Capitalism Vs. Others – A Discussion

This post is a continuation of the discussion between me and tin that started here and continued here.

Let me start the discussion with some definitions. I define communism, or more generally collectivism, as any economic system that exhibits the following criteria,

1. Little to no property rights

2. little to no free trade

3. the means of production and the price of goods are controlled by government

I define capitalism as the following,

1. strong property rights

2. high levels of free trade

3. an overall laissez-faire economy where people are allowed to enter into whatever contractual agreements they like

4. An economic system where prices are allowed to signal scarcity – the more expensive something is, the more scarce and in demand it is

5. A government that protects property rights, enforces contracts, and holds up the rule of law

Why is capitalism superior to other forms of economic ideologies? One of the primary reasons is that because it has been implemented and seen to work – especially in comparison to other economic systems.

Walter Williams, professor of economics at George Mason University, explains the differences this way:

There’s no complete explanation for why some countries are affluent while others are poor, but there are some leads. Rank countries along a continuum according to whether they are closer to being free-market economies or whether they’re closer to socialist or planned economies. Then, rank countries by per-capita income. We will find a general, not perfect, pattern whereby those countries having a larger free-market sector produce a higher standard of living for their citizens than those at the socialist end of the continuum.

What is more important is that if we ranked countries according to how Freedom House or Amnesty International rates their human-rights guarantees, we’d see that citizens of countries with market economies are not only richer, but they tend to enjoy a greater measure of human-rights protections. While there is no complete explanation for the correlation between free markets, higher wealth and human-rights protections, you can bet the rent money that the correlation is not simply coincidental.

So we see here that the more capitalist a country becomes, especially compared to collectivist economies, the higher the standard of living and human rights are.

This is not just a pattern in the West, this pattern has been repeated all over the world. To see how the spread of capitalism around the world is affecting global poverty I recommend everybody watch this short ted talk by Hans Rosling, a Swedish professor on international health and economic development.

Click here to watch the ted talk

That is not to say that we don’t have more to learn on economics or that capitalism is perfect – we certainly do and it definitely isn’t, but any reasonable discussion on economics must first start off acknowledging what we know works and must work within that system. History has shown as clearly as it possibly can that a market oriented economy is superior, indeed vastly superior as far as standard of living for the poor and human rights go, to a government centered economy where prices are dictated by government fiat instead of by scarcity. Utopian aspirations may be good for establishing an end goal but actual economic implementation should be dictated by theory and empirical evidence, especially when so many lives depend on it.

15 Responses to “Capitalism Vs. Others – A Discussion”


  • okay, since the last comment did not go through, i’m going to be really short on this one.
    by your definition of communism, i am not a communist. i do not believe in the concentration of political power in a few hands, and i do not think the government should dictate anything, but the other way around. i agree with the zapatistas who say that the government should “command by obeying.” the closer to direct local democracy, the better.

    having said that, i do think that certain human necessities (for both a healthy individual and a healthy society) should be guaranteed by the community (notice i say community, and not government, i don’t like the state). things like health care, education, food and housing, all these things should be accessible to all. as to private property, i don’t know if you mean like people’s houses and stuff, or if you are talking about factories and the so called “means of production.” i think a community should have the right to decide what kind of ownership they want.

    [i have to go, wait for part 2]

  • I was listening to a Robert Jensen lecture about Capitalism on Friday right before I read your comment in Chavo’s blog. I would like to add these thoughts to this discussion of Capitalism by Jensen. I will state here that I too will continue this discussion on my blog.

    “Capitalism is admittedly an incredibly productive system that has created a flood of goods unlike anything the world has ever seen. It also is a system that is fundamentally (1) inhuman, (2) anti-democratic, and (3) unsustainable. Capitalism has given those of us in the First World lots of stuff (most of it of marginal or questionable value) in exchange for our souls, our hope for progressive politics, and the possibility of a decent future for children.

    1. Capitalism is inhuman

    There is a theory behind contemporary capitalism. We’re told that because we are greedy, self-interested animals, an economic system must reward greedy, self-interested behavior if we are to thrive economically.

    Are we greedy and self-interested? Of course. At least I am, sometimes. But we also just as obviously are capable of compassion and selflessness. We certainly can act competitively and aggressively, but we also have the capacity for solidarity and cooperation. In short, human nature is wide-ranging. Our actions are certainly rooted in our nature, but all we really know about that nature is that it is widely variable. In situations where compassion and solidarity are the norm, we tend to act that way. In situations where competitiveness and aggression are rewarded, most people tend toward such behavior.

    Why is it that we must choose an economic system that undermines the most decent aspects of our nature and strengthens the most inhuman? Because, we’re told, that’s just the way people are. What evidence is there of that? Look around, we’re told, at how people behave. Everywhere we look, we see greed and the pursuit of self-interest. So, the proof that these greedy, self-interested aspects of our nature are dominant is that, when forced into a system that rewards greed and self-interested behavior, people often act that way. Doesn’t that seem just a bit circular?

    2. Capitalism is anti-democratic

    This one is easy. Capitalism is a wealth-concentrating system. If you concentrate wealth in a society, you concentrate power. Is there any historical example to the contrary?

    For all the trappings of formal democracy in the contemporary United States, everyone understands that the wealthy dictate the basic outlines of the public policies that are acceptable to the vast majority of elected officials. People can and do resist, and an occasional politician joins the fight, but such resistance takes extraordinary effort. Those who resist win victories, some of them inspiring, but to date concentrated wealth continues to dominate. Is this any way to run a democracy?

    If we understand democracy as a system that gives ordinary people a meaningful way to participate in the formation of public policy, rather than just a role in ratifying decisions made by the powerful, then it’s clear that capitalism and democracy are mutually exclusive.

    Let’s make this concrete. In our system, we believe that regular elections with the one-person/one-vote rule, along with protections for freedom of speech and association, guarantee political equality. When I go to the polls, I have one vote. When Bill Gates goes the polls, he has one vote. Bill and I both can speak freely and associate with others for political purposes. Therefore, as equal citizens in our fine democracy, Bill and I have equal opportunities for political power. Right?

