After re-reading Paul’s blog a few times, including the considerable comments…the word capitalism came up over and over again. It seems the word capitalism has morphed into a definition far removed from it’s original use and incorporation into everyday conversation. Sort of like the word “cool”.
At one time cool defined a relative temperature. It morphed from street slang of the beatniks into mainstream use which occasionally defines relative temperature but also includes it’s use describing favorable acceptance of a person, place, or thing. Hip used to describe a body part. Now it is additionally used as a description of person, place or thing that is “cool”. I believe that process of language degradation includes the word capitalism.
Like the words “cool” and “hip”, capitalism means so many different things to so many different people, it is now very hard to define. Since we have freedom to form our own political, moral, and cultural worldviews/opinions, we tend to use capitalism, its pitfalls and highpoints depending largely on our personal definition. So, what is capitalism? I am not sure that I really know what it is anymore.
In the blog, including some comments intertwine the stock market, which is the driver or basis of most investment opportunities, establishing the resulting profit gained from market investment is the bottom line and final determining factor in all business decisions. We are approaching a stock market record of 30,000. The Dow Jones Industrial Average is an indicator of how 30 large, U.S.-listed companies have traded during a standard trading session. And the Dow seems to be the gold standard for so many to support the word capitalism.
So, according to many of the commentators, mainstream media, politicians, and most people who have money invested in their 401K’s including the definition of the S&P, our measure of economic success is how well the company is being traded on the stock market. If that is what pure capitalism is about, as a country, the US is a resounding economic success. It does not matter where a product is produced. Nor does it matter who produces it. All that matters is the companies we invest in, produces an ever escalating share price.
And if one’s 401K is expanding regularly each quarter, who is going to bitch about Cirrus Aircraft being owned by the Chinese military, or complain that Boeing’s quality control needs a revamp? If the 401K is doing well, the S&P is off the charts, pay no attention to the pandemic economic issues, still high national unemployment, aviation companies in stagnation, 400 MAX’s still dormant, domestic airline load factors under 20%, 250,000 and climbing additional dead folks, Covid-19 infection rates off the charts, a disputed election, with a national debt that is so large, we cannot wrap our minds around the ever increasing, incredible numbers. For the S&P is the great and powerful OZ standing behind that curtain currently defined as capitalism.
So many folks seem to believe all we need is a constant expansion of investment followed with ever higher share prices no matter that our economy is on life support via the currency printing press. Capitalism seems to have morphed into something that has no bearing on the original idea of not only free market trade, supply and demand, but the idea that preserving, encouraging, and training national resources such as a highly skilled, educated labor force working in US companies, located within the boundaries defined as the United States of America. Why?
Because national economic health is being defined by investment profits in companies no matter where they are located or who owns them, and their true, current economic condition. That is why we have the stock market totally out of phase with the economic realities of our present day economy. Boeing is a better company today than they were two weeks ago because the AD on MAX has been lifted? Seriously? In two weeks their quality control went up? New management, with new ideas, new US workforce, new customers? Nothing has changed but their stock price increased when FAA gave their blessing. That is economic success?
I believe we really don’t know what capitalism really is. I surely don’t anymore. We want the benefits of investment profits no matter the national cost. As long as the investment leger is expanding, consumerism always expanding, it doesn’t matter where the product is built, nor by whom. Nor does it matter how the greenbacks get into the hands of the consumer. It just matters the consumer remains a consumer. Whatever it takes to the keep the consumer flush enough to be able to spend dollars…no matter where that dollar came from…is all that counts today.