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November 24, 2005
An attempt to answer Maurice and others, Thurs., Nov. 24, 2005, 8:36 AM
I received mail from Maurice, which I believe is a fair articulation of what some of you are thinking after my recent musings. I will first read you the letter from Maurice, who in effect represents Anyman, and then I'll reply.
Dear Bill:
I just have a question. In some posts lately you have used the term "capitalists" to describe the Big People who are stealing money from the working class. While this may be an accurate description of a great wealth transfer, a huge robbery (and I think you are correct), why do you use that term to describe the robbers?
What we have here in the U.S. are not free markets. I hear that we supposedly have them, and thus we have capitalism, but I don't see truly free markets. Much is done in cooperation with vested political interests who condone and support the activities that will eventually destroy the middle class here in America (I can't speak for Canada, not knowing the story so well). I certainly see that in health care, which is denigrated as being a "failure of the free market", when it is not free at all. The insurance industry is run in cooperation with unelected insurance boards in each state, and the government really already rules most of health care here in the US; it just does so in a way that gives some of the worst of all worlds. Whether you agree or not that it should be, it is certainly not free-market capitalism. It is corporate thievery, but it doesn't fit my definition of free market anything.
It just seems to me that denigrating these "capitalists" give real capitalism a bad name. It's more akin to this definition of mercantilism I saw on Dictionary.com: "an economic system (Europe in 18th C) to increase a nation's wealth by government regulation of all of the nation's commercial interests", except that our mercantilists are not helping increase the nation's wealth very well, only the Big People.
Maybe I am missing something. What system would you have in place of capitalism? Is the problem capitalism per se, or is it in the general decline of integrity out there, something I believe is apparent out there in our society. Madison wrote that it was that integrity of the people that mattered, that the words of the Constitution mattered for nothing if they HAD no integrity...and is this a case where the "capitalists" are just immoral?
How do the Little People fight back? In a time where the politicians are either stupid or as venal as corporate Big People, and in fact are dancing the same dance, what are the workers supposed to do? Vote the bums out? And replace them with....whom? Ask the government to step in and work for the People? Great idea, but that notion was raised a long time ago, and seems to be a quaint atavistic thought, rather than what's going on in our day. Revolt against the corporate chieftains? Get the law behind the workers? Great, if you can get that to happen before things fall apart. Have an overthrow of the whole shebang? And replace it with...?
Is capitalism inherently bad? Or does it too, like decent government, depend on the moral climate?
I'm not even criticizing here, I am genuinely interested.
Where does government fit in? What's a workable situation? I just read you using "capitalist" as if it meant "criminal" if I am reading it correctly (but maybe I am wrong). I think capitalism works, it gave us the great things we have in our lives (and we can argue about too much debt and all the sins of the modern financial system...but I am talking about the impetus for invention that capitalism provides).
Thanks
Maurice"
Maurice,
You ask a good question. Since all readers deserve an answer, I will try to explain myself in the blog -- possibly Friday or (probably) Sunday. The essence of the point I will make, however, is that we, the owners of capital, who work hard to build our capital, and who are individually most desirous of improving the quality of our lives, are increasingly confronted by "organized gangs", calling themselves capitalists, but in reality are themselves ideologists who consider us their chattels.
I hate labels, but I suppose others would label me "Libertarian Socialist".
Before I write again on this subject I will try to find a good definition of "organized gangs". I will search the literature as follows.
http://en.wikipedia.org/wiki/Capitalism
http://en.wikipedia.org/wiki/Ideology#Ideologies_emphasizing_class_struggle
http://en.wikipedia.org/wiki/Anti-capitalism
http://en.wikipedia.org/wiki/Libertarian_socialism
http://en.wikipedia.org/wiki/Capitalism#Marxist_critique_of_capitalism
http://en.wikipedia.org/wiki/Fee_simple
Thank you, Maurice, for continuing to read my blog. I want you to know that I have no interest in politics or religion. In addition to my passion for capital markets, I do have an abiding interest in the freedom of capital markets, where the owners of capital are not treated like someone's chattel.
While I understand the nature of rights and obligations to others in our society, I also expect others to respect mine, and yours. So the concept of fee simple is important to me.
Last evening, CNN's Larry King had a splendid interview with U.S. Supreme Court Justice Breyer, who appears to me to be a wonderful person. Breyer explained that his interest in his capacity as Judge is in the extreme boundaries of the law, as well as the rule of law.
Organized groups who abuse laws that were intended to protect society focus my interest, as a person bound to the rule of law, on the justness of laws, and also rules and regulations, that ultimately enhance the exploitation of the individual.
Yes, this belief conveys a notion of criminality, whether on legal or moral grounds, whenever I see cases where the rights of the individual and his or her ownership of capital are attacked and pillaged by these organized groups".
I know from experience that very few judges are experienced enough in capital markets to understand that so-called white-collar crime goes far beyond cases of simple embezzlement. I believe there is a need for Supreme Courts to extend their knowledge in this area.
When the Constitutions of the United States or Canada were created, there was no trading in securities," as the term is recognized today. There was "trading in physicals" where the trading was done face to face. We now live in the Digital Age, where trading is virtual.
Increasingly, there are significant abuses in this area. The result is that today the public has become increasingly skeptical of capital markets. The problem will get worse until there will be a total breakdown in the confidence of the owners of capital in the trading systems that are supposedly operated for their benefit.
In the case of America, which leads the world in these matters, I believe the time is appropriate for the U.S. Supreme Court to rule on the appropriateness of the 1933-1934 Securities Act, and all rules and regulations governing the provision of financial services to the public, in light of society's needs and resources today. I think at the end of the day, just as there was a determination by the nation's founders for the need to separate Church and State, there is a need to separate Financial Services, including Commercial Banking and the use of debt, from the Capital Market.
Cordially,
/Bill
Posted by Posted by Bill Cara on November 24, 2005 08:36:45 AM | Category: Cara re: Cara