Bert Olivier
Bert Olivier

Troubles with capitalism

Anyone who has been reading international news media such as TIME magazine recently will have noticed that people seem to be very worried about capitalism, judging by article headings such as “How to fix capitalism”, “Is capitalism broken?”, “Let’s fix this mess”, “Capitalism under fire” and “Keeping Wall Street honest”.

In one of these – “Capitalism under fire” (TIME, February 6 2012) – five panellists debated capitalism’s future at the recent Davos meeting (or is it junket?) of the capitalist elites. To the question of whether “20th-century capitalism [is] failing 21st-century society”, the answers diverged in a predictable manner. Sharan Burrow, who represented the International Trade Union Confederation (surprisingly, at Davos!), responded by saying:

“Absolutely. We’ve lost our moral compass. We need to redesign the system. When you have the greatest inequity since just before the ‘30s Depression, this is bad news for capitalism. Seventeen of the richest countries in the world have gone backward on equality, and 210-million people are out of work. The market’s lost its capacity to soak up people who need to be employed.”

David Rubenstein (MD of the Carlyle Group) partly agreed with her:

“Economic disparity is bad in many parts of the world, and capitalism has not solved that problem … The question is, How do we deal with it? How do we eliminate the boom-and-bust cycle in capitalism, and how do we eliminate the economic disparity? Government is supposed to be the leader. The business community wants leadership from the government officials that we elect.”

But Ben Verwaayen (CEO, Alcatel-Lucent) claimed that “We need to talk about innovation and sustainability and reform, not just about corporations and greed”, with Raghuram Rajan (Professor of Finance, University of Chicago) agreeing that “There are deeper forces driving inequality than oversize corporations. Technology, competition, globalization and a need for innovation are all pushing for higher pay and higher levels of skills”.

Clearly, even among people in these positions of power and influence, there is no consensus about what needs to be done to revitalise the dominant economic system, on the one hand, and address the major source of discontent among the populace at large today, namely the chasm dividing the haves and the have-nots. Some of the people in the know seem to think that — at least in the developed North — capitalism is beyond redemption. In a recent interview (TIME, February 13), banker and author Loretta Napoleoni (“Maonomics”, “10 Years that Shook the World”) responds to the question of whether “Europe [can] still foster economic growth” with blunt “real-economics”:

“Absolutely not. We are in a post-capitalist society. Capitalism is a system that works if you are modernising, industrialising, as in China and Brazil. You need a new system. In order to do that, you need a leadership that is willing to reinvent the wheel.”

The implication of this straightforward assessment for South Africa is that we are in the same boat as China and Brazil — because there is still a lot of modernising to do here, there is scope for capitalism as she sees it, remembering that China’s “state-capitalism” seems to be getting more and more attractive to the ANC government.

In an article titled “How to save capitalism”, Michael Schumann (TIME, January 30) also spells out some painful reasons why, as the global economic crisis continues — which has been blamed on just about everything and everyone bar the flying spaghetti monster of the pastafarians (and even of that, I’m not too sure) — capitalism itself has now become the alleged culprit:

“It’s easy to see why. As jobs remain scarce and the welfare of middle-class American and European families has come under strain, capitalism, as it functions today, seems to have failed to do what it is supposed to do: provide economic opportunity and a better future for all. [Sound familiar? B.O.] We’re taught in school that capitalism is a meritocracy that awards the hardworking and talented. In the wake of the 2008 financial crisis, however, capitalism often appears to benefit only the connected and privileged. To many, Wall Street financiers remain unreformed and unrepentant; they’re still getting rich off [of] the same sort of risky shenanigans that caused the US economy to tank in the first place. Bankers evict families from their homes only to tear those homes down … Over the past three decades, as capitalism has become freer and more globalised, the rich have benefited enormously while the many have often been left with the crumbs. The gap between the rich and poor has been widening just about everywhere.”

Despite his realistic assessment of the economic situation in a capitalism-dominated world, however, Schumann goes on to sing the praises of precisely those features of capitalism, some of which also impressed Karl Marx in the 19th century, despite his unmitigated opposition to it, namely its capacity to eradicate poverty, to stimulate innovation and reform itself under difficult or adverse conditions.

In the same edition of TIME, David Rothkopf argues that “fixing capitalism means taking power back from business”: “A key part of fixing capitalism will be reconciling the large and growing imbalances between the public and private sector. National governments have, over the past several decades, seen the most basic pillars of their power erode.”

