15 ms·

The end of capitalism has begun

103 points by gburnett 11y ago

dpweb 11y ago
It's interesting the Greece and 2008 global crises are usually brought up, but important to note that with capitalism comes a need for responsibility - especially regarding debt, and those failures were a result of irresponsiblity on the part of the governments and actors involved - not a defect of the capitalist system itself. In both cases, taking on massive debt and quite simply, living beyond one's or a state's means.
- ewzimm 11y ago
  This seems like a bit of a strawman version of the Greek crisis in relation to capitalism, attributing to human failures actions which were a result of a complex series of coercive acts. The worldwide financial crisis was created because of strong incentives on financial institutions to game the system for profit. This led to a worldwide breakdown of economies, but nations were not equally able to respond with economic stimuli. The Greeks were in a particularly bad situation because of a wealthy class which has been able to avoid taxation. Corrupt government also played a very important part in the process. But the underlying cause of the crisis was the fact that the rules of capitalism have the property of being exploitable by large financial institutions unless they are under strict public oversight, and even this has been shown to be ineffective. Rational self-interest by banks which damaged the world economy forced Greece into a series of austerity measures which progressively weakened their economy and their ability to pay their debts, locking them into a series of pressure to take yet more loans under terms which lowered their ability to repay them. The logical end of this was their most recent deal which surrendered national sovereignty over their economy. So what we see from this example is that capitalism has shifted most of the power to those most able to manipulate it, financial institutions, and led to the degredation of national sovereignty. The extreme end of this scenario would be a world without any nations controlled entirely by banks, but I doubt we will get to that point before alternative models take hold, as very few people want to live in that kind of world.
  - Zigurd 11y ago
    More specifically, nations are captured by their SIFI banks and used as a front to coopt the power of sovereigns.
- Shivetya 11y ago
  The problem with Greece isn't capitalism, that much is obvious. The problem is the EU was designed to fail. It was created in such a way to appease the dominant economic countries by guaranteeing the EU would not be a transfer union. This all but doomed weaker economies from the get go. Tied to one currency they lost the most effective means of combating budgetary and economic issues. Worse, as they become weaker it becomes ever harder for them to generate the hard currency they need. So if anything what happened is exactly the opposite of capitalism, they could not compete because the rules agreed by governments prevented them. Yes Greece shares fault for working the books but the EU was formed to only favor the powerful countries and protect their interest, this was no union
  - yummyfajitas 11y ago
    Preventing the EU from being a transfer union is not what doomed the weaker economies; the fact that some of the weaker economies tried to turn it into such did. The more capitalist weaker economies (note: most are poorer than Greece) seem to be doing just fine. https://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&met_y=ny_gdp_pcap_cd&idim=country:EST:LVA:LTU&hl=en&dl=en#!ctype=l&strail=false&bcs=d&nselm=h&met_y=ny_gdp_pcap_cd&scale_y=lin&ind_y=false&rdim=region&idim=country:EST:LVA:LTU:GRC:SVK&ifdim=region&hl=en_US&dl=en&ind=false https://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&...
  - digikata 11y ago
    I wonder if it is possible to design a currency union with just a small amount of decoupling between the individual national bonds and the unified currency? e.g. all members of the union are required to make certain transactions in euro, but issue national debt in their own currency which floats in exchange vs the euro? I think this scheme has problems, but it seems like with the right decoupling points somewhere in the system, you might be able to operate the euro more robustly.
- lotsofcows 11y ago
  There's a defect in the EU, the Greek government, the Greek people and all the states / people who have made business arrangement with the above? That's an awful lot of people. Are you sure the problem's not in the system?
davidgerard 11y ago
I'm fairly sure people were thinking this in the 1970s, just before neoliberalism came along and destroyed all in its path.
- angrybits 11y ago
  The internet changes a lot of rules. Who will make the most effective use of these new rules remains to be seen, but the game has changed nonetheless.
- pkkim 11y ago
  And your point is that capitalism will renew itself once more?
- rtz12 11y ago
