Sunday, March 08, 2009

Picking raisins

Capitalism & Socialism are portrayed as white v black, two irreconcilable concepts of ownership and class. By doing so, the debate on how to move forward is needlessly polarised, preparing the ground for dogmatists to take over the ship only to ram it against the next best iceberg. By us falling into that trap and not seeing how both systems are partially mutually inclusive we are becoming apostles of a nonsensical dualist approach, similar to the often heard notion of man v nature. Just as We are Nature, so is Capitalism Socialism.

A socialist system of government and ownership of assets still requires capital to operate, and a capitalist system still requires the state to also hold assets and provide a degree of non-productive social security to its people.

Both arrangements contain aspects which are to be endorsed and others which are not in the best interest of the people. Why not pick the raisins from both cakes instead of rigidly defending the taste of one and dismissing the other as uneatable? My idea of socialism is not based on people’s servitude to the state nor does it exclude the concept of profits or entrepreneurship, quite the opposite, effort must be rewarded. But I believe what constitutes effort needs to be redefined.

That a company CEO earns more than the lowest paid cleaner working for the firm is to be expected, but their earnings must be linked. I suggest a ratio of max 20:1, meaning that for the CEO to earn 1 million per year, the lowest paid employee must be on $50K. Should the CEO want to double his income, he must also double the lowest paid employee’s wages.

Private ownership of assets and companies is the way to go, however essential services, such as schools, public transport and hospitals should be state owned or controlled. Capital, eg investment funds and their private equity holders, are not in the business of looking out for thy neighbour, they plan for profit maximisation, which is ok for goods or services that are being sold, but the provision of goods and services to cover quintessential human needs, such as medical treatment, education of the people or commuting between places, should never be allowed to be driven by passion for profits. A society with enough foresight to avoid social unrests or even revolutions should be able to provide its less fortunate members with basic human requirements, such as housing, food and health care in a non-profit framework.

The flaw in the capitalist doctrine is that it is too one-sided in its approach to entitlements, to the point that puritans go as far as to argue against any benefits being handed out to the needy. Stiff shit, that’s social Darwinism for yer, better luck next time. Not recognising that capital itself is constantly asking for its entitlements, as it is also needy. Capital also asks for government handouts, it’s just not called "the dole" but "R&D Grants", "Subsidies" or "Bailouts". Capital is needy, of a peaceful and harmonious society in which it can operate and securely invest its profits, and when listening to business leaders you get the impression they feel entitled to that.

The state needs to be far more regulatory than what it is at the moment, ensuring that the excesses the capitalist component inevitably is drawn to are contained to a reasonable limit and are not running counterproductive to the well being of our fellow men. Free (as in unregulated) enterprise as we know it is the reason for surplus food & produce harvested in a pumper season being destroyed so as to keep the wholesale prices up in the US and Europe. Utter foolishness, and yet that’s what happens.

As Marx said, "From each, according to his ability; to each, according to his need." Apply this logic for example to the ever growing disparity between rich and poor nations. Year after year, the relatively few bobs which are given in Foreign Aid by donor nations more often than not disappear in bureaucratic channels or are embezzled by corrupt leaders in the recipient nations. Nobody seems to be accountable for the lack in progress, everybody points the finger at everybody else. There is neither a pragmatic and coordinated approach to FA nor an incentive for the donor nations to ensure long term improvements are achieved. Every five years or so world leaders meet at some posh retreat to discuss the plight of the countless people living in third world conditions, emerge with a communiqué in which they express their firm desire to half within the next few years the number of people dying of starvation, only to meet again five years later to lament how things have gotten even worse. What a bloody circus of fuckwits, drives me mad just thinking about them shits. But what’s even worse is that it is us who elected them in the first place, and when its election time again all their lies and incompetence are forgotten.

So here is my idea on how to tackle the wealth gap across the numbered worlds and improve on that equality thingy. All the world’s countries are grouped by size and ranked by wealth. From the resulting lists, the richest nation is paired with the poorest; the 2nd richest with the 2nd poorest, and so on, till lets say on a list of 100, the 49th is teaming up with the 51st. Now every rich country has one other country it is "responsible" for, which would imho allow for a more focused attitude to FA and over time would lead to better outcomes. If every affluent country would adopt a poor nation of similar size, and without ideological blinkers tried to assist in its humanitarian and economical development, via means ranging from student exchanges to technology transfer, the world would see friendships develop where there were none whilst at the same time causing the boat-lifting tide to rise.

To sum up, Churchill once said "The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries." I see it the exact other way round, the inherent vice of capitalism is the unequal sharing of miseries, the inherent virtue of socialism is the equal sharing of blessings. I hope this makes sense and doesn’t sound too rumsfeldish.