'The new market fundamentalism is more dangerous to the world now than Communism.'
May 6, 2001 11:02 AM   Subscribe

'The new market fundamentalism is more dangerous to the world now than Communism.' George Soros, on the inside pissing in. Capitalism with a human face?
posted by holgate (14 comments total)
There aren't many new and noteworthy ideas put forth in this article. The only thing which adds any kind of interest and credibility to it, is that it's partly about "a capitalist opposing capitalism". But how much of a capitalist is George Soros, anyway? Is he one, at all? Not according to Capitalism Magazine:

When someone is called a "socialist," the meaning is that he advocates the principles socialism whether he practices them or not. But when someone like Soros is called a "capitalist" the meaning is that he allegedly practices capitalism even though he opposes the principles underlying capitalism. It's time to be consistent and call Soros an anti-capitalist — which is what he certainly is.

And hey, "Capitalism with a human face"? Does anyone really want to go through that discussion, yet again?
posted by frednorman at 11:23 AM on May 6, 2001

Gee, frednorman, I thought you didn't like people being labled, such as you being labeled a libertarian in earlier threads. Correct? Maybe you shouldn't label George Soros either. But we all contradict ourselves at various points. It's only human. Soros says he's anti-market fundamentalism. I know what he's talking about. It's not too terribly complex.
posted by raysmj at 11:59 AM on May 6, 2001

The Economist printed an editorial about global inequality recently that, I am sure, would irk people on all sides of the free market debate. Socialists, new market capitalists, Randians, libertarians, garden variety liberals, environmentalists, Americans, Europeans, Mexicans, Canadians, French-Canadian teddy bear lobbers, neo-liberals, compassionate conservatives, Greens, whatever. Interesting thing is, the magazine believes that inequality must be addressed for pragmatic reasons. In other words, it's morally neutral.
posted by raysmj at 12:13 PM on May 6, 2001

The article hints at subtle problems that I've been worrying about for years. I suspect they're about to get worse. Why? Capitalism is now in the process of damaging its most fundamental support structures. Greed is shortsighted, after all. The most important support being hacked away at (aside from democracy and the environment itself) is the Ford principle... that people earn enough to afford your products. From this principle alone, it's a necessary logical result that Capitalism can only withstand so much concentration of power before it undermines itself and the markets collapse. So it's going to fall apart for sure unless something changes (it's *possible* that technogical change could bail us out to some degree, but far from certain). If change isn't fast enough, what then? Totalitarian State Capitalism? (actually, how far away is that really?) Another Great Depression? Another World War? I suppose it's all okay so long as the top couple % keep increasing their holdings...
posted by muppetboy at 12:21 PM on May 6, 2001

The most important support being hacked away at (aside from democracy and the environment itself) is the Ford principle... that people earn enough to afford your products.

This "principle" is, of course, balderdash, as a moment's thought will show. Should every Boeing employee be able to afford their own 747? On the flip side, should people who make running shoes earn only enough to buy a pair now and then? Ford's principle makes sense only if all goods are worth the same amount, which in the real world is so obviously preposterous as not to bear thinking about.

What Ford meant is just exactly what he said: that his employees should earn enough to buy one of his cars, not just any random good they happened to manufacture. In other words, he found a way to get back some of their increased salary by selling them something that, until he came along, they didn't even think they needed. This wasn't just about being fair to the workers; it was also about motivating them and getting more cars out onto the road to increase demand for the product. Not to mention it was excellent PR. Furthermore it forced his eventual competitors to raise their wages to match his, so they maintained a more or less equal cost footing while only he reaped the publicity benefits of being the first to pay higher wages.

Ol' Henry Ford was wily, all right, but painting him as some sort of socialist hero is completely missing the point. Most people who argue for a "living wage" think there should be fewer cars in the world, so why idolize a man who thought it would be an excellent idea to pay all his employees enough to afford one of their own? One of modern life's biggest problems may well have begun with this very decision.
posted by kindall at 1:27 PM on May 6, 2001 [1 favorite]

