The Debate on Capitalism Report

By Michael Tivana | 3-05-02    - back to Tribal Messenger

The debate on 1-31-02 was between Tym Parsons taking the positive and Michael Tivana taking the negative. Mr. Parsons argued what I feel are the basic philosophical cornerstones for capitalism and what makes it a success in the world. My arguments follow.

First Tym’s points:

• capitalism thrives on freedom
• there is a certain degree of selfishness to accumulate wealth making the whole system more wealthy
• private property verses self-sacrificing shared property
• taming the savages and bringing them into the system is good for them
• lassi faire corporations
• natural resources are limitless

His reasoning comes from Ayn Rand and follows the views of objectivism.

I will not discuss these points at this time. I just want it to be known that he is right on target in portraying the basic beliefs of the ruling class in today’s world. Here are a couple of key questions asked of me by the people in the audience.

“Why do you think inequality is immoral?”

My answer was a bit lame. I explained that it wasn’t right for people to be making $5 an hour while somebody else is getting rich off their labor. My take on this is that the capitalist system creates a hierarchy of owners and laborers. Generally speaking is it moral that one man generates wealth from the labor of another?

A man named Marcus blurted out, “It’s wrong because it causes pain”.

He is right. It is no more than slavery, when it gets to the point where the workers are forced to work while living in squalor. They are even told how lucky they are. In many examples in today’s world slavery is even better than what they have and this points out that something is flawed in the system and its caused by a large gap between the rich and the poor.

“Why do you think that capitalism must keep expanding to survive?”

The very definition of capitalism is to grow and expand. This must not be confused with the more modest free enterprise system, we are talking about corporate capitalism complete with shareholders, investors workers and directors. Lately this animal is morphing into a new system yet again called globalization and the poison apple credit system. Capitalism always ends up creating a situation that is unstable because of the ever increasing gap between the rich and the poor. There will always exist this tension between the haves and the have-nots.

Capitalism requires ever expanding markets. In order to pay for more jobs there needs to be more and more profits. Corporations must keep expanding or die. Tell a corporation to limit growth is like telling a lion to stop hunting. It’s against the nature of the system to stop growing. The measure of success is year over year growth.

The expanded debate outline from January 31, 2002.

The debate against the topic, "Is Capitalism the just & moral system?"

There is a story I like to tell about a wealthy Texan driving on vacation through the Navajo reservation. He passes by a Navajo elder resting in the shade on the porch of his mud thatched Hogan and says to himself, “that poor Indian, such poverty.” The Navajo sees the Texan passing by with his steer horns on the hood of his long Cadillac and says to himself, “that poor American, such poverty.”

It’s all relative. Judging poverty like morality is relative to what you use for measurement. In this case we are using the spirit as the measuring tool. There are different ways to be impoverished. The story points out that there is a poverty of the spirit where there is an invasion of materialism into the system.

Why is capitalism not THE moral system?

Again there are many ways that we can measure this.

We can examine why capitalism is immoral by pointing out that it is a system of winners and losers, producing many disenfranchised citizens that show-up as the unemployed, hungry and neurotic. Or we can say that capitalism creates a huge inequity of wealth between the haves and the have-nots, and that the rush for profits and money create untold amounts of stress, lying and scamming; all of which are not good for the human heart.

But other systems do this as well and these are signs that something is wrong with the system whether it be Communism, Socialism or Capitalism, except one – tribalism. To me Tribalism is the ideal system because it is equalitarian in its wealth, enfranchising in its society and there is no landlordism. Nobody is homeless, nobody goes hungry, everyone is involved in the society, and it’s in its end goal is non-materialistic. Here money is a luxury, not a necessity. There are three ways to have our needs met – by buying, trading, and sharing. The most productive and assuring is to share our needs. I have seen it work with hundreds of thousands of people with great results. Because capitalism is bankrupt morally, rife with corruption, it would be unfair to capitalism to compare it to the tribal system at this time using morality as a standard. Lets examine more closely the capitalist system; which by the way has grown beyond free enterprise.

The US, like many countries, derives its strength by being a hybrid system; part capitalism in its strong businesses, part socialism through government programs such as the Federal Housing Authority, the GI Bill, and the rural electrification plan; and part Communism in our strong labor unions, worker collectives and Co-operatives both on the farm and in the grocery store. The government, which acts on behalf of the whole in a socialist manner, not free enterprise is largely responsible for the technology that we enjoy in our modern lives. NASA, the Pentagon, government grants, the universities etc. have all contributed to the research of modern science. Rather than compare these systems lets focus on capitalism, its faults and how it is attacking the other systems in our country and the world.

What are the inherent flaws in capitalism that contribute to its immorality?