  The real neoliberalism came along a lot earlier. The 1970s were the time when the meaning of the word "neoliberalism" got warped.
boona 11y ago
The 20th century, in contrast to past centuries, was an experiment in progressivism. The idea that the state can be used by the masses to improve the well being of individuals over what can be achieved in a situation of economic liberty. So what came of this? We're finding out is that the power to regulate, is also the power to grant special favors. That giving this power, even to a well intended political class, was resulted in a poor outcome for us. I find it interesting that the EU took over the currency, interest rates and inflation are set by state actors, and that now we're seeing articles such as this one that blame economic liberties for the failure of the system.
- contingencies 11y ago
  The 20th century, in contrast to past centuries, was an experiment in progressivism. Maybe from the magnetosphere. Otherwise, it's blatantly false ... well, at best limited to the coddled middle class western world, but only post WWII, and only if you exclude Vietnam, the Gulf War, and other major conflicts, the NSA's antics, and pretty much anything that happened in economics... perhaps with the exception of collateral debt and high frequency trading, which were progressing something ... I'm just not sure anyone really stood for it except its positive results on their bank accounts. I suppose Mao, Hitler, Pol Pot and the Japanese Empire were 'progressivist' by some definition, though!
angrybits 11y ago
From the fine article: > individualism replaced collectivism and solidarity I find myself wondering if I am part of a remaining few who treasure that. I value self-sufficiency over dependency, moreso as I get older. I have come to realize that there can rarely be an imposed collective benefit that didn't come at the expense of at least one individual. The answer to "is it worth it?" will be dependent on which one you ask. Likely the same for "is it moral?" if I had my guess. That said, I don't think individualism can last forever. The fast exchange of ideas gives incredible power to well coordinated groups. Will it descend into mob rule? Maybe, maybe not. Time will tell. We see regular examples of internet mobs taking down powerful people and companies. The recent Pao take-down comes to mind here. People have their opinions on whether or not it was justified, and mine is irrelevant here, but to me what is most striking was the sheer effectiveness of it. Eventually "we" will figure out how much power we wield and put it to use on targets of more consequence than the CEO of a cat picture website. Occupy could have really shaken things up with the right leadership in place. They were tactically effective, but lacked a leader to put them to effective use to achieve an end. I think the time of the collective is fast approaching. As long as it's a volunteer collective, I have no issue. If it's forced at the threat of violence, I think my opinion would differ. I am not convinced that history inspires confidence on this one. edit: small clarification
- Retra 11y ago
  Self sufficiency and dependency are not a 1-dimensional parameter. You can be self sufficient in some aspects, and dependent in others, and each of us can be like this in different ways. Both aspects have their merits, and it is very easy to see that those merits are fundamental necessities. Governance is hard.
  - johndevor 11y ago
    Dependency does not mean government. A homeless man can be dependent on a church for food and shelter, but that does not mean governance.
    - Retra 11y ago
valar_m 11y ago
This statement seems odd to me: Second, information is corroding the market’s ability to form prices correctly. That is because markets are based on scarcity while information is abundant. I don't understand how this follows. Wouldn't having more information mean that prices form more correctly?
- toomuchtodo 11y ago
  Only if everyone has perfect information all of the time.
  - altcognito 11y ago
    and the ability to interpret and rationally act on that information. (if rational action is what one wants)
- vegancap 11y ago
  He doesn't explain how more information effects market scarcity, he's really just thrown that one out there with no explanation!
- ef4 11y ago
  Yes. The author's statement is malformed. Lots of people get themselves into trouble pontificating on how the flow of information makes markets work or not work. What they often fail to notice is that there is also a market for information itself, and that it's not really necessary to special case "information" differently than any other necessary input.
Mikhail_Edoshin 11y ago
Again?
michas 11y ago
Capitalism did end in 1913, when FED was founded. What we have today has nothing in common with it
contingencies 11y ago
