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The Forum > Article Comments > Fundamentals of capitalist economic life > Comments

Fundamentals of capitalist economic life : Comments

By Peter Gilchrist, published 10/12/2008

Now is a good time to examine the corpse of the unregulated market.

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After distilling the article's obscure theorizing and translating its euphemisms, it seems clear that it advocates ETS/fart taxes as some kind of mystical source of enlightenment.

As I have stated before, the fictitious market of misnamed and misconceived "carbon trading" is meant to provide usurer-parasites the ultimate fake economy for their speculation. That is why the AGW/CC hoax has been pushed from World Bank men Stern and Garnaut, with extra marketing by hedge fund boss Al Gore, along with explicit support from the likes of Murdoch. The creed's high priests are beyond not only criticism but even scrutiny, blessed by their bogus "humanitarian" and supposedly "leftist" dogma.

After the fake trade in packaged debt and bets on rise/fall, etc., via the derivatives market, such is the fakery's intended replacement by a yet faker and more oppressive, obscurantist indeed feudal economy.
Posted by mil-observer, Wednesday, 10 December 2008 3:04:03 PM
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Just a comment about the US car industry. There is little doubt that too many cars are manufactured in the world. The US suffers from this because it has excessively high cost structures brought about by union feather bedding and legislative absurdities like "The Two Fleet Rule" which requires US car manufacturers to balance their profitable large car production with locally made small cars to reduce the overall average fuel consumption of the cars they make.

The result is that US manufacturers build high cost, low quality small cars that nobody buys. Instead of bailing them out, Congress could repeal this ridiculous rule and then let the market work its magic.
Posted by Senior Victorian, Wednesday, 10 December 2008 4:09:12 PM
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I am amazed beyound belief that any one from the real world can start off with the premise that the market is unregulated. They are obviously not active in any market I know of. Indeed I can only think of the ransom market controlled by African pirates as unregulated. It is clear that investors and banks went into the loan bubble market despite all the warnings and there were many warnings over the last few years. Like all bubbles it burst. Investors must have been blind to allow themselves to be trapped into listening to the so called money market experts. For instance 14 months ago a significant Australian money magazine was advising that the sub-prime problems of the USA were not going to have a significant effect on Australia and that the best investmemt around was real estate. Gosh! so much for the wisdom of the press ignoring fundamentals again...
Posted by ORAMZI, Wednesday, 10 December 2008 5:22:26 PM
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This is yet another in a series of articles blaming capitalism for the failure of government interventions. They fail to make out a cogent economic theory because they fail to come to terms with basic definitions.

Capitalism means the private ownership of the means of production. Unregulated means unregulated. It means not regulated. It means government is not regulating it.
No regulation. Got that?

The onus of proving something is on those who assert it.

Now. Where? What unregulated capitalism?

The existence of the Federal Reserve alone disproves the entire thesis of these articles. The Federal Reserve is a government monopoly of the money supply. The supply of money is a means of production. As it is a government monopoly, it means this system is not ‘unregulated capitalism’. Understand?

This is your definitional problem. You are confusing government monopoly control of something, with capitalism, and then blaming capitalism for the failures stemming from central government interventions based on anti-capitalist economic beliefs.

But the advocates of capitalism never claimed that central planning by government will not produce economic chaos and cronyism: that is the whole argument in favour of competitive capitalism and against such collectivism in the first place!

If the Fed was abolished, and the right of people to supply money in a competitive market was not illegalised as it is now, that would be capitalism as to the supply of money. But that does not describe the current situation, does it? Well guess what? These facts have economic consequences!

What all the anti-capitalist schools of thought don’t seem to understand is that these negative consequences are happening as a result of economic law. These are universal propositions of human action that apply regardless of time, place and culture. They follow logically from certain natural limitations including the scarcity of resources including time, natural resources, and human labour. They cannot be made to disappear by legislative fiat, or by changing human institutions. They apply anyway whether you like it or not. There is no magic pudding hidden in Obama’s backside.
Posted by Diocletian, Wednesday, 10 December 2008 5:22:35 PM
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*If* the government lowers interest rates, government cannot stop the resulting inflation. *If * there is inflation, the government cannot stop the resulting systemic malinvestment. *If * there is systemic malinvestment, the government cannot stop the resulting boom and bust.

If money was supplied in an unregulated market on the basis of private property, then society - through the market - would replace government paper with gold and silver as money. None of these current problems would have arisen on a gold standard. Why not? Because government couldn’t just keep inflating the money supply by printing paper and passing it off as real wealth, in pursuit of collectivist agendas of wealth re-distribution.

What is the function of the Federal Reserve? It is to manipulate the price of money so as to manipulate the supply. Is this a free market in money? No. It is a regulated market.

Why is it regulated? Because the government thinks it can make for a better society by centrally planning the values and actions of the population.

Is this capitalist? No, it’s the opposite. Capitalism means the private ownership of the means of production, not government ownership and control of them with a view to central planning. Get it?

Why does government do it? Because they think that by manipulating the money supply, they really can make real wealth, stabilise the economy, and do social justice. Why do they think that? How can they believe they can make real wealth just by printing paper, and do social justice by fraud and theft?

Have any of the anti-capitalists ever refuted the arguments that show that the only economic activity stimulated by government inflation of the money supply is nothing but the consumption of capital, which makes society poorer, at the same time producing the very problems in issue? No. All we get are the same old tired personal arguments, slogans of left and right wing, and sense of entitlement to unearned wealth
Posted by Diocletian, Wednesday, 10 December 2008 5:23:35 PM
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"Capitalism means the private ownership of the means of production".

What pseudo-Marxian quackery is this? If a group, village collective or state institution pool capital investment for enterprises then we already offer serious measures of "public ownership" - not private.

You're on a different planet mate - it just kills the discussion by the "appalling factor" - you know, like "there goes the neighborhood...any use hanging around this sheltered workshop?".

And get over this "government" shibboleth: most recent governments have sold out the public because the main parties have become hoes for prevailing monetarist oligarchs, even joining such predators (like Bob Carr's case, among many examples). There's not even an ounce of controversy in such a statement any more.
Posted by mil-observer, Wednesday, 10 December 2008 5:55:48 PM
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