DO WE LIVE IN AN ORDERLY WORLD?

Adam Smith was absolutely brilliant in his time. Some of his prescriptions continue to inform capitalism’s best practices. Others however do not. Orderliness heads this list.

For an enabling world view, Smith borrowed from the great physical scientist Isaac Newton who was enamored with orderliness, for instance in the orderly way planets in our solar system revolve around the sun. For Smith and other classical economists, Newton’s world view was manifested in presumed equality between household saving and business investment. No leakage out of saving was permitted in the classical intellectual system.

~ Jim Sawyer

(More on) GOVERNMENT’S ROLE

No longer can contemporary capitalism operate on autopilot as in Adam Smith’s time. Now, extra-market-oriented choices by citizens are becoming essential to circumscribing the market with public priorities for health and welfare, education, environmental stewardship and much more.

The “new” capitalism ahead will steer around the false dichotomy of only two choices: laissez-faire or Marxism. It will focus on designing and sourcing productive capital needed to produce society’s chosen outcomes. Capital becomes thought of as “wherewithal.” Egregious pseudo-capitalist schemes are then met explicitly with tax and regulatory action.

~ Jim Sawyer

WHAT’S GOVERNMENT’S ROLE?

Barak Obama’s graduation speech seems to call listeners to ask this question: What should be government’s role? So, let’s look at the intricate interface between government and capitalism.

How can capitalism be fixed, patched, put back together? It begins with refurbishment of mission. What do we want and what are we willing to sacrifice in order to get it? Also, what do we want for the generation just behind this one, and those following after them?

Contemporary advocates of returning to laissez-faire argue against any significant role for government, therefore they oppose mission clarification for planning purposes. That’s what the “free market” in capital assets does, they exclaim. Their perspective creates a myriad of problems, of course. The Trump Administration’s unpropitious response to the Coronavirus challenge illustrates this painful reality.

~ Jim Sawyer

AND NOW, PSEUDO-CAPITALISM

We’ve described a hypothetical scenario in which an 18th Century farmer removes a plow horse from the field, then tethers it near his door solely for the pleasure of his children. Farm output and productivity slip. Then we linked the scenario to contemporary American capitalism.

We call this pseudo-capitalism. It has evolved to include all sorts of wealth-hording schemes akin to the 18th Century version of removing the horse from the field. Some of these are known as rigging, gaming and other rip-offs undermining community, citizenry and work force. Nefarious among these is vulture capitalism in which self-proclaimed investors actually disinvest by dismantling the companies they control and furloughing their workers, then selling off corporate assets to high bidders.

~ Jim Sawyer