Awesome to see such an expression of technological optimism informed by social concern. A rare thing these days. they have struggled to describe the dynamics of the new “cognitive” capitalism. And for a reason. Its dynamics are profoundly non-capitalist. I believe the author refers to Yann Moulier Boutang's theory, espoused in his book Le capitalisme cognitif (translated in to English as Cognitive Capitalism): http://www.amazon.com/Cognitive-Capitalism-Yann-Moulier-Boutang/dp/0745647332 http://www.amazon.com/Cognitive-Capitalism-Yann-Moulier-Bout... .. I actually had it sitting on my bookshelf here in China (had to wait for the translation to come out before ordering) .. must remember to read it now!
vegancap 11y ago
The author assumes we have 'capitalism' to begin with. Even talks about big banks etc. Secondly, he's citing 'information technology' as being the death of 'capitalism'. An industry, arguably the most aggressively capitalistic. Then he talks about corporate monopolies (anyone who's read economics 101 would tell you corporate monopolies are rarely result of unadulterated capitalism, but rather state corporatism). He mentions big companies using public data, most of that public data is generated, collected and shared openly by private companies to start with. I'm not even sure what his point was there... Then he talks about alternative currencies, something which bloomed in response to flailing, devaluing state currencies. Which is just about the most free-market response to state currencies... The next paragraph he references briefly the 'sharing economy', something pioneered and spearheaded by companies such as Airbnb and Lyft. Truly great success stories of consumer capitalism. "The solutions have been austerity plus monetary excess. But they are not working." - What? Our public spending has increases by £50bn, how is this 'austerity'? The cuts have slowed down our public spending and even that has made us one of the strongest economies in Europe. So I'm not sure where he's getting the 'not working' from. "Even now many people fail to grasp the true meaning of the word “austerity”. - Oh, the irony. Most of the fluffy scenarios he describes, whereby private individuals make voluntary, mutually beneficial agreements with each other, is almost the very definition of capitalism!
- deleted 11y ago
  [deleted]
  - vegancap 11y ago
    Apology accepted? But I do know what I'm talking about. Monopolies in a market economy can only exist if they've had no competitors and have met all of their customers needs and defeated all competition. Google is a monopoly, because it's something we're all generally pretty happy with. Even the slightest downfalls in Google lead to competitors taking advantage of that. Say data privacy for example, Google were subpar there, so Duckduckgo gained major momentum. Market competition will almost always prevent monopolies. Monopolies occur within our current model because state regulation, state taxes (including corporate tax relief) create what's known as a 'barrier to market'. Meaning it's far, far more difficult for a competitor to actually compete on a product level. Most of our debt's occur because interest rates are so high, and why are interest rates so high? Because they're pegged above inflation, and why do we have inflation? Because governments bide time and bribe us with free things either funded by debts they've instigates, or by printing fiat currency. Which aren't market ideals, by any definition.
applecore 11y ago
We've been hearing about the impending “end of capitalism” since the beginning of merchant capitalism in the 16th century. Mercantilism still thrives even when commodities are produced by non-capitalist production methods.
mml 11y ago
you can't run an economy on information alone. you can't eat information, or haul lumber with it. Information is just a lever that makes hauling lumber or producing food more efficient. Author needs to get out more.
omonra 11y ago
I find the article lacking. Author makes a bunch of controversial yet unsupported statements. Even if they're true (something he doesn't really bother proving), the logical links from one to the next are missing. Ie I can't even dismiss it as typical Guardian progressive ranting - because there is no coherent story to dismiss, more of a hot-potch of terms. Putting it down in the 'not even wrong' file.
- Animats 11y ago
  That's more or less correct. The problem is real (we don't need that many people to make all the stuff) but the proposed solutions are no good. He's into co-ops and "local", which just don't do much in the developed world because the big guys are not inefficient. (You're not going to beat WalMart on price with your local grocery co-op.) Then there's some Marxist analysis, which doesn't help; Marx wrote when companies needed huge labor forces. Bernie Sanders, the presidential candidate, makes an interesting point. He questions the whole idea of economic growth as a national goal. “Unchecked growth – especially when 99 percent of all new income goes to the top 1 percent – is absurd. Where we’ve got to move is not growth for the sake of growth, but we’ve got to move to a society that provides a high quality of life for all of our people."[1] There's something to be said for that. You get what you measure and optimize for, and US policy has been to optimize for GDP. Maybe we should be optimizing for median per capita real income per hour worked, or "how much does an hour of work buy for most people". That's a number you never used to see in the press, but it shows up more now. [1] http://www.washingtonpost.com/blogs/wonkblog/wp/2015/07/13/what-bernie-sanders-is-willing-to-sacrifice-for-a-more-equal-society/ http://www.washingtonpost.com/blogs/wonkblog/wp/2015/07/13/w...