    3. Capitalism is unsustainable

    This one is even easier. Capitalism is a system based on unlimited growth. The last time I checked, this is a finite planet. There are only two ways out of this one. Perhaps we will be hopping to a new planet soon. Or perhaps, because we need to figure out ways to cope with these physical limits, we will invent ever-more complex technologies to transcend those limits.

    Both those positions are equally delusional. Delusions may bring temporary comfort, but they don’t solve problems. They tend, in fact, to cause more problems, and those problems seem to be piling up.

    Capitalism is not, of course, the only unsustainable system that humans have devised, but it is the most obviously unsustainable system, and it’s the one in which we are stuck. It’s the one that we are told is inevitable and natural, like the air.”

  • good intervention by P-3000

    i agree that capitalism is inhuman, insustainable, and anti-democratic.

    something that i noticed from HP’s comments, is that his conception of society is extremely individualistic, and does not seem to appreciate the interconnections of all human beings to the planet. his conceptions is also highly predatory, with the most agressive, the most powerful, and the most privilege trampling over the most vulnerable. so, although i do not think that we need a welfare-state, we do need a society that takes care of human beigns regardless of wether they can contribute or not to the economy.

    HP reduces human society/community (global, local) to the market. we are all in relations of production and consumption, things that have valuable do so because they “cost” not because they are useful, human activity has value because it “pays” not because it enriches human life (think of office work, telemarketing, repetitive maquiladora work).

    i had mention earlier (in the post that got erased) that capitalism has historically needed a strong State, it currently does too. it needed the state to ensure the colonization of the Americas, the preservation of slavery, of war (to secure new markets, cheap labor, and natural resources), protection of monopolies abroad (like the United Fruit company in Guatemala, who owned most of the countries infrastructured and arable land, and which obtained it from US backed dictators). capitalism needs the state (the police, its prisons, its laws) to protect its interest from a growing poor. to protect its patents. capitalism relies on governmet subsidise, low taxes (which is a form of subsidize when they use roads, water, and other things we pay with our taxes). capitalism needs the state to carry own trade agreements and to enforce payments to loans and interest rates, etc. i do not think that capitalism could exist without a state.

    okay, enoug for now. peace.

  • P-3000,

    Thanks for replying! I will make sure to visit your blog as well as this discussion is an important one and it should be discussed as often as possible. Allow me to make some comments, please let me know what you think.

    In discussions like this it is important to restate just how much wealth capitalism has brought us and there is nobody who recounts that better than the Swedish writer Johan Norberg, who writes:

    Karl Marx explained that capitalism would make the rich richer and the poor poorer. If someone was to gain, someone else had to lose in the free market. The middle class would become proletarians, and the proletarians would starve. What an unlucky time to make such a prediction. The industrial revolution gave freedom to innovate, produce and trade, and created wealth on an enormous scale. It reached the working class, since technology made them more productive, and more valuable to employers. Their incomes shot through the roof.

    What happened was that the proletarians became middle class, and the middle class began to live like the upper class. And the most liberal country, England , led the way. According to the trends of mankind until then, it would take 2 000 years to double the average income. In the mid-19th century, the British did it in 30 years. When Marx died in 1883, the average Englishman was three times richer than he was when Marx was born in 1818.

    The poor in Western societies today live longer lives, with better access to goods and technologies, and with bigger opportunities than the kings in Marx’ days.

    Ok, said Marx’s evil apprentice Lenin. We might have been wrong about that. But the working class in the West could only become richer because they are bribed by the capitalists. Someone else would have to pay the price for that bribe – the poor countries. Lenin meant that imperialism was the next natural step of capitalism, whereby poor countries had to give up their work and resources to feed the West.

    The problem with this argument is that all continents became wealthier, albeit at different speeds. Sure, the average Western European or American is 19 times richer than in 1820, but a Latin American is 9 times richer, an Asian 6 times richer, and an African about 3 times richer. So from whom was the wealth stolen? The only way to save this zero-sum theory would be to find the wreckage of some incredibly advanced spacecraft that we emptied 200 years ago. But not even that would save the theory. Because we would still have to explain from whom the aliens had stolen their resources.

    It is correct that colonialism often was a crime, and in some instances led to horrible acts. But globalisation in the last decades shows that the existence of wealthy, capitalist countries facilitates development for poor countries if they participate in a free and voluntary exchange of ideas and goods. Globalisation means that technologies that it took wealthy nations billions of dollars and generations to develop can be used straight away in poorer countries. They can sell to wealthier markets and borrow capital for investments. If you work for an American company in a low-income country, you receive about 8 times the average income in that country. Not because multinational companies are more generous, but because they are globalised, and bring machines and management that raise the productivity of the workers, and consequently also their wages.

    Therefore, opportunities for a poor country with open, market-friendly institutions increase as the rest of the world becomes more developed. It took England 60 years to double its income from 1780. 100 years later, Sweden did the same in just 40 years. Another 100 years later, countries like Taiwan , South Korea , China and Vietnam did it in no more than 10 years.

    During the 1990s, poor countries with about 3 billion inhabitants have integrated into the global economy, and they have also seen their annual growth rates increase to almost 5 percent per capita. It means that average income doubles in less than 15 years. Compare this to the much slower growth in rich countries, and the negative growth in developing countries where 1 billion people live. These countries, especially in sub-Saharan Africa , are the least liberal, the least capitalist and the least globalised. It seems Lenin had it upside down – poor countries that are connected with the capitalist countries with trade and investment grow faster than those countries, those that don’t become poorer.

    Let’s have a short look at the statistics to see the greatest untold story ever. The proportion in absolute poverty in developing countries has been reduced from 40 to 21 percent since 1981. Almost 400 million people have left poverty – the biggest poverty reduction in mankind’s history. In the last 30 years chronic hunger has been halved, and so has the extent of child labour. Since 1950 illiteracy has been reduced from 70 to 23 percent and infant mortality has been reduced by two-thirds.

