“American Capitalism is a malignancy that permeates our economic, social, and political systems and institutions. This untreated cancer ravaging the body of civilization is spreading like an unchecked conflagration in a munitions factory. Feudalism didn’t die; it simply evolved. Corporatism, Consumerism, wage slavery, debt slavery, free trade agreements, deregulation, and privatization condemn most of the global population to varying degrees of slavery, serfdom or indentured servitude.” — Jason Miller at the popular liberal blog, The Smirking Chimp
For the record, I don’t think capitalism in itself is to blame for the bad stuff Jason Miller attributes to it. I think any way you choose to run an economy can lead to “slavery, serfdom or indentured servitude” if ordinary people have no protections from powerful people. Sooner or later the wealthy and powerful will find a way to game the system, whatever it is, to their advantage. Capitalism may be a little easier to game than some other systems, but none are foolproof. Certainly communism, which is capitalism’s polar opposite in most respects, has been found to lead to “slavery, serfdom or indentured servitude” wherever it’s been tried.
Anyway, Mr. Hawkins comments,
Because Mr. Miller and his many comrades in the Democratic Party don’t understand human nature, they don’t understand capitalism.
First off, Mr. Miller didn’t say anything about being a comrade of the Democratic Party, and Smirking Chimp (which is not a blog, but which contains many blogs, including Jason Miller’s) is not an instrument of the Democratic Party. Greens and Naderites are free to blog there also, I believe. I’ve met the proprietor of Smirking Chimp, and he doesn’t strike me as the sort who demands loyalty oaths. Hawkins needs to relieve his knee from its tendency to jerk.
Capitalism is designed to take advantage of one of the most basic truths about human beings: people are selfish.
People will work very hard for themselves and their families, but, they are not automations and very few of them are going to work hard to line someone else’s pocket or for “society,” if they don’t think their efforts are being properly rewarded.
With capitalism, that selfishness leads businessmen to hire more workers to increase their profits, to earn more money which they pay taxes on, and to create products and services that the rest of society can use — not out of the goodness of their heart, but because they benefit from it. Take away the benefits that people can earn from themselves, then they won’t go the extra mile and society won’t be able to profit from their efforts.
Let’s take a look back at the Golden Age of Laissez Faire in the United States —
1820–1880: The Seamstress Impoverished
Seamstresses were familiar figures in early 19th-century American cities, filling the needs of an expanding garment industry. Working at home, they stitched bundles of pre-cut fabric into clothing worn by Southern slaves, Western miners, and New England gentlemen. Dressmakers were responsible for producing an entire garment and could earn a decent wage. Seamstresses, however, were poorly compensated for work that was both physically demanding and unpredictable. Paid by the piece, seamstresses worked 16 hours a day during the busiest seasons, but their income rarely exceeding bare subsistence. Making matters worse was, shop owners were notorious for finding fault with the finished garments and withholding payment. Consequently, seamstresses often relied on charity for their own and their families’ survival.
Yeah, capitalism worked like a charm for those women. Oh, wait …
Here’s another little blast from the past:
History In 1888, New York state factory inspectors provided the following description of sweat-shops: “In New York city, in the tenement house districts where clothing is manufactured, there exists a system of labor which is nearly akin to slavery as it is possible to get. The work is done under the eyes of task-masters, who rent a small room or two in the rear part of an upper floor of a high building, put in a few sewing machines, a stove suitable for heating irons, and then hire a number of men and women to work for them.” Explicit in the inspectors’ definition of a sweatshop is the exploitation of garment workers by contractors, who forced their workers to labor for long hours only to be paid insufficient wages. In addition to physically sweating as a result of their toil, workers were also “sweated” in the same manner an animal would be milked or bled.
By the 1880s, for the most part, seamstresses no longer negotiated work on an individual basis but were subsumed into a system of contracting. Contractors received components of garments that they in turn assembled according to designs. These finished products were returned to the manufacturers and marketed under the company’s label. As a result, manufacturers distanced themselves from the hiring and equipping of a labor force, which became the responsibility of the contractor. Manufacturers paid a set price for each finished garment they received from the contractor, which was considerably lower then they would then charge retail. Consequently, contractors, in order to make any profit, forced longer hours and lower wages on their workers.
