Even though I don’t own any capital, I am a capitalist. I still believe that capitalism is the most effective way to allocate resources. A free market. Willing buyers and sellers. Comprehensive knowledge.
I understand that perfect knowledge is a requirement of a perfect market of free market capitalism, but it’s that imbalance of knowledge that lets one of the participants of a business deal make a killing, so I’m okay with that little distortion of perfect free market capitalism.
Despite the rhetoric, the United States is not a system of free market capitalism. Government intervention is necessary to obviate the inherent distortions of free market capitalism. Pollution, for instance, or the exploitation of child labor, are not costs born by polluters and exploiters of child labor. Not everything is captured by market forces. Somebody needs to put a check on the robber barons, and government is preferable to mobs with pitchforks, mostly because mobs with pitchforks can be neutralized by thugs with billy clubs.
But in the United States, government has been co-opted by big business. One need look no further than the tax code to see that we no longer live under a system of free market capitalism.
Why does Warren Buffet pay income taxes at a lower rate than his secretary? Because the finance sector has distorted the tax code by capturing part of the government.
The government picks winner and losers. And the winners are the people who subsidize the campaigns of the political candidates. The winners are the guys who hire the lobbyists who schmooze and wine and dine the politicians. As a result, campaign donors and the clients of lobbyists get money from the government.
I think I make better choices on how to spend my money than letting the government decide.
The losers are the taxpayers. The losers are the people who expect government services for their tax dollars. The losers are the small businesses who just want a level playing field, who don’t want to compete against government subsidized competitors for the consumers’ disposable income.
It’s a great system for the people who benefit from it. In El Paso, for a few thousand dollars, the local campaign donors garner millions of dollars in privileges and tax abatements. The citizens, many of whom live in or close to poverty, subsidize the businesses and hobbies of the wealthy.
That’s not capitalism. That’s corporate socialism.
When the system’s beneficiaries wheedle their way into control of the government’s monopoly of force, that’s fascism.
A million here, a million there. That’s not a lot for a government with a billion dollar budget. But think where that diverted money could have been spent. Think what we could have done with a million dollars spent on childhood education, for instance, or support for small businesses. Think who would benefit more from a million dollar investment – our local millionaire philanthropists, or families who need after-school childcare so the parents can work a second job to provide for their family?
Paradoxically, today’s Democratic Socialists are closer to the aims of free market capitalists than the self-proclaimed “capitalists” promoting the status quo. The “capitalists” will don any costume to achieve their self-serving aims of personal enrichment.
If you take a really close look, and that might involve some introspection, you’ll notice that the emperor is naked.