    So the rich get richer, and the poor get richer even faster than the rich. Both Marx and Lenin were wrong.

    So in conclusion, we have that capitalism has cut global poverty by half, lifted 400 million plus people out of absolute poverty, increased the poors nutritional intake, the poors lifespan, and reduced the poors infant mortality rates (by more than 2/3’s), increased literacy, all in the shortest time in the history of mankind. This is hardly what one would consider, “marginal or questionable value”, atleast not if one is poor.

    With that out of the way, my future comments will concentrate on answering Robert Jensen’s individual criticisms.

  • I understand you are framing this discussion as Capitalism vs. Communism, please don’t think I am a communist. I give you the credit that you know life is more than black and white, allow me the same. Keeping this limited to only two systems is only for this discussion’s purposes.

    Let’s begin with the end stats in your final paragraph:

    “So in conclusion, we have that capitalism has cut global poverty by half, lifted 400 million plus people out of absolute poverty, increased the poors nutritional intake, the poors lifespan, and reduced the poors infant mortality rates (by more than 2/3’s), increased literacy, all in the shortest time in the history of mankind. This is hardly what one would consider, “marginal or questionable value”, atleast not if one is poor.”

    Here are a couple of stats for all of yours:
    -The number of working poor has increased
    -In the US childhood poverty has increased
    -500 children die everyday from lack of access to food (not that their isn’t food, there just are not capitalists willing to make it available to them, because of ‘market purposes.’)
    -3 billion people today live on $2 a day
    -many poor countries have nationalized health care and free education

    Simply put. IF the U.S. is the powerhouse of capitalism where we have capitalism leading the way, running the show, how can you explain OUR child poverty rates, homelessness, infant mortality rates, literacy rates, mental disease rates, violence, imprisonment, drug addiction (OTC and Illicit), suicides, and overall dissatisfaction with life?

    Cuba and other countries with much weaker economies and ‘un-pure capitalism’ have all the opposites of our super mega rich country.

    So Jensen’s view of the “marginal or questionable value” of the byproducts of capitalism holds true. I would much rather have health, literacy, and a sane society, than all the so-called riches capitalism brings.

    This rose colored glasses view of capitalism, like that of Thomas Friedman, ignores the social and political constructs that capitalism (for the most part) creates and causes dis-ease in people. This view of capitalims being the savior of the planet is unsustainable. It ignores the other facts you are aware of but choose to ignore.

    If everyone could read, if everyone was treated like white males, if everyone wasn’t raped, if everyone wasn’t shot, if everyone wasn’t colonized, everyone wasn’t given drugs while in the womb, or in front of their home, if everyone wasn’t told because of their weight, color, size, shape, that they were less than others, if everyone had parents,…
    THEN maybe then would capitalism be that system that could be applied equally and be beneficial to all.

    WE are not there. WE need a humanitarium system that measures succes in human terms not dollars and cents.

    To think otherwise is simply repeating what those who truly benefit from capitalism have developed to create cheerleaders who believe in Alger Hiss and Santa Capitalism.

    To paraphrase Jensen: Why should we support or hail the virtues of system that celebrates the worse aspects of human nature?

    To do just that, to admire and promote the predator/selfish model that is capitalsim is sick: inhumane, undemocratic and unsustainable.

  • i guess i’m out of the conversation. good luck you two. i don’t think we can convince each other. i hope that hp at the ends stands for human life and dignity, equaliy, democracy, liberty, justice, etc. remember the importance of critical reflection, of comparing reality to political rhetoric, etc. there are such things as capitalist fundamentalists, i hope you are not one of them. peace.

  • P-3000,

    Point taken on the communist charge – I will try to refrain from assuming you are arguing the communist case in the future (I’ll even stop calling you a ‘damn communist’ under my breath ;-) ).

    As far as the stats you give it is important we make it clear that we are not comparing apples to apples. Economists like to separate poverty into two categories, there is what they call absolute poverty – which is the poverty I was referring to – and then there is what economists call relative poverty, which is the poverty you are now referring to.

    The difference between the two poverties hit home to me when I was reading an article, dont remember where maybe National Geographics, and it had a native from Africa visiting the United States for the first time. The journalist thought it would be a good idea to show this African the ‘ghettos’ of the United States, so he drove him around some of the most poverty stricken areas and was shocked to hear the African, after looking around for some time, shout out, ‘I want to live in the United States’, the journalist, with a confused tone, asked how he could say such a thing after seeing what he has seen and the African immediately responded that “it is in the United States where the poor people are fat“.

    In the United States and developed countries in general (which, btw, happen to be the most capitalist countries in the world) the poor people have an obesity problem, whereas in underdeveloped countries the poor people tend to have a starvation problem, and it would be wrong to bundle up the two like they are the same thing.

    This is not to say that relative poverty is unimportant and does not need to be addressed – it isn’t and it does, but you can’t group the two as if they were one. To give yet another example, I grew up in Compton, California, in what many people in the United States would consider severe poverty but my father, who came to the United States in his mid-twenties, grew up in a small town in Guerrero, Mexico, where he has had to lift old food off the floor to eat because poverty was so bad. Clearly, as bad as Compton is, it is nowhere near the absolute poverty those in other countries have had to endure (I’ve blogged more on this here).

    How different are these two categories? Dani Rodrik, Professor of International Political Economy at the John F. Kennedy School of Government at Harvard University, is fond of asking his students that very question, he asks,

    I asked the audience a favorite question of mine: would you rather be poor in a rich country, or rich in a poor country. I gave them the following terms for thinking about the question:

    1. Assume you care only about your own consumption
    2. Define poor and rich as someone who is the in the bottom or top decile of a country
    3. Define poor and rich country analogously as a country in the bottom or top decile of the distribution of per-capita incomes across countries.

    The audience was divided evenly between those who would choose to be rich in a poor country and those who would rather be poor in a rich country. The real answer is that it is not even close. This has important implications for how we think about poverty reduction in the world.

