Economies Change

Pure capitalism is the natural state. Giving and getting value works.

When “well-meaning??” people try to restrict the natural, they show several non-virtues.

  • Impatience. I can’t wait, even though I know the market fixes itself over the intermediate to long term.
  • Arrogance. I know what is best and others (even all the others) do not.
  • Greed. I can do better if the market is different.
  • Revenge. I will punish my enemies.
  • Selfish Altruism. I will reward my friends.

I doubt they would admit these motivations, but given a broad view of the marketplace and the social background, I doubt a Martian would disagree that they are present.

Much of it is lead by delusion. Like – Equal means equal outcome. Like – The long run is a series of short runs. Like – There is such a thing as government money. Like – A little inflation is good.

Systems always evolve or devolve and the change occurs based on limits and opportunities. Evolution when opportunities outweigh limits and vice versa.

If socialism succeeds or fails completely, what would it become? Capitalism probably, that’s where the resources are. Lots of evidence on that one. If capitalism fails what will it become? Socialism probably. Less and less allocated more and more equally until everyone has an equal slice of nothing.

The interesting point is to see how the change happens.

When socialism becomes capitalism, it does not do so in one gulp. There are early adapters. A significant share of those are criminals. Criminals are intuitive capitalists. They get the idea that what you get from the system is proportional to your own skill and effort. They do not expect others to look after them. Their idea of rules and rational are somewhat off the conventional playing field, but nonetheless fully rational. Farmers are another group that gets it, albeit with a better rule set.

As capitalism changes to socialism, will criminals lead the way? So far there is no evidence to preclude the possibility. So far we have not nominated some groups as criminal. We may some day.

  • Think the enrichment of global warming advocates.
  • Think the enrichment of unions and their members.
  • Think the empowerment of Chicago style politics.
  • Think empowerment of ethnic groups like native people at Caledonia, Oka, Akwasasne.
  • Think of Occupy Wall Street.
  • Think of politically motivated prosecution and of politically motivated non-prosecution.

If you want to know how legislation and regulation affects us, learn from the Latin.

“Qui bono?” Who benefits?

Don Shaughnessy is a retired partner in an international accounting firm and is presently with The Protectors Group, a large personal insurance, employee benefits and investment agency in Peterborough Ontario. don.s@protectorsgroup.com

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