Capitalism with no capital?

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Free market capitalism has received a bit of a hard time lately with the unpopular bail outs of banks after “free market capitalism went crazy” with “unbridled greed”.

But what is free market capitalism and who are capitalists?  Well some might say “that’s an easy one: the Western countries are capitalist and the East is getting there.”

But looking at my 1982 Oxford Dictionary, the definition of capitalism is:

“System in which private capital and wealth is used in production and distribution of goods, dominance of private owners of capital and production for profit.”

A Capitalist then is:
“Person using or possessing capital, rich person, of capitalism or capitalists.”

Hmmm….. That sounds like the America, UK and New Zealand of old, not like it is now. 

Who in the world is building up capital for production and distribution of goods?
Well not the West, but even if the East has the “capital” part of free market capitalism I don’t think either the East or West has true free market capitalism now.

But what about Wall street, and what ever the street name is in New Zealand where all the banks, brokerages and hedge funds are…aren’t they capitalists?  No they are merchants of anti-capital, that is they sell debt.  It almost seems silly for me to state that, but this is the level of delusion we are in: In general debt for non goods producing un-distributable housing is not capital, it is anti-capital. Savings of excess labor used to purchase producing assets is capital!

The fact is debt has become the capital of the western world.  But is that right? Can it work?  Everything that is common sense and wisdom says that debt is the opposite from savings, debt is anti-savings that is just common sense.  Yet here we are with our entire monitory system based on debt now, like it was an asset!

My old Oxford Dictionary made capitalism easy to understand as I thought it would be,  but over time maybe we have lost our way, the definition is now not so certain and simple, the online up-to-date Wiki definition is actually similar but note the significant added bit at the end:

“Capitalism is an economic system where capital and land, the non-labor factors of production (also known as the means of production), are privately owned; labor, goods and resources are traded in markets; and profit, is distributed to the owners invested in technologies and industries. The pervasiveness of wage labor is another important feature of capitalism, which depends on non-labor income derived from property not intended for the owner's personal use. Also see rise of financial capitalism, which controls all other forms of capitalism.”

So now we have “financial capitalism the master of all other forms of capitalism”
I say hogwash to that… The bankers make their bets, the hedge funds hedge their debts, but at the end of the day a capitalist countries economy whose core is hollowed out with debt will eventually collapse inward, the fraud will be exposed.

Like the little boy who pointed out the emperor had no clothes, “look the capitalists have no capital at all”!

How can the borrower be the master of the lender? Tell me, can that be the new common sense? With down now the new up, red now the new black?

We know the countries doing the borrowing and the ones who are lending…. So really who are the capitalists?   Are there any free market capitalists?

I don’t think it was lack of regulation or too much freedom that caused the “recession”, debt based money was decreed and regulated into place by governments allowing the “unbridled greed” voters wanted in the first place. Money was no longer based on capital, but debt, it could be made with a few strokes of the qwerty key board…. Well how about that! Money was unbridled and it went wild! Who would have guessed!
Those who wrote the American constitution knew it, to name some.

If money had real worth and was limited, banks would not be so keen to lend it out for any old venture,  greed would be bridled with the fear of losing something real.

Debt based money regulated into place by non-free market governments is a source of much unbridled greed, and the opposite of free market capitalism.

But as you may have picked up already, I don’t blame governments for this, even government actions are cause and effect, for example when people say “The government should pay for this, or boost spending for that” while in ignorance not knowing the government does not have said money, we the people effectively requested out of short term greed long term debt based money taxes and control.

I’ll leave you with this little gem:
Say not, “Why were the former days better than these?” For it is not from wisdom that you ask this."
Ecclesiastes 7:10

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