10 Capitalist Myths

Capitalism makes everything possible. Capitalism leads to wealth, wealth leads to investment, investment spawns innovation, and through glorious creative destruction, today?s innovations surpass and replace yesterday?s, creating more wealth. Through capitalist initiative, civilization has advanced beyond the wildest imaginings of our forbears. Today we cure diseases that were incurable. We cultivate miracle crops to feed the world. There is no problem in that cannot eventually be solved if we just give capitalist entrepreneurs free rein. Yet in spite of compelling evidence, the capitalist system remains challenged. Globalization, privatization, the growth of intellectual property law, industrialization, mechanization, and free trade have all spawned resistance. Voices raised include socialists, environmentalists, indigenous peoples, humanitarians and even other capitalists. The following Capitalist Myths, each embraced by far too many capitalists, dangerous when adopted blindly, can be amended or eliminated through more serious debate. Capitalism is a powerful force for positive change, but cannot realize its full potential unless it acknowledges and confronts its myths, and assimilates positive ideas from belief systems besides its own. Myth #1 Global Free Trade is Always Best Not always. While a world of unfettered free trade can create faster overall economic growth, that same growth can cause some societies and countries to become worse off. Suddenly introduced global free trade can turn an entire country's economy and fledgling local industries upside-down. Foreign investment often focuses on over-development of single commodities that can go bust. Increased foreign investment and global trade usually ride into a country alongside debt. Going into countries using international legal weaponry to enforce free flow of capital and foreign ownership of local assets isn't always best. Alongside free trade there is fair trade, an equally elusive and worthy goal. Myth #2 Cheaper is Always Better Price competition is a pillar of capitalism, but many measures of value do not immediately or easily translate into quantities of money. How can the happiness of a people, or the health of an ecosystem appear on the financial statements of a multinational corporation? Hire lower-paid employees and lay them off and move to another country as soon as it?s cheaper there, then move again. Mechanize the workplace and make workers commodities. Log forests on cheap land, pay massive short-term profits into dividends and close the company. Strip-mine oceans with driftnets 50 miles long and kill off the final scattered fish with high-tech sonar detection systems. Capitalist competition means more, cheaper, faster; cheaper goods, cheaper shelter, and cheaper protein, but it?s not always better. Myth #3 Capitalism has European Roots

Only some capitalists are European. The functions of capitalism; property ownership, monetary exchange, trade, competition, value creation and entrepreneurship, easily predate Europe and exist and originate from most everywhere. Private individual wealth and multinational corporations come from diverse cultures. That the Europeans have been successful capitalists doesn?t mean they invented capitalism, and it doesn?t automatically consign capitalism to European values and prerogatives. Critics of capitalism point their fingers at the west more than the west deserves. Capitalism is part of human nature. Myth #4 Intellectual Property is Sacred Absolutely not! Patents for inventions that incorporate life forms, mimic natural processes or copy native remedies and recipes are walking on legal thin ice. ?Business method? patents are complete baloney and should be repealed. Maybe copyrights last too long, and royalties cost too much. The public domain is under attack and it?s shrinking. Farmers who save and reuse seed from their own crops, inadvertently or effortlessly cross-pollinated with windblown genetic material that somebody patented should not be prosecuted. Open source legal precedents are already set in the software industry. Stakes are high. Intellectual property law run rampant becomes an expensive and devastating tool for oligarchic and other vested interests to outlaw competition. How capitalist is that? It?s time to reverse this trend. There is an intangible commons, too. Myth #5 Industrialization is the Only Alternative From a global perspective industrialization is inevitable, but that doesn?t mean developing countries should develop now or else. Countries that would have enjoyed relative stability if they?d never industrialized can be sorely disrupted by sudden financial flight. