“As Capitalism’s Crisis Deepens, Thoughts of Socialism Return Again”

28 05 2015

I found this totally captivating, AND educational……  he doesn’t address everything we discuss here on DTM, but this is well worth making a big jug of coffee to listen to….  enjoy!

These programs begin with 30 minutes of short updates on important economic events of the last month. Then Prof. Wolff analyzes several major economic issues. For May 13th, these will include:

  1. Socialisms Vary: Bernie Sanders to Hugo Chavez to Francois Hollande and Beyond
  2. Socialism, Communism, and the Role of the State
  3. Marxism and Socialism
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8 responses

28 05 2015
Anthony William O'brien

I believe in a society that takes care of the disadvantaged. A degree of income equalization is good, too much inequality is bad. Good laws well written and well administered make a society function better.

On the other hand.Those who take beneficial risks and work hard should be rewarded. The free market is far from infallible, but is relatively efficient. Where the welfare of society is unaffected, people should be free to make their own decisions.

I guess that makes me a pale pink socialist. What was very close to the center is now considered bleeding heart liberal leftie.

Raised on a diet of truth justice and the American way and listened to a message of hope I did hope. The deeper left told me I had taken a dose of hopeium. And the bad things that the deeper left said would come to pass have come to pass.

28 05 2015
Arthur Robey

I married a communist Economist. We agreed that a mixed economy was optimal, although she had nothing but praise for the USSR. She mourned it’s demise.
However, Prof Wolff says that they did not have Socialism but State Capitalism.
We are in a transition towards an age of machines. If we solve the energy crisis it will be inevitable that human labour is no longer required and then the problem becomes much clearer. How do we prevent Baron Harkonen from grabbing all the output of the machines.
I can see machines that harvest plastic from the great garbage dump, our oceans

28 05 2015
mikestasse

Personally……. I can’t see how we save this energy crisis.

29 05 2015
GBV

Gah.
I’m about 47 minutes in and I think I have to stop.

As a Canadian, I’m not sure Mr. Wolff understands exactly what happened out in Alberta and why the NDP came to power (i.e. the honesty of the incumbent Premier, Jim Prentice, about how dire the government revenue situation was with collapsing oil prices).

I also don’t see the value in demonizing Capitalism, when in reality we haven’t had a capitalistic system in place for ages; we have cronyism, as explained by Mike Maloney:

“We don’t have free markets, and we haven’t had since 1913. You cannot have free markets if you don’t have free market money. The currency is 50% of every transaction there is in society, and if you have a small group of men at the central bank having a meeting each month (in the United States it’s the FOMC) deciding how much currency there is going to be in the system, and what the cost of that currency is (the interest rate) – that’s a manipulated market by definition. There is no transaction in society that is not manipulated. When people say that the free markets are failing – we do not have free markets. When people say that capitalism isn’t working – we don’t have capitalism, we’ve got cronyism. We’ve got special favors being granted by Congress to the people that lobby them. It skews the economy, and creates all of these artificial bubbles that end up popping, and everybody loves living in a bubble – so they just want the Fed to create the next one.”

He also seems to push (failed) socialist ideas such as more government jobs (few of which produce any real wealth, and instead act as a drag on the economy), more money for government (when we see how wasteful and corrupt government is, ensuring that money goes to corporate and monied interests as opposed to what people actually need), and further arrogant regulation by technocrats/government (who, probably like Mr. Wolff, are academics at best who think they know what the problem as opposed to people with actual market experience).

I’m hopeful that Martin Armstrong will be correct, and within the next few months the end of Socialism will kick in as people start to lose faith in Big Government…

http://armstrongeconomics.com/archives/30920

Cheers,
-GBV

29 05 2015
mikestasse

Yeah, I’ve heard all the excuses…… trouble is, we have to deal with what we’ve got, and it was Capitalists who transformed Capitalism into what it is, and it was Socialists who transformed Socialism into what it is, and in the end, it’s human fallibility that’s at fault, we end up allowing being led by psychopaths craving absolute power that in the end corrupts absolutely.

We need to wipe the slate clean and come up with a brand new ism, and frankly nothing of the sort will happen pre collapse. How we exterminate psychopaths post collapse is what’s on my mind…

29 05 2015
GBV

I don’t see any “ism” solving the problems – it’s gotta be each person making good decisions. No government or corporate entities are going to hand “fairness” or “liberty” to people – they have to go out and get it for themselves.