You're totally missing my point and taking it far, far too literally. I'm using Ford's principle as a metaphor for a deeper issue. What 'm getting at is this: if the bottom continues to sink while the top continues to rise, eventually the top just begins to serve itself because the bottom can no longer afford to participate. If the top gets too narrow, then the entire economic system stagnates or collapses. In a system like Capitalism which requires perpetual growth, even mere stagnation will mean downfall. It has to keep growing to survive. If you run out of people who can afford to consume at rates that cause growth... because they're already maximally in debt or they're in jail or just plain starving... then you run out of growth and Capitalism fails. Given the current trajectory of growth at the top and atrophy at the bottom, I have a hard time imagining that Capitalism isn't going to fail. It's just a question of HOW and WHEN.
posted by muppetboy at 3:05 PM on May 6, 2001

BTW, you're jumping to conclusions about what I think of Ford. Ford is no hero of mine. Nor was he a socialist... although you could argue he was in favor of fascism.
posted by muppetboy at 3:19 PM on May 6, 2001

Foxes and rabbits.

And I'm quite amused that "Capitalism Magazine" denounces Soros as if he were Trotsky in 1923. As if such a pathetic little publication mattered.
posted by holgate at 4:05 PM on May 6, 2001

More substantially, Soros was demonised in 1993 by the British press for betting on the economic weakness of the UK, and winning. (It was the idiotic attempts to prop up the pound which doomed the Tories to utter meltdown, I think history will presume.) But having read more of the man, and met people from eastern Europe who benefitted from his scholarships, I have to respect him for his perspective on the impact of unfettered (one might say Thatcherite) capitalism on the former Eastern Bloc.
posted by holgate at 4:11 PM on May 6, 2001

Soros has been prophesizing doom since at least 1997. He understands how fundamentally unstable world economies are and how a few people placeing bets on currency can ruin entire countries and how its only a matter of time before social forces backlash. He calls for better international institutions. Currently the US Govt writes off debts and bails out other economies (Mexico) by the billions on a regular basis to cover the lame-ass wall street tycoons who made stupid bets because they know the Govt will bail them out.. yet we stick it to the average person in credit card debt just trying to pay the bills. Thats what Soros is saying.. the system has become more important than the people in the system. Its facism by definition. More dangerous than communism.
posted by stbalbach at 5:36 PM on May 6, 2001

"State Capitalism" is the nice word for what's essentially fascist, and there are all kinds of things which don't quite fit the fascist mold in the US, but overall, we're slowly sliding in that really bad direction. Corporations are closed, non-transparent, unaccountable tyrannies. Citizens have little say in how they operate and less each day. Putting more and more stuff under their control via "privatization" is definitely heading us in the direction of fascism... or extreme state capitalism if you prefer. It won't be a world like Germany or Italy under fascism, but it could be pretty awful in a new kind of way. To many millions of disenfranchised people, it already is pretty awful.
posted by muppetboy at 6:21 PM on May 6, 2001

Corporations are closed, non-transparent, unaccountable tyrannies

As opposed to, say, the Internal Revenue Service?
posted by lileks at 8:10 PM on May 6, 2001

Lileks, taxpayer anger has resulted in a 50% decrease in audits and numerous other reforms -- notably the "innocent spouse rule" -- in recent years. That sounds accountable and transparent to me. It may be the clearest epitome of the faceless bureaucracy found in our land, but citizens can and do defend themselves in court or petition their elected representatives for redress.

That's a hell of a lot more than they can do for a WTO ruling.
posted by dhartung at 8:36 PM on May 6, 2001

Fred, the secondary definition of capitalist, according to the American Heritage Dictionary, is an "investor of capital in business, especially one having a major financial interest in an important enterprise," which certainly describes Soros.

Having just finished Fast Food Nation, I'm trying to get a handle on my thoughts regarding the rise of the multinational corporation and the implications on the nature of capitalism; when unions arose in America and Europe, they were bitterly fought by corporations, but those corporations were, for the most part, dependant on the labor. Now I think they'd just move to a cheaper, un-unionized part of the world (similar to the movement of textile mills from New England to the South, only on a global scale).

Lemme ask Fred (and anyone else who cares to give a reply) -- to what extent does expressing dissatisfaction with the current system ("late capitalism") reflect "anti-capitalist" tendancies? I think you're right that Soros is terribly uncomfortable with the current system, but do you feel that Teddy Roosevelt counted as an anti-capitalist? What about Adam Smith, who could (very generally) be described as pro-free-trade, but strongly anti-monopoly?

(And here's a link to a previous MeFi thread on Soros that I started in December.)
posted by snarkout at 7:44 AM on May 7, 2001

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