Capitalism didn’t put a stop to these practices. Free markets didn’t put a stop to these practices. It was government regulation and labor laws that, finally, provided some protection for workers.
The notion that unfettered selfishness and deregulation benefits everybody has been disproved by history time and time again, yet ideologues refuse to learn that lesson. Capitalism needs watchdogs to keep it honest, or it corrupts into plutocracy and, eventually, corporatism. That’s a plain fact. Selfishness may inspire people to better their lives, but it also inspires people to lie, cheat, steal, hoard, and exploit.
One of the biggest atrocities of human history — the death by starvation of more than one million Irish during the Famine — was made worse by “free market” ideology. Free markets didn’t cause the blight, but the ideology prevented the English from providing relief when it easily could have.
In deciding their course of action during the Famine, British government officials and administrators rigidly adhered to the popular theory of the day, known as laissez-faire (meaning let it be), which advocated a hands-off policy in the belief that all problems would eventually be solved on their own through ‘natural means.’
Great efforts were thus made to sidestep social problems and avoid any interference with private enterprise or the rights of property owners. Throughout the entire Famine period, the British government would never provide massive food aid to Ireland under the assumption that English landowners and private businesses would have been unfairly harmed by resulting food price fluctuations.
In adhering to laissez-faire, the British government also did not interfere with the English-controlled export business in Irish-grown grains. Throughout the Famine years, large quantities of native-grown wheat, barley, oats and oatmeal sailed out of places such as Limerick and Waterford for England, even though local Irish were dying of starvation. Irish farmers, desperate for cash, routinely sold the grain to the British in order to pay the rent on their farms and thus avoid eviction.
In the first year of the Hunger, the British Prime Minister arranged for some shipments of corn to Ireland that helped a little. But then the government changed hands, and a new Prime Minister took over.
Once he had firmly taken control, Trevelyan ordered the closing of the food depots in Ireland that had been selling Peel’s Indian corn. He also rejected another boatload of Indian corn already headed for Ireland. His reasoning, as he explained in a letter, was to prevent the Irish from becoming “habitually dependent” on the British government. His openly stated desire was to make “Irish property support Irish poverty.”
As a devout advocate of laissez-faire, Trevelyan also claimed that aiding the Irish brought “the risk of paralyzing all private enterprise.” Thus he ruled out providing any more government food, despite early reports the potato blight had already been spotted amid the next harvest in the west of Ireland. Trevelyan believed Peel’s policy of providing cheap Indian corn meal to the Irish had been a mistake because it undercut market prices and had discouraged private food dealers from importing the needed food. This year, the British government would do nothing. The food depots would be closed on schedule and the Irish fed via the free market, reducing their dependence on the government while at the same time maintaining the rights of private enterprise.
And at least a million Irish starved, and about another million left Ireland on “coffin ships” in which many more died of disease. This is the nonsense that the “free market” devotees want to go back to. Like it worked so well the first time.
Almost a century ago Theodore Roosevelt quoted Abraham Lincoln:
“Labor is prior to, and independent of, capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration.
“If that remark was original with me, I should be even more strongly denounced as a communist agitator than I shall be anyhow. It is Lincoln’s. I am only quoting it; and that is one side; that is the side the capitalist should hear. Now, let the workingman hear his side.
“Capital has its rights, which are as worthy of protection as any other rights… Nor should this lead to a war upon the owners of property. Property is the fruit of labor;… property is desirable; is a positive good in the world.”
And then comes a thoroughly Lincolnlike sentence: —
“Let not him who is houseless pull down the house of another, but let him work diligently and build one for himself, thus by example assuring that his own shall be safe from violence when built.”
It seems to me that, in these words, Lincoln took substantially the attitude that we ought to take; he showed the proper sense of proportion in his relative estimates of capital and labor, of human rights and property rights. Above all, in this speech, as in many others, he taught a lesson in wise kindliness and charity; an indispensable lesson to us of today. … The issue is joined, and we must fight or fail.
Do read the whole speech, if you haven’t already. TR laid out the essential foundations of modern American liberalism in this speech and gives “deregulation” of business a resounding bitch slap. “The right to regulate the use of wealth in the public interest is universally admitted,” he said. He said that in 1910. We need to do some universal re-admitting.