  - code_chimp 11y ago
    "Growth for the sake of growth is the ideology of the cancer cell." - Edward Abbey
  - omonra 11y ago
    Thanks. Re the Bernie Sanders quote, it's actually not true (http://www.politifact.com/truth-o-meter/statements/2015/apr/19/bernie-s/bernie-sanders-says-99-percent-new-income-going-to/ http://www.politifact.com/truth-o-meter/statements/2015/apr/...). For start it omits taxes and wealth transfers - and secondly it measures 2009-2013. 2009 was the year right after the crash when 1% experienced a sharp decline in income. Thirdly, the huge increase in healthcare (hence insurance) costs is largely carried by employers. That's one of the main reasons for stagnant wages of late - total compensation has been increasing but the increase is flowing into benefits - thus flat income. I have been thinking myself about the issue of inequality and think it's being obfuscated by the language used (whereby it's discussed in terms of rich vs poor instead of US poor vs foreign poor). Ie - how are the wages for the top 1% (lawyers, doctors, bankers, etc) affecting the wages for the bottom 50%? If anything I think that immigration has been a much larger factor (for the low skilled / paid sector of the economy).
EthanHeilman 11y ago
>Second, information is corroding the market’s ability to form prices correctly. That is because markets are based on scarcity while information is abundant. The system’s defence mechanism is to form monopolies – the giant tech companies – on a scale not seen in the past 200 years, yet they cannot last. By building business models and share valuations based on the capture and privatisation of all socially produced information, such firms are constructing a fragile corporate edifice at odds with the most basic need of humanity, which is to use ideas freely. This is a fascinating dynamic. How do you charge for information when nearly anyone can replicate it for free? * Novelty - sure you can get civ4 for 2 dollars, but civ5 is "more desirable". * Punishment - hexrays blacklisting engineers that use IDApro without a license. * Technical - DRM it is only mildly effective, but architectural solutions such as gmail or WoW have a low piracy rate. * Rewards - benefits to compliance, such as steam backing up your saved games and giving you hats. If a nation were to completely ignore IP law would that provide a competitive advantage to that nation?
TheGrimDerp1 11y ago
Full-on, spot-on, and a huge "hell-Yeah." I've said it before and I'll say it again, we need to build a really big damn space ship. (buildtheenterprise.org)
paulhauggis 11y ago
"Postcapitalism is possible because of three major changes information technology has brought about in the past 25 years. First, it has reduced the need for work," The need for work hasn't reduced, it's just changed. The issue is that someone will need to be doing the work and the people doing the work aren't going to put up with giving the majority of their pay to the rest of society (that don't need to work) for very long. This idea will eventually lead to total wealth distribution and then the issue will be how you decide to split up the money. Do we then need to have control on the number of kids a person can have? How about risky behavior (so health care costs aren't that high)? Also, who decides how it's split up? All of the articles about basic income and 'post capitalism' only take into account what will happen in the very beginning, which might seem like it's working. They never discuss the long-term where 3 generations of families are living off of the system and the continued dependence of more and more people. What happens when the number of people on basic income vastly outnumbers the amount of people working? Will the government force people to work? A revolution? Starvation?? Capitalism is not perfect, but it's the one system that not only brought us the most technology and advancements, but also brought the most people out of poverty. Most of these ideas aren't new. They have been tried and failed and are now just being re-packaged and prettied up into something that seems more palatable.
TYPE_FASTER 11y ago
The success of Uber, Airbnb, Ebay, Amazon underwhelms his argument. Information technology, and really the internet, have worked around traditional anti-capitalistic forces like taxes and regulation very effectively.
de1978st 11y ago
Good read, thx for the post.