1) Laws that regulate capitalism are too easy to change and manipulate

2) Capitalism must expand to survive

3) The Globalization movement and Privatization

4) The mad rush for profits

5) Corporations without a conscience

1) Laws are in place to keep corporations from forming monopolies and charging whatever they want for electricity and then claim bankruptcy, right? I think there are laws to prevent this flaw of corporate treachery from occurring, but then I wonder. In the Spring of 2001, Enron held the entire west coast hostage charging electric rates up to 500 times what they were the year before.

Bush’s Economic Security Bill is on the table right now. This law will rescind the minimum corporate tax law and be retroactive back to 1986. If this bill passes, not only will the US government no longer receive minimum corporate taxes but will have to pay back all these taxes collected since 1986.

By manipulating the system corporations pay little or no taxes, the wealthy have double blind trust funds and pay little or no taxes. In the 1950's ----- US Corporations paid 31% of the Fed’s general revenue. In 1996---- only 11% came from corporations. The wealthy 1% of the nation owns 40% of our wealth and I’m still waiting for something to trickle down.

Last spring I read an interview with Treasury Sec. O'Neill. He called the current U.S. tax system "an abomination" that required changes to its "very structure." His preferred changes? O'Neill said he, "absolutely supports the elimination of taxes on corporations, and shifting the tax burden to individuals. Government would work better if it collected taxes in a more direct way from the people."

He also called for the abolition of Social Security and Medicare, on the grounds that "able-bodied adults should save enough on a regular basis so that they can provide for their own retirement, and, for that matter, health and medical needs." In fact, O'Neill believes the U.S. should reconsider the whole purpose of taxation: "National defense is a federal responsibility," O'Neill said, "but all other outlays need review."

After reading this I said to myself, this is not going to work, he is insane. Now that I have seen Bush’s Economic Security Package where the corporations pay no taxes, I see I was the crazy one for thinking this is too far out there to have a chance to come true.

Because of the weakened laws that regulate capitalism, the gap between the wealthy and the poor has never been greater. The wealth of the rich does not bring us all up to a higher standard of living, but rather it is the cause for a higher cost of living for everyone else and the cause for unnecessary hardships.

2) Capitalism must expand to survive.

In order for capitalism to thrive consumption must expand at a 5% growth rate year after year. Where does the resources come from? Where are the markets coming from? It currently takes 6.4 hectares of arable land to maintain one person living the American life-style. There is only 1.7 hectares of arable land for every person on the planet. Where are the resources coming from? They come from subordinating the people of the third world to provide us with cheap labor and cheaper land. Slavery and labor camps are occurring more and more in the world and people that once lived free on their land now have to work the land to pay the landlord or perish. The story of the American Indian is being told over and over again in today’s world as the empire reaches out to expand its resources and markets.

We are being told that exporting our way of life is reducing poverty in the world when in fact it is not. “Give the people trade, give them an economy and they will prosper”, we are told. But the globalization money lenders are keeping the people and whole countries in poverty through the banks of the Globalization reform movement regulating the trade and dictating the terms of the loans. Countries are not allowed to spend money on their people and have to spend the money only on building the infra-structure that will support the incoming corporations.

The US has a habit of toppling countries. Whenever a country has gotten on its feet the US de-stabilizes it and colonizes its people. The US has toppled 29 democracies since WWII and installed dictatorships in their place. Some examples are:

Samoza in Nicaragua - The Shah of Iran – Sukarno in Indonesia – Pinochet in Chile - Mondt in Guatemala (now on trial for genocide) and who can forget Marcos in the Phillipines? Imelda Marcos is now on trial for embezzlement, again.

It’s called the Dominator model – an age old formula for an empire to dominate a weaker population. Here is a model of how empires work. It is simple yet compelling because of its proven authenticity throughout history. Where do you think the colonies were in 1776? Why did they rebel? What is the social and economic condition of some of our colonies today?

The large triangle represents the colonizing nation.

At the top of the empire are the power-holders.

Myth - the US supports peace and freedom around the world.

Truth - the US is a leader in fighting democracy and freedom around the world.

The empire fights democracy by calling leaders of the free countries communists and now terrorists – Sandinistas in Nicaragua are an example.

The colonizers hold power over the colonies through dictatorships and military aid.

A side note: The US supplies 51% of the world’s military hardware annually

Since 1950, the US government has provided over $91 billion to militaries around the world. The vast majority of these funds go to Israel, Egypt, and Palestine to reward them for making a cold peace in 1979 with $50 billion going to Israel. 78% of the aid we give to the Middle East is military – imagine what kind of a world we would have if this were reversed and 78% was humanitarian aid.

