11/24/2002

11-24-02 - 1

11-24-02

Some simple analysis of Capitalism. First of all, the only way to profit in a capitalist business is to swindle your customers. This is almost true by definition. If you sell an asset at cost, you haven't made any profit, you've simplify turned a non-liquid asset into a liquid asset. In order to make a profit, you must sell over cost. In order to make a big profit, you must sell something that's worth very little at a very high price. For example, Wall Street sold internet stock during the boom this way; they were really the same as a "pet rock" - very high price, very low value (HPLV). Generally, the Capitalist establishment is very excited about HPLV commodities, it spends a lot more on advertising them. Some examples are stocks, entertainment, fancy cars, diet foods, fancy clothes, cigarettes, booze, lottery tickets, software, etc. There are other more complicated ways that the Establishment acheives HPLV. One is with subsidies. Agribusiness, for example, gets the cost of production subsidized, while keeping the cost the same through price controls. The result is that if you grow wheat yourself, it has low value, because it must compete with the wholesale price of subsidized product, but major agribusiness has still made a large profit.

The next interesting thing in Capitalism is to realize that corporations are run by people. In an "ideal" capitalist model, corporations are just like individuals - they choose the things that are best for them. In reality, this doesn't happen. The reason is that corporations are run by CEO's, and CEO's are human, therefore they are greedy and selfish. The result is that Corporations do what is best for CEO's. Now, CEO's are almost by definition part of the Moneyed Elite. The Moneyed Elite in general sticks together and watches out for each other, since they live in great fear that the people will become empowered and try to acheive decent living conditions, which would ruin the great skewing of wealth that the Elite enjoy. CEO's also have connections in the Elite in their friends and family, their Alma Mater, their previous job, and of course they want to make sure they can jump to another good job when they run their current company into thye ground. The result is that CEO's generally do what is good for the Elite, hence Corporations generally make decisions based on benefitting the Moneyed Elite. Corporations clearly care nothing for their employees; they will do things to make them happy, but only in so far as it improves productivity, hence their bottom line. Furthermore, CEO's are generally very short sighted, and logically so. They really don't care how the Corporation does in the long term, because they want to get fired (and thus earn a huge severance) and then either retire (subsidized by the workers of the Corporation) or take a huge hiring bonus (and stock option grant that waters down the holdings of the average stock holder). CEO's only want to improve the profits of the company for the major shareholders (the Elite) in the short term. Thus, doing things like breaking up companies, shutting down factories, etc. are all "good for the company" (meaning "good for the Moneyed Elite") despite the human cost to the workers.

Governments and corporations in general are machines to improve the lives of the few at the cost of the many. Of course, not all governments are this way, but the US certainly is, and any one else that gets out of line, we rapidly bring back into line through sactions, IMF rules, etc. You may think, "hey, I have my DVD player and my SUV, I'm doing fine" - well, you're getting close to Moneyed Elite yourself (did you approve of the recent tax cut?), but you've still been thoroughly taken advantage of. Can you afford to buy the house you live in? How long could you afford to live without work? Are there open spaces near you, clean air to breathe? Are you afraid of the dangerous poor element? The real life-quality-improving benefit of your labor has been skimmed and diluted and sabotaged.

Taxes. Many people object to taxes, because it is a direct transfer of money from you to Government, and the Government will generally use it for bad things (direct transer of money to the Elite, via Lockheed, Boeing, ADM, Monsanto, EDS, foreign intervention, etc.). This is true, but to take out all your resentment on taxes is foolish. You must realize that your real wealth has been much more heavily adversely affected through subtle means - you're paid less than you should be, health insurance costs more than it should, things you buy are price-inflated, the things you own are depreciated, and the wonderful free things in the world (nature, community) are destroyed. Furthermore, Government is not all bad. Neither Governments nor Corporations are really entirely intentionally corrupt. There's no vast conspiracy. Many of the people who do these things don't really realize what they're doing. They're only doing what they were taught was right in a capitalist system - they are doing what's best for themselves (and their friends). America glorifies greed more than any other country. If you can gain fame and fortune by screwing over your neighbor, you are a clever hero, not the bastard that you should be considered. Our cultures idolatizes robbers and thugs like John Rockefeller, JP Morgan, Teddy Roosevelt, Andrew Carnegie, Jack Welch, etc. Even modern anti-heros like Bill Gates may be occasionally villified (out of jealousy), but anyone would trade places with him any day. Money is far more important than the means used to get it. Money is far more important than any side effects inflicted on others to obtain it.

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