Capitalism Needs a rethink

[The Twilight Shadow]

Has it occurred to anyone that repeated GLOBAL financial crisis might be a little indicator that capitalism might not be working and might indeed be bad for the entire global community?

Watch this stuff:

http://www.cbc.ca/doczone/meltdown/

And here's some food for thought

http://www.cbc.ca/doczone/meltdown/extras.html

* Half of America owns only 2.5% of country's wealth. The top 1% owns a third of it.
* The gap between the top 0.01% and everyone else hasn't been this bad since the Roaring Twenties.
* In 1950, the ratio of the average executive's paycheque to the average worker's paycheque was about 30 to 1. Since the year 2000, that ratio has exploded to between 300 to 500 to one.
* In 2008, the total national household debt in Canada has reached an all-time high of $1.3 trillion. A survey found that 42% of respondents said their personal debt was rising in the past three years, and 21%said they couldn't manage their debt.
* 61% of Americans "always or usually" live paycheck to paycheck, which was up from 49% in 2008 and 43% in 2007. The numbers are similar in Canada.
* A staggering 43% of Americans have less than $10,000 saved up for retirement.
* In America today, the average time needed to find a job has risen to a record 35.2 weeks.
* In 2008, the World Economic Forum rated Canada's banking system No. 1 in the world. The U.S. came in right behind — Namibia.
* It is being projected that the U.S. government will have a budget deficit of approximately 1.6 trillion dollars in 2010. How much is that? If you went out and spent one dollar every single second, it would take you more than 31,000 years to spend a trillion dollars.
* In February 2010, there were 5.5 unemployed Americans for every job opening.
* In California’s Central Valley, 1 out of every 16 homes is in some phase of foreclosure.
* U.S. banks repossessed nearly 258,000 homes nationwide in the first quarter of 2010, a 35% jump from the first quarter of 2009.
* In May 2009, the number of Canadians getting regular employment insurance benefits in reached 778,700, the highest level on comparable records going back 12 years. During the month, the number of people getting EI benefits grew by 9.2%, from April.
* More than 24% of all homes with mortgages in the United States were underwater (the mortgage is more than the current market value of the home) as of the end of 2009.
* This most recession has erased 8 million private sector jobs in the United States.
* 39.68 million Americans are now on food stamps, which represents a new all-time record. But things look like they are going to get even worse. The U.S. Department of Agriculture is forecastingthat enrollment in the food stamp program will exceed 43 million Americans in 2011.
* The Dow Jones Industrial Average just experienced the worst May it has seen since 1940.
* If you only make the minimum payment each and every time, a $6,000 credit card bill can end up costing you over $30,000 (depending on the interest rate).
* Approximately 21% of all children in the United States are living below the poverty line in 2010 - the highest rate in 20 years.
* In 2010 the U.S. government is projected to issue almost as much new debt as the rest of the governments of the world combined.
* In 2009, U.S. banks posted their sharpest decline in private lending since 1942.
* During the first quarter of 2010, the total number of loans that are at least three months past due in the United States increased for the 16th consecutive quarter.
* As of February 2009, there were 111,500 employees working in motor vehicle assembly and parts, down 37% from its peak in 2001, according to a Stats Canada report.
* According to a Pew Research Center study, approximately 37% of all Americans between the ages of 18 and 29 have either been unemployed or underemployed at some point during the recession.
* For the first time in U.S. history, banks own a greater share of residential housing net worth in the United States than all individual Americans put together.

And has anyone considered how ridiculous it is that anyone, ANYONE would be making or losing profit in the trillions? I mean short of the gov't who in their right mind could possibly even use that much money?

[Lackadaisical2]

And has anyone considered how ridiculous it is that anyone, ANYONE would be making or losing profit in the trillions? I mean short of the gov't who in their right mind could possibly even use that much money?

Good question, I suppose its cool though, since no one does actually have that much money.

All your stats are for the US, most of them are comparing it to itself, we got as rich as we are and were using capitalism, in fact I struggle to think of many developed nations which don't use a primarily capitalist system.

Has it occurred to anyone that repeated GLOBAL financial crisis might be a little indicator that capitalism might not be working and might indeed be bad for the entire global community?

Yes, its quite obvious that a lot of thought has gone into that particular question, but until someone can come up with something better I'll be glad to stick to capitalism.

[Siromizu]

The only reason for problems in a "capitalist" system is too much regulation. We need no regulation at all, for the perfect system to reveal its perfect nature.

