Hey! My name is Claudiu Radu and for the past decade years or so, I've been working as an article writer and blogger, among other things.
What is Capitalism?
For a term heard all around the world virtually every day it is shocking how little is known about capitalism by the general public. Some people confuse it with corporatism while others just don’t know anything about it.
As usual, the problem is caused by the media, press and political parties who, these days, are more interested in misinforming the general public rather than informing it. So you basically have four or five different definitions for the same word.
So what is capitalism, then? Well, when I have many problems that all seem to converge from one single point or place, I go to the root of those problems so let’s go to the root of capitalism, its beginning.
Capitalism, officially, is an economic system based on the private ownership of the means of production and their operation for profit.
Capitalism can be traced back to the early Renaissance but modern capitalism, the capitalism we know and love today, emerged at the beginning of the nineteenth century when the emergence of globalization helped it reach almost every corner of the world.
We already encounter an issue. Clearly, capitalism is an economic system but there are lots of discussions about it affecting the political sector of different countries. Those discussions are not as farfetched as you may think as the governments of most western countries are populated by many people who used to work in the economic sector and have brought many ideas from their previous workplace to their current one. Furthermore, there are many political leaders who insist the governance of a country is similar to managing a private company which is a complete nonsense as the two disciplines share very few elements in reality. If you don’t believe my last statement, just look at the social and political disaster we fondly refer to as the Trump administration.
In theory, Capitalism promotes political freedom allowing political and economical power to be separate and not clash with each other but in practice that never happens as influences from the economic sector into politics and the other way around are obvious in the western world.
One important thing, before we move on, is to clarify the difference between capitalism and corporatism as many people confuse the terms. Moreover, advocates of capitalism blame corporatism while corporatists blame capitalism for our society’s social and economic problems, so it’s very important to have a clear grasp on both economic systems before we dive deeper into this matter.
To accomplish that, we’ll concentrate on corporatism in our next chapter.
So, what is Corporatism?
The term corporatism is derived from the Latin word corpus which means human body. The idea behind this ideology is that all divisions of a society should efficiently perform its designated functions thus contributing to the society’s performance in the same way organs contribute to the human body’s health.
Corporatist ideas exist since the Ancient Roman times but in different forms. The corporatism we know today has taken form in the early twentieth century trough the “National Corporatism” regime instated by Benito Mussolini in 1922. Now before you start yelling that Mussolini’s regime was fascist and shouldn’t be used as an example because it’s evil keep in mind that, in the twenties, it was considered to be quite progressive, so much so that Hugh Johnson was inspired by Benito’s regime while making the “New Deal”.
That being said, we can’t get away from the fact that most regimes in the early twentieth century who bolstered a corporatist foundation were totalitarian dictatorships. This fact alone should ring alarm bells although Hugh Johnson and Franklin Roosevelt remained confident in the choice they’ve made.
Knowing all that, you may look suspiciously at the corporatist economic system, but it shouldn’t be vilified because, after the Great Depression, the US were in a desperate need of financial reforms and regulations and the “New Deal” provided just that, helping the USA to leave behind the financial disaster we now refer to as the Great Depression.
The basic idea of corporatism is that “the society and economy of a country should be organized into major interest groups (sometimes called corporations) and representatives of those interest groups settle any problems through negotiation and joint agreement. In contrast to a market economy which operates through competition, a corporate economic works through collective bargaining” 
The idea sounds good in theory, but in practice it has its problems, the most obvious one being communication or lack of it. The whole concept is based around agreements and negotiations between corporations and public facilities which don’t really happen in the real world. Corporations are extremely secretive these days to anything surrounding their business so the main characteristic of corporatism is being eliminated from the global market we talk about so much.
That’s why I don’t agree with all the people saying corporatism is affecting the world we live in because, in today’s market, corporatism as we know it from the last 100 years doesn’t even exist. Which raises the question: What is disturbing our social, political and economical climate so much, these days? The answer is pretty obvious: capitalism.
