Is this capitalism moral? Wrong question, because this ain't capitalism. This is oligarchy, a few very rich and powerful firms not only selling for their clients but also buying for themselves in the financial markets. And that IS immoral. It excludes most of us, until we end up having to inject our tax dollars -- or more exactly, until we borrow those dollars -- in order to avoid a complete financial collapse. You and I can't play their game, but we must certainly keep the people who cause the disaster in business so as to avoid abject poverty, roughly on the order of the Bronze Age. That is profoundly immoral.
It is time to get real. In fact, it's long past time. America needs to create new capital to invest in productive enterprises that will employ people, growing food, inventing new commodities and services, and improving the classic ones. We are not going to do that by selling each other our houses, or opening more fast-food outlets. We need a diversified economy based on market capitalism, not on oligarchs enriching themselves in gigantic shell games played with trillions of dollars.
We need to rebuild the intellectual and physical infrastructures that undergird such an economy. That requires taxation. And it also requires regulation of markets. Any politician who will not level with the people about this daunting task has to be voted out. Bring capitalism back! should be our slogan.
That is a tall order, because the so-called Masters of the Universe can threaten to destroy the banking system the world depends upon if we touch the source of their strength, namely, the so-called shadow banking system. If you remember Frank Herbert's novel Dune, you will recall its salient point: the ability to destroy something is in fact to control it. The mountain of money spent to influence governments around the world, starting with the United States, is also a giant obstacle.
If we continue down the primrose path of tax reduction, deficit increases, and oligarchical manipulation of capital markets, there will be a much greater depression. The Arab Spring should be teaching a lesson: "tipping points" happen, and suddenly the game changes, taking everyone by surprise. The scales will fall from the people's eyes. A strongman will arise to "save" us, at the cost of our republic. History does repeat itself -- Ave Caesar, Heil Hitler, Stalin Save Us... sound familiar?
Finally, we need an economy that allows each person to be not only a consumer but an actor in it. The source of America's wealth has never been finance, but in those goods and services that entrepreneurs make available to the widest possible audience, er, market. Anyone remember Charles Ives? Yes, the Charles Ives, considered to be America's greatest composer of music. What does he have to do with this?
In his lifetime, Ives was known not for his music but for his knack for taking something and making a lot of people wealthy by making it available to the masses. Life insurance for everyone was one of his dreams. If you have such a policy, it is because Ives felt that they were not just for rich people. When President Wilson wanted to raise money for World War I, he asked Ives to take it on. Ives promptly created bonds denominated so that the most ordinary patriot -- economically speaking -- could own at least one. It was a howling success.
There have been huge numbers of examples since. There can be plenty more. But only if we break up the oligarchies and start practicing real capitalism again. A place to start: if you want to buy a stock, make sure your broker doesn't have shareholders to answer to. Better yet, make sure she's invested too.
This didn't answer the question I started with, I know. I think a morality of capitalism can be defined and defended, and that capitalist immorality therefore can be described in principle. It has to do with the notion of the common good.
But that is for another day. Meanwhile, bring back capitalism!
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