    So what is the correct answer, he gives that here,

    Actually a lot of respondents got this right, but the answer is counterintuitive as some also mentioned. The correct answer is that a poor person in a rich country is three times better off than a rich person in a poor country (given my definition of what “rich” and “poor” mean in this context). It is not even close.

    He goes on to explain that the same comparison can be given with regard to health indicators, and I would be willing to bet for literacy, infant mortality, and all the other standards mentioned above.

    So in conclusion, though child poverty in the United States may have increased (something that fluctuates up and down all the time), the fact that capitalism has “cut global poverty by half, lifted 400 million plus people out of absolute poverty” is still a miracle in itself, and the fact that capitalism did this in the shortest time in the history of man demonstrates the power of markets in doing what no other economic system has been able to do.

    As far as the rest of your stats, where you write,

    -500 children die everyday from lack of access to food (not that their isn’t food, there just are not capitalists willing to make it available to them, because of ‘market purposes.’)
    -3 billion people today live on $2 a day

    The problem here isn’t capitalism, the problem here, as you have mentioned, is the lack of capitalism. What these countries need is to move away from their communist or atleast communist leaning economies and move more towards capitalism (among other things). In other words, it is the Chicano Studies students and their ilk that need to move out of the way and let the capitalists, especially through free trade, move in.

    I do find interesting your comments on Cuba, where you write, “Cuba and other countries with much weaker economies and ‘un-pure capitalism’ have all the opposites of our super mega rich country.”

    Cuba is a favorite of lefties, it is brought up often as a proof that an alternative to capitalism exists, but what is often left out is a broad picture of Cuba, a deeper understanding of how the economy really is. Here is a broader overview of the Cuban economy,

    Before Castro, Cuba was as rich as Italy, and richer than Spain. Cuba has not merely lagged behind, it has actually grown poorer, and is now more than five times poorer than these countries. It used to be among the richest in Latin America, now it’s among the poorest.

    Cubans had better access to food than all other Latin American countries, except Argentina, before Castro, but now they have worse access than almost all the others. Cubans are the only people in Latin America who have seen their intake of calories decrease since then. It is now better than in the 90s, but more than every tenth Cuban is chronically undernourished.

    Cuba had lower infant mortality than all other Latin American countries before Castro, and lower than France, Italy and Japan. It is the only area where progress has continued since then, but it has been much slower than in other similar countries.

    We can also discuss their protein intake, one of the lowest in Latin America, their standard of living, their job growth or even their freedom of expression and civil rights record. We can go on and on showing different stats but what I like to focus on when discussing Cuba with people is the actual preferences of Cuban citizens themselves.

    I ask you this, if Cuba is so great, especially compared to the United States, why is it that citizens of Cuba risk life and limb trying to escape it year after year? Do you think it is the rich people trying to escape? Of course not, it is the poor, and circumstances have to be really bad for people to risk their lives (and imprisonment if caught) trying to cross an ocean and in the process leave family and friends behind.

    Also, where do you think most of those Cuban immigrants wish to go? To the most capitalist country in the world, of course, and they are no different than poor immigrants the world around. There is a reason why the poor from all over the world continue to choose the United States as a place to call home, and I assure you, it is not our welcoming attitude – it is our economy, an economy based on capitalism, the same capitalism that has relieved poverty throughout the world at large.

    tin,

    Please, stick around I will get to your posts in time. Like you, I have school work to do as well and have a limited time to blog…but I am not ignoring you, I promise.

  • We obviously are not going to convince each other to change their views, this was not my goal to begin with. I do want to point out some flaws in your logic and simply remind you to include real human needs in your future analysis of economic structures, because what is obvious is that what we have been doing is not good for this planet.

    You wrote:
    “In the United States and developed countries in general (which, btw, happen to be the most capitalist countries in the world) the poor people have an obesity problem, whereas in underdeveloped countries the poor people tend to have a starvation problem, and it would be wrong to bundle up the two like they are the same thing.”

    Ofcourse they are not the same thing, but both lead to an early grave. This is a flaw in logic. Just because one is dying from hunger, does not mean dying from obesity and its related diseases is any better.

    As far as your example about the professor who asks his students what would they choose: being poor in a rich country or rich in a poor country. This reeks of arrogance. He ASKED his student’s opinion and they were split. There is no right or wrong answer!!! He asked what they would choose. For him to go on to say there is RIGHT ANSWER on a question that asks for an opinion brings into question his role as a so-called educator.

    Next you wrote:
    “the fact that capitalism has “cut global poverty by half, lifted 400 million plus people out of absolute poverty” is still a miracle in itself, and the fact that capitalism did this in the shortest time in the history of man demonstrates the power of markets in doing what no other economic system has been able to do.”

    Now this is the usual play on words people who want to keep the status quo use. Just like when discussing the unemployment numbers. They say unemployment has gone down because they changed the definition of what is means to be unemployed. Are they unemployed and looking for work? Are they unemployed and not looking? Are working at a temporary position? Are they part time? etc. That fact is in this the richest country of the world our children have been born into poverty at a faster rate in a short amount of time, without healthcare, without quality education, and without anyone questioning how or why this is happening.

    Next: in response to some of my stats.
    “The problem here isn’t capitalism, the problem here, as you have mentioned, is the lack of capitalism. What these countries need is to move away from their communist or atleast communist leaning economies and move more towards capitalism (among other things). In other words, it is the Chicano Studies students and their ilk that need to move out of the way and let the capitalists, especially through free trade, move in.”

    Here you are simply overgeneralizing and again making this into a ‘you are either for capitalism or you are a communist’ view. You don’t know what the countries’ economic system is/are. Again here in the most capitalist country we have some of the worst social welfare conditions. We also have a track record of violating human rights. We have rid our courts of habeus corpus. We torture and imprison dissidents (see COINTELPRO). We bad mouth the poor and defensless and blame them for EVERYTHING wrong in our society. While allowing corporations to destroy the environment, families (Enron and other high crimes), and benevolent instititions (schools, social security, natural resources) We do this because we are cowards. Because it is too hard to fight the big guys (they got lawyers) Instead we pick on the little guy and suck up to the bullies in hopes that they will let us slave for them.