[Arkinesia]

Yeah, capitalism needs a rethink. Like a 1920s kind of rethink.

Things worked nicely in the '20s as people in general became more affluent. However the middle class wasn't 'invented' at the time, which made things a bit…snaggy.

Then people went out and took out a shit ton of investments on credit and that fucked things up.

Back in the '20s most people of the lowest brackets paid 1% or less in taxes.

[Forster Keys]

The only reason for problems in a "capitalist" system is too much regulation. We need no regulation at all, for the perfect system to reveal its perfect nature.

Nothing is perfect. Not even capitalism.

[Vesintor]

It isn't capitalism's fault.

Here's an example of how GLOBAL capitalism is screwing us, using America:

Here in America we have many laws in place to prevent exploitation of the worker (minimum wage laws, child labor laws, labor regulations they must meet, including adequate number and length of breaks, overtime hours and rates of pay, etc.)

In many less developed foreign countries, say for instance China, Taiwan, or India, there is minimal or no regulation on child labor and worker exploitation.

American corporations then outsource to these countries that allow for worker exploitation and...big surprise, the American worker is FUCKED.

Why would a company hire American workers and buy American products, when they could pay workers in another country much less (in the area of cents an hour) and buy foreign goods for dirt cheap?

If it were a fair playing field, the American workers would be doing fine.

[Forster Keys]

It isn't capitalism's fault.

Here's an example of how GLOBAL capitalism is screwing us, using America:

Here in America we have many laws in place to prevent exploitation of the worker (minimum wage laws, child labor laws, labor regulations they must meet, including adequate number and length of breaks, overtime hours and rates of pay, etc.)

In many less developed foreign countries, say for instance China, Taiwan, or India, there is minimal or no regulation on child labor and worker exploitation.

American corporations then outsource to these countries that allow for worker exploitation and...big surprise, the American worker is FUCKED.

Why would a company hire American workers and buy American products, when they could pay workers in another country much less (in the area of cents an hour) and buy foreign goods for dirt cheap?

If it were a fair playing field, the American workers would be doing fine.

Ironic. Since many of these laws you speak of were fought for by the "evil socialist" unions.

[Siromizu]

Taiwan

DERP
"Taiwan now faces many of the same economic issues as other developed economies. With the prospect of continued relocation of labor-intensive industries to economies with cheaper work forces, such as in China and Vietnam, Taiwan's future development will have to rely on further transformation to a high technology and service-oriented economy. In recent years, Taiwan has successfully diversified its trade markets, cutting its share of exports to the United States from 49% in 1984 to 20% in 2002. Taiwan's dependence on the U.S. market should continue to decrease as its exports to Southeast Asia and China grow and its efforts to develop European markets produce results. Taiwan's accession to the WTO and its desire to become an Asia-Pacific "regional operations center" are spurring further economic liberalization."

It isn't capitalism's fault.

Here's an example of how GLOBAL capitalism is screwing us, using America:

Here in America we have many laws in place to prevent exploitation of the worker (minimum wage laws, child labor laws, labor regulations they must meet, including adequate number and length of breaks, overtime hours and rates of pay, etc.)

In many less developed foreign countries, say for instance China, Taiwan, or India, there is minimal or no regulation on child labor and worker exploitation.

American corporations then outsource to these countries that allow for worker exploitation and...big surprise, the American worker is FUCKED.

Why would a company hire American workers and buy American products, when they could pay workers in another country much less (in the area of cents an hour) and buy foreign goods for dirt cheap?

If it were a fair playing field, the American workers would be doing fine.

Ironic. Since many of these laws you speak of were fought for by the "evil socialist" unions.

The "fair playing field" would be rid of those stupid laws.

[Vesintor]

Taiwan

DERP
"Taiwan now faces many of the same economic issues as other developed economies. With the prospect of continued relocation of labor-intensive industries to economies with cheaper work forces, such as in China and Vietnam, Taiwan's future development will have to rely on further transformation to a high technology and service-oriented economy. In recent years, Taiwan has successfully diversified its trade markets, cutting its share of exports to the United States from 49% in 1984 to 20% in 2002. Taiwan's dependence on the U.S. market should continue to decrease as its exports to Southeast Asia and China grow and its efforts to develop European markets produce results. Taiwan's accession to the WTO and its desire to become an Asia-Pacific "regional operations center" are spurring further economic liberalization."