This resonates with the words of David Rubenstein, quoted earlier. Perhaps this process of curbing corporate power is already happening in the very belly of the beast of capitalism, namely Wall Street. In New York, US Attorney and Prosecutor, Preet Bharara, has already won 56 convictions out of 63 cases where Wall Street traders have been charged with offenses like insider trading and securities fraud — activities which, if unchecked, enrich the perpetrators beyond one’s wildest imaginings, and obstruct access to investing opportunities on the part of other investors. He has already seen several of these erstwhile paragons of capitalist success being imprisoned in the wake of his relentless investigations, and he has not lost a single case.

Perhaps this is what the world of high finance needs — someone (working with a team of dedicated staff) to remind them that greed sometimes (not often enough, yet, though) has a price to pay. And it is a reminder that the insatiable beast of capitalism CAN be reined in, if representatives of the state — in this case, its prosecuting arm — have the guts to take the bull by the horns.

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    • HD

      @Tofolux

      You really have no idea how the Chinese system works or what is really happening in China, do you?

      @Bert

      How else do you suggest human exchange relations should be structured?

      Markets are merely voluntary exchange institutions where ordinary people exchange things that they want (value more highly). Value is entirely separate from money – money is merely a commonly agreed upon method of exchange – to make things easier. Value is subjective and economist since the marginalist revolution theorise around this concept.

      You just throw around “capitalism”, Smith and Friedman without any real understanding of their ideas or perspectives on economics? I dare you – take up a book like Friedman’s “Free to Choose” or read Smith’s Wealth of Nations/Moral Sentiments and you will find that their views have been twisted by their detractors and opponents into something completely different. These guys aren’t evil scrooges but was deeply concerned with moral questions.

      This is my biggest gripe with a lot of the comments on TL. People have this view of economics which is completely devoid of the actual history of economic thought. It is a type of folk understanding that people have picked up from parents, schools and popular media, that in no way resembles the actual philosophy behind the discipline. Then again I also think the way economics is taught is abyssal. It is taught like maths instead of a proper social science discipline.

    • http://www.vegansociety.org.za Aragorn23

      @Bert: I think what Brent has fallen prey to is what Mark Fisher calls, in his book of the same name, capitalist realism – the idea that there is no alternative to some or other form of capitalism (be it the idealistic capitalism of the free market folks or some or other extant form of state capitalism).

      Some of the comments are also guilty of reproducing a false dilemma: liberalism (some or other form of Lockean liberty as a priori / categorical good) vs. socialism (some or other form of consequentialism beholden to the notion of the Enlightenment subject and its concomitant practices of ethical normativity and representation, i.e., what Foucault might have called ‘the injustice of speaking for others’).

      In response to this, I highly recommend the following recent book by Nathan Jun; where both classical liberalism and classical socialism emerge out of what can be termed ‘political modernity’, Jun sees anarchism as the first form of political postmodernity: http://www.continuumbooks.com/books/detail.aspx?BookId=158779

    • http://www.vegansociety.org.za Aragorn23

      @Garg: You say that greed is endemic to human nature. To this I would add an important provisio: *under certain conditions*. Under other conditions, as Graeber, Kropotkin and others have observed, mutual aid and solidarity are endemic. See Rebecca Solnit’s ‘A Paradise Made in Hell’ for a great exploration of this phenomenon. In other words, human nature seems little more than the capacity to adapt, within limits, to context.

      Your narrow, overly-technical definition of capitalism suffers from the same problems as your similarly tortuous definition of anarchism: you attempt to extract an unequivocal definition for a term that is far more usefully understood in context***. Your approach might work for defining a programmatic class, or some other technical term in mathematics or computer science, but it falls far short in delineating the rich multiplicity of overlapping meanings that have agglomerated around descriptions of complex social phenomena. To wit, a Google search for the origins and meaning of the term ‘capitalism’ yields a wide variety of results, including its pejorative use by Marx, a full taxonomy of types by Wikipedia (these include state capitalism) and, of course, the obviously self-justificatory reworking by your free market friends.

      I find your implied claim that collusion wouldn’t occur in a ‘real’ capitalist society entirely dubious. If anything, there would be more incentive given the lack of social controls.

    • http://necrofiles.blogspot.com Garg Unzola

      @Aragorn23:
      That’s a very valid point. There is no dichotomy between classical liberalism and socialism, as a system with classical liberalism (which to me is closer to capitalism) does not prevent private socialism or welfare to exist. On the contrary, it encourages it. By contrast, a socialist system that is entrenched per definition limits and prevents classical liberalism (property rights, individual autonomy, etc).