How exactly, has Capitalism destroyed the world we live in?
Capitalism as an economic system, although very naïve from its inception can be very useful in the sector it was designed for, the problem is, it isn’t used in the sector it was designed for. Capitalism has been adapted to different areas like governance and politics, education, science, technology and even entertainment. Basically every single term that now has the word industry behind it, is affected by capitalism. That isn’t necessarily a bad thing if it’s done properly, but it can became a real hassle when is implemented only with short-term profit in mind, which unfortunately, is the case in most fields.
I have taken America as a negative example throughout this article, not because I have a personal issue against this country but because, whether we like it or not, they give the political and social direction for the whole western world. Also, they’re still adamant they are the centre of democracy and equality between individuals which, in today’s context, seems like a cruel joke.
Influence into politics
Let’s take a closer look at what happened in the political sector of the United States of America.
According to Randall G. Holcombe, political capitalism “is an economic and political system in which the economic and political elite cooperate for their mutual benefit. The economic elite influence the government’s economic policies to use regulation, government spending, and the design of the tax system to maintain their elite status in the economy. The political elite are then supported by the economic elite which helps the political elite maintain their status; an exchange relationship that benefits both the political and economic elite” 
This is most obvious in the structure of the American government where, since John D. Rockefeller’s son, Nelson Aldrich became governor of New York and then Vice President of USA, there has been a tradition for oil magnates to buy influence into the political sector. The result: in the US, nearly 134 million people (over 40 percent of the population) are at risk of disease and premature death because of air pollution, according to American Lung Association estimates. 
The situation is eerily similar in the firearms industry where, in 2014, 33594 people were killed by firearms and the following year, around 85000 people were injured by guns, including nearly 10000 children. To make matters worse, the NRA (National Rifle Association) spends millions to advocate or oppose political candidates. In 2016 the NRA spent nearly $20 million on efforts opposing Hillary Clinton and nearly $10 million on efforts supporting Donald Trump. 
With so many influences into politics, most for personal benefit, capitalism is undermining the whole purpose of democracy.
Influence in education
You may be hoping that future generations will live better than us and won’t make the same mistakes we made, but that hope is without fundament. With the student loans bubble dubbed as the most likely to burst by most economists, the current generation of youngsters will look to the future in horror as they head in another economic crash while being dragged down by the loans they need to pay as soon as they graduate. On top of that, they’ll have to deal with the aftermaths of the poorly managed coronavirus pandemic that wreaks havoc in today’s economy. Now, in case you aren’t familiar with the latest blunders from the American educational system, I’ll fill you in.
In March 12, 2019 an FBI investigation known internally as Operation Varsity Blues was released to the public. The documents exposed that well-known institutions like Harvard, Stanford and Yale were involved in fraudulent admissions. The scandal revealed that at least 50 students were admitted to important American Universities based solely on bribes made by their parents. 
Another dubious chapter of the American educational system that took place at the start of 2019 was the closing of Argosy for-profit university that left thousands of students without a degree. The sheer unprofessionalism that plagued the final days of this chain of universities that showed massive disrespect to students, teachers and other staff members, accompanied by the rumors that former a CEO walked away with large sums of money from the university reminded me of the start of the 2008 financial crisis. This wasn’t the only for-profit university that closed down in the history of the USA, as the Corinthian College fell in 2015, followed by ITT Technical Institute in 2016 and Education Corp. of America in 2018. 
The capitalist school, like the capitalist economic system, is a time bomb that can blow up at any time, or at the time the managers think will be the most profitable for them. The term in itself seems to be an oxymoron and the big problem is, capitalist schools are starting to be adopted throughout the rest of the world. Let’s learn from what happened in the US and run away from such scams as the American students are starting to do.
Influences in science and technology.
I’ve left this field for last because it’s the most talked about subject for the last two decades. As most areas of modern society, it was also affected by capitalism and not in a positive way. People talk a lot about the ridiculous pace at which technology is improving but most of those people aren’t involved in the industry. The fact is, technology is actually improving at a ridiculous pace, a ridiculously slow pace, unfortunately. Now, this is the point at which most people usually start shouting at me about laptops, smartphones, tablets, electric vehicles and AI.