LOL

Did you even read the date? Do you think global trade began in 2002? HERP try again

[Lackadaisical2]

DERP
"Taiwan now faces many of the same economic issues as other developed economies. With the prospect of continued relocation of labor-intensive industries to economies with cheaper work forces, such as in China and Vietnam, Taiwan's future development will have to rely on further transformation to a high technology and service-oriented economy. In recent years, Taiwan has successfully diversified its trade markets, cutting its share of exports to the United States from 49% in 1984 to 20% in 2002. Taiwan's dependence on the U.S. market should continue to decrease as its exports to Southeast Asia and China grow and its efforts to develop European markets produce results. Taiwan's accession to the WTO and its desire to become an Asia-Pacific "regional operations center" are spurring further economic liberalization."

LOL

Did you even read the date? Do you think global trade began in 2002? HERP try again

how could he think that when it references trade in 1984 and 2002?

Taiwan isn't a cheap labor market, which was the point. Lumping it in with China and India was misinformed.

[Vesintor]

Taiwan isn't a cheap labor market, which was the point. Lumping it in with China and India was misinformed.

It isn't in a cheap labor market now, it was prior to around 2002. The US was trading with them for a long time before that so the fact that they aren't a cheap labor market today doesn't invalidate my point.

[Lackadaisical2]

Taiwan isn't a cheap labor market, which was the point. Lumping it in with China and India was misinformed.

It isn't in a cheap labor market now, it was prior to around 2002. The US was trading with them for a long time before that so the fact that they aren't a cheap labor market today doesn't invalidate my point.

"In many less developed foreign countries, say for instance China, Taiwan, or India, there is minimal or no regulation on child labor and worker exploitation. "

Your use of the present tense seems to indicate you were speaking of it post 2002, but w/e.

[Siromizu]

It isn't in a cheap labor market now, it was prior to around 2002. The US was trading with them for a long time before that so the fact that they aren't a cheap labor market today doesn't invalidate my point.

"In many less developed foreign countries, say for instance China, Taiwan, or India, there is minimal or no regulation on child labor and worker exploitation. "

Your use of the present tense seems to indicate you were speaking of it post 2002, but w/e.

Ninja'd;
All that "is"-ing looks like present tense to me. Since when is it 2002?
If it's not what you meant, we have no problem here.

[The Parkus Empire]

Nothing is perfect. Not even capitalism.

Money is perfect, so capitalism is at least a love of perfection.

[Vesintor]

Your use of the present tense seems to indicate you were speaking of it post 2002, but w/e.

I was giving an EXAMPLE of how the American worker has been and is at a disadvantage.

My use of present tense was immaterial, because in this context an informed reader would know that the US had been trading with Taiwan for much long than just the present day.

Now that that's clear. Can we get back to my actual point? I've yet to see anyone comment on that.

[Forster Keys]

Nothing is perfect. Not even capitalism.

Money is perfect, so capitalism is at least a love of perfection.

How is money perfect? I don't like money. I like money a little less than I like food. Food has taste. Money tastes rather bad.

Depends how you define perfect though....

Argh! Too complicated!

[Whiskey Hill]

The "fair playing field" would be rid of those stupid laws.

But then Americans would still be screwed, since they wouldn't be protected from exploitation from their employers. How would that solve anything?

[Albrante]

Has it occurred to anyone that repeated GLOBAL financial crisis might be a little indicator that capitalism might not be working and might indeed be bad for the entire global community?

Watch this stuff:

