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Luke Hutchison

TED Fellow, Google

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Is capitalism sustainable?

Bono stated in his TED2013 talk that the numbers show that we can eradicate all poverty worldwide by 2030. While I really hope that is true, it begs the question: Is capitalism sustainable? Is it possible to have a rich and middle class without a poor class? The sad reality of capitalism is that if there is an exponentially small number of people with exponentially large wealth, there has to be an exponentially long tail of much poorer people who are each contributing to that wealth. Not that we necessarily need an exponentially small number of people with exponentially large wealth, but would the world keep running without capitalistic incentives that increase the separation between rich and poor? Can we eradicate all poverty without the rich sharing their riches? What happens to civilization when nobody is willing to work in the factories and orchards, or build roads?

(Please don't take this question the wrong way! Personally I wish that nobody had to work menial jobs. I just don't understand how we can eradicate poverty when so many jobs will always translate into low-paid labor.)

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    Mar 22 2013: Larry:

    Maybe I have been promoting the good old days to a great extent. What I believe is that we need to go back to a point where the system worked better and knowing what will happen if we continue as we have.
    It leads to the mess we have made today.
    What do I want? A "redo" if you will. Now, I know we actually can't go back in time ( if we could, I would have not smoked, taken better care of myself and not have hurt the people I did... but I digress)...
    The point is, we can understand history and plan to correct our outcome to a better future. I am not sure if it will be a different economic system or a different political system. What I am sure of is that the future should place the rights of life, liberty and the pursuit of happiness for individuals as the goals of society and government. Not the other way around.
    I also believe that individuals who deprive others of their rights be punished severely. Be they serial killers or bankers.

    I read the blog and the description of the failures of our system is correct.
    My point is that if Homo Sapiens can not get past the genetic flaws of greed and pursuit of power, will the species continue? Or will it expand into a cannibalistic mass of self destruction. I hope we ( homo sapiens) are smarter then that and won't let the pending obvious to happen.
    • Mar 22 2013: Mike,
      I see your point but I think you err on two points. First the way things were done, or set up to be done, in the past seems to be almost a religion with you. By that I mean you have certain beliefs that you just will not examine for veracity. The "good old days" just didn't happen, Mike. They are myth. I am 72. I hear people who were born after 1980 talking about the 50's, 60's, and 70's as though those were great days and everything was glorious. Mike, I lived those days, they were nothing of the kind. You are dreaming of a society that just never has existed. And even if it had, those days are gone. We have to deal with today and yesterday has little to teach us about how to solve today's problems. Some, yes - but very little.

      Listen, my friend, I want to see us develop a society where we, as individuals, have opportunities to develop our personal abilities and "make our fortune" as much as you do. I think capitalism has much going for it in that respect. BUT, capitalism, like fire, is only a tool. It is NOT the "be-all-and-end-all" of a balanced and workable society. In western society today money has taken on a significance that is unhealthy in the extreme. It has become our master in our sick exaggeration of it and what it means. This is not because we, as individuals, are sick by nature (greedy) no matter what you've been taught. We are not. I wanted money and I got it. Plenty of it; but I managed to do that without preying on my fellow citizens.

      And what of other values? Do the arts have no intrinsic value or is everything in our society to be judged by its dollar value? Capitalism is a fine economic system - it is NOT a fine social philosophy. It must not rule over man. It's job, when properly controlled, is to enhance our lives, not to dominate them as it does now.

      It is the job of the social system to organize us so that our work is effective in advancing us as individuals and as a community. Either we hang together or we will be hung alone.
      • Mar 22 2013: Larry,
        I too lived in the depression, WWII, the 50-70s and the present. We went through rougher times than present Americans have ever known. I came through poverty, living at one time in a converted chicken house on a relative's small farm.

        However, the 50-70s were a time when an individual worker could buy a home, have two cars, and send his kids to college. In the 1930s FDR said, "we must build toward the time when a major depression cannot occur again." Had it not been for that effort we would have had another major depression instead of the current "greatest recession." It wasn't the bailout or the stimulus that saved us. It was a yearly 2 trillion dollar economic stimulus about which nobody speaks. FDR initiated social security and unemployment insurance. His followers added medicare/medicaid and food stamps. These programs paid out $1,436,700,000,000.00 each year, and those payments of immediately spent money carried an economy-boost of 160%, giving a net economic boost of $2,298,720,000,000.00. Even in the most severe recessionary period over the past 5 years that kept an additional $11.5 trillion of economic activity flowing in our nation.