    AND as far as how you link Chicano Studies to stopping free traders, that logic is all your own and holds no water. I didn’t know we had that much power, but now that you mention it, hey maybe we do.

    You need Chicano studies because one day you will need to remember something real and translatable to more people in this world. More people in this world speak more than one language than not; more people have crossed a border than not; more people are negatively categorized because of where their family came from than not; more people have been victimized for their documents, for their country losing a war, for their country being raped by a corporation, for having an accent, for their appearance. Chicano/a studie is giving voice and power to so many around the world who have been living in the/a Nepantla we have named. What have you given in balance to what you have taken?

    Finally Cuba:
    You don’t see many Black Cubans coming to Amerikkka do you?
    It is better for them in Cuba where now they are allowed to go to school and get PhDs. Even IF Cuba’s infant mortality has dropped, it is still higher than the US!!!!! Even if their economy has dropped, their literacy rate is higher than the US!!!!! Where is your head at?

    Ofcourse people want to come here, this is the land of oppurtunity. That is undeniable. This country was built on theft, exploitation and lies and if you got a great crime or great lie to tell you can get paid for it here in the US of A.

    Blind faith will just lead you into bumping into walls.
    I can read that you are studying this and your positions obviously are loved by your teachers. You will get good grades. In the broader world of ideas expect challenges and I hope you learn to see the other side. Just because some one has no money, does not make them any less and their views of the world any less valid. There is some truth in everything, relative at times, but with openess and discussion general truths will rise.

    The simple answers are seldom the correct ones.
    That is why I cannot propose an alternative at this point. The answer is not easy. One system or another. Maybe we still need to come up with a new one. Debating what is, in the light of the current state of the planet demands we need to find another way of doing things.

    -ps
    I read somewhere else about allowing two parties to be able to negotiate the terms of thier affairs without interference. Well if you can tell me how to get around those pesky credit card contracts, auto dealer contracts, or even how to get around agreeing to click on the terms for this blog site or another website, tell me. I would love to hear how you negotiated with all these business to terms that are agreeable to both parties involved.

  • P-3000,

    Why would you think that we would not change each others minds? I certainly believe that my opinion follows the data and I certainly hope you think the same of yours. In fact, my life is one big change of opinion – I am, afterall, a conservative-libertarian who is Mexican and grew up in Compton….how many of those do you find? Trust me, you certainly can change my opinion.

    You write,

    Just because one is dying from hunger, does not mean dying from obesity and its related diseases is any better.

    Are you really trying to say that living an obese life in the United States is ‘somewhat’ equivalent to living in starvation in, say Africa? The two are miles apart – and I don’t see how anybody could draw any comparison between the two. An early death from obesity is radically different than an early death from starvation. Countries that suffer from absolute poverty have life expectencies of 30 or 40’s at most, some have a life expectency much shorter. Whereas the poor in the United States, those exhibiting obesity problems the most, have a life expectency of only a couple years to at most 5 years below that of the rich. In other words, we are comparing life spans of 30’s and 40’s to life spans of 70’s and 80’s, a radical difference by anybodies measure.

    I should also mention that capitalism is amoral – in other words, it does not deal with morality and what habits should be changed because of that extra wealth – it only cares about producing that extra wealth. If because of an extra abundance of food people eat more and become obese, capitalism has nothing to say about that. To say it a different way, obesity and the problems of peoples indulgences is not an economic problem, it is a religious problem, or a discipline problem, but not an economic problem (it is also a ‘problem’ that those in underdeveloped countries wish they had).

    You also write, being poor in a rich country or rich in a poor country. This reeks of arrogance. He ASKED his student’s opinion and they were split. There is no right or wrong answer!!!

    Maybe you misunderstood his question, he didn’t just ask this question he gave certain qualifications – the most important of them being the standard of living you would have. He wrote, also quoted above,

    I gave them the following terms for thinking about the question:

    1. Assume you care only about your own consumption
    2. etc

    He is not talking about family bonds, or environmental beauty, or wheather, or culture, etc…he is talking in pure economic inductators, and when you qualify the question with that, there is a right or wrong answer. The very poor in the United States, for example, have more access (three times more access, actually) to nutrition, to health care, to education, to growth opportunities etc, than the very rich people in underdeveloped countries do. Again, the differences couldn’t be more shocking.

    You also write, That fact is in this the richest country of the world our children have been born into poverty at a faster rate in a short amount of time, without healthcare, without quality education, and without anyone questioning how or why this is happening.

    Yet this is the country that immigrants, especially poor immigrants, from around the world continiously flock to knowing full well that they will be amongst the poorest of the poor in this country….it seems that they know something you don’t know. But let’s not get into a tangent discussion regarding the USA economy, though I disagree with your analysis, suffice it to say that even if it was true, capitalism is still the miracle I claim it to be. Bringing 400 million people+ out of a poverty that gave them a life span of 30 or 40 years, to a life span that now gives them 70 or 80 years is a huge achievement, and doing this in the shortest time in the history of man is an astronomical achievement. Bringing up economic indicators that have very little to do with lifespans is still irrelevant (though I would say that the solution in the United States is to make the economy more capitalist, but that is another topic for another day).

    You also write, Here you are simply overgeneralizing and again making this into a ‘you are either for capitalism or you are a communist’ view. You don’t know what the countries’ economic system is/are.

    No I am not, this is a factual statement. As my initial post on this blog stated (did you even read it?) the richest countries in the world are capitalist and the poorest countries in the world are communist or communist leaning. It is a pretty close one to one connection…so I am not assuming anything, I am following the data. Second, you again make the mistake of assuming that being poor in a developed country is the same as being poor in an underdeveloped country. Can we atleast agree, from here on, that being poor in the United States is not the same as being poor in, say, sub-saharan Africa? Can you atleast agree there is a fundamental difference between relative poverty, what we experience in the USA, and absolute poverty, what people in Sub-Saharan Africa experience? I am not saying that relative poverty is unimportant, I am just trying to get you to see that they are still radically different from each other. Can we agree on that?