    • http://necrofiles.blogspot.com Garg Unzola

      @HD:
      Precisely. If we were discussing a topic critically, there’d be no room for such hissyfits as ‘system x is so evil and must be abolished!’. Particularly if we can’t even define system x.

    • http://necrofiles.blogspot.com Garg Unzola

      @Aragorn23:
      1. I did not claim that greed is the only endemic human quality. Solidarity and mutual aid are endemic too and they aren’t mutually exclusive to greed, let alone self-interest. Which is why you’d find countless cases of solidarity and mutual aid in most societies, along with cases of greed.

      2. Precisely. Which is why, if I would like to criticise say anarchism, I look for a clear definition of the term and – more importantly – I state my preferred definition in my criticism, along with its source. This is standard practice in academic writing and is not related to my background in computer science. It’s just stock intellectual rigour and you’d learn this in any rudimentary research methodology course worth its salt (which is where I learnt it, ironically my research methodology course was not from the computer science department but from a humanities department).

      3. I never claimed that collusion would not occur under capitalism. I claimed that voluntary collusion with mutual consent is better than entrenched collusion.

    • HD

      @Aragorn

      In generally, I agree with both of your statements, although with a few evolutionary psychology and biology caveats are unavoidable.

      But, surely Garg’s point is that Bert offers (or implies) a too “loose” definition (to the extend that he even offers one) of capitalism, which allows for all sort of straw men and enables him to wax lyrically (or is that philosophically) about concepts devoid of a critical reflection on their context, history or conceptual clarity. (all things which I am sure he will point out – he does indeed care about and apply – unless we go down that other route…).

      So why not be at least a bit more specific? Might it be because he will then encounter arguments which no longer makes things look so simple or fit a dogmatic narrative…like those of free market crowd?

      So sure, it is socially complex, but Bert is not attempting to find any common ground for talking or exploring – instead he prefers to talk his language only.

    • http://www.sane.org.za Yaj

      China has a predominantly state-run and state owned banking system which is tightly regulated-reserve requirements are raised to control credit extension and prvent over-heating of the economy and not just simply raising interest rates only. Its central bank is also state-owned and state-run pursuing an exchange rate policy that suits their own national interests, their currency shielded from speculative attacks and volatility-very different too the situation here in SA.

    • Andre

      @ Bert, I see the hints at the requirements for a replacement of capitalism with something else, but i also see the optimism that the capitalist system can be reigned in – unless you are drawing a distinction between ‘the world of high finance’ (which perhaps needs more prosecution of the greedy) and the system that needs to be redesigned (in terms of which prosecution of the greedy will be guided?). Your piece brings to me the optimistic message that there is no consensus amoung the high priests of capitalist institutions. The economy is a matter of concern to many besides these erstwhile occultists guarding its arcane workings behind (cracked) walls of factish rhetoric. The inability of the original architects to patch these walls is good news. Consensus would patch the walls by presenting matters of fact upset by greedy bankers or imbalances between the public and private sectors or some other interference with ‘nature’. I think a better course would be to celebrate the lack of consensus; resist its becoming by adding to it. By cultivating a lack of consensus we can perhaps move forward powered by something other than the sterilizing ‘progress’ that has laid the world to waste. We surely dont want more of the same? So if we can agree that the time of time (progress) is passed, maybe the time of Time (magazine) as a realistic forum for gathering concern is passed with it.

    • Tofolux

      @HD, Garg, Aragorn and whomsoever. I think you guys are in la.la.land. Are you for real? CHINA has the most successful economic system to date – FACT. Capitalism is failing – FACT. Now what part of that dont you understand.

      But really, i like this one “there is no dichotomy between classical liberalism(?) and socialism. I beg you please gargle, um sorry / explain….I am really interested in your own interpretation on this one…..
      Also, hd I need some explanation on ” loose definition of capitalism which allows for……unless we go down the other cont”. explanation of full sentence.
      As you know by now, my education is very limited. Some might say consequences of being taught under a tree. So clearly you need to regargle/ um sorry re-explain for my simple mind.

      But let me say about China. they have a developmental state and they have come up with a developmental economic model that seeks through regulatory reform, to achieve consistently the outcomes we see today. Imagine if SA, also a mixed economy, achieves the same outcomes? We have resources, China doesnt, So can you see the possibilities. Nothing ventured, nothing gained. I think SA will yet astound you. SOmething of which they are becoming quite renowned for.

