Monday, August 23, 2010

Capitalism: An Utopia

As much as I detest socialism and collectivism, as an ideology, I have arrived at the conclusion that capitalism is also an utopia, which, when put into practice, cannot exist in reality.

The problem with socialism, American-style liberalism, and related ideologies is very simple: the principle might be good (I disagree with that too, but let's not get too philosophical here) - the more advantaged provide for the rest. Goods and services produced are redistributed in a more equitable way. The problem is very simple: the redistribution is done by an elite, a small privileged group, and thus cannot be equitable no matter how you turn it. In addition to the incentives created ("why should I produce anything when I won't be able to enjoy it, because some douche will take it away from me on a whim?") it is also highly inefficient. People will no longer produce all they are capable of producing because of the lack of incentives, and humanity will suffer (basically it will be poorer than otherwise).

The apparent solution is capitalism. I will not rewrite economic theory here, why that system is more efficient, nor will I go into the moral arguments of why it is more equitable (people produce only things that are needed by others, with minimal waste, and uncoerced).

However, I realized that this ideal is also an unattainable utopia. Capitalism relies on a fair and blind justice system, and an unbiased legal environment where the market can thrive and people can prosper. However, this environment must also be upkept and enforced by somebody, and again that is a small elite. And the probability of this elite being incorruptable, of upholding the law and never according special favors, is for all purposes 0.

Many point to the Russian ogligarchy as the failure of capitalism; I saw it as a system that was as far away from capitalistic as possible (there was no rule of law to protect the uncoerced transactions between individuals and firms; law enforcement was monopolized by an entity that formed winners and losers in the system, as opposed to allowing the market to determine them). Now that I look back at it, I see things more clearly: it is impossible to have an impartial entity protect the mentioned transactions and their fairness.

Because no elite in power or watchdog will ever protect or enforce the fair and unbiased system of property rights laws and other legal pillars of capitalism, I reached the conclusion that such a system is utopian in nature. Having reached this conclusion, I offer no alternative solution for a system best equiped to fostering human advancement. Perhaps a return to slavery, where I am the master and everyone else my slave, but even that wouldn't be too efficient, because I don't have dictatorial tendencies, or even desires, and I am prone to wasting time writing blogs instead of enforcing maximum production. The only solution I can think of now is anarchy, or the law of the jungle. But it's not popular, and the generations indoctrinated in the public school systems around the world are not likely to even listen to the arguments in its favor.