What does this mean in terms of life and death? Uncancelled debt may be responsible for the deaths of 130,000 children each week until the year 2000 [since May 1998]". The UN

One of the root causes of poverty in the world lies in the powerful nations formulating most of the trade and aid policies today. These policies maintain dependencies on industrialized nations, while providing sources of cheap labor and cheaper goods for populations back home. The net result is the increasing personal wealth of the industrial nations at the expense of the poorer nations. The exact process of how this occurs will be discussed when we debate on the topic of Globalization. But we can discuss how one of the cornerstones of globalization capitalism is rapidly changing the world in which we live – and this is privatization.

3) Privatization

The new 2002 Monopoly game allows you to privatize the utility companies, and you can charge whatever you want. The example here is Enron charging whatever it wanted for electricity in California in the Spring of 2001. The losers that can’t pay go to jail, which are now privatized too. Unless you own the jail you will have to pay to stay there unless you go free during one of the frequent prison riots. Remember that once you privatize you can’t go back.

The prisons in New Mexico were privatized in the late 80’s. The people were told that they were paying $80/day for each prisoner and that the cost would be $40/day when privatized. Well it’s been 12 years and the cost is over $80/day + they have additional costs from the frequent prison riots due to the lousy conditions.

Recently I learned that 73% of the 120 private prisons in 19 states are being subsidized by local governments. Taxpayer money in the form of: tax-free bonds, infrastructure subsidies, property tax abatements and training grants is going to private industry. Facilities operated by the two largest private prison companies, Corrections Corporation of America and Wackenhut Corrections Corporation, were extensively subsidized. The formula is to de-stabilize an area (Tim Eyeman no more taxes), talk the people into saving money on government projects through privatizing them, then get government to pay for them.

The port of Seattle is being privatized right now and not only are the corporations getting the land and equipment they are getting a half billion dollars to upgrade the infrastruture. This is a case of corporate welfare that is barely noticed. What next, will we privatize our schools, parks and highways? The capitalists always start with the same line, the project will save the tax-payer money, be run more efficiently, cost less money, and provide jobs. This is far from the truth.

The ultimate attack to socialism is Bush wanting to privatize the Social Security program. He wants to give us our social security funds so we can invest them in the stock market. Well I say lets privatize the military. I want my money back so I can ante up with my neighbors and by a tank for our homeland security.

It gets worse; de-stabilization and Privatization are just the beginning. The capitalist takeover routine has four more levels.

The other four attacks are:

Market Liberalization - means that the rich in the burdened country are free to invest their money offshore

Market-Based Pricing - a fancy term for raising prices on essential goods like electricity

Free Trade - means deals are made to control imports and exports of goods

Flexible workforce - means that the workers are demanded to work for lower wages

This is the formula that has played out to completion in Argentina, an industrial country that the World Bank has cannibalized. For debt! Realize this, debt has become a natural resource which explains why the capitalists like deficit spending, it creates more debt to be bought and sold on the open market.

4) Profits

In the tribal system money is a luxury; in the capitalist system money is a necessity.

The urgency to have money just to stay on the planet is huge. If you don’t perform you are on the streets.

So is the lust for greed and power. The system in which we live all too often puts profits before people and the environment. The capitalists can point to all the wealth that the system creates but at what expense to the environment and at what loss to the human heart? Allowing companies to volunteer to do the right thing does not work, because they never give up the fight to usurp the existing laws in any way they can.

The profit system is more than a mad rush for money that rules out all signs of consciousness; it has become a beast of its own nature. We have allowed the profit culture to become so engrained that we have turned our doctors into pill pushers, our phone companies into scam artists and our CEOs into deceitful thieves. And because of the decline of the American quality of life, our two wage earner families are producing children that are being raised by paid surrogate parents on a scale that is unprecedented in human history.

In the US and around the world capitalism is responsible for disenfranchising the homeless, creating hunger (31m going hungry in the US each year, 40% of these people are children), dumping toxic waste in streams, child labor, price-fixing by monopolies, and unfair hiring practices. These are expenses our society pays for as we allow this runaway pursuit of profits to continue.

Competition is good but it eventually leads to a decline in our quality of life. Until the mid 70’s there were no self-service pumps at gas stations. Soon there will be no meals on airlines etc.

There are many unmet needs in our society and charity isn’t going to come close filling them. Charity is a band-aid on the gashing wound of capitalist scroogism, chronyism, ans scammism. What is required is a new system and a new attitude.

5) Corporations

Corporations are not people. They do not have a beating heart. They live only if they can feed on profits.

Listen to what Pres. Lincoln had to say about corporations.

I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country. Corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed."

U.S. President Abraham Lincoln, Nov. 21, 1864, the first Republican President

Capitalism has changed so much recently that I think it deserves to be called something else, like Gambling.