    • http://necrofiles.blogspot.com Garg Unzola

      @HD:
      That is exactly my point. If Aragorn23 would like to wax lyrical about anarchism, after all, he’d be careful to point out that he does not consider Rothbard’s anarcho-capitalism or Konkin’s left-libertarianism (in itself a term that needs careful defining before a critique is levelled at it) as instances of true anarchism. This much is fine and it contributes to prevent people familiar with those to judge his anarchism writings by the same standard.

      It’s another way of saying ‘given that anarchism means this, all of this follows’, whereas the blog post above takes the approach that ‘given all these negative effects, capitalism is evil’. This assumes the initial points (ie begs the question) of what is meant with capitalism, and that we do currently have a capitalist system. Let alone being a case of appealing to consequence.

    • http://necrofiles.blogspot.com Garg Unzola

      @Totolux:
      China says China has the most successful economic system to date. But this system is exactly of the same kind as America’s economic system. The difference is of degree and not of kind, and neither are capitalist systems.

      Did you read the links I posted above? This would give you more insight into why China’s economy isn’t as successful as they’d have you believe in addition to explaining why it isn’t a capitalist system.

      No need to beg, I’ll gladly explain. Classical liberalism does not prevent me from starting a kibbutz or conducting any form of communal living experiment, or from being charitable, provided that in doing so I do not initiate force against other individuals or compromise their rights (occupy their property or force them to participate in my social experiment). By contrast, a socialist system implemented top-down from state level forces me to participate in a socialist system, whether I’d like to or not. It’s the difference between starting a kibbutz in your backyard, which classical liberalism permits, and forcing everyone to live and work on the state’s kibbutz with no opt-out.

    • http://www.vegansociety.org.za Aragorn23

      @Garg: I’m not sure that I agree with your distinction between ‘voluntary’ collusion and ‘entrenched’ collusion. Surely collusion could become just as entrenched in a free market society, given that a small minority of people might do exceptionally well in such a society, take ownership of loads of private property, hire private security firms and network with each other to maintain what would be, in essence, ruling class power. Frankly, I fail to see the difference between what to me seem like the natural ends of such a system and the state capitalist system we currently have. I think we can do much better once we recognise that our possibilities are not limited to those that exist somewhere within this liberalism vs. socialism binary, which is why I usually encourage discussion of anarchism, a kind of ‘third way’ that’s neither left nor right.

      As for definitions, here’s one from the Jun book I mentioned earlier: “Anarchism is better understood as (a) universal condemnation of and opposition to all forms of closed, coercive authority (political, economical, social, etc.), coupled with (b) universal affirmation and promotion of freedom and equality in all spheres of human existence.”

      Errico Malatesta also offers a nice definition in his freely available text ‘Anarchy’, although he traces the etymology back to ‘anarkhia’ instead of ‘anarkhos’ (without authority).

      PS: Ironically, I was referring to Derrida in the post that was rendered incomplete 😀

    • http://www.vegansociety.org.za Aragorn23

      @HD and Garg: I agree that we should employ some rigour in defining our terms if we want to have a constructive discussion (and, to be fair, I think Bert’s definitions in this and other pieces on ‘capitalism’ are pretty solid). However, it doesn’t follow that we can define terms opportunistically, something the Ayn Rand website definition of ‘capitalism’ seems to be a prime example of.

      Rothbard, out of interest, seemed to have a fairly nuanced take on the complexities involved in defining terms too rigidly: http://www.lewrockwell.com/rothbard/rothbard167.html

      PPS: The post that was rendered incomplete was the one with the *** – a disclaimer about the endless complexities and slipperiness of discerning context and meaning that Derrida speaks about at length in his work.

    • http://necrofiles.blogspot.com Garg Unzola

      @Aragorn23:
      Given that capitalism is a society based on individual rights, particularly private property rights, collusion is only possible to the extent that it occurs in absence of coercion from an authority. Entrenched collusion is collusion with the aid of an authority, such as taxation and parastatal enterprises.

      That definition of anarchism is on par with capitalism as Ayn Rand defines it. Her capitalism is hardly an opportunistic definition, it’s merely mental hygiene so we know she’s evangelising laissez faire and not our current situation whereby banks get bailed out by government but the spaza shop on the street corner doesn’t. By criticising her notion of capitalism, we know you are criticising individual rights. When Prof Bert criticises capitalism, he’s criticising government sponsored debt, government controlled currency and hazardous environmental consequences then taking the leap of faith back into a dark void yet hits capitalism every time. Given that you’ve done the ‘define capitalism’ search, do you think he’s being critical of a particular socio-economic system? To me, this is constructing an opportunistic panchreston.

      Rothbard and Rand would both agree with Jun’s anarchism (a) but not with (b). This is too egalitarian and contradicts (a) if you think about it carefully. Equality in all spheres? That’s a Gattaca scenario. Without digression from the mean, progress isn’t possible.

    • Tofolux

      @HD, Aragorn and Gargle, I will venture to say that somewhere someone has a split personality. ie a three-way split. Can I ask who am I addressing, ie which personality?

    • Rich

      @Tofolux
      In regards to China and its success there are two key points:
      1. massively exploited workforce
      2. a seriously undervalued Yuan
      I think both are not sustainable and change will happen…

    • Brent

      Bert all i ask is that you detail your preferred system, spell it out so we can pick it apart and please define capitalism, a word coined by Marx. The SACP collects fees from its members and presumably banks/invests these funds, does that make them capitalists? If not why not, to be a capitalist must one create things and employ people, sounds ok to me?
      If income disparity is your main gripe, where you work form a collective of EVERYONE working there and share the funds earmarked for salaries exactly equal, no one getting more than anyone else. It will be a living example to all of us of how the socialist/progressive system should/can work.
      I am not a single mined capitalist, dont even know what that means, my preferred system is a Free Market Multi party democracy regulated by a progressive govt. that does not interfere with peoples freedom of choice in all things, included economic decisions.

      Brent

    • http://necrofiles.blogspot.com Garg Unzola

      @Tofulax: From Gargle, it appears that someone else has a split personality. If you really are lacking in education, you could do worse than this concise guide to economics, or this basic introduction.

      @Aragorn23: Thanks, I enjoy Rothbard’s writing. It’s not the purpose to get a definition cast in stone, merely to have an intellectually honest debate. For this purpose, clear definitions are a prerequisite.

      I agree that capitalism vs socialism is a false dichotomy. If we would like to criticise the current economic climate, then we must realise that we’re not living in either.

      @Rich: Exactly. Besides the cooked books and fertile ground for ideological wishful thinking that China’s alleged success requires, some people notice the wizard behind the curtain (the world’s next big bust).

    • Tofolux

      @Rich, if you remember the dismal economic policies of Mao Tse Tung and if you remember the dismal poverty Chinese found themselves in then how is it that they have the strongest economy in the world today? Do you think they got here because of the weak yuan and exploitation. I wonder if you are acknowledging the gains that govt has made. For the record, there is NO Chinese person in China today that lives on less than a dollar a day. Now wrap your head around that fact. No Chinese person, who lives on less than a dollar a day. A population of 1.3+ billion, I’m sure you can do the sums. I also think you are forgetting that the communists are very good at communism and socialism. You are forgetting what communists do in a communist state or socialist for that matter. Guys, guys, guys, I think you are pulling the teeth out of this debate, We are going no-where……eg now you have a person, who has split himself into triplets to make a point. c’mon now…..l

    • http://www.vegansociety.org.za Aragorn23

      @Garg: It does not follow from the fact that a society is based on individual rights that it will necessarily be able to support those rights. It is also not the case that collusion necessarily requires, or would diminish without, state authority.

      When Bert criticizes the state of affairs most of us understand the term ‘capitalism’ to refer to, it’s easy to use the old free market fundie trick of ‘well that’s not markets, that’s the big evil state’ and to then assert that his definition is at fault, when perhaps all that we can really conclude is that he has a different analysis of the underlying problems to yours. Certainly, his full analysis should (and I’m sure it does) factor in state power, but then, ideally, it should also move in the direction of a full (Foucauldian) genealogy – a full mapping of networks and relations of power, discursive and non-discursive practices, modes of subjectivation…I suspect you get my point.

      The fact that Rothbard and Rand don’t agree with Jun’s (b) but agree with his (a) is precisely why anarchists are opposed to the idea of ‘anarcho-capitalism'; it relies upon a false, or at the very least insufficient, definition of anarchism. Jun’s book argues this at great length with a great deal of philosophical rigour.

      As for your ‘Gattaca scenario’, you might do well to read a bit more on anarchism and what anarchists mean by equality. Remember, anarchists hate state socialism just as much as they hate capitalism.

