Posted by
Playful Walrus on Tuesday, May 08, 2007 10:00:16 AM
Quentin Gee, a graduate student at UC Santa Barbara,
writes in the taxpayer-aided school’s newspaper that he doesn’t quite buy what John Stossel said on campus about capitalism vs. socialism. Big shock.
Stossel claims that capitalism does not need much government oversight to correct for the tendency of greedy corporations to “cheat.” His main reasoning is that “word gets out” and cases of corporate corruption are “few and far between.” But there are two fundamental concerns about this defense.
The first is the question regarding who in fact gets the word out. Most major media outlets are themselves corporations, usually subsidiaries of larger corporations. For example, NBC is a subsidiary of General Electric and ABC is owned by the Walt Disney Company. What happens if they cheat?
If GE cheats and NBC doesn’t expose it, then Fox News (News Corp), CBS, ABC, and CNN (Time Warner) will expose it, and that’s just network/cable television news. That doesn’t include television stations owned by companies that don’t own networks, radio networks and stations, magazines, newspapers, and online news sources. If it is Disney cheating, substitute ABC with NBC.
From 2001 to 2003, General Electric paid $9.5 billion less than what their standard corporate tax would have been, the result of “tax incentives” and income reporting loopholes, hardly something you’ll hear about on the “NBC Nightly News.”
Incentives and loopholes, if legal, aren’t cheating. Don’t like it? Overhaul the tax system instead of using it as a way to punish legal behaviors and reward other behaviors.
The second concern is how “few and far between” the cheaters in capitalism are. The list of cheaters is massive, but I’ll give two examples. Does thwarting the unionization of workers count as cheating? Sounds like it to me. But even the pro-capitalist BusinessWeek admits that, in the 1980s, U.S. industry “conducted one of the most successful anti-union wars ever, illegally firing thousands of workers for exercising their rights to organize.”
What about
intimidation by unions and corruption within unions?
What about corporate welfare? These tax credits, incentives and deductions for companies are on the order of $200 billion per year, while a welfare program to people such as Temporary Assistance to Needy Families gets less than $17 billion annually. It seems like Stossel’s later claim that welfare “leads to dependency on the government” is better applied to the capitalist economic conglomerations we call “companies” rather than families that have befallen hard times.
How about we get rid of all government welfare of all kinds?
Another weak argument that Stossel made was that socialism is worse than capitalism. His one example is the Soviet Trabant, an unreliable, ugly automobile, makes socialism look bad. Of course, Stossel’s weak analogy fails to mention a number of more relevant factors that explain the low quality automobiles in the USSR.
There are plenty of other examples. Nowhere, though, do you cite where socialism has been better than capitalism.
For starters, the Soviet Union came out of World War II with a scarred social infrastructure and serious economical challenges, which is well known to anyone who has taken a history class.
You mean history classes taught by commies? The U.S. never faced challenges?
In addition to this problem, 25 percent of the Soviet economy in the 1980s was devoted to defense and foreign affairs, compared to 6 percent for the U.S. When one nation spends 19 percent more of its economy than a more economically powerful nation
Wait- the U.S. went through WWII as well. How did the U.S. become more economically powerful? Could it be… capitalism?
on building high-performance MiG fighter planes and hydrogen bombs, we should expect a loss in ingenuity in other sectors. Clunkers like the Trabant are expected. This has less to do with economic philosophy, more with other conditions that the Soviets faced. Just for the record, I’m not a communist.
Okay, we’ll take you at your word. But making excuses for the failures of socialism in a society that is supposed to be capitalist is silly. I mean, by virtue of you being here, isn’t it clear that capitalism is better? Just exactly which country in the world has long been a favorite of immigrants and illegal aliens?
The biggest disappointment that Stossel left me with was his approach to the issue of global warming. According to Stossel, scientists in the 1970s were concerned with “global cooling,” and this supposedly undermines conclusions regarding global warming. Although it is true that scientists were worried about cooling, the concerns are of a different type than those regarding global warming.
So what? You still have to explain why we should
now believe people who were wrongly predicting the exact opposite outcome a mere 30 years ago. They were certain that the world was going to cool into an ice age. Now they are certain it will warm up and have horrible consequences as a result. Why should we believe them now?
If the Federal government doesn’t handle something, it doesn’t mean that it won’t be done. Supply & demand, and competition/choices for consumer dollars, aided by modern communications, rounded out with charity and social awareness, will keep a free capitalist society functioning well. Socialism rewards underachievement and doesn't provide enough motivation for innovation. If we were to agree that global warming is a man made threat to the world, capitalism would still be better at finding solutions than socialism.