capitalism. DeLay, Frist and Abramoff are the names in the news, but the tone is set by the leadership--Cheney of Halliburton and Bush of Harken Energy--a large predator and a small scavenger, specialists in cronyism and expert in nothing else. When predation becomes the dominant business and political form, the foundation of capitalism crumbles. Markets lose legitimacy, investors fly to safety in bonds, and authentic innovation and shared growth both become unattainable. The solution must be not just a change of parties but a new political class, including a new media not under corrupt control.


Then there is the predatory attack on unions and labor, in which many economists are complicit. This is far advanced in America and most visible today in Europe, as reflected by the doctrine of flexible labor markets, which claims that the conquest of unemployment requires cutting the pay of the working poor. But there is no history of unemployment ever being conquered this way--certainly not in the United States of the 1940s, 1960s or 1990s. Modern Europe also affords counterexamples of equalizing growth, from Norway and Denmark to recent gains in Spain, as well as object lessons, most recently in France, of the catastrophe of designed exclusion.

[The Backlash Cometh]

1. Predatory capitalism = chaos economics = free market = Libertarians

[dcfirefighter]

2. Oversimplified

There are libertarians would require entities to pay for what they take or withold, which opens up TRUE competition.

[The Backlash Cometh]

4. Most Libertarians aren't pure Libertarians.

They're either business types who don't want any regulation stopping them from pursuing their business deals or don't want their money touched by taxes; or they're anti-government malcontents who just don't want anybody telling them what to do. period.

[dcfirefighter]

7. I'm a libertarian

and I don't want the government telling me how to live, so long as it doesn't hurt anyone else. I'm a libertarian and think that competitive market solutions are generally better than buearaucratic fiat solutions. I'm a libertarian and think that there's more than enough demand for productivity for everyone to be employed at a good wage, and to be able to purchase the things they need and many of their wants. It's just that what we call free-market is actually Capitalism, and favors returns to Capital (and claims Land as Capital) over returns to Labor.

[The Backlash Cometh]

8. I'm afraid that discussion has been beaten to death on this board.

Good luck with that. Most people on this board will probably tell you that the last five years is clear indication that the pursuit of a free market society isn't the path to an utopia. It's the path to anarchy because you can't get 100 libertarians or Libertarians in the same room and come up with agreement on when free market goes too far. Obviously, if you're in the top 1% of income brackets, you can tolerate more social disruption than someone who is in the middle class.

[dcfirefighter]

9. What do 100 socialists agree on?

What services should the government supply?
Healthcare?
Education?
Defense?
Food Production?
Housing?
Energy?
Clothing?

[The Backlash Cometh]

10. Socialist programs and theory are not predominant in policy today

so what socialist have to say about anything is pretty irrelevant. What is relevant are the theories of CATO or Machiavelli Libertarians or the Manhattan Institute or anything that Grover Norquist touches. Because, let's get serious, if they weren't having such a negative impact on our lives, we wouldn't give a hoot where the lines were drawn. But, since they DO have such an impact, we probably should pay more attention about what the Libertarian views are of the man on the street, compared to the man that lives in the McMansion. I think it's becoming very clear that the Libertarian lifestyle may be grand for the man in the McMansion, but the guy in the street who thought that deregulation was going to make his life better, is pretty much getting screwed and he's beginning to realize it.

Most people who do get to know Libertarians personally, pretty much find them to be extremely selfish, so, I tend to avoid them.

[dcfirefighter]

11. Big L little l difference

And, really, not many people listen to CATO. Now it's Heritage, which isn't quite libertarian. CATO opposes the war in Iraq, who was listening.

I think you'd be surprised at how many progressives and democrats are quite libertarian.

The Libertarian Party is fairly conservative - their brand of deregulation tends to wind up allowing private interests to enclose the common-wealth, through pollution, extraction, etc.

[The Backlash Cometh]

13. You little "l"s have a long way to go to extract yourselves from the

big "L"s. The minute you open your mouth and start taking about free market, you blend together and become "Ll"s. Pronounced, eyyehs.

[dcfirefighter]

14. Maybe to you

but then you don't seem too open minded

I suppose rather than a free market, you'd rather have the 'elected' government control prices and production?

Even in the best of times, such a system requires near universal control by a powerful central authority. I believe Lord Acton had something to say about that.

The Socialist Party even concedes that, for socialism to work, it has to be universal, or at least completely isolated from non-socialist economies.

As far as I can see, the only real socialist successes have been as relatively minor augmentations of decidedly free-market economies: SS, UHC, etc.

So screw that.

I want economics to work for People. It can, and should.

