The Capitalism Papers, chapter 4

(Continuing from this post.) Chapter 4 begins the section on capitalism's fatal flaws. It gives examples of corporate schizophrenia, where some of the people within them feel human compassion and accountability but corporations, not being people (except legally), have no such feelings but only the undivided purpose of making a profit. There are a few examples of corporations causing environmental disasters where the executives effuse sorrow and regret while pledging to clean it up. But inevitably they fight adequate, or sometimes any, remuneration due to the cost to the profit margin while cutting back on or abandoning costly clean up efforts. Contrary to the Supreme Court's ruling, these corporations feel nothing and are only directed by their charter, which is to make as much money as possible. The corp's humans must put aside their own feelings and get on with business.


Cost-benefit analysis is the 'rationale' for a corp's bottom line. When the Ford Pinto's gas tanks started exploding they figured it would cost less to go to court over the deaths caused thereby instead of fixing the problem in the cars. When Wall Street collapsed, they figured since they'd created such huge banking conglomerates through deregulation that not only would they not  be punished but that they'd receive government welfare in the form of a bailout paid for by the rest of us. On top of that Wall Street banks gave huge bonuses to these masters of greed and deception for not only almost bankrupting their companies but the entire global economy, which would have been the case had they not been bailed out. The bottom line is that whatever human decency the executives of these corps had it was long programmed out by the nature of the corp itself within the capitalist matrix.

Health insurance companies were exposed by Wendell Potter, a public relations manager for one of them. He was required to sabotage Obamacare with deliberate lies and deception, death panels being a more flagrant example. The entire idea was to make money regardless of the health of the policyholder. To do so they engage in anti-competitive behavior, rig unaffordable prices, routinely deny coverage, eliminate preexisting condition coverage. Hence the huge opposition to Obamacare, which has now become law and will curtail some of this activity. But not without a ferocious ongoing battle still being waged by the Congressional regressives, who cannot abide that it might work. Note that health insurance companies are not fighting this so much because Obamacare feeds them many more customers for their voracious appetite and they'll still make a huge profit despite the prevention of previous abuses.

The basis of capitalistic rationale is that enlightened self-interest, aka greed, is good. This invisible hand (job) doesn't need governmental regulation to keep it in check; in itself it is a divine form of good for all. Or at least some kind of physical law inherent to the structure of the world in its own right that we must obey. When allowed to flow unimpeded its benefits will raise all boats via abundant trickle-down prosperity. Capitalists are fond of finding two out-of-context quotes by Adam Smith to justify greed but fail to mention Smith's broader context of being against monopolies and large-scale corporate entities. His kind of capitalism was based more on local and regional economies, not the global monster that grew out of them. For Smith the larger the business organization the more likely the conspiracy to defraud the customer and the increased necessity of government to protect the latter. For him 'enlightened' self-interest was that which earned one a healthy profit while giving a fair deal to the customer for his benefit as well. That is not the kind of self-interest rampant in global capitalism. And most interestingly, Smith promoted the necessity of public goods like roads and infrastructure that required public taxes to fund them, and that the rich should pay more in taxes for this purpose. One does not hear the regressives quoting these passages.

On the other hand Ayn Rand's social Darwinism is the example par excellence of greedy self interest and one will not find therein Smith's kind of enlightenment. Her ideas are echoed repeatedly throughout regressive rhetoric as if from the word of God. And Rand is God to these folks, as is the money in which they trust. Rand's characters rationalize the need to step on and eliminate, if necessary, the 'little people' undeserving of anything but our disgust. It's the makers we must value and stomp on the takers, the same kind of Randian rhetoric we hear from regressives today.

The chapter closed with a discussion of corporate personhood. The Supreme Court--well, its regressive majority--decided that our Constitution and Founding Fathers though of corps this way. Say what? Corps barely existed at the time, and certainly not in the form we see today. Founding fathers like Jefferson warned against giving corps more power. Freedom of speech was in no way intended for corps, only individuals. There was no mass media as it is today, so they did not foresee that such giant medal conglomerates should be given free reign to support whatever its corp's intentions might be. A corp's intentions? Really? What they mean is the people who own and control the majority of the corp's intentions, which are, guess what, making more money, period. And they do so by spending a lot of money, now considered free speech, to drown out an individual's free speech, most certainly not the intention of the Founders.

The final point being, even if people in the corp want to do right, they cannot based on the corp structure. Which itself is an outgrowth of the larger capitalist structure. The structure is the reigning paradigm and you either submit to and fit within it or you're swallowed up and spit out. And it is the paradigm that needs to change.