103 points by gburnett 11y ago

dpweb 11y ago

It's interesting the Greece and 2008 global crises are usually brought up, but important to note that with capitalism comes a need for responsibility - especially regarding debt, and those failures were a result of irresponsiblity on the part of the governments and actors involved - not a defect of the capitalist system itself. In both cases, taking on massive debt and quite simply, living beyond one's or a state's means.

ewzimm 11y ago
This seems like a bit of a strawman version of the Greek crisis in relation to capitalism, attributing to human failures actions which were a result of a complex series of coercive acts. The worldwide financial crisis was created because of strong incentives on financial institutions to game the system for profit. This led to a worldwide breakdown of economies, but nations were not equally able to respond with economic stimuli. The Greeks were in a particularly bad situation because of a wealthy class which has been able to avoid taxation. Corrupt government also played a very important part in the process. But the underlying cause of the crisis was the fact that the rules of capitalism have the property of being exploitable by large financial institutions unless they are under strict public oversight, and even this has been shown to be ineffective. Rational self-interest by banks which damaged the world economy forced Greece into a series of austerity measures which progressively weakened their economy and their ability to pay their debts, locking them into a series of pressure to take yet more loans under terms which lowered their ability to repay them. The logical end of this was their most recent deal which surrendered national sovereignty over their economy. So what we see from this example is that capitalism has shifted most of the power to those most able to manipulate it, financial institutions, and led to the degredation of national sovereignty. The extreme end of this scenario would be a world without any nations controlled entirely by banks, but I doubt we will get to that point before alternative models take hold, as very few people want to live in that kind of world.
- Zigurd 11y ago
  More specifically, nations are captured by their SIFI banks and used as a front to coopt the power of sovereigns.
Shivetya 11y ago
The problem with Greece isn't capitalism, that much is obvious. The problem is the EU was designed to fail. It was created in such a way to appease the dominant economic countries by guaranteeing the EU would not be a transfer union. This all but doomed weaker economies from the get go. Tied to one currency they lost the most effective means of combating budgetary and economic issues. Worse, as they become weaker it becomes ever harder for them to generate the hard currency they need. So if anything what happened is exactly the opposite of capitalism, they could not compete because the rules agreed by governments prevented them. Yes Greece shares fault for working the books but the EU was formed to only favor the powerful countries and protect their interest, this was no union
- yummyfajitas 11y ago
  Preventing the EU from being a transfer union is not what doomed the weaker economies; the fact that some of the weaker economies tried to turn it into such did. The more capitalist weaker economies (note: most are poorer than Greece) seem to be doing just fine. https://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&met_y=ny_gdp_pcap_cd&idim=country:EST:LVA:LTU&hl=en&dl=en#!ctype=l&strail=false&bcs=d&nselm=h&met_y=ny_gdp_pcap_cd&scale_y=lin&ind_y=false&rdim=region&idim=country:EST:LVA:LTU:GRC:SVK&ifdim=region&hl=en_US&dl=en&ind=false https://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&...
- digikata 11y ago
  I wonder if it is possible to design a currency union with just a small amount of decoupling between the individual national bonds and the unified currency? e.g. all members of the union are required to make certain transactions in euro, but issue national debt in their own currency which floats in exchange vs the euro? I think this scheme has problems, but it seems like with the right decoupling points somewhere in the system, you might be able to operate the euro more robustly.
lotsofcows 11y ago
There's a defect in the EU, the Greek government, the Greek people and all the states / people who have made business arrangement with the above? That's an awful lot of people. Are you sure the problem's not in the system?

davidgerard 11y ago

I'm fairly sure people were thinking this in the 1970s, just before neoliberalism came along and destroyed all in its path.

angrybits 11y ago
The internet changes a lot of rules. Who will make the most effective use of these new rules remains to be seen, but the game has changed nonetheless.
pkkim 11y ago
And your point is that capitalism will renew itself once more?
rtz12 11y ago
The real neoliberalism came along a lot earlier. The 1970s were the time when the meaning of the word "neoliberalism" got warped.