Most of these arguments are easily dismantled as the first electric cars were produced in the late 19th century and early 20th century and were very popular at the time being more usable that the gasoline cars of the same period.
The situation is very similar in the case of laptop computers as the idea for a portable computer appeared soon after the popularization of the PC (personal computer). The IBM 5100 was the first commercially available portable computer and was launched in 1975. In 1982 the Epson HX-20 was the first portable PC which was similar in size with modern laptops and was actually described as a laptop and notebook. By the late 80s laptops looked like the ones we use today and were equipped with touchpads and handwriting recognition.
The scenario is very similar for smartphones and tablets. Tablets were produced since the late 80s and early 90s having different operating systems and using a stylus in the same way modern tablets use it. Mobile phones with PDA capabilities were in production since ’94 with concepts released to the public even earlier. Later in the decade, appeared PDA/phone hybrids like the Nokia 9000 Communicator launched in 1996. In the early 2000s the BlackBerry was developed which is considered by many to be the first smartphone. What I consider to be the first smartphone was launched in 2007 by former Apple CEO Steve Jobs. Called the iPhone it boasted a touch-based user interface and paved the road for all smartphones used today. Now, smartphones and tablets aren’t real technology because they haven’t really replaced anything as technology usually does, they’re more like gadgets which is perfectly shown by the history of tablets which were ignored during the 90s and only caught the public’s attention after the rise of the smartphone due to Steve Jobs’s tremendous marketing skills.
The last nail in the coffin of the “modern technology” we speak so often about must be the AI. Yes, the Artificial Intelligence which scares so many people around the world is actually just a disinformation spread around by the media. A branch of the broader field called Cybernetics, Artificial Intelligence is actually the attempt to simulate human-like cognitive abilities on a machine, a field that hasn’t seen much updates in recent decades. The field in which we actually made great leaps is Machine Learning, but ML won’t kill us any time soon as it doesn’t really learn it just stores data according to certain rules and needs constant supervision in order to make the correct decisions and interpretations of that data. While ML systems are really smart and have changed the world we live in, they are smart in the “Hey! Look what cool things my phone can do” sense, they aren’t human smart, meaning they don’t have conscience and never will they’re just some useful tools. 
The reason why capitalism stalls the progress of our society is really down to its nature. The whole purpose of capitalism is to bring capital or money in, and in order to accomplish that you must eliminate the risk from your company. Now risk can be bad in economy but in education, art, science, technology, music, film and football, risk is actually the force that moves these fields forward and gives excitement, unpredictability, progress, performance and innovation. Leaving the fields I’ve enumerated earlier without these characteristics turns them in exactly what they are today: useless shadows of their former selves. By applying capitalism to fields in which it doesn’t really belongs we halt our whole society both socially and, ironically, economically as well, because a society cannot prosper when fields like education and technology are neglected.
Even as a viable economic system I’m still not convinced by capitalism, because it relies too much on the benevolence many different wealthy people scattered around a country or even the entire world. This naivety has led the American people to, at least, an economic crisis in every decade since the 70s because the “free market” has the nasty habit or crashing down every now and then. This is the main problem that sits at the base of all the economic and social problems we are going through at the moment, because all the corruption and social imbalance is down to the so-called elite having too much power and little to no responsibility in today’s world. The riots that started with the #BlackLivesMatter movement are the right thing to do because this has gone too far for too long and radical solutions must be taken to bring back some sense into our modern society and economy. If we don’t act now it will get worse because the “elite” doesn’t stop, they never stop, look at the state of the global economy or have a look at the environmental issues all around the world.
They. Never. Stop.
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This content is accurate and true to the best of the author’s knowledge and is not meant to substitute for formal and individualized advice from a qualified professional.
© 2020 Radu Claudiu