http://www.cbc.ca/doczone/meltdown/

And here's some food for thought

http://www.cbc.ca/doczone/meltdown/extras.html

* Half of America owns only 2.5% of country's wealth. The top 1% owns a third of it.
* The gap between the top 0.01% and everyone else hasn't been this bad since the Roaring Twenties.
* In 1950, the ratio of the average executive's paycheque to the average worker's paycheque was about 30 to 1. Since the year 2000, that ratio has exploded to between 300 to 500 to one.
* In 2008, the total national household debt in Canada has reached an all-time high of $1.3 trillion. A survey found that 42% of respondents said their personal debt was rising in the past three years, and 21%said they couldn't manage their debt.
* 61% of Americans "always or usually" live paycheck to paycheck, which was up from 49% in 2008 and 43% in 2007. The numbers are similar in Canada.
* A staggering 43% of Americans have less than $10,000 saved up for retirement.
* In America today, the average time needed to find a job has risen to a record 35.2 weeks.
* In 2008, the World Economic Forum rated Canada's banking system No. 1 in the world. The U.S. came in right behind — Namibia.
* It is being projected that the U.S. government will have a budget deficit of approximately 1.6 trillion dollars in 2010. How much is that? If you went out and spent one dollar every single second, it would take you more than 31,000 years to spend a trillion dollars.
* In February 2010, there were 5.5 unemployed Americans for every job opening.
* In California’s Central Valley, 1 out of every 16 homes is in some phase of foreclosure.
* U.S. banks repossessed nearly 258,000 homes nationwide in the first quarter of 2010, a 35% jump from the first quarter of 2009.
* In May 2009, the number of Canadians getting regular employment insurance benefits in reached 778,700, the highest level on comparable records going back 12 years. During the month, the number of people getting EI benefits grew by 9.2%, from April.
* More than 24% of all homes with mortgages in the United States were underwater (the mortgage is more than the current market value of the home) as of the end of 2009.
* This most recession has erased 8 million private sector jobs in the United States.
* 39.68 million Americans are now on food stamps, which represents a new all-time record. But things look like they are going to get even worse. The U.S. Department of Agriculture is forecastingthat enrollment in the food stamp program will exceed 43 million Americans in 2011.
* The Dow Jones Industrial Average just experienced the worst May it has seen since 1940.
* If you only make the minimum payment each and every time, a $6,000 credit card bill can end up costing you over $30,000 (depending on the interest rate).
* Approximately 21% of all children in the United States are living below the poverty line in 2010 - the highest rate in 20 years.
* In 2010 the U.S. government is projected to issue almost as much new debt as the rest of the governments of the world combined.
* In 2009, U.S. banks posted their sharpest decline in private lending since 1942.
* During the first quarter of 2010, the total number of loans that are at least three months past due in the United States increased for the 16th consecutive quarter.
* As of February 2009, there were 111,500 employees working in motor vehicle assembly and parts, down 37% from its peak in 2001, according to a Stats Canada report.
* According to a Pew Research Center study, approximately 37% of all Americans between the ages of 18 and 29 have either been unemployed or underemployed at some point during the recession.
* For the first time in U.S. history, banks own a greater share of residential housing net worth in the United States than all individual Americans put together.

And has anyone considered how ridiculous it is that anyone, ANYONE would be making or losing profit in the trillions? I mean short of the gov't who in their right mind could possibly even use that much money?

I've never been a fan of libertarian capitalism, it makes people into douches. Now combine a free market with a conservative population then things can work a bit smoother.

[Vesintor]

I've never been a fan of libertarian capitalism, it makes people into douches. Now combine a free market with a conservative population then things can work a bit smoother.

If you must quote the entire OP, at least put it between spoiler tags.

[Albrante]

I've never been a fan of libertarian capitalism, it makes people into douches. Now combine a free market with a conservative population then things can work a bit smoother.

If you must quote the entire OP, at least put it between spoiler tags.

My bad, redone...

[Mindhar]

The only reason for problems in a "capitalist" system is too much regulation. We need no regulation at all, for the perfect system to reveal its perfect nature.

Even some noted Austrians have admitted that their system has little practical or theoretical grounding and is more of a philosophical idea along the lines of "wouldn't it be nice if...?".

As the kind of person who likes his economics with mathematics and applications mixed in, I've always dismissed it as unscientific, much like Marxist economics (ooh irony).

The "fair playing field" would be rid of those stupid laws.

... and this brings up the "fairness or freedom?" question.

Anyway, occasional recessions and downturns are a feature of capitalism operating within normal parameters. There will be periods of negative growth and there will be crashes. There are a number of theories on how to fix this -- during the Great Depression the US targeted unemployment by creating large numbers of low-skill jobs (building dams and whatnot) and letting the money supply take care of itself. This worked out for a couple of years but then there was the Depression of 1937, and then the large "bubble" of WWII, so that the US didn't get back on economic track until postwar. Evidently now they're trying out a new strategy for minimising economic harm done. Can't say it's been working even quite as well as the New Deal did. (This does not prove that Keynes > Friedman, incidentally. Too many additional variables complicate matters.)

[The Twilight Shadow]

Did anyone actually watch the meltdown videos I linked to? Seriously the economic crisis we're in is because of lack of regulation. Canada was protected because our banks have always been conservative and we don't give credit without colatoral. The whole thing started with people not bothering to check if the people they were lending to could actually pay their debts and then selling that debt, that hadn't yet been paid, as if it were real money. And you people want LESS regulation? Are you insane? You can't trust business. All they care about is themselves. You need to force them to be socially accountable otherwise they'll fuck the world over.