    • http://none Lyndall Beddy

      Rich

      You can add to your points on China

      1. 2/3 of the population still in rural poverty and kept there by influx laws

      2 Colonisation and exploitation of its neighbours (Tibet, Mongolia, Burma, Vietnam)

      3. Special Zones, where the development is actually happening, which are free trade zones laws with no rules and minimum taxation

    • http://www.newstime.co.za/columnist/PaulWhelan/5 Paul Whelan

      Whatever else of value comes out of discussions about competitive systems, it has become clear that it is an exercise in futility to try to progress by asking for or offering definitions of capitalism (or any similar abstraction), since any definition can only be given in terms that are acceptable to the party giving it.

      If the definition could be agreed, there would be no disagreement.

    • http://necrofiles.blogspot.com Garg Unzola

      @Aragorn23:
      1. Yes, you are correct. Merely dodging clear definitions does not invalidate the entire critique. My contentions with the blog post does not rely merely on opportunistic definitions as my other comments point out. There are more but it’s really tiresome and it will be futile unless the economic ignorance problem is addressed.

      I do not view income equality (or any equality bar legal equality) as a desirable state of affairs, nor do I view an income gap as a meaningful indicator.

      2. Rothbard and Rand are at odds with regards to anarchism. Rothbard attempted to conflate Rand’s capitalism with his flavour of anarchism. Rothbard bases his anarchism on a broad knowledge of economic history and anarchism so you’d enjoy more of his writings.

      Rand was not against the state at all. State capitalism and state socialism are both cases of what I mean with entrenched collusion (with the caveat that there can be no state capitalism, unless the state’s role is only to protect individual rights, but I’m trying to work with how I understand you mean the terms).

      Your question is valid and I do not have an answer for how an anarcho-capitalist society would prevent collusion. The purpose is however not to prevent collusion but to ensure individual rights and private property in order to provide any collusion with competition. I recall Friedman having a good explanation on monopolies but also no solution. His solution – like Rand’s – is the state prevents collusion.

    • jack sparrow

      Never mind tofolux, soon you’ll be able to exchange banter with the Chinese you love so much right here in SA. Of course it may be a master and servant relationship like the ANC has with them.

    • Rich

      @Tofolux,
      Actually I do think that…plus more.
      What I do not believe is that not one Chinese person lives on less than a dollar a day. That is a very bold statement.

      China’s efficiency to date, I suppose, can be distelled down to one thing – autocratic rule. What the boss says goes and woe betide they who refuse.

      Also, whay not add in your statement that ‘capitalists are very good at capitalism’ or would that be going too far?

    • http://necrofiles.blogspot.com Garg Unzola

      @Rich & Tofulax:
      China did not experience much improvement in economic conditions until the late seventies, when they started liberalising trade (see Chinese economic reform).

      The main problems noted above are income disparity and revitalising our current economic system (whichever that may be). We see from China that more economic freedom results in larger income disparities, while at the same time having less people in absolute poverty. This is a general trend that can be found in all emerging nations.

      In addition, some developed nations have long since past the status of developing nation but have managed to stay on top of the HDI for quite some time. Ireland came from out of nowhere by implementing market reforms (read: followed neoliberal policies) and managed to find a spot amongst the top 10.

      The crisis of capitalism is thus not one of failing capitalism, but one of preventing a relapse into centralised economies and a decline back to more equitable wealth distribution at a dismal standard of living.

    • jandr0

      @Tofolux: “I think you guys are in la.la.land. Are you for real?”

      “CHINA has the most successful economic system to date – FACT.”

      NO, not a FACT. Please quote the source of that alleged FACT and the evidence to support it.

      “Capitalism is failing – FACT. Now what part of that dont you understand.”

      Once again, not a FACT (and again please quote sources and evidence).

      As to China’s success, to add to Rich and Lyndall’s comments:

      1. China has a massive internal market. The size of your internal market is a significant contributor to economic success (provided you get the rest right, of course).

      2. Here are three broad measures of a country’s economic strength: GDP, GDP growth, and GDP per capita. Now, while China’s GDP growth may be high, remember that they’re coming off a low base. And while it’s GDP may be comparable to (say) the USA’s or Japan’s, both of them still smoke China in GDP per capita.

      3. China only really started growing strongly economically when moving AWAY from pure communism TOWARDS principles of free markets (Garg Unzola and some others have already pointed at this). Incidentally, the same movement towards free markets, although away from centrist state socialism, had the same effect in India.

      So, clearly, a move towards free markets (closely associated with capitalism) results in more economic prosperity, and you boldly claim – with no supporting evidence or facts – that capitalism failed.

      I fail to see your logic.