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Feeding the Beast

I‘ve long considered myself a capitalist. By which I’ve meant that I support our system of economic production and distribution which is privately owned and driven by free markets. The success of capitalism seems evident.

And yet, as I’ve gained more real-world experience living and making a living in a capitalist society, I’ve begun to moderate my view a bit.

When I was younger, I was a proponent of libertarian or “hands-off” views relative to markets. I was convinced that a free, unregulated market would regulate itself. My viewpoint has changed.

Though still a proponent of capitalism, I now believe that unregulated or even under-regulated capitalism will grow into a beast that we must feed, rather than a beast that feeds us.

  • Which aspects of otherwise free markets do you believe require the most regulation for your optimal society?

  • I think we need to ensure adequate quality of life issues for all who work.

    Here’s a simple example: vacation time. Maybe it’s just me who needs a vacation, but I haven’t had a real vacation that has lasted longer than three days for more than 10 years. Now, I’m unique, because I am self-employed. But, by all reports that I see, American’s have the least vacation time of any industrialized nation. I think the is a result of under-regulated capitalism.

    The libertarian argument to solve this issue would say that if people value vacation, they’ll gravitate towards companies that offer more vacation. It shows, I believe, a fallacy in libertarian thinking, because it fails to account for economic downturns that give more power to companies than to workers. The result is we, as a community, are working longer hours and taking fewer vacations.

    I’d support a mandated amount of vacation time for all workers.

  • Are you proposing that the government should prohibit you from working in the manner that you do?

  • No; I believe my situation is unique. But, I would support a mandated level of vacation time for employees, much like a minimum wage law.

  • The libertarian streak in me makes me suspicious of anyone who proposes a regulation that applies only to other people.

  • No…I think you misread my comments. I’m not suggesting that I should be exempt from such laws, only that such laws don’t make much sense in my situation since I’m self-employed and have no employees.

  • Perhaps I have misunderstood. Are you suggesting that if I were self-employed, I’d get to pick however many hours or days I wanted to work, but since I work for a company, I shouldn’t be allowed to make that decision?

  • If you found yourself in the position of being given more vacation time than you’d like to take, I’d support your choice to use that vacation time to continue to work for your employer.

  • Would my employer be allowed to reduce my pay as it is required to increase my vacation time?

  • You are asking a specific questions about possible legislation. I am not proposing specific legislation just yet, and certainly all of these details would need to be hammered out if we were to transition into this type of additional regulation.

    I am raising the question as to whether the current business climate is working for individuals and families, and if we are satisfied with maintaining the status quo. I find myself troubled with the status quo, and worry that we’ve let our worship of capitalism get the best of us.

    How do you feel about the broader question?

  • On the broader question, I tend to think that the government is not the right place to try to solve such problems — the marketplace is.

    There are a number of defects in the operation of markets, principally those related to collusion among competitors rather than competition, and to exploitation of public “commons.” And government can reasonably address those defects through appropriate legislation. Much of the other legislation that passes for “correction of market defects,” IMO, is either concealed wealth transfers (through protectionism, subsidies, targeted taxes, etc.) or unjustifiable “big brother” conclusions that people are incapable of identifying and understanding their own best interests.

    Just so my biases are clear, much of my thinking regarding economic regulation stems from Milton Friedman’s Free to Choose, my training at the University of Chicago, and my legal practice as an antitrust lawyer. Those influences all cause me to list to preferring markets over governments in most situations.

  • The broader question is not whether government is the tool to solve the question raised, but rather, whether the question raised has merit. I’ve posited that left unregulated, capitalism will continue to require more and more from its participants until the very nature of living in a capitalistic society becomes one of feeding the beast.

    BTW, regarding transfer of wealth, I’m not sure I understand your point. There are “systems” in place that tend to horde wealth, and tend to transfer it to certain individuals. Unless you conclude that there should be no regulations, then the regulations that do exist will inevitably be imperfect; and through these imperfections, wealth may be transferred in all directions. For example, I think a regressive system of taxation is wealth transfer from the poor to the rich.