SUBJECT: Liberals Do Not Oppose Capitalism
FAIR WARNING: I meander into a bunch of different points with this post. I hope to polish it later and repost. (So your feedback in requested and appreciated).
INTRO:
A very well-educated conservative friend of mine sent me a link to a Cato Institute essay by Robert Nozick entitled "Why Do Intellectuals Oppose Capitalism" (1998).
I'm always glad to get a thoughtful invitation to sample my political opposition's sources first hand. Too much "echo chamber" is terrible for a productive debate.
I question the very premise of that essay. I contend that it's unfair to frame this debate as "intellectuals (liberals) opposing capitalism". I'm very liberal by most standards and I run in such left-wing, Hollywood circles that it's virtually a cliche. So I hope that lends me some credence when I strongly state this: I very rarely encounter anyone who is opposed to capitalism full stop. I think that population is microscopic even among self-identified Liberals.
Much more prevalent, by at least an order of magnitude, is the typical liberal who opposes "Unregulated Capitalism" or "Laissez-Faire Capitalism" or "Free Trade". I think that is a massive distinction. You are free to argue that anything other than an extreme Libertarian's definition of capitalism is "not capitalism". But if you do then be prepared to be alienated from the overwhelming majority of Americans.
You can try to make your case that life would be better overall if we embraced "Unregulated Capitalism" and entirely rejected any social safety net. But you won't win any wide elections admitting that you want to abolish Social Security, Unemployment Insurance, SNAP, Public Education, FDA, EPA etc.
Heck, as of 01/27/12, Ron Paul can't even win a plurality of the GOP vote in highly conservative sates.
NOTE: I previously made a similar point about the GOP's politically-expedient shifting definition of "Socialism".
That established, I think that Nozick's argument is flawed and falsified by the facts.
Here is my perspective...
1) Liberals (and especially Liberal Intellectuals) rarely begrudge undeniably productive/innovative icons like Larry Page (founder of Google) or Steven Spielberg for their wealth. There is very little envy and instead there exists substantial appreciation of or pride in their achievements (if not motivating inspiration). The same respect cannot be said of Philip Knight (q.v. Nike's overseas child labor problems) or the average Wall Street banker (primarily because of the bailouts that are seen as "reverse Robin Hood" taking taxes from the underpaid school teachers to subsidize the bankers unmerited bonuses).
Why can Liberals draw such a distinction between Larry page and a Wall Street Banker? If Nozick's argument were perfectly true then there would be no such distinction. However, Nozick may be on to something regarding the very fact that liberals make such distinctions at all.
2) Nozick makes a layperson psychological assessment of Intellectuals feeling "entitled" to success they have not achieved and resentful of the less-inteligent who become successful. To be sure, if that were the case then that would be difficult to defend assuming we, as we generally claim, aspire to a meritocracy. "Potential" shouldn't be rewarded because what you do with that potential is so much more important. Consequently, it is "Achievement" which should be rewarded (in order to encourage more achievement, not to mention the obvious morality of it).
And so, the bigger issue presents itself: Have we created a truly meritocratic system that best encourages achievement?
If we haven't done so then some people's gains, by definition, are inherently illegitimate (at least compared to the ideal).
This is summed up with the legendary Chester Karrass book title: "In Business, as in Life, You Don't get What You Deserve. You Get What You Negotiate."
Since we must conclude that not everyone is a master negotiator, some people must be getting more than they deserve and other less than they deserve.
Examples:
• Is the $150k per year Bentley salesman really providing triple the utility to society compared to the $50k per year Fire Fighter?
• How can it be good that the School Psychologist (Guidance Counselor) with a Masters in Social Work makes less than the Dog Groomer to the Stars?
• Why should the Mutual Fund Manager looking after $1 Billion in investments make over 100x what a US Air Force Pilot makes flying a $1 Billion Stealth Bomber?
One idealistic solution is to turn everyone into a better negotiator. This would be tantamount to making everyone a better poker player until the skill differential reduced to virtually nothing and the game became purely one of luck. Though with negotiation skills more equally distributed, the person's actual benefit to society should be better represented in her compensation. But how much effort work would that take and wouldn't that energy be better used in "growing the pie"?
