Wednesday, 31 August 2016

Which Capitalists would want true Capitalism?

You don't have to look too far to find people who advocate a "pure" Capitalist system, or a laissez faire, free market Capitalist system, where humans have limited or no government, and trade on a purely voluntary basis, where market forces exist unfettered and un-manipulated.

This, we are told, is true Capitalism, and something work striving for.

Except for the fact that no capitalist would ever want it.

Would people who hold a large property portfolio want market forces to affect the housing market, with tax concessions like Negative Gearing, which gives housing a competitive advantage as an investment asset?  Would they wan't to lose government intervention?

Would large software companies and media companies want to lose the governments ability to change copyright and patent law to give them an advantage?

Would the energy sector want to lose the might of the tax-payer funded US military which ensures supply of resources?

Which capitalist, that is, a person with substantial capital, would want to give up the ability to buy political favours and replace it with a free market system where legally, the playing fields are levelled?

You'll find that the loudest proponents of laissez faire capitalism are not capitalists themselves, but ideologies who think they are capitalists or at least want to signal belonging to this social group.  Wall Street isn't going to voluntarily give up the potential of future bail outs.  Who exactly is going to benefit?

The reason that real capitalists won't want a free market system, or would deliberately undermine such a system is because a socio-economic system which is built around individuals trying to maximise their income and gain competitive advantage is going to eventually see those individuals gaming, changing and corrupting the system to gain more.  Why adhere to principles of the free market, when corrupting them gives you more power?

Therein lies the great paradox.  A system designed around greed and acquisition simultaneously requires people to limit their avarice and ability to acquire to adhere to moral principles.  If the moral principles result in selfishness, then logically, the system justifies its own destruction.

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