The End Of Capitialism? (Part 2 And Counting)

Just when you think Republicans and conservatives have run out of ways to bankrupt our country and our lives, along comes this piece of nonsense from the New York Post. I supposed that I shouldn't be surprised; the Murdoch-owned tabloid has been an outpost of comic-book journalism for years (as well as editorial hypocrisy: family-values editorials mixed with topless-bar ads). But the author of this piece, John Crudele, has generally proved in the past to be one of its better writers.

The unsurprising aspect of the article, however, lies in the nature of its economic-bailout prescription, which is a variation of an idea that comes up from time to time in right-wing circles (and, sometimes, left-wing ones as well): easy access to retirement savings, typically framed as short-term "loans" that would have to be paid back at some point.

The obvious objection to this is that it would further weaken the banking industry and Wall Street, by allowing everyone to simultaneously raid the last stable asset in the American financial system. Banks would have even less money to lend, which would send interest rates skyrocketing. And, as interest rates go up while the stocks and bonds in pension plans are liquidated, privately-owned companies would have an even harder time raising capital to survive, let alone expand.

This is another illustration of how the classic vision of capitalism as a system based on personal initiative, hard work and thrift gives way in reality to a world in which something closer to piracy prevails: borrow and spend (and, when that fails, steal and spend). In the Reagan (and even in the post-Reagan) era, this generally has taken the form of highly leveraged buyouts and mergers, typically creating large amounts of short-term wealth on paper, but ultimately producing only unemployment, monopolization and, ultimately, bankruptcy.

I sometimes think about George Bernard Shaw's joke about Christianity--the only thing wrong with it is that it's never been tried--and conclude that it has at least as much applicability to capitalism as it does to anything else. Let's face it. It's hard to work, to take risks with little or nothing to fall back on, to forgo short-term pleasure in favor of long-term gains. It's much easier to focus on the next fifteen minutes, and hope that the day of reckoning never comes. Except that it does. And, to paraphrase Keynes, sometimes in the long run we're not dead when it does.

Ultimately, there is no easy road. Working hard, working together, paying for what we need and not what we want, and planning for the uncertainties of life are the only ways to get out of the current crisis. Sorry, Mr. Crudele, but there are no pain-free solutions. There are only the right ones.

And, by right, the last thing I mean is extremely right.