A new economics lesson in 'progressive' capitalism

Watching the market over the past few months must have been tough on gambling addicts. Why? Because despite what Wall Street would have you believe – you know that the ‘market’ somehow has a mind of it’s own and always ‘corrects’ when it’s been bad? It doesn’t. Because the ‘market’ is NOT the all-knowing, all-seeing entity that capitalists like to think it is.  No, the ‘market’ is manipulated by the following:

1. Mood of investors (or as I like to call them ‘gamblers’)

2. Bizarre doings overseas (like the Grand Poohbah of Greedistan picked his nose-) or

3. Really bad or good things that happen (like a run on a bank or an oil well spill in the along the coast or planes hit the Twin Towers or Grand Poohbah doesn’t pick his nose)

Yet we base our whole economy betting our money (because at this point – this is not investing) on short-term gains, not long-term benefits. We think in quarters, not in decades.

It’s crazy! It’s the one-armed bandit being pulled over and over again with no relation to reality – except – did I get some profits today? There must be more.

Adam Smith, sometimes called the ‘Father of Capitalism’, wrongfully believed that if people were allowed to do anything they wanted, however they wanted, make as much money as they wanted without regard to how it affected society, that it would eventually BENEFIT society. Oops.

I am not against making profits or even investing in companies that do. However, making profits just for profits’ sake leads to what we have now - over consumption, greed, risk-taking and debt. With regulations, companies should not just have to respond to their shareholders, but to the society at large.

The biggest economic boom in our history occurred under the most regulations and the highest taxes paid by corporations. From the 1940s through the 1960s, our economy grew through our manufacturing industry and the creativity of the American worker and entrepreneur. We didn’t make plastic crap. We made things we used: televisions, cars, clothing, vacuum cleaners, and furniture. You can’t find American-made anything any longer because of the deregulation.

Don’t believe me? Look at some of industries we’ve de-regulated and therefore have been put out on the ‘free-market’ alter of  “Mamma needs a new pair of shoes.”

1. Phone system

2. Airlines

3. Railroads

4. Education

5. Health care

6. Banking

7. Energy

These industries have in some way been ‘deregulated’ or otherwise set ‘free’ in the marketplace. Notice any similarities? They all have either been severely weakened or prices have skyrocketed.

I believe in an economic theory that puts profits and societal benefits on an equal footing. It’s time to rethink capitalism before it’s too late. Call it progressive capitalism.