    You also write, You don’t see many Black Cubans coming to Amerikkka do you?
    It is better for them in Cuba where now they are allowed to go to school and get PhDs.

    Yes, as a matter of fact you do. How many Cubans have you met? Black Cubans come to the United States just as much as non-Black Cubans…besides, what does it matter that they can get a PhD in Cuba if they are not allowed to use it? Cuba, remember, is the country where people with PhD’s get more money driving taxi’s than working in their profession.

    You also write, Even IF Cuba’s infant mortality has dropped, it is still higher than the US!!!!! Even if their economy has dropped, their literacy rate is higher than the US!!!!! Where is your head at?

    I don’t know where you get your data from but the infant mortality rate of the United States is statistically equivalent to that of Cuba and our literacy rate is actually higher (97% vs. 96%)….sure, Cuba has more doctors, hospital beds and teachers but this amounts to little in actual results. Even on where Cuba supposedly excels the most, the United States still holds her own and this is without even mentioning the numerous areas where Cuba has an abysmal record (human rights and civil rights as well as economic indicators). Factor all of this in and it makes sense why so many try to flee the country year after year.

    You write, Ofcourse people want to come here, this is the land of oppurtunity. That is undeniable. This country was built on theft, exploitation and lies and if you got a great crime or great lie to tell you can get paid for it here in the US of A.

    but you fail to mention that so was Mexico and all of Latin America (or is Spanish and Portuguese colonialism excused?) , yet that is precisely where most of the poor immigrants coming into the United States come from. Could the reason the United States is ‘the land of opportunity’ be something else then? Hint: Look at the USA’s economy ;-)

    You also write, Blind faith will just lead you into bumping into walls.
    I can read that you are studying this and your positions obviously are loved by your teachers. You will get good grades.

    Not so, I am an electrical engineer by trade and have been working as an engineer for coming up on nine years now. I have only taken one course in economics and that was in undergrad. Currently I am taking upper division electrical engineering courses at UCSD in the hopes of getting my masters there – not a single economic course. All that I have learned I have learned by personal reading.

    You also write, In the broader world of ideas expect challenges and I hope you learn to see the other side. Just because some one has no money, does not make them any less and their views of the world any less valid. There is some truth in everything, relative at times, but with openess and discussion general truths will rise.

    I believe in everything you say here. I have never believed that money makes someone better or more important, on the contrary, I think the poor have a special eye to see the world that is often missing in the rich. I grew up (relatively) poor and all of my friends, both past and present, have done the same. My point in this discussion is not to say that rich people or rich countries are objectively better, but to argue that a higher nutritional intake, longer life span, and better standard of living is better for those who lack exactly those. As far as looking at other opinions, that is what I spend the most time doing. Look at my blogroll and you will see many people who disagree with me politically, look at the forums I visit, the blogs I visit, and the people I interact with – practically all have to do with the opposing views.

    Oh yeah, as far as contracts go, you always have the right to change contracts (personal auto seller, for example) or opt out of them completely. Nobody is forcing you to do anything and just as much as you have the right to state the minimum requirements for you to enter into a contract, so does other parties involved.

  • HP-

    hello HP, you asked for me to stay in the conversation but then don’t engage my comments. a lot of the points you make you back up from scholars and economists who I and other very much disagree with. i could also spend time citing scholarly work, economist, revolutionaries, community and environmental activists, indigenous people fighting de-colonial struggles all around the world, but you wouldn’t believe or respect that. so really, it doesn’t help when you quote from one of your heores. i could do the same. I could cite, Noam Chomsky, Howard Zinn, John Holloway, Eduardo Galeano, Subcomandante Marcos, Rigoberta Menchu, Vandana Shiva, Angela Davis, Patricia Hill Collins, Gloria Anzaldua, hey, even Michael Moore, who have a very different view of Capitalism than you do. but i don’t think you would change your views.

    We see capitalism very differently. Capitalism is not amoral, it is not simply an economic system. it enters our system (minds and bodies). the way we work, the way we live, the way we interact with others/relationships, what we consider of value, our dreams and apirations, etc.

    i very much disagree with your statement that poor countries are communist or communist leaning, this is an absurd statement. not even Cuba or Venezuela are communists, where do people own the factories, where do we have a system of direct democracy or close to it? Marx and many other Marxists (although not the majority) criticized the state and state control over society and the means of production. communism would require the dismantling of the concentration of power in the state. but what Marx and marxists say is not the point, i don’t think of myself as one. the issue for me is about communities and people deciding by themselves how they want to live and what type of society they want to have (if capitalist want to be capitalist, that’s great, but have themselves exploit each oter). capitalism or state socialism do not respect democracy (unless you think that in the US we have a democracy), and will use force and whatever means to impose their ways on others. if you disagree with this, then you are completely ignorant of US history and the history of Russia and China, which is precisely what they did. if you do not know this history, then we cannot have a conversation, if you do not see how capitalism needs a strong state, then i don’t think we can have dialogue since we see things from a very differnt point of view.

    talk to your friends, your professors, etc. having discussions over a blog are not going to change how you or i see the world. (if anything, it lets me know that capitalist fundamentalism does exist)

    if you want to continue our discussion, please take the time to read my previous post and have a thoughtful response. if not, have a good life. and maybe the people you love (that is, if they are not walking oxymorons “libertarian-conservative”) can change your mind. but like i heard a commedian say, “have you ever tried to convice a rich person that capitalism doesn’t work?” is just not possible, and i don’t mean you are rich, but you are obviously very comfortable with the privileges of living in the world’s greatest super power (power over the rest of the world, or do you think is about diplomacy?).

    peace.

  • tin,

    As I said in my previous post, I am not ignoring your posts or even the remaining post of P-3000…my problem here is time. Because of other commitments, I can only post a response once every other day, or depending on what day of the week once every day – at most. Give me a few days and I will respond to you and P-3000 more fully.