The only reason for problems in a "capitalist" system is too much regulation. We need no regulation at all, for the perfect system to reveal its perfect nature.

Even some noted Austrians have admitted that their system has little practical or theoretical grounding and is more of a philosophical idea along the lines of "wouldn't it be nice if...?".

As the kind of person who likes his economics with mathematics and applications mixed in, I've always dismissed it as unscientific, much like Marxist economics (ooh irony).

The "fair playing field" would be rid of those stupid laws.

... and this brings up the "fairness or freedom?" question.

Anyway, occasional recessions and downturns are a feature of capitalism operating within normal parameters. There will be periods of negative growth and there will be crashes. There are a number of theories on how to fix this -- during the Great Depression the US targeted unemployment by creating large numbers of low-skill jobs (building dams and whatnot) and letting the money supply take care of itself. This worked out for a couple of years but then there was the Depression of 1937, and then the large "bubble" of WWII, so that the US didn't get back on economic track until postwar. Evidently now they're trying out a new strategy for minimising economic harm done. Can't say it's been working even quite as well as the New Deal did. (This does not prove that Keynes > Friedman, incidentally. Too many additional variables complicate matters.)

Mmmhmm and that was just the United States. What happens when capitalist China throws us into a global depression with their billion wide populace. Or what about India for that matter hmm? Have you considered that "The Great Depression" didn't just affect the freaking United States, or the more recent global recession for that matter? THE WHOLE BLOODY WORLD WAS AFFECTED BY IT YOU NIT! It's all fine and good for a country to run their economy whatever the hell way they want but when their fuck ups become not only my problem but the problem of everyone else on the whole planet then I'm going to sit up and take notice. The point here is what happens when not only the states are the nice developed capitalists having depressions and upsetting the global economy but also everyone else and their brother so that we don't have enough time to bounce back from it. Boom U.S. goes, then boom China has a meltdown, then India has a meltdown, oh well then theres Britian, and now the U.S. has crawled back up and generated enough corruption to shoot us all in the foot again - am I painting a clear enough picture here? They're not called global financial crises for nothing.

[The PeoplesFreedom]

Did anyone actually watch the meltdown videos I linked to? Seriously the economic crisis we're in is because of lack of regulation. Canada was protected because our banks have always been conservative and we don't give credit without colatoral. The whole thing started with people not bothering to check if the people they were lending to could actually pay their debts and then selling that debt, that hadn't yet been paid, as if it were real money. And you people want LESS regulation? Are you insane? You can't trust business. All they care about is themselves. You need to force them to be socially accountable otherwise they'll fuck the world over.

Actually it was because of too much regulation, and the counterfeiting federal reserve.

[Siromizu]

The "fair playing field" would be rid of those stupid laws.

But then Americans would still be screwed, since they wouldn't be protected from exploitation from their employers. How would that solve anything?

They can protect themselves from exploitation, or they can suffer for their stupidity.

[Siromizu]

The only reason for problems in a "capitalist" system is too much regulation. We need no regulation at all, for the perfect system to reveal its perfect nature.

Even some noted Austrians have admitted that their system has little practical or theoretical grounding and is more of a philosophical idea along the lines of "wouldn't it be nice if...?".

As the kind of person who likes his economics with mathematics and applications mixed in, I've always dismissed it as unscientific, much like Marxist economics (ooh irony).

As soon as you regulate, you give some group an advantage over others. While I understand were you're coming from, I think it's easier to let people do as they will (those with a brain or a knack can still prosper, after all), even if it is less efficient on an overall scale, rather than discriminate in the name of net productivity. I'll admit that I'm rather more a philosopher than economist.

The "fair playing field" would be rid of those stupid laws.

... and this brings up the "fairness or freedom?" question..)

What's with the "or"? Freedom is fair.

Anyway, occasional recessions and downturns are a feature of capitalism operating within normal parameters. There will be periods of negative growth and there will be crashes. There are a number of theories on how to fix this -- during the Great Depression the US targeted unemployment by creating large numbers of low-skill jobs (building dams and whatnot) and letting the money supply take care of itself. This worked out for a couple of years but then there was the Depression of 1937, and then the large "bubble" of WWII, so that the US didn't get back on economic track until postwar. Evidently now they're trying out a new strategy for minimising economic harm done. Can't say it's been working even quite as well as the New Deal did. (This does not prove that Keynes > Friedman, incidentally. Too many additional variables complicate matters.)

We don't need to "fix" downturn at all, as an intrinsic feature of a free-market system. It will sort itself out, for better or for worse.