Friday, January 8, 2010

Critique of Capitalism I

Now no one would ever mistake me for a communist (at least I don't think anyone would.... well maybe Texans!) but I have always been a little uneasy with American style capitalism (from hence forth referred to as just capitalism because I feel it is the form of capitalism that is most prevalent in the world). Now I don't have an issue with market, nor private property I am very much in favor of both of those aspects of capitalism my issue and worries are focused on big business. Big business is not totally evil, but its presence in an economy puts strain on government and freedom in all societies.
Big business is problematic for one because of its immense size. With their large amounts of money, large businesses wield immense amounts of power. Now wealthy people also wield immense amounts of power but there is a big difference between a corporation and a person: a corporation is practically immortal. There is not much that can truly "kill" a large corporation even bankruptcy. If the company has enough money it can just lobby the government to rescue it which leads me to my second point that bothers me about big business. Freedom is immensely important to me and the biggest threat to freedom is the state, one of the problems with big business is that it requires a large government to properly maintain it. All markets require some sort of government to help them properly function, but as a business grows in size in power the government must grow as well in order to keep the market working. As the government grows it expands into all aspects of life.
Large companies also sabotage one of the principle tenets of the capitalist system, they stifle competition. All companies are always looking to best competition and when companies are relatively equal in power this is a good way to make sure they police themselves and work to better the life of their customers however when a company becomes so large that they can easily quash and buy out start up companies that would attempt to be competition they distort the market and no longer have incentives to serve their customers except through dictates from the government, which brings us back to point 2.
Capitalism has in many ways been a wonderful advent to the world, it has lifted many millions out of poverty and continues to do so to this day, however it was developed in a time when many of the problems it brings us today were unthinkable because they were impossible given the technology at the time, therefore a re-look at the fundamentals and assumptions is in order. Next time I will look at some of the assumptions capitalism makes and offer my critiques on them as well.

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