    Btw, as far as my scholars go, I challenge you to find me a scholar, especially an economic scholar, from either the left or the right, who disagrees with anything I have quoted above. Capitalism, and the overwhelming good it has done around the world is self-evident and unquestioned by economists on all sides of the political spectrum. Sure, you may find a historian or a Chicano Studies professor (or a linguist), who can say some bad things about capitalism, but that would be like me quoting an economist as an authority on a historical matter (or linguistic matter). Not fair at all….As far as the economics profession goes, both the left and the right side are unabashedly committed to capitalism and especially free trade. Again, as I said in a previous discussion with you, it is only really the sociology and Chicano Studies majors that still entertain communist views…all majors that directly deal with economies and which ones work and which don’t have already been convinced by the overwhelming evidence of capitalism.

    I will address the rest of your comments soon – I promise.

  • This is my final response to P-3000, I am leaving out the charge that capitalism is anti-democratic and unsustainable for time constraint reasons (as well as a belief that they are weak charges)…my next post will start to address tin’s comments above.

    1. Capitalism is inhuman

    This is one of the many aspects of capitalism that lefties often confuse – capitalism is not based on greed, capitalism is based on self-interest and the two are not the same. One person may be greedy at times and s/he may be charitable at times, but that same person is always self-interested. Whether you are a priest or a corporate CEO, you are always working on your own self-interest – you just happen to have different self-interests.

    Second, capitalism offers protection against those who are greedy – it gives them avenues to exercise their greed in a way that also increases the wealth of others.

    As the 20th centuries greatest economist Milton Friedman said, “The problem of social organization is how to set up an arrangement under which greed will do the least harm; capitalism is that kind of a system”.This is what Adam Smith referred to when he wrote, “…by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.” When a CEO works hard to make her business more profitable, she must do so by, ultimately, pleasing the customers. Thereby raising the quality of life for those at the bottom.

    Economist Walter Williams explains it this way:

    It’s popular to condemn greed, but it’s greed that gets wonderful things done. When I say greed, I don’t mean stealing, fraud, misrepresentation or other forms of dishonesty. I mean people trying to get as much as they can for themselves. We don’t give second thought to the many wonderful things others do for us. Detroit assembly-line workers get up at the crack of dawn to produce the car that you enjoy. Farm workers toil in the blazing sun gathering grapes for our wine. Snowplow drivers brave blizzards just so we can have access to our roads. Do you think these people make these personal sacrifices because they care about us? My bet is that they don’t give a hoot. Instead, they along with their bosses do these wonderful things for us because they want more for themselves.

    People in the education and political establishments pretend they’re not motivated by such “callous” motives as greed and profits. These people “care” about us, but from which areas of our lives do we derive the greatest pleasures and have the fewest complaints, and from which areas do we have the greatest headaches and complaints? We tend to have a high satisfaction level with goods and services like computers, cell phones, movies, clothing and supermarkets. These are areas where the motivations are greed and profits. Our greatest dissatisfaction is in areas of caring and no profit motive such as public education, postal services and politics. Give me greed and profits, and you can keep the caring.

    In other words, I would much rather be part of an economy based on self-interest than an economy based on altruism – just think of the radical difference in standard of living between capitalist and communist economies.

    Lastly, another important point that should be mentioned in discussions like this is that there is a give and take in human nature between self-interest and status seeking. In economies where self-interest plays a lesser role status seeking becomes its substitute and given the trade-offs between the two I would rather be in an environment where self-interest plays the dominant role.

    Economist Arnold Kling explains it this way:

    “Many people think that we should look down on “economic man,” who rationally calculates costs and benefits. They believe that people should have higher motives.

    Instead, I suspect that the most likely alternative to economic motivation is a worse motive: status-seeking. I believe that is more important to curb our lust for status than our lust for goods and services.

    The drive for economic gain helps the individual, and, as Adam Smith famously showed, helps others. Trade and economic growth are positive-sum games, in which there can be winners without losers. Moreover, when people seek economic gains, this is usually transparent. You usually understand when you and others you transact with are trying to improve your economic well-being.

    Status, on the other hand, is typically a zero-sum game, in which one person’s gain comes at the expense of others. Adding to the evils of status-seeking is that people often deceive themselves and others into believing that they are doing something for a higher motive when in fact they are seeking status.”

    The full article, which I recommend everybody interested in this topic read, can be found here.

    With that out of the way…now I can devote my full attention to tin’s comments above.

  • Tin,

    You give me vague and general comments in your response, not much I could sink my teeth into. Who would disagree with comments like, “i do not believe in the concentration of political power in a few hands, and i do not think the government should dictate anything, but the other way around…. the government should “command by obeying.” the closer to direct local democracy, the better”.

    I generally agree with everything you say here yet me and you politically disagree on probably everything, so you understand my frustration in trying to engage your comments.

    However, you approach real disagreements when you write, “having said that, i do think that certain human necessities (for both a healthy individual and a healthy society) should be guaranteed by the community things like health care, education, food and housing, all these things should be accessible to all”. But even here, depending on what you mean by ‘guaranteed’ and ‘accessible’ I could also agree with everything you say.

    We do start to see clear disagreements in your second post though, but even here, it is primarily limited to misunderstandings of what I believe, you write, [my] conception of society is extremely individualistic, and does not seem to appreciate the interconnections of all human beings to the planet. [my] conceptions is also highly predatory, with the most agressive, the most powerful, and the most privilege trampling over the most vulnerable. so, although i do not think that we need a welfare-state, we do need a society that takes care of human beigns regardless of wether they can contribute or not to the economy.

    This begs the question – I believe the very opposite, I believe that capitalism, properly implemented, is the most wide reaching economic policy around. It increases the standard of living of those in a certain country and increases the standard of living of other people in other countries around the world. Also, private property and an economic environment where free enterprise and entrepreneurship can thrive is the least ‘predatory’, ‘agressive’ and ‘privilege trampling over the most vulnerable’ than any other economic system in history.

    You show me an economy where people can rise from rags to riches, where even the poor have a higher living standard than the rich did a couple generations ago, and where birthright plays an insignificant role and I will show you an economy that is capitalist. Of course you believe the opposite, but the burden of proof is on you to provide the reasons why.

