How Capitalism Makes Evil Rational

It’s always worth understanding an important ideology’s ethical calculus.

Capitalism’s is brilliant.

If someone is willing and able to give you money to do something, you are improving their life.

The corollary is:

If you have money, you have it because you have improved someone else’s life. The more you have, the more lives you have improved.

There are assumptions embedded in this logic: That people know what improves their lives, for example, and that everyone involved is buying and selling voluntarily.

Demand isn’t desire, mind you. If you want something that would improve your life a lot, it doesn’t matter if you can’t command enough money to get it. Adam Smith pointed out that bums may want coaches complete with horses, but this does not translate to “demand.”

Still, basically, the theory is that you get money by helping other people.

Roy Dalio, the fund manager famous for his book on principles, believes this one hundred percent.

Now, it’s important to understand that capitalism is an ideology and organizational principle sitting on top of a series of technologies. We can call those technologies “industrialization.” Industrialization is not capitalism; we can imagine there might be other moral and organizational principles which could work with industrialization. We tried, as a species. We called it communism, which was centralized industrial control, and it didn’t work out in the end. Some say that’s because it couldn’t work, others say it’s because the USSR had less people and resources than capitalism, along with a weak strategic position.

I’ve argued parts of both. The truth is we don’t actually know.

Both systems are ideologies which determine who gets to control a certain amount of other people’s time, and who got to tell people what to do. That’s what money does, and anyone who has spent their entire life working for money by doing what other people tell them to do should understand this (though remarkably, many people don’t).

Capitalism is also an argument based on scarcity. It says: “There isn’t enough, so we need to make sure the people who get what we have use it to help others.”

That’s the actual moral argument: Capitalism is the best way to use people and resources to help the most people. It’s why whenever someone suggests there might be another way, someone else will say “Venezuela, Venezuela, neener, neener.”

Here’s a strange thing, though. Every time I look into homelessness I find that there are more empty homes than homeless people. There’s probably an exception, but I’ve never found one in the Western world.

We also throw out far more more food than is needed to feed everyone.

So at the very least, we know that capitalism isn’t distributing goods to everyone who needs them. The capitalist argument to this contradiction isn’t, “That’s false!” It’s that, “Communism failed, so you’re stuck with this.”

Then there’s another issue: Capitalism has turned out to be terrible at managing scarce resources. We could make a lot of things we use more durable so they’d last longer. Instead we make them so they won’t, deliberately. We make them so they’ll break or wear out, and people will have to buy another set, because companies need to make a profit. It’s not that cell phones couldn’t be created to last much longer, it’s that the people who make them don’t want to. The same is true of light bulbs, clothes, almost all electronics, cars, and so on.

We’re wasting vast amounts of resources, and that waste also shows up as vast amounts of pollution and huge destruction of the environment.

Pollution, including pollution involving carbon, methane and other climate change gases is an important example of not managing limited resources. There’s actually a limited amount of room to pollute, and beyond that, the environment starts changing in ways which are dangerous to us and the rest of life. This is a genuine scarcity “pollution sink,” and capitalism isn’t managing it.

It turns out that capitalism (and state communism before it) isn’t very good at managing scarcity. Perhaps it’s better than an opposition which doesn’t exist any more, but it’s not good enough to avoid wiping out island nations and changing the climate catastrophically.

So what we have is a technology which is theoretically capable of managing scarcity (industrialization/science) and an ideology and organizing principle (capitalism) which can not.

We produce way more than we need, vast amounts are wasted, we still have people without homes or going without food, and we’re destroying the environment and changing climate in disastrous ways.

That’s an ideology which is, well, evil. To produce more than we need, and then say, for ideological reasons, “But some people have to sleep on the street, and others need clean out sewers by hand, and still others have to go hungry” is a simple failure. To destroy the ecosphere is another failure.

Capitalism doesn’t do what it is supposed to do: It doesn’t use resources efficiently or distribute them in a humane way. In fact, it uses resources inefficiently, vastly so.

It turns out that “if it makes money” isn’t a good proxy for “does good while using resources efficiently.”

By capitalism’s rules, destroying the world is rational. Not feeding people is rational. Having homes sitting empty while people freeze on the streets is rational. Making way more goods than people need, through planned obsolesence, is rational.

And these aren’t corner cases. This is what the logic leads to. This is the system running on its core logic loops. Someone is paying for all of these things, so it must be making them better off, so therefore doing these things is good. More, the people doing those things are given MORE resources (money) so they can perpetuate same behaviours, because the system assumes the behaviour must be good, or someone wouldn’t be paying for it.

This isn’t just, well, evil. It’s insane.

When your ideology says: “Destroying the world’s climate and environment, starving people, and making people homeless is rational”? There’s a problem with the ideology.

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