        FDR added further, "Do what we may to inject health into our ailing economic order, we cannot make it endure for long unless we bring about a wiser, more equitable distribution of the national income." He also warned about runaway financial speculation, and the Glass Steagall act was passed to reign in such speculation. Our current recession was caused partly by rescinding its restrictions. Capitalism is not the gambling of money belonging to others for one's personal gain. The purpose of stocks is not to trade on miniscule rises and drops in their value to accumulate millions of pennies at a time into extreme wealth. Stocks were intended for investing in new enterprises on the hopes that they would improve our national economy and simultaneously provide wealth for the investor.
        • Mar 22 2013: Richard,
          The standard of living that you mention was supported in large part by supplying arms for two world wars and profiteering on the world's needs after them. Aside from that I cannot disagree with you in most of what you say. But remember that in those days a man could support his family nicely on his earned income if he was a good worker.

          In modern times our real income has fallen so far that it takes two incomes to meet our needs. Not luxury - just what we see as needs. And this isn't getting any better. You and I didn't have to contend with off-shoring of jobs or automation the way today's people do. We had the ability to do well if we wanted to do so because our society had the means to provide us with gainful employment. I, in particular, have done very well in my life, financially.

          BUT.... this is a whole different ball-game today. The system that allowed us to do OK in our day, has been taken advantage of by unscrupulous greedy bastards who have no honour and none of the respect for our fellows that you and I were taught.

          Some of the founding fathers glimpsed the problems that we'd be caused by the big banks and tried - twice - to get the country out from under them by setting up a government currency. The banks bought enough of 'our' representatives to end both those efforts and get themselves re-installed as masters of our currency.

          And that, my friend, was that. Our fate was sealed. The situation we have now was the inevitable result once we lost control of our money to those banksters. Until we get back control of our government and it sets up a proper national currency that owes nothing to the big banks, we're - in the vernacular - fucked.

          Right now our governments are our worst enemies because they're acting on behalf of the oligarchs instead of on our behalf. Until and unless that changes, we'll stay in the bottom of the outhouse.

          Thanks for your comment ;-)
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        Mar 22 2013: Larry,
        We all have views of our childhood. Mine was an immigrant family who literally came here with nothing.
        I was the first to attend college mainly because I got drafted and the sarge told me to be an officer. Officers sleep in tents.
        From your comments, I have not made myself clear.
        We are discussing capitalism. I think free market capitalism is the most "democratic" of all economic
        systems.
        Since the beginning of the US, the Federalist have pushed, schemed, legally and illegally to establish a strong central government, soliciting and favoring financial support by every means possible.
        So, I have maintain through this conversation that we go back to real capitalism and vote out these "politicians" who see themselves as governing superiors.
        Then you suggest that my focus leaves out the societal changes that are here today. Each generation has been identified as to their nature. To my dismay, The greatest generation got so caught up in the post war boom, they gave their children (the age of Aquarius) little moral guidance and the beginning of the 'me too' society got started.
        So, now we have real social problems, fine arts have been reduced to hanging red cloth across the Grand Canyon and our music has gone from Beethoven to Beyonce. So, pardon me I am not excited about there current generation. For the most part, a good swat on the backside is way past in order.
        • Mar 22 2013: Mike,
          I agree that we're talking at cross purposes here. I'm involved in a number of conversations-by-comment here and, being new, I haven't figured out how these threads work and keep getting mixed up as to what conversation I'm having with who!

          Ok, let's see if I can make myself clear. I like capitalism a lot. It's been very good to me. But... there are different forms of capitalism. Each form serves a particular purpose better than other forms of it do.

          Our society uses the term capitalism to mean the whole ball of wax. Economic system, social system and all the other systems. I doubt the value of "free market capitalism" aka laissez faire capitalism because any economic system is merely a tool and, while free market might be a useful tool in developing a nation, it sucks once that nation is developed. It is way too competitive at a basic level. Any developed nation ought to be able to guarantee its citizens - ALL its citizens - a decent standard of living and - more important - a decent education. Our present one could do that but it doesn't.

          This is not because of having a strong central government. It's because the economic system is dominating the social system. The harm that is being done is from the economic big boys bribing the elected reps to pass laws that put them in the driver's seat. They don't belong there. We, the people belong there.

          You seem to think that letting the economic system control the social - and other - systems is the solution to our woes. I, on the other hand see that as the cause of all our woes. Capitalism need not enshrine the feudalist attitudes of gluttonous luxury vs absolute poverty. That does NOT work for the majority - only for the few at the top.

          Capitalism, of a different form, has the ability to serve us well - ALL OF US! But it will never do so as long as we let it continue to greedily prey on the largest part of the population. Worst of all it is so greedy that its now eating itself!
        • Mar 22 2013: Mike,
          I hope I figured out how to continue in this thread.

          Men form a society so as to accomplish things together that individuals cannot do alone. One of those things is caring for all members of the society including the ill, the old, and the children. We co-operate to those and other ends. When we've done that, we're ready to engage in competition. Until we've done that we're assholes if we cut each others throats for a crust of bread in competition for basics. There is capitalism for social good and there is another kind of capitalism for individual good. Sometimes they are congruent sometimes they are not. Where they are not then capitalism for the social good must prevail over capitalism for the individual good. In other words, I'm happy to see you do well as an individual BUT if you fuck up my kids while you're getting fat, I'll eat you alive.

          The ONLY way for capitalism of the individual to be acceptable is for the well-being of the society - the one that allows of an individual doing well, remember? - to be assured. And that, my friend, means that the society MUST control and set limits on what the economic system, and all who are part of it, may do.

          In our society we elect reps to manage things on OUR behalf in preference to managing our society for those who are engaged in the great game of wealth acquisition. We do that because only few people care to spend their lives playing that game. We, mostly, have other fish to fry. That the 'players' insist on us all playing their game is destructive to all else in our society. Play the game if you wish - and I personally wish - but don't mess with the society that nurtures you and provides you with the wherewithal to play. That screws us up and eventually, as we can see today, screws up the whole system that we all - you included - need. We're not in trouble because of a strong Federal govt. We're in trouble because our govt. is corrupted by wealthy predatory, greed-capitalists.

          We can do it better.
        • Mar 23 2013: Larry,

          Are you saying my comment is crap? If so, c'mon, show me how.

          Or are you suggesting that our present plight is that dire?
        • Mar 23 2013: Richard,

          ""Are you saying my comment is crap? If so, c'mon, show me how.""

          No.
      • Mar 23 2013: Hi, Larry,
        There was no place for me to directly reply to your comment about mine. Firstly, war does not cause economic prosperity, rather it consumes resources into destruction. I have seen others say that the cause of our prosperity was our manufacturing output that had no competition on the world stage. That argument is not only baseless but patently false. Reading the commentary at the time I see that we rebuilt the factories of both our allies and enemies after the war and that they had the latest technologies in those factories while ours were generations old. The latest reason I hear is that oil discoveries were the economic drivers of the time. That may be partially true. But the real cause of prosperity is political policy of the era.

        In the late 1920s the economic spread of both wealth and income was much like it is today. FDR said he was determined to make it more equitable. This aroused the wrath of the wealthy, and a plot was put in place to have him overthrown. Before his election there was an effort to assassinate him. Before his second election he commented, "I should like to have it said of my first administration that in in these forces of greed and lust for power had met their match. I should like to have it said of my second administration that in it they met their master."

        He raised the highest marginal tax rate to 90%. Those monies funded the TVA, Grand Coulee and Hoover dams, the paving of suburbia, the freeway system, and the space program. Each of these and other similar programs brought prosperity and growth to all impacted regions. NASA spun off 1400 industries. That entire period saw comparatively low unemployment. With the Reagan economic policies it was turned around. Unemployment since has been higher than in the previous 30 years. Today those same forces of greed and lust for power are back in control of both wealth and wages. The 99% need to reclaim our nation from their stranglehold.

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