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Source link: http://archive.mises.org/18730/where-do-they-get-this-stuff/

Where do they get this stuff?

October 15, 2011 by

“In other European cities, including Berlin and London, the demonstrations were largely peaceful, with thousands of people marching past ancient monuments and gathering in front of capitalist symbols like the European Central Bank in Frankfurt.” NYT

A government-created institution that creates a government-issued paper currency that is a shabby piece of paper thanks to government intervention in order to bail out government-subsidized and government-sustained institutions. And they call this a capitalist symbol? Utterly bizarre.

{ 36 comments }

Geoffrey Allan Plauché October 15, 2011 at 6:52 pm

Even many libertarians have a hard time seeing the Federal Reserve as a government corporation, despite the fact that it was created by the federal government, has its board of governors appointed by the president, has a government-granted monopoly franchise, and that it works with the federal government, particularly the Treasury, to create and regulate the US money supply. No no, it’s private, they’ll tell you. Or at best there are no clear criteria for saying whether it is a government corporation while Walmart is not.

B.C. October 15, 2011 at 7:28 pm

Citation needed!

Oklahoma Libertarian October 16, 2011 at 3:57 pm

Did you miss the link directly after the quote?

Kevin B October 15, 2011 at 8:30 pm

Definitions change. Capitalism now refers to multiple types of systems. “Capitalism” has been so fraudulently used, that the word is now practically worthless.

Free-market capitalists need to get over it and choose a new word, unless they’d rather spend their time arguing about definitions.

Iain October 15, 2011 at 8:36 pm

Like you just did? Anyways, what word works for you? Won’t that word just get co-opted and misunderstood over time as well?

Kevin B October 15, 2011 at 9:02 pm

You get it, right? I can use ‘free-market capitalism’ on this forum with confidence that readers will not be confused. Not so much confidence elsewhere.

And I can use ‘free-market capitalist’ and not act confused when people hate on ‘capitalism’. They aren’t the same thing.

feudalredux October 16, 2011 at 12:45 pm

Using a new word will not clarify anything for the perpetually confused products of govt schooling. If anything, it will only add to their confusion.

The brainwashed masses need to realize that the govt is lying to them, and that the media is perverting the meanings of perfectly good words. The illusion will not be lifted if you just create an alternate reality with New Age Words and your own Fantasy Land of No Bullshit.

Kevin B October 16, 2011 at 4:35 pm

Okay, then you’d rather spend all your time arguing about definitions. I didn’t say that it wasn’t an option.

Matthew Swaringen October 16, 2011 at 1:37 am

Just define your terms when you enter a discussion at the beginning.

I’ve found very few people to engage in semantic argument when I define the terms. But even when I do define the terms, they think the ideas are completely unrealistic and silly. And that’s really what there is to overcome. The reason they conflate corporatism/capitalism is they really think freedom leads to corporatism. They think that the US has gone “further to the right” over the last 30 years. If you explain how this isn’t true they don’t believe it.

They’ll repeat some nonsense about deregulation and get some backup from statements like the one Lawrence Lessig made recently “One statistic summarizes it all: in 1980, close to 100 percent of the financial instruments traded in the market were subject to New Deal exchange-based regulations; by 2008, 90 percent were exempted from those regulations, effectively free of any regulatory oversight.”

xodix October 16, 2011 at 7:41 am

Yes, the problem with the term Capitalism is that it has been coopted and does not necessarily any longer suggest a Free Marketplace. Crony Capitalism or State Capitalism are nothing more than Fascism or Socialism. Words are powerful.

Free Enterprise, as a term, would be much harder to corrupt. Even “free markets” have come to be misunderstood, as though “markets” only include Wall Street financial exchanges and their electronic and otherwise-located proxies. To me, “a free marketplace” is more suggestive of buyers and sellers (including producers) coming together without government mandate or interest to decide on what should be produced, what prices should be in the marketplace, and what the medium of exchange (or mediums of exchange) should be. Perhaps an equally good term might be “a free economy”.

feudalredux October 16, 2011 at 12:48 pm

“Free Enterprise, as a term, would be much harder to corrupt.”

Surely you are joking!! Have you heard of NAFTA? Did you hear what the bozos did to Free Trade?