boona 11y ago

The 20th century, in contrast to past centuries, was an experiment in progressivism. The idea that the state can be used by the masses to improve the well being of individuals over what can be achieved in a situation of economic liberty. So what came of this? We're finding out is that the power to regulate, is also the power to grant special favors. That giving this power, even to a well intended political class, was resulted in a poor outcome for us. I find it interesting that the EU took over the currency, interest rates and inflation are set by state actors, and that now we're seeing articles such as this one that blame economic liberties for the failure of the system.

contingencies 11y ago
The 20th century, in contrast to past centuries, was an experiment in progressivism. Maybe from the magnetosphere. Otherwise, it's blatantly false ... well, at best limited to the coddled middle class western world, but only post WWII, and only if you exclude Vietnam, the Gulf War, and other major conflicts, the NSA's antics, and pretty much anything that happened in economics... perhaps with the exception of collateral debt and high frequency trading, which were progressing something ... I'm just not sure anyone really stood for it except its positive results on their bank accounts. I suppose Mao, Hitler, Pol Pot and the Japanese Empire were 'progressivist' by some definition, though!

angrybits 11y ago

From the fine article: > individualism replaced collectivism and solidarity I find myself wondering if I am part of a remaining few who treasure that. I value self-sufficiency over dependency, moreso as I get older. I have come to realize that there can rarely be an imposed collective benefit that didn't come at the expense of at least one individual. The answer to "is it worth it?" will be dependent on which one you ask. Likely the same for "is it moral?" if I had my guess. That said, I don't think individualism can last forever. The fast exchange of ideas gives incredible power to well coordinated groups. Will it descend into mob rule? Maybe, maybe not. Time will tell. We see regular examples of internet mobs taking down powerful people and companies. The recent Pao take-down comes to mind here. People have their opinions on whether or not it was justified, and mine is irrelevant here, but to me what is most striking was the sheer effectiveness of it. Eventually "we" will figure out how much power we wield and put it to use on targets of more consequence than the CEO of a cat picture website. Occupy could have really shaken things up with the right leadership in place. They were tactically effective, but lacked a leader to put them to effective use to achieve an end. I think the time of the collective is fast approaching. As long as it's a volunteer collective, I have no issue. If it's forced at the threat of violence, I think my opinion would differ. I am not convinced that history inspires confidence on this one. edit: small clarification

Retra 11y ago
Self sufficiency and dependency are not a 1-dimensional parameter. You can be self sufficient in some aspects, and dependent in others, and each of us can be like this in different ways. Both aspects have their merits, and it is very easy to see that those merits are fundamental necessities. Governance is hard.
- johndevor 11y ago
  Dependency does not mean government. A homeless man can be dependent on a church for food and shelter, but that does not mean governance.
  - Retra 11y ago

valar_m 11y ago

This statement seems odd to me: Second, information is corroding the market’s ability to form prices correctly. That is because markets are based on scarcity while information is abundant. I don't understand how this follows. Wouldn't having more information mean that prices form more correctly?

toomuchtodo 11y ago
Only if everyone has perfect information all of the time.
- altcognito 11y ago
  and the ability to interpret and rationally act on that information. (if rational action is what one wants)
vegancap 11y ago
He doesn't explain how more information effects market scarcity, he's really just thrown that one out there with no explanation!
ef4 11y ago
Yes. The author's statement is malformed. Lots of people get themselves into trouble pontificating on how the flow of information makes markets work or not work. What they often fail to notice is that there is also a market for information itself, and that it's not really necessary to special case "information" differently than any other necessary input.

