Sunday, September 14, 2008

On Capitalism and Accountability

I am a capitalist socialist libertarian. Most of my friends are socialist liberals.

They say, "Capitalism is about maximizing profit, at the expense of all else. We would rather insist that corporations protect the environment and take care of their workers and take care of consumers. Why aren't you with us?"

My answer has many parts. First, I am interested in meeting the needs of people. Ultimately, the profits of capitalism are not an end in themselves, but a means to meeting needs. That is why I am a socialist. I believe that the government should tax the wealthy to support the poor, and should take measures to protect the environment. The fine details of how this happens are crucial to achieving optimal results.

Second, I am a libertarian. That means that I believe in freedom. This sounds trite, like some kind of Bush Doctrine, but be careful what you mock. Federal overreach such as minimum wage laws, child labor laws, immigration laws, complex tax codes, excessive taxation (in some cases), medical litigation, corporate subsidies, and red tape make it more difficult for individuals to start businesses and pursue personal dreams. Some of these laws have an important purpose, but I think that the costs they impose are high.

Here is one caveat to my libertarianism. On the spectrum from individuals to the federal government, you find families, neighborhoods, districts, states, and regions. Those groups that are closer on the spectrum to the individual should have greater freedom to impose control on their own members than those groups closer to the federal government have the ability to impose laws on everybody. For example, neighborhoods should generally not interfere with parenting, states should not interfere with neighborhood zoning preferences, and the feds should not prevent states from establishing environmental restrictions above and beyond the federal mandates. But a key role of the Federal government is to keep communities from acting aggressively towards one another or preventing their members from migrating to other communities.

And finally, I am a capitalist. To me, this means that I look to hard work, business, and even corporations-- all in pursuit of profit --as the most effective motors of production. And this motor produces exactly what the market demands, that is, what people are willing to pay for. Granted, some people have more needs than others, and some people are better-equipped to produce more than others, and that's why I'm also a socialist.

To some extent I'm just spouting off what I think without saying why. The choice between capitalism and the many versions of its absence (Totalitarian Socialism) involves so many value-judgments and contingencies on the exact specification of these economic systems that the very idea of proof on these matters is a dead end.

However, here is one rough outline of an argument for capitalism. Observe that nearly all institutions stray from their stated missions. This is often referred to as corruption or incompetence. The Catholic Church has abused children, FEMA neglected New Orleans, Bear Sterns let down it's shareholders, countless relief organizations have mishandled funds, etc. One thing that has come out of all of this is a near universal desire by the public to hold institutions accountable for their actions.

The nice thing about the greedy world of business is that, #1, everyone knows precisely the mission of a business (to make profit), and #2, the free market holds businesses accountable to that mission. In other words, as long as corporations are not pressured to engage in multiple missions (caring for the environment beyond the requirement of the law, or sporting charitable side-projects), there is complete transparency about what these institutions (companies) do and why they exist. "Corporate corruption" is redundant. Corporations ARE corruption-- institutions embodying the aggregate greed and need of humanity --and it is the business of a small government to enforce the laws we establish to protect people from the path of these pariahs. But to restrict them too severely is to reduce freedom and commerce.

We have a choice: to know where corruption lies, or to be constantly chasing it, rooting it out of the programs set up by our elected leaders. Greed exists everywhere, so it is important that the institution that specializes in regulating greed be as small, transparent, and focused as possible. That institution is the government. And when the government goes into business, or when the government asks businesses to do the business of government, that's when things get fuzzy. And fuzz is bad.


Anonymous happypappy said...

OK now tackle--fit in--spirituality, true religiosity.

1:19 PM  
Blogger current typist said...

Wait, happypappy--this IS spiritual. And I'm the latest convert!

4:13 PM  
Anonymous dr perfection said...

dear freakwenter. Should I take my money out of investments and hide it in my mattress?

1:48 PM  
Anonymous dr perfection said...

dear freakwenter. Should I buy gold?

8:19 PM  
Blogger My Freakwentness said...

dear dr perfection. do not store up your treasures on earth, and especially not under your mattress, where moth and rust destroy, but instead invest in real estate. Homes are going for dirt cheap now and you should be able to cash in, at least moderately well, in a few years.

8:24 PM  

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