Free Trade could not survive the onslaught of the word-redefinition crusade, but Free Enterprise shall prevail?

DixieFlatline October 15, 2011 at 9:19 pm

A Central Bank is a Communist Manifesto plank.

http://laissez-fairerepublic.com/TenPlanks.html

#5

There is a lot of ignorance in this world, it would be overwhelming to identify all of it.

Richie October 15, 2011 at 10:09 pm

That’s exactly what I was going to post. Karl Marx called for it, so obviously it must be a capitalist symbol!

None of Your Business October 15, 2011 at 10:09 pm

“How strangely will the Tools of a Tyrant pervert the plain Meaning of Words!” – Samuel Adams

Horst Muhlmann October 17, 2011 at 10:07 am

Here’s another one:

When words lose their meaning, people lose their freedom — Confucius

autocrat October 15, 2011 at 10:52 pm

That thing referred to as ‘Capitalism’ has _always_ been supported and made manifest by the State. Government force and privilege was the mother and nurturer of Capitalism, and it continues to be.

State Capitalism, is in fact, redundant – unless of course you’re re-defining ‘capitalism’ completely contrary to its historic and contemporary context.

I agree with Kevin B… find a new freaking word. Or at least properly _qualify_ your “version” of capitalism: “Idealistic Capitalism” maybe… or “Hypothetical Capitalism”… “Utopian Capitalism” maybe?

And, why your insistence on ‘capitalism’…? what’s wrong with a free market? A true free market would logically support many different modes of production.

Kevin B October 15, 2011 at 11:06 pm

‘Free market’ is much easier to correct.

A: “The problem is the free-market.”

B: “The market is heavily regulated, you idiot.”

Crowd laughs.

autocrat October 15, 2011 at 11:50 pm

No doubt.

Hey – we’re all intelligent enough to understand that language is a vexingly dynamic thing wherein a single word will have many meanings and interpretations, especially over time and between cultural, intellectual and theoretical schools of thought. Why is Mr. Tucker feigning such surprise that somebody somewhere might have a very different understanding of ‘Capitalism’ than he?

We need a Subjective Theory of Capitalism ( STC ).

-grin-

Iain October 16, 2011 at 2:17 pm

Wrong, how many times do we have to say this. The state is characterized by systemic violations of property rights and leeching off of capital.

autocrat October 15, 2011 at 11:41 pm

Besides the intrinsic involvement of the State, how does the European Central Bank fail to be Capitalist?

* It is corporately owned and controlled

* Its means of production are privately owned, with wage earners doing the labor

* It uses wealth to create wealth

* It transacts on a market

… sounds pretty Capitalist in form and function to me.

“But… but – the _State’s_ involved!”

Since when does Capitalism require that the private owners and/or controllers may be formed/operated/controlled/owned by any natural or legal or corporate persons _excluding_ the State?

nate-m October 16, 2011 at 2:53 am

* It is corporately owned and controlled

It’s governmental controlled. Just like the USA Federal bank. It’s how the large banks in the USA and Europe reduce competition, control the market, and ensure profitability. In both cases the separation between these large banks and government is more for show then anything else. The two of them, quite effectively, are mechanisms of the state government. You have political wings of the government, military wings of the government, and these central banks are economic arms of the state government.

* Its means of production are privately owned, with wage earners doing the labor

You have to be joking, right?

* It uses wealth to create wealth

I am willing to be your conception of wealth is very poorly defined. The money the central banks ‘print’ (create out of thin air) is effectively a form of taxation. So, yeah, they ‘create wealth’… they create wealth for themselves by taking it out of the economy. Just like taxes ‘create wealth’ for crooked politicians and war mongers.

Overall they are very destructive.

Since when does Capitalism require that the private owners and/or controllers may be formed/operated/controlled/owned by any natural or legal or corporate persons _excluding_ the State?

By your definition everything and everything that ever happened that is remotely economic in nature is capitalism. The Russian communists from the 1950′s were capitalists. The Chinese government is made up of nothing but capitalists. State welfare is capitalism. Socialism is capitalism. Taxation is capitalism. Armed robbery is capitalism. etc etc.

autocrat October 16, 2011 at 5:15 am

@nate-m, thankyou for responding – however as far as I’m able to see, your arguments only re-enforce my premise:

That the European Central Bank is a perfectly Capitalist enterprise.