And in some ways we already do – this Wolff fellow suggests that property rights need to be thrown out the window and everyone’s capital needs to be appropriated and given back to the people; yet we do have models already in place that socialize profits/organizational control (e.g. cooperatives). But should every organization, government or corporate, be forced to exist any certain way? In a truly free market people (and thus organizations) would be able to freely choose their structure and not be coerced by either capitalists or socialists…

Cheers,
-GBV

29 05 2015
GBV

And this (http://armstrongeconomics.com/archives/19352):

Marxism is a Dead Idea But Capitalism (Freedom) has Never Truly Existed

Posted on March 11, 2014 by Martin Armstrong

InvisibleHand-DanielleThe Socialists argue that we actually have a free market economy called capitalism and that is the reason for the economic downturns. They assume we can create an economic flat-line they call socialism/communism. Anything that booms and busts they call capitalism. The real question is when have we EVER had free markets and Capitalism without someone trying to regulate and manipulate the opposite side – labor or capital?

During the very early emergence of society coming out of the dark ages when we were abandoning serfdom, for a brief shining moment after the Black Plague or Death of the 14th century, capitalism may have existed for less than a year. Other than that, both sides (labor & capital) have been trying to regulate and manipulate the other ever since so there really has never been a free market that socialists seem to hate so much.

Adam Smith’s Invisible Hand was against the French Physiocrats who tried to reason that “wealth” was only agriculture and the blacksmith making products to sell to the farmer was a parasite living off of the wealth created by the farmer. Smith in his Wealth of Nations said that was wrong. Everyone combined through their individual productivity creates the wealth of the nation. Smith was proven correct with Japan rising to the second largest economy with a tiny landmass and hardly any natural resources. They became productive and wiped out the unions in the USA that were trying to rig the game no different from capital. Each side gains control for brief periods like democrats and republicans, yet neither can see that they need each other to exist.

The Black Death killed about 50% of the population in Europe that sparked a labor shortage which re-instituted wages. For a brief shinning moment real free markets existed. Labor rose in value naturally based upon demand. Then the manipulations all began.

The kings during the 14th century became greedy and began taxing wages or introduced the poll tax. As long as there was serfdom, people never paid taxes, only the “rich” landowners. This economic change of free labor (capitalism) produced the first tax rebellion in France and then England. The shortage in labor sent agricultural prices soaring. The landowners said this wasn’t fair that wages were rising and England passed legislation to reverse the free markets. In 1362, a petition was filed in the English House of Commons blaming the inflation on workers “who refuse to bear the burden of poverty patiently” to justify freezing wages.

It was at this time that taxes rose causing hoarding of capital among labor and landowners reducing the VELOCITY of money. Ordinances now appeared prohibiting the exportation of precious metals as hoarding increased. Edward III issued the Statute of Labourers in 1351 that set a maximum rate of pay at pre-plague levels and required all able-bodied men to work. The Black Death created a very dynamic economic impact by increasing individual wealth, reducing the population creating a shortage of labor, and price inflation. This was the free markets at their best.

The change economically was felt throughout Europe. In Florence, there was the Revolt of the Ciompi in 1378 that was an insurrection involving the lower classes that seized the government and created the most dynamic democratic government that would ever exist in Florence. As government began taxing the people, rebellions became more commonplace.

We have NEVER actually experienced a period of pure free markets. Depending upon who was in control labor or capital, each side has sought to use the law to change the balance of power economically in their favor. Today, we have the excessive rise in taxes causing the producers to hoard their capital and not hire or expand businesses. This has led to unemployment in excess of 60% among the youth. It is not that one side is right and the other wrong. Both sides are wrong and cannot use the rule of law to try to create an economic advantage for themselves.

Therefore, it is hard to say what lies ahead but we are at a Rome Moment. Marxism will end for it includes everything that seeks to manipulate for the benefit of the so-called people that is really now government workers at the expense of the private sector. However, the living standards of the people in general have declined, not because of the “rich”, but because of the growing unproductive sector we call government.

The only possible way forward would be to eliminate taxes for thereby both sides would no longer have an economic advantage to control government. Politically, we need to end career politicians for this would put the people in a real position of overseeing the bureaucracy. Those terms should be no more than 1 year. Will this solve all the problems? NO! It will not even last forever for one side or the other will find a way to alter the power and seek to attack and exploit the other side with regulation and laws.

This is just the beginning. There is NEVER a permanent solution for there is a cycle at work as well. Capitalism (defined as real free market for both sides) has NEVER existed except for some very few brief periods until one side or the other begins to try to control the other for personal gain.

30 05 2015
mikestasse

There’s one ‘ism’ totally misconstrued by the media that I’d be interested in following, anarchism…… but whether even it could cope with Limits to Growth of course remains to be seen…

http://themindunleashed.org/2015/05/5-reasons-why-anarchy-would-be-an-improvement-in-human-governance.html

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