    You continue to misrepresent what I believe when you write, “HP reduces human society/community (global, local) to the market. we are all in relations of production and consumption, things that have valuable do so because they “cost” not because they are useful, human activity has value because it “pays” not because it enriches human life (think of office work, telemarketing, repetitive maquiladora work).” This is a complete misrepresentation of my views. I do not consider economics the end all be all of human life. My discussion here is only focused on that because that is the point of our disagreement. I strongly believe that family, social and cultural bonds, and human integrity are much more important in daily life and should be as so. But here we are talking about basic necessities, things like nutritional intake, life expectancy, and child mortality rates, and it’s inappropriate to discuss the beauties of “enriches [in] human life” when you lack even these basic necessities.

    You also confuse capitalism when you write, “i had mention earlier that capitalism has historically needed a strong State, it currently does too. it needed the state to ensure the colonization of the Americas, the preservation of slavery, of war, protection of monopolies abroad. capitalism needs the state to protect its interest from a growing poor. to protect its patents. capitalism relies on governmet subsidise, low taxes. capitalism needs the state to carry own trade agreements and to enforce payments to loans and interest rates, etc. i do not think that capitalism could exist without a state”.

    Where to begin? This confuses what capitalism is and what capitalism needs. Capitalism does not need a strong state and has historically thrived more with a weak one, take Hong Kong as just one example – Hong Kong under British control was neglected, John Cowperthwaite decision to leave Hong Kong as it was, to limit bureaucratic interference, to say no to tariffs, personal taxes higher than 15 percent, and limit red tape created a near perfect example of ‘pure capitalism’. For example, Hong Kong didn’t have import or export duties, restrictions on investments coming in or profits going out (near complete free trade), no capital-gains tax, no interest tax, no sales tax, no minimum wage, no unemployment benefits, no pro-union legislation, no social security, no national health program, and little to no welfare……yet Hong Kong in that same period was one of the “Asian Tigers”, and Hong Kong poverty reduced at the quickest rate in the history of mankind.

    To give another example, take slavery and its abolishment in the Americas. Donald Boudreaux, chairman of the Department of Economics at George Mason University, notes this:

    slavery had been an ever-present institution throughout human history until just about 200 years ago. Why didn’t slaveholders of 2,000 years ago in Europe or 500 years ago in Asia accumulate wealth that triggered economic growth comparable to ours? Why is Latin America so much poorer today than the United States, given that the Spaniards and Portuguese who settled that part of the world were enthusiastic slavers? Indeed, the last country in the Americas to abolish slavery was Brazil — in 1888, a quarter-century after U.S. abolition. By American and western European standards, Brazil remains impoverished.

    And why, having abolished slavery decades before their Southern neighbors, were Northern U.S. states wealthier than Southern states before the Civil War? …

    The fact is that slavery disappeared only as industrial capitalism emerged. And it disappeared first where industrial capitalism appeared first: Great Britain. This was no coincidence. Slavery was destroyed by capitalism.

    To begin with, the ethical and political principles that support capitalism are inconsistent with slavery. As we Americans discovered, a belief in the universal dignity of human beings, their equality before the law, and their right to govern their own lives cannot long coexist with an institution that condemns some people to bondage merely because of their identity.

    In other words, slavery is the antithesis of capitalism and history has shown that the two cannot, for long, co-exist together.

    So even here, two posts into your comments, we have yet to reach something fundamentally of disagreement between the two of us.

    In your last post we reach some disagreements, but even then there is still little to work with. For example, you write, i very much disagree with your statement that poor countries are communist or communist leaning, this is an absurd statement.…Fine, if you want to define communism differently than the leaders of these countries or even historical supporters of their movements did, that’s fine. My point here is that poor countries are ‘non-capitalist’ and rich countries are capitalist. Those non-capitalist countries also tend to follow a pattern very similar to communism, for example they have little to no free trade and little to no property rights.

    It should also be noted that communism, strictly defined in your terms, cannot be accomplished. History has shown group after group trying to do just that, and in every case, it has resulted in gross human and civil right violations (nobody in history has killed more people than governments trying to follow communist doctrine) and the poorest standard of living in the world. In other words, communism as defined by academics is pure utopianism, and a dangerous utopianism at that. One that F.A. Hayek, as early as 1944 in his groundbreaking book, The Road To Serfdom, showed could not be realized.

    Whereas capitalism has been implemented and in doing so has brought in unprecedented prosperity to places and people that have previously been forgotten and ignored – the differences between the two systems couldn’t be more staggering.

  • hp-

    thanks for replying to my post. i see that we are finally having a conversation. i do think that i do not provide many specifics, but really, even the one’s you provide, do little to convince me. what i would need, is a lot more time to go through the numbers and evidence that backs up my arguments (but this is just my past time, to look at blogs, i remind you that i’m a graduate student). but since you have given me the time, i think is fair that i at least provide one comprehensive post, with some concrete evidence.

    i do not know much of Asia, but i do have a good working history of Latin America (especially Mexico and Central America) and the United States. i would concentrate my argument to these regions as this is what i know. in a future upcoming post, i will show you how capitalism in the Americas has needed a strong state, and continues to need one. i have a very different defition of free trade than you do.

    i will try to develop the following points: capitalism needs a strong state, capitalism is not solely an economic system or amoral but affects many aspects of our existence, capitalism is extremely individualistic and predatorial. capitalism cannot exist without human exploitation (wether is as slaves, colonies, low wage workers, undocumented labor, etc.).

    one thing you are right, i cannot show you a nation-state that looks like my definition of the type of society i envision. for one, i envision a society without a state (crazy ha?), and i do not base my conceptions of what is possible based on what the history books say has been or is. (there are many thins left out of mainstream history history).

    so, wait for my post, i’ll need a few days, maybe by Monday.

  • Sounds good tin, I just ask that you keep this post in mind when you refer to capitalism in Latin America.

    With that said, I look forward to your response.

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