[The Backlash Cometh]

15. Open minded.

Open minded is for people who don't have the experience to make an educated decision. I was open minded with Libertarians once before. Took 3 years of my life and it proved to be a futile experience. They are selfish and they don't really understand what they want to accomplish. They will attack city hall because that's what they think they're suppose to do, then they turn around and give the information freely to developers who use it to screw over the public. That's free market at work. That's what Libertarians will accomplish. They will take away the balance between the public good and individual interest. You see, when government STOPS protecting the public good, nobody is there to step in its place. The ACLU is just not interested in those kinds of fights. So, all over America, we have powerful families which control local government simply because they own the land, the lawyers and the judges.

I guess Libertarians never stop to think who is going to protect the public good in a capitalist society. The answer is: No one. That's why we're having so many problems in this country.

[dcfirefighter]

16. You've hit the nail on the head

which is why I'm not a Libertarian.

The 'Free Market' doesn't work for Land: land, air, water, minerals, etc.

Those powerful families are powerful precisely because of market failures. They've been able legally monopolize some privelege and exploit it. Most recently you can look at the Bush Oil family, but historically, it's been land (railroads), land (oil), land (steel), land (timber), land (furs), land (coal), land (air pollution), or just land (acreage).

Allowing complete and nearly tax free ownership of land REQUIRES that you tax labor. Each owner of such monopoly figuratively has the right to tax others for it's use, either by renting it out or by selling it at his pleasure.

[The Backlash Cometh]

17. Now how do we convince the Libertarians that they are their own

worst enemies? And how do we convince the ACLU to pick up the fight, even though the money isn't as lucrative and titillating as defending pornography cases?

[dcfirefighter]

18. It's tough with the libertarians

but most of them believe that if the price of something goes up, production rises as well, to match.

They get a puzzled look when you ask them about land - what price is required for production of land to increase? They may bring up Dubai, but emphasize the physical space aspect: at what price does the production of physical price increase? You may also be able to get them to buy into the idea that paying 'location dues' is just a user fee, the ultimate user fee to the government (society) for recognizing your property rights.

Still another tact with L's is to emphasize the right of self-ownership. Each individual has a valid and irrevocable (albeit transferrable, especially in the case of products of labor) claim to his own labor, and thus, the products of his own labor. Allowing allodial ownership of land and natural resources contraverts this: land is, by definition, the product of no-one's labor. Land titles originated in nobility, and purchased nobility. (Title - as in Duke or Earl). Ownership of such land gives you the right to require others to pay you for the right to use that land, or, in other words, collect your own taxes.

As for the ACLU, I suppose the method is to join the ACLU and change it from within, but I'm not sure.

[The Backlash Cometh]

19. My favorite Libertarian story:

I'm writing in response to your comment: "Each individual has a valid and irrevocable (albeit transferrable, especially in the case of products of labor) claim to his own labor, and thus, the products of his own labor."

It reminded me of a story I read on DU. It involved a Libertarian who took a job in Iraq and he thought he was going to make the big bucks as a driver. Supply and Demand, right? Big bucks waited for him in Iraq, so he took his Master Degree'd Libertarian butt to Iraq thinking he was going to make six figures driving a truck and it turns out that the truck he was going to drive was a sanitation vehicle and part of the job required pumping out the shitholes. The guy was traumatized because sometimes the equipment malfunctioned and he ended up with shit from head to foot. He desparately tried to get out of the job, but he had signed a contract and those kind of jobs don't yet have a labor union, nor are they prone to government regulation.

That guy can claim all the individual rights he likes, but when the shit hits the fan, it's a public advocate group that he's going to crawl to when he needs help.

[EVDebs]

3. Lester Brown's Plan B 2.0 book says a new economics is necessary

for the world to get into the future, or to even HAVE a future to look forward to.

John Stewart Mill and other forward looking thinkers, seeing that resource contraints would eliminate 'free market' capitalism, or at the very least restrict free markets, were positing a 'steady state economics' within a democratic political structure.

I googled this site up,

http://www.steadystate.org/

maybe a discussion can flow from this, DUers !

[eppur_se_muova]

6. Now THAT sounds interesting. Thanks for the link. nt

[dcfirefighter]

12. J.S.Mill

isn't that far from Henry George (a contemporary of EDebs). Both of their theories are popular amongst progressive, libertarian, democrats (see my sig).

Several states have the option, or have a bill to give the option, of taxing land values higher than improvement values; the land values are due to natural and community wealth; the improvement values are due to labor and individual investment, and should be taxed less, if at all.

The theories also support the idea of real full, non-inflationary employment.

[Jara sang]

5. Competition will be the death of humanity.

Though the system right know is not really "competition" it is more subjugation.

[Ksec]

20. The Nation is an important magazine.

Good article and I agree with it.

We need a new system, a hybrid of socialism and capitalism or else we head straight to a third world economy