Capitalism v Crony Capitalism

Occupy protesters have been mischaracterized by many people as being opposed to "capitalism." Based on my conversations and observations, I have not encountered protesters who oppose "capitalism." Rather, they oppose what has been described as "crony capitalism." Compare the  follow definitions, from Wikipedia:

Capitalism is an economic system that became dominant in the Western world following the demise of feudalism. There is no consensus on the precise definition nor on how the term should be used as a historical category. There is general agreement that elements of capitalism include private ownership of the means of production, creation of goods or services for profit, competitive markets, and wage labor. The designation is applied to a variety of historical cases, varying in time, geography, politics and culture.

In the above definition, you won't see, as an element of capitalism, that players are allowed to rig the system.  Compare to Crony capitalism:

Crony capitalism is a term describing a capitalist economy in which success in business depends on close relationships between business people and government officials. It may be exhibited by favoritism in the distribution of legal permits, government grants, special tax breaks, and so forth. Crony capitalism is believed to arise when political cronyism spills over into the business world; self-serving friendships and family ties between businessmen and the government influence the economy and society to the extent that it corrupts public-serving economic and political ideals.

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Capitalism under the microscope

Annie Leonard has passionately researched and written a book she titles: The Story of Stuff: How Our Obsession with the Stuff Is Trashing the Planet, Our Communities, and Our Health-and a Vision for Change (2010). I haven't yet finished her book, although I'd like to post on one point she strongly makes early on, a point that is the elephant in the room regarding most discussions of the American way of life. It is a topic not far from the hearts of the many free market fundamentalists out there. The topic is whether it's time to put capitalism under the microscope. Here's what Leonard has to say:

[There is no doubt we will reach the planet's carrying capacity; we're heading in that direction now.... a big part of the problem we face today is that our dominant economic system values growth as a goal unto itself, above all else. That's why we use the gross to metric product, or GDP as a standard measure of success.... All right. Are you ready? I'm going to say it: this critique of economic growth is a critique of many aspects of capitalism as it functions in the world today. There. I said the word: "capitalism." It's the Economic-System-That-Must-Not-Be-Named. When writing the film script of The Story of Stuff, my intent was to describe what I saw in my years on the trail of trash, visiting factories and dumps and learning about how things are made, use, and thrown away around the world. I certainly didn't sit down and figure out how to explain the flaws of capitalism. It was trash, not economics, that was originally on my mind. So at first it took me by surprise that some commentators called the film "an ecological critique of capitalism" or "anti-capitalist."... it turns out that a hard look at how we make and use and throwaway Stuff reveals some pretty deep problems caused by core functions of a specific economic system called capitalism. There's no way around it: capitalism, as it currently functions, is just not sustainable.... Yet, in the United States, were still hesitant to broach this unmentionable subject, fearful of being labeled unpatriotic, unrealistic, or insane. Elsewhere in the world, there's a widespread recognition that some aspects of capitalism aren't working well for the majority of the world's people or for the planet; people talk about it openly.... Can we put capitalism on the table and talk about it with the same intellectual rigor that we welcome for other topics? Can we examine the failures of capitalism without falling into generations-old stereotypes and without being accused of being un-American? Refusing to talk about it doesn't make the problems disappear. I believe the best way to honor our country is to point out when it's going astray, instead of sitting here silently as many economic, environmental, and social indices worsen. Now would be a good time to start looking at what we could do differently, and what we could do better.... The belief that infinite economic growth is the best strategy for making a better world has become like a secular religion in which all our politicians, economists, and media participate; it is seldom debated, since everyone is supposed to just accept it as true. Why are so few people willing to challenge, or even critically discuss, an economic model that so clearly isn't serving the planet and the majority of its people. I think one reason is that the economic model is nearly invisible to us. ... [W]e tend to forget that were viewing the world through the paradigm, like it's a pair of contact lenses.... before we can change a paradigm, we need to identify it as a paradigm rather than assume it is truth. [Starting at page xviii]

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Michael Moore on the challenges we face

Over at The Nation, Naomi Klein interviewed Michael Moore, who has just released his newest movie: "Capitalism: A Love Story." You can hear the entire podcast here. What follows are three excerpts from the interview (Michael Moore speaking):

You can't avoid the anger boiling over at some point when you have one in eight mortgages in delinquency or foreclosure, where there's a foreclosure filing once every 7.5 seconds and the unemployment rate keeps growing. That will have its own tipping point. . . . Greed has been with human beings forever. We have a number of things in our species that you would call the dark side, and greed is one of them. If you don't put certain structures in place or restrictions on those parts of our being that come from that dark place, then it gets out of control. . . . [W]hen anthropologists dig us up 400 years from now--if we make it that far--they're going to say, "Look at these people back then. They thought they were free. They called themselves a democracy, but they spent ten hours of every day in a totalitarian situation and they allowed the richest 1 percent to have more financial wealth than the bottom 95 percent combined." Truly they're going to laugh at us the way we laugh at people 150 years ago who put leeches on people's bodies to cure them.

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Huffington: Capitalism isn’t evil, but this isn’t capitalism

In her review of Michael Moore new movie, "Capitalism: A Love Story," Arianna Huffington had this to say about the current state of economic affairs:

In the film, Michael describes capitalism as evil. I disagree. I don't think capitalism is evil. I think what we have right now is not capitalism.

In capitalism as envisioned by its leading lights, including Adam Smith and Alfred Marshall, you need a moral foundation in order for free markets to work. And when a company fails, it fails. It doesn't get bailed out using trillions of dollars of taxpayer money. What we have right now is Corporatism. It's welfare for the rich. It's the government picking winners and losers. It's Wall Street having their taxpayer-funded cake and eating it too. It's socialized losses and privatized gains.

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Guess this author

The more things change, the more they stay the same, it seems. See if you can guess who authored this quotation on capitalism vs. socialism: (all emphases are mine)

The economic anarchy of capitalist society as it exists today is, in my opinion, the real source of the evil. We see before us a huge community of producers the members of which are unceasingly striving to deprive each other of the fruits of their collective labor—not by force, but on the whole in faithful compliance with legally established rules. In this respect, it is important to realize that the means of production—that is to say, the entire productive capacity that is needed for producing consumer goods as well as additional capital goods—may legally be, and for the most part are, the private property of individuals. For the sake of simplicity, in the discussion that follows I shall call “workers” all those who do not share in the ownership of the means of production—although this does not quite correspond to the customary use of the term. The owner of the means of production is in a position to purchase the labor power of the worker. By using the means of production, the worker produces new goods which become the property of the capitalist.

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