“It has been said that capitalism is the worst form of economics, except all the others that have been tried.”
In my travels though the internet, you see a lot of noise about the recession, the economy, and how it’s looking all doom-and-gloom. And there’s a lot of reasons why there should be some worried faces out there. Companies are going belly up, countries in places that are normally a bastion of financial security are going under in a sea of red ink, or getting quite close. Heck even the United States, who on the economic scale would probably be the furthest into the capitalistic camp, had it’s credit rating lowered recently due to their decades of financial mismanagement and recent political instability/incompetence (although their president Barack Obama would like you to believe that credit ratings apply to everyone except themselves). So naturally folks aren’t too pleased with the folks on Wall St, Bay St, and Paternoster Square to name a few economic hubs. They want answers, and they want solutions, and after three years of a recession that doesnt’ seem to be going away, folks are getting antsy for solutions…
And like the comparisons in 2008 that we were screaming headlong into the first Great Depression since the the jitterbug was popular, we’re also getting a rising voice that was popular then as well. One that wished to kick out the authors of this financial disaster and the economic system that hold so dear, in favour of one a wee bit more worker friendly. Or so the sales pitch goes. Youv’e got three guesses as to which one it was, and the first one don’t count (You folks following Fox News really should get this on the first try.).
Yes that’s right, one of those two ideologues that were oh so popular in the dirty thirties, has folks wondering if we should give it another kick at the can. And no, this isn’t the communism that has been (among other things), striped, mutated, packaged and rebranded to mean any and all of the things that keep the RepubiTeaPartiers deathly afraid 24/7/365, but actual communism; The State being the all knowing, all seeing, all owning entity of your world. And in the thirties, like today, you can sort of see the appeal; a lot of folks are unemployed, their work is gone, their houses repossessed, you can see how a economic system where they’re the ones at the top of the food chain would being appealing. And in the 1930′s it was, very much so. There were marches, parades, heck it was large enough to have action taken against it in multiple countries (To pop my blogs Godwin”s Law cherry, one of the appeals for the nazis in the thirties was their loathing of communists…and why their other transgressions were sometimes overlooked until WWII).
However this time around, things are a little bit different. While things are bad, they’re not Great Depression bad. There’s no soup kitchens in every town, you dont’ have reports of folks sustaining themselves on one ballpark frank a day, nor do you hear of entire swaths of states being put on the auction block in one day. Add to that the history of communism is a lot more extensive, and we’ve seen that really, it doesn’t work. The USSR lost thirteen of it’s republics after losing a game of financial chicken with the USA in the Cold War. China has found that being the West’s supplier of what seems like everything offers a lot better perks….not to mention cash, then whatever Mao had built. The wave of communist governments that swept Africa in the 70′s have largely faded into history. And while there’s some countries holding on, or in the case of South America, looking to re-embrace, for many it’s become more a dog of a different colour; more socialism then communism. Outside of North Korea and Cuba, there arent’ really any countries that have stuck with Marx’s vision. Not a glowing endorsement considering the plethora of nations that have given it a test drive at time or another in the last century.
So why is it resurfacing? Simple really. The old saying
Those who cannot remember the past are condemned to repeat it.
by George Santayana applies quite well here. The generation that lived through the last economists nightmare have largely past on, and those that followed began to forget or ignore the dangers of what a completely laissez-faire policy can cause, especially in economic matters. It didnt’ worked in 1841 in Ireland, it didn’t work in 1929 in the United States, and it didn’t work again when the reins were loosen in the 2000′s. And since we didn’t learn from our predecessors’ mistakes, here we are. While most of the calls for going to the other extreme are mainly outside of North America, it is a bit odd that the places you see folks talking about it, hail from areas that have felt its kiss first-hand. Possibly Stockholm syndrome perhaps?
And thus we’re down to the crux of what this writeup is all about, while we should be looking for solutions, and there are many being suggested from the sensible to the bizarre, going to extremes isn’t the way to go. If we had bothered to stay awake during history class as they quickly skipped through the 1930′s to rush to WWII, we would have seen that it was going to extremes that was a large driver of how the 1940′s would play out; Germany(facism), the USSR(communism), Japan(militarism) and the US(isolationism), all four nations would adopt extreme economic/political positions that had little room for maneuverability and flexibility. Most of us remember what the result of that was. While there are some rumblings of semi-extreme, inflexible positions (see the fracas that the US enjoyed over the last month and change), there’s currently nothing that looks even comparable to the storm clouds that were forming over seventy years ago.
As the parahparsed title of this article alludes too, capitalism has many flaws; you’d have to be a fool or a zealot to not acknowledge that. In it’s rawest, most concentrated form it can be especially brutal to all but those near the top of the financial mountain, as we’ve found out a multitude of times over the centuries. However, if it has a bridle placed upon it, and we hold it from breaking away like a panicked stallion with restrictions to where it can go and what it can control with no rearing back on the reins, it actually works, and works quite well. At least in comparison to its competition throughout history. Regulation, if properly managed and maintained, can actually be useful, if not necessary to combat the extremes that creep into all economic systems, thanks to that wonderful blessing and curse we all possess called human nature.
Want an good example? How about Canada? It hasnt’ escaped the recession completely (what nation has really), but with restrictions for banks that until just before the recession began prevented a repeat of the rash of bad debts that the united states is still suffering from. Things aren’t perfect of course. SouthWestern Ontario is a milder version of Michigan, Newfoundland and PEI suffer from chronic double digit unemployment, and debt ratios for a large amount of the populace are at troubling levels, but there’s no rumours of Canada defaulting on their debt anytime soon. Indeed, if the debt isnt’ being paid down at a decent clip over the next few years, I’d wager the current government will find itself back to a minority status, if not out altogether. Us Canadians, we’ve become quite the penny pinchers over the last two decades. Amazing what a credit rating downgrade can do to motivate some folks.
And now, if you’ll excuse me, it’s time to hit the hay. Have to be rested to effectively participate in that best of the worst of economic forms.