Dear James,

What you’re pointing to as the successes of capitalism is in reality the successes of people free from the abuses of poverty and the state. We have seen the rise of our wealth and prosperity through capitalism but at a blood price, having been built upon the cheap (and yes exploitative) labour of the rest of the world. We do not enjoy, for example, cheap Tesco clothes without the slavery, abuse and exploitation of other human beings in the poorer world. This is not to say capitalism has not made us richer or better off-it has- yet the market has operated happily with the public sector to combat many of the great injustices over the century. For example public education (advocated no less than by Adam Smith) gave us, and in all countries adopting it, literacy and skills freedoms that would not exist (for all that is) under a fully capitalist system. I need not point out, I am sure, how many US citizens do not have health insurance for example. What we have today is a mish-mashed hybrid system of public and private industries, one that has, despite its flaws given most of us what we wanted in terms of survival. Our greatest prosperity, shared amongst us all, has developed since this mixed market world came into operation. Just look at the post-WW2 figures as proof of our hybrid nations’ success! It's not capitalism or the state that is our saviour, it is people, working public or private, that have saved us from the scourges you have pointed out. Yes, the market has reduced our food prices but also, Yes, public education has meant that we can all read and write.

What, I think, many people have realised is that the state and rampant corporate capitalism do not serve us well at all, not at least that is, without a price (sometimes in blood) we would rather not pay. We have recognised that we need change and that is what the anti-capitalist cry is about. What i thin is the crux of the problem is not the profits we make as workers, its simply that we do not control them. I see an economy where the workers, not the totalitarian state (e.g. Soviet Union) or the exploitative shareholding corporation, own their profits-free from misery and alienation because they enjoy the fruits of their production. I see the State not as a provider, but solely a purchaser of the public goods, health and education we need.

Were we to own our profits, not some third party, our incentive to work and innovate is laid bare, simple and powerful before us. Am I killing the Goose that laid the golden egg? No, because profit and markets would still exist. What of investment, the engine of the entrepreneur? Investment would operate as it already does with loans, existing government support methods and venture lenders who seek profits from their investment without ownership. We would not feel like mere wage slaves, completely disassociated from our production or from each other. We, I feel, would be so much happier, wealthier and freer than we are today.

We are not born to be slaves, to the wage or to the state. Change is inevitably coming, as Schumpeter noted, it is up to us to decide what should replace the crooked system we live in.

Posted by: Vlad Alsop at May 24, 2006 01:54 PM

I often find myself among football-mad economic illiterates. They nod agreeingly when there is mention of footballers' pay being capped. When I point out the obvious i.e that they'll lose their Henrys, their Gerrards, and their Rooneys to someone operating under no such interference, they become pensative for a moment, and slightly perturbed that their own thinking hasn't taken this simple logical step forward.

Posted by: Brad at May 24, 2006 06:04 PM

Don't worry James, capitalism will be back. We are in a never ending cycle.

Capitalism = plenty = decadence = decline = reality check = capitalism.

We're just unlucky being around as we approach the worst point in the cycle.

Posted by: John East at May 24, 2006 06:26 PM

ARTICLE ON 'CAPITALISM' IN TELEGRAPH [24TH MAY]IS EXCELLENT BUT IS IN THE WRONG NEWSPAPER - YOU ARE PREACHING TO THE CONVERTED!!! TO ACHIEVE REAL IMPACT IT SHOULD BE PUBLISHED IN AT LEAST THE GUARDIAN BUT IDEALLY IN ANY DAILY 'RED TOP' OR SUNDAY 'BLUE TOP'

PETER CROMBIE

Posted by: Peter Crombie at May 24, 2006 06:52 PM

Dear James,

I too have given a great deal of thought to the matter and also conclude that the "welfare state" is totally misconceived and needs to be done away with - but from a very different perspective to your own, i.e. from that of an evolutionary biologist and anthropologist.

Free-market capitalism works so well because it has developed and been honed to take advantage of (work with, rather than against), you would probably say, "human nature", but is actually, our "animal nature".

As Darwin pointed out, man is an animal (Earth's Greatest Ape), so it should hardly come as a surprise to learn that the socio-economic structures we have created and come to depend upon are deeply rooted in our animal nature, in behaviour that developed over millions of years to cope with circumstances (in a natural environment which included other, rival groups of humans) very different from the artificial socio-economic environment of modern society, which, since the advent of civilisation, is where individuals, subject to the same behavioural programming, now struggle for survival and advantage.

This is a perspective that has been greatly neglected, not least, because, like everyone else, academics and scientists too are immersed in and dependent upon their own niches in the artificial socio-economic environment, which makes it very difficult for them to recognise, and besides which, no one is inclined to bite, or even question, the hand that feeds them.

The natural environment was replaced by an artificial socio-economic environment, in which free-market capitalism finally developed to take full (and thus, such effective) advantage of our behavioural programming, facilitating the most competent and powerful individuals' survival and advantage in an environment they themselves helped shape with their own strengths and interests in mind.

As scientific and technological advances in the service of free-market capitalism created ever more material wealth, consciences were pricked and the welfare state was eventually created, providing services and benefits, ostensibly "free", to everyone who needed them.

Lacking the bio-anthropological understanding presented here, what the well-meaning creators of the welfare state did not realise was that the welfare services and benefits, once they were created, would be seen (consciously or, more likely, subconsciously) by an ever increasing number of people as just another part of the socio-economic environment, there to be exploited by the less well-off, just as the wealthy have always exploited the opportunities available to them higher up the socio-economic hierarchy (inherited wealth, unearned income from investments, social connections, the best education, cleaver accountants and lawyers, etc).

It worked quite well at first because most people still felt deference towards the powers that be, as well as solidarity towards their fellow countrymen. But attitudes have changed dramatically since it was created; deference undermined, not least, by the press in positive and negative ways, and solidarity undermined by mass immigration and the primacy given to market forces (and their justification of grossly unjust and disproportionate income differentials), competition and individual success at making and saving as much money for oneself as possible. Those unable to achieve this kind of "success", or of finding a satisfying job, could at least derive some benefit and satisfaction from exploiting the welfare state.

I hope that you find this evolutionary, bio-anthropological approach to the welfare state of interest. I believe it to be essential for a proper understanding of everything relating to our society and economy, which it also reveals to be inherently unsustainable on our finite and vulnerable planet. This is the subject of an essay I wrote for David Cameron's Quality of Life Policy Group, which you might like to take a look at: http://www.spaceship-earth.org/PoS/The_root_causes_of_non-sustainability.pdf.

With best regards

My website: www.spaceship-earth.org

Posted by: Roger Hicks at May 25, 2006 08:40 PM

Let me correct the presumptuous comment you make at the end of your post. I'm at school (in sixth form), and I can assure you we are not taught the 'evils of capitalism'. We're given the facts and encouraged to make up our own minds.

I can only assume the same priviledge wasn't extended to you.

Posted by: Jamal at May 28, 2006 08:47 AM