Mikhail_Edoshin 11y ago

Again?

michas 11y ago

Capitalism did end in 1913, when FED was founded. What we have today has nothing in common with it

contingencies 11y ago

Awesome to see such an expression of technological optimism informed by social concern. A rare thing these days. they have struggled to describe the dynamics of the new “cognitive” capitalism. And for a reason. Its dynamics are profoundly non-capitalist. I believe the author refers to Yann Moulier Boutang's theory, espoused in his book Le capitalisme cognitif (translated in to English as Cognitive Capitalism): http://www.amazon.com/Cognitive-Capitalism-Yann-Moulier-Boutang/dp/0745647332 http://www.amazon.com/Cognitive-Capitalism-Yann-Moulier-Bout... .. I actually had it sitting on my bookshelf here in China (had to wait for the translation to come out before ordering) .. must remember to read it now!

vegancap 11y ago

The author assumes we have 'capitalism' to begin with. Even talks about big banks etc. Secondly, he's citing 'information technology' as being the death of 'capitalism'. An industry, arguably the most aggressively capitalistic. Then he talks about corporate monopolies (anyone who's read economics 101 would tell you corporate monopolies are rarely result of unadulterated capitalism, but rather state corporatism). He mentions big companies using public data, most of that public data is generated, collected and shared openly by private companies to start with. I'm not even sure what his point was there... Then he talks about alternative currencies, something which bloomed in response to flailing, devaluing state currencies. Which is just about the most free-market response to state currencies... The next paragraph he references briefly the 'sharing economy', something pioneered and spearheaded by companies such as Airbnb and Lyft. Truly great success stories of consumer capitalism. "The solutions have been austerity plus monetary excess. But they are not working." - What? Our public spending has increases by £50bn, how is this 'austerity'? The cuts have slowed down our public spending and even that has made us one of the strongest economies in Europe. So I'm not sure where he's getting the 'not working' from. "Even now many people fail to grasp the true meaning of the word “austerity”. - Oh, the irony. Most of the fluffy scenarios he describes, whereby private individuals make voluntary, mutually beneficial agreements with each other, is almost the very definition of capitalism!

deleted 11y ago
[deleted]
- vegancap 11y ago
  Apology accepted? But I do know what I'm talking about. Monopolies in a market economy can only exist if they've had no competitors and have met all of their customers needs and defeated all competition. Google is a monopoly, because it's something we're all generally pretty happy with. Even the slightest downfalls in Google lead to competitors taking advantage of that. Say data privacy for example, Google were subpar there, so Duckduckgo gained major momentum. Market competition will almost always prevent monopolies. Monopolies occur within our current model because state regulation, state taxes (including corporate tax relief) create what's known as a 'barrier to market'. Meaning it's far, far more difficult for a competitor to actually compete on a product level. Most of our debt's occur because interest rates are so high, and why are interest rates so high? Because they're pegged above inflation, and why do we have inflation? Because governments bide time and bribe us with free things either funded by debts they've instigates, or by printing fiat currency. Which aren't market ideals, by any definition.

applecore 11y ago

We've been hearing about the impending “end of capitalism” since the beginning of merchant capitalism in the 16th century. Mercantilism still thrives even when commodities are produced by non-capitalist production methods.

mml 11y ago

you can't run an economy on information alone. you can't eat information, or haul lumber with it. Information is just a lever that makes hauling lumber or producing food more efficient. Author needs to get out more.

omonra 11y ago

I find the article lacking. Author makes a bunch of controversial yet unsupported statements. Even if they're true (something he doesn't really bother proving), the logical links from one to the next are missing. Ie I can't even dismiss it as typical Guardian progressive ranting - because there is no coherent story to dismiss, more of a hot-potch of terms. Putting it down in the 'not even wrong' file.