SIDE NOTE FOR YOU: For your own good you should know the essentials of negotiation (which is much more than mere brinksmanship).
Here's a starting point > http://en.wikipedia.org/wiki/Negotiation
My quick negotiating tips:
i) Research (what others pay for a similar thing and what your negotiating opponent normally prices it at)
ii) Sell (get your opponent excited about making the deal, initially go for "win-win".)
iii) Know your range (best case / worst case) before you meet.
iv) Give away as little leverage as possible: Try to get them to make the first offer but if that's impossible, always lowball when buying or ask big when selling and then demand either acceptance or a counter-offer.
v) Don't negotiate against yourself: (don't compulsively fill the silence, make them fill the silence).
But who wants the whole world haggling all the time on literally everything?
Arguably, capitalism particularly thrived with the advent of the "standard price" (as opposed to the inefficient, slow & tailored-the-customer Bazaar pricing).
A more effective solution, IMHO, is to evolve our economy to become ever more meritocratic. This requires us to recalibrate & redirect incentives and few systems are equipped to handle that better than the Federal Government.
----------------------
CRUCIAL SIDE NOTE FOR ME:
I am in the process of formulating a grand theory that is not yet ready for its own post.
In short: Because economics shapes policy by what it measures, I think there should be a new measure of productivity/prosperity beyond GDP (Gross Domestic Product and its outdated Agricultural/Industrial/Service sectors troika) that specifically excludes "non-productive" sectors (like War, which actually benefits no one, and "zero-sum" businesses like Wall Street & Insurance & SNL's Commercial Parody about ROBOT INSURANCE).
In a less pejorative economic paradigm all businesses could be classified into these 3 groups:
a) Productive (e.g. Farms, Manufacturers, Creative Pursuits, & Services that tangibly increase happiness >>> that which "grows the pie")
b) Protective (e.g. Police, Military, Security, Lifeguards, & some Healthcare >>> that which"preserves the pie")
c) Partitioning (e.g. Lawyers, Courts, Accounting, Banking, & Insurance >>> that which "divides the pie")
THE BENEFIT OF THIS KIND OF PARADIGM: By concerning ourselves with these different kinds of productivity we can better identify (and thus defend against) the growing problem of being an unproductive society overly reliant on Wall Street instead of actually making things. Ideally, we would be reducing "Protective" and "Partitioning" sectors down to as small as possible while directing resources (human resources & investment) into "Productive" pursuits.
FACT: "From 1990 to 2006, the GDP share of the financial sector in the broad sense increased in the United States from 23% to 31%, or by 8 percentage points." - http://www.bis.org/speeches/sp081119.htm
3) Given the following:
a) it is inevitable that China's economy will surpass America's (because they have triple the population and a faster growth rate)
b) America's advantage over the rest of the world in education has slipped with no evidence it will change direction
c) America's advantage over the rest of the world in manufacturing has slipped with little evidence it can change direction
>>> We should take a serious look at our approach to the concept of "Comparative Advantage" and what works best for Americans ("Free Trade" vs. "Fair Trade"). The goal of government must be to protect & enhance the lives of its citizens. Increasing the profitability of nationless corporations should only be pursued insofar as it enhances the lives of the nation's citizens.
4) Let's assume, for a moment, that generally the smartest kids go to Harvard. It should then scare us all that such a shockingly high percentage (30% to 45% depending on the year) go to work on Wall Street. Assuming they do it for the money, wouldn't it be better if we created more lucrative incentives for the smartest to become inventors, innovators, engineers, scientists, researchers?
NOTE: That is related to my old refrain that "Free Market Capitalists" should stop taking credit for American prosperity when it was the inventors, engineers and scientific researchers who actually made life better (in the form of computers, air conditioners, medical cures etc.). Because almost no one would give up their current life of technological advancement if given the choice to go back in time and be Pharaoh of Egypt. Sure you could roll around in gold and have women worship you (which is understandably desirable) but one infected cut could kill you. Life keeps getting better because of technological progress.
----------------------
ALSO NOTE: This is all substantially related to my still inchoate concept of "Productive Wealth".
No comments:
Post a Comment