The smart capitalists create a corporation when starting a business, why? Because they will not be liable if anything goes wrong. What kind of character does this build? Corporations like Enron promote bad character and immoral behavior by providing a veil of anonymity between the crime and the offender. I am confident that the argument Enron officials will use in their defense is that they did nothing illegal.

Corporate welfare – isn’t it enough that they don’t pay taxes? Do we have to give them money on top of it? The money trail is rife with examples of how the government gives tax breaks to woo companies to their shores and also how they spend money on infrastructure costs such as dock re-building in the Port of Seattle to training grants for prison guards in New Mexico.

Enron is significant for several reasons. I think the most telling reason is that it exposes that the power-holders are fighting among themselves. The whole story is stranger than fiction as we see shredded documents, a key witness committing suicide, the CEO’s wife claiming poverty, billions of dollars gone from a company that a few months prior was just holding the left coast hostage on high electric rates. 14 states have lost pension fund investments ranging from 135 to over 300million for the state of Florida.

Enron and Anderson used new forms of bookkeeping called off balance sheet accounting. Now there is a new economic system, its called Enronomics, the masterful art of smoke and mirrors accounting.

TAXES - there have always been tax revolts in society and this is the righteous fight among the taxed and their governments and has been the cause for revolts of varying degree throughout time. But let’s look at it from a broader view than just paying taxes. Let’s look at tax appropriations. The way we spend our taxes is important.

Today I was looking at a web site called 'Citizens Against Government Waste’. These people diligently watch the federal government to expose pork and waste. The projects that they came up with were for the people and came in the way of: recreation halls on military bases, flood control, scientific research, transportation, the military and more. These are the projects that actually give the people something in return for the taxes they pay. Their complaints about pork amount to $119 billion in 10 years. That is less than $12 billion a year. Even if these were all uncalled for projects this is a minor problem when we see that the entire budget is $1.5 trillion a year. The US is currently paying $32 billion a year for the S&L scandal in the 80’s. The CIA gets $20 billion a year.

Sunday morning Feb 3,2002, Sec of Defense Rumsfeld said on national TV that 3% of the US budget is spent on the military when it is actually 23% and when you include the interest that we are paying on the barrowed money for the military it raises to 47% of all our tax money to the federal government is spent in the military. Now where is the waste? There is significant waste in our government spending lets focus on the big stuff. The country would be best served if the Republicans would spend less time soliciting support for their tax revolt and more time protecting the citizenry from Republican generated scandals such as the S&L, HUD, Pentagon waste, and Super-Fund environmental clean-up scandals.

The federal Income Tax was created when Republican President Taft and a bi-partisan congress agreed that the fairest way to fund the federal government is through taxing those with the best ability to pay. The original income tax applied only to the rich: 99 percent of the population was exempt. This is an example of how laws can be changed and in this case the changed tax codes change the spirit of a constitutional amendment.

Summary

Today the battle for resources in the capitalist system creates a world that fosters the wealth of the relative few at the expense of disenfranchising the lower class and making the lowest a class of untouchables.

It is time to start a new system, a hybrid of the best of all systems with some new twists.

Gaia Principle

In the 60’s the world experienced something; we became a global community. Man went to the moon and looked back at a planet without borders. Earth is our home and we are responsible for the environment and for the rights of our fellow human beings. It became clear that it is time for the dominator model to go away and replaced with a new one that respects rather than usurps life on the planet.

The Kyoto Accord sets a precedent by placing a value on things that are good for the planet such as forests. This new system rewards those countries that keep their forests intact. Costa Rica pays landowners to keep their trees. On the other hand there will be fines for countries that contribute to polluting the planet. We must do the same for our personal god given rights. Our inalienable rights must be our only private property and we must fight to protect them. We must punish with tariffs and taxes the countries and their accomplices that diminish human rights and reward those that honor the rights of people to life, liberty and the pursuit of happiness. This means we will have to repeal old laws and write new ones, but most importantly we will have to retire old attitudes. Until we place a value on all of everyone’s rights and place a value on all that is good for humanity will we be able to live in a truly moral world.

Rebuttal – Wealth and freedom –

Our leaders are busy tricking people into believing that the US is under attack because of our success in generating wealth and freedom. This explains why Bush is getting rid of our wealth and our freedom so we will be safe.

Rebuttal – Private property

According to Ayn Rand, the Founding Fathers of the United States recognized that there was one right that stood paramount over all, and that several other rights logically stemmed from it. The most important right was the right to life. Logically, it must be the beginning of everything, for without that right, all others would be worthless.

Rebuttal – Solution for Labor - An International Living Wage

All citizens of the empire are responsible for its actions and its character. By instigation and consent (especially by consent) are the battles waged. Only by becoming informed of our world and by taking action to speak the truth will the powers of the empire builders be challenged and regulated. Only then will faith in humanity be restored and life be allowed to flourish once again.