Animats 11y ago
That's more or less correct. The problem is real (we don't need that many people to make all the stuff) but the proposed solutions are no good. He's into co-ops and "local", which just don't do much in the developed world because the big guys are not inefficient. (You're not going to beat WalMart on price with your local grocery co-op.) Then there's some Marxist analysis, which doesn't help; Marx wrote when companies needed huge labor forces. Bernie Sanders, the presidential candidate, makes an interesting point. He questions the whole idea of economic growth as a national goal. “Unchecked growth – especially when 99 percent of all new income goes to the top 1 percent – is absurd. Where we’ve got to move is not growth for the sake of growth, but we’ve got to move to a society that provides a high quality of life for all of our people."[1] There's something to be said for that. You get what you measure and optimize for, and US policy has been to optimize for GDP. Maybe we should be optimizing for median per capita real income per hour worked, or "how much does an hour of work buy for most people". That's a number you never used to see in the press, but it shows up more now. [1] http://www.washingtonpost.com/blogs/wonkblog/wp/2015/07/13/what-bernie-sanders-is-willing-to-sacrifice-for-a-more-equal-society/ http://www.washingtonpost.com/blogs/wonkblog/wp/2015/07/13/w...
- code_chimp 11y ago
  "Growth for the sake of growth is the ideology of the cancer cell." - Edward Abbey
- omonra 11y ago
  Thanks. Re the Bernie Sanders quote, it's actually not true (http://www.politifact.com/truth-o-meter/statements/2015/apr/19/bernie-s/bernie-sanders-says-99-percent-new-income-going-to/ http://www.politifact.com/truth-o-meter/statements/2015/apr/...). For start it omits taxes and wealth transfers - and secondly it measures 2009-2013. 2009 was the year right after the crash when 1% experienced a sharp decline in income. Thirdly, the huge increase in healthcare (hence insurance) costs is largely carried by employers. That's one of the main reasons for stagnant wages of late - total compensation has been increasing but the increase is flowing into benefits - thus flat income. I have been thinking myself about the issue of inequality and think it's being obfuscated by the language used (whereby it's discussed in terms of rich vs poor instead of US poor vs foreign poor). Ie - how are the wages for the top 1% (lawyers, doctors, bankers, etc) affecting the wages for the bottom 50%? If anything I think that immigration has been a much larger factor (for the low skilled / paid sector of the economy).

EthanHeilman 11y ago

>Second, information is corroding the market’s ability to form prices correctly. That is because markets are based on scarcity while information is abundant. The system’s defence mechanism is to form monopolies – the giant tech companies – on a scale not seen in the past 200 years, yet they cannot last. By building business models and share valuations based on the capture and privatisation of all socially produced information, such firms are constructing a fragile corporate edifice at odds with the most basic need of humanity, which is to use ideas freely. This is a fascinating dynamic. How do you charge for information when nearly anyone can replicate it for free? * Novelty - sure you can get civ4 for 2 dollars, but civ5 is "more desirable". * Punishment - hexrays blacklisting engineers that use IDApro without a license. * Technical - DRM it is only mildly effective, but architectural solutions such as gmail or WoW have a low piracy rate. * Rewards - benefits to compliance, such as steam backing up your saved games and giving you hats. If a nation were to completely ignore IP law would that provide a competitive advantage to that nation?

TheGrimDerp1 11y ago

Full-on, spot-on, and a huge "hell-Yeah." I've said it before and I'll say it again, we need to build a really big damn space ship. (buildtheenterprise.org)

paulhauggis 11y ago

"Postcapitalism is possible because of three major changes information technology has brought about in the past 25 years. First, it has reduced the need for work," The need for work hasn't reduced, it's just changed. The issue is that someone will need to be doing the work and the people doing the work aren't going to put up with giving the majority of their pay to the rest of society (that don't need to work) for very long. This idea will eventually lead to total wealth distribution and then the issue will be how you decide to split up the money. Do we then need to have control on the number of kids a person can have? How about risky behavior (so health care costs aren't that high)? Also, who decides how it's split up? All of the articles about basic income and 'post capitalism' only take into account what will happen in the very beginning, which might seem like it's working. They never discuss the long-term where 3 generations of families are living off of the system and the continued dependence of more and more people. What happens when the number of people on basic income vastly outnumbers the amount of people working? Will the government force people to work? A revolution? Starvation?? Capitalism is not perfect, but it's the one system that not only brought us the most technology and advancements, but also brought the most people out of poverty. Most of these ideas aren't new. They have been tried and failed and are now just being re-packaged and prettied up into something that seems more palatable.

TYPE_FASTER 11y ago

The success of Uber, Airbnb, Ebay, Amazon underwhelms his argument. Information technology, and really the internet, have worked around traditional anti-capitalistic forces like taxes and regulation very effectively.

de1978st 11y ago

Good read, thx for the post.