There is neither a “de jure ” nor a “de facto” definition – or “standard theory” – of Capitalism which precludes market distortions via force and/or fraud, or via “public funding” through a “State-like” beauracracy. Nor to put a limit on the number of the “corporation’s” board of directors and/or shareholders and/or other vested persons.

One thing that _can_ be said with absolutely certainty:

The purest, most true, most ultimate purpose of ‘Capitalism’ is simply this: to maximize profits.

The _State_ has been a reliable and powerful means of… _maximing_profits_ .

All your arguments can be reduced to what amounts to subjective ethics. I might as well just roll a die and go with “natural rights”, or perhaps “republican values”… or “the divine rights of kings” – “islamic law”.

In other words, you’ve been reading too much Locke and have gone soft in the process:

The successful Capitalist uses _every_tool_ at his disposal to maximize profit (and to reduce competition.). Period.

Bart October 16, 2011 at 6:01 am

autocrat, capitalism was a reaction to mercantilism. Government granted monopolies were a part of mercantilism that people found particularly vexing. Your assertion seems to be saying that capitalism and mercantilism are the same things. They are not.

nate-m October 16, 2011 at 1:17 pm

The _State_ has been a reliable and powerful means of… _maximing_profits_ .

Yeah, for the state. Not for anybody else, unless the state governments sees their profit as to the state’s advantage.

In a true capitalist system with voluntary exchange when people engage in business BOTH parties come away wealthier. A capitalist economy has no zero sum game. In a free market people only engage in enterprises and trading when they feel that they have something to gain from it.

When the factory worker works for the capitalist it is because the factory worker will be wealthier because of it then if they did not. If I sell my goods to a store it is because I will become wealthier and the store will become wealthier. We only engage in business and transactions because it’s perceived to be profitable for the people involved.

That is why capitalism is wealth producing. Factory workers only work at factories in a free market because it’s profitable for them to do so. They create more wealth for themselves doing that then they could create on their own.

But that can only happen in most cases in a truly free and open market. As soon as you have the goons with guns from the government show up then anything can happen.

The purest, most true, most ultimate purpose of ‘Capitalism’ is simply this: to maximize profits.

It is true that people involved in a capitalistic system are interested in maximizing profits, but it does not mean that everybody wanting to maximize their profit engages in capitalism.

A man pointing a gun at your head and demanding use of your wallet or body is seeking to maximize his profit. He values the sexual satisfaction, feeling of power, money, or whatever else he thinks he is going to get out of that transaction. But that is not capitalism.

This is how state governments work. They use the military and police to threaten and control individuals to maximize their own advantage. The large banks and corporations use the central government controlled banks and their buddies in political office to maximize their own advantage. They have much more in common with the man with the gun threatening you then with the capitalist owning a factory and producing goods on the market.

All your arguments can be reduced to what amounts to subjective ethics. I might as well just roll a die and go with “natural rights”, or perhaps “republican values”… or “the divine rights of kings” – “islamic law”.

You assume far to much. Instead of trying to think you just assume you know what ever arguments are going to be directed at you. Your communicating with a figment of your imagination and is just regurgitating that conversation out onto your keyboard.

In other words, you’ve been reading too much Locke and have gone soft in the process:

You are woefully ignorant.

Luckily this is something that can be fixed easily by yourself.

autocrat October 17, 2011 at 4:43 am

I’ll try again:

Your version of capitalism appears to preclude Corporate/Private accumulation of political capital. ( However, in the real world, the fact that Capitalists have historically spent political capital in pursuit of private/corporate/capitalist interests is broadly and generally recognized. )

From which sources are you deriving your theory of… “Noble Capitalism”, and what makes those sources particularly authoritative?

Would you mind providing a bullet-list of what you consider to be the primary/fundamental identifying attributes of ‘Capitalism’?

This is probably the most brief and accurate definition of actually-existing Capitalism that I have seen:

“Capitalism entails the private ownership of [natural resources and capital goods] by a class of owners called capitalists, either individually, collectively or through a state apparatus that operates for a profit or serves the interests of capital owners.”

( You’ll notice the above definition of Capitalism does not preclude State involvement. )

Using the above quoted definition, I support capitalism only when it operates from the context of a true free market:

Wherein there exists no artificial barriers to capital and credit nor to the means of production, whereby a natural labor-to-capital equilibrium is reached via ubiquitous competition. ( Wherefore a stateless voluntary economy emerges in which individual/private and collective/cooperative worker-owners tend to comprise the vast bulk of society’s luxury, agricultural, industrial and financial activity. )

I’m convinced that a true free market would naturally and effectively dissolve one of Capitalism’s primary pillars: the large population of cheap wage workers competing against each other in what amounts to a buyers market. Who would work for a boss when they can comfortably subsist without one, and where they can easily go into business (either independently or jointly) on their own? Answer: not many, and only if the compensation was particularly high/worthwhile.

xodix October 17, 2011 at 7:07 am

Autocrat:
I like your definition, although what you’re leaving out is the element of risk. People, in general I think, like to reap rewards, but they are afraid of risk. It takes a lot of moxy to succeed or fail on one’s own, and generally more time and effort to succeed than to take another kind of risk, which is to be employed and let someone else take care of the details of employing you. When you start a business and it fails, you might be able to blame someone else such as government, and the blame may be in part well-placed, but ultimately you have to take responsibility for your own failure. If someone fires you or lays you off, then it’s much easier to blame the employer who treated you unfairly or was greedy for profits and let you go to line his own pockets.

Ultimately, any market is a buyer’s market. That’s what people don’t seem to understand. It’s the consumer who has the power, unless some greater power like government steps in to force consumption, such as the monopoly in Federal Reserve Notes for legal tender or insurance via Obamacare. Even the Wall Street markets are controlled by buyers. When no one is buying, prices must go down low enough for someone to see value or no transaction occurs. It is nearly always easier to buy something than it is to sell it. (Look at so many of our basements.)

rodney dawkins October 16, 2011 at 12:02 am

Quite right. Capitalism concerns the use of genuine wealth to sponsor economic activity. The important point is that money should be an honest representation, whether that is hard work or whether that is inheritance – of somebody else’s hard work. Yes, money can be dubiously obtained, but that is because capitalism is not heaven on earth in its perfection – the price you pay is that brutes and thieves can prosper – assuming they can make high-level, rational decisions in a competitive market place, where only the deft survive. In other words the honesty of the money is the key to its self-regulation. Now the EU, and other pseudo-socialist states have been undermining the integrity of money. It is this market mendacity that is at the root of the current economic crisis. And unfortunately politicians have been complicit, and when people eventually cotton on, then they will become the eventual focus of public ire. It’s just taking a while for the penny to drop – he said, ironically.

PJ October 16, 2011 at 2:08 am

R.D. We must speak… U have the words my students and I dream.

Ryan October 16, 2011 at 6:26 am

The ECB is considered a “capitalist symbol” to leftists because the leftist paradigm does not delineate between corporatism and capitalism.

There is no hope of setting society back on a path toward free markets until people at large understand that capitalism is not merely “socialism, except that the corporations control government.”

nate-m October 16, 2011 at 1:53 pm

They use the term to denote anything and everything they do not like. Replace ‘capitalism’ with ‘System of Hilters with money’ and you get essentially the same definitions they use.

Ryan October 17, 2011 at 7:58 am

Yeah, exactly. Perfectly said.

Tony M. Fernández October 16, 2011 at 2:28 pm

It’s the Michael Moore definition of capitalism – anything we don’t like. It’s much like how people throw around the term fascism. This is why I prefer the term free market, or individualism.

pravin October 17, 2011 at 1:54 am

i dont use individualism.idiots think individualism means selfish behaviour like those big banks who dont want to give up their bonuses. free markets are fine .
my technique is to attack their proposed solution: ie more regulators by telling that those bad businesses always have the regulators in their pockets.

MattK October 16, 2011 at 4:34 pm

I think people are doing good thing. We are loosing because they want to save big companies.

Hannah L. Migliavacca October 16, 2011 at 10:36 pm

To put it in von Mises words, this has turned “praxeologically catallactic”, whatever that means.

Daniel October 16, 2011 at 11:36 pm

If you don’t know what it means then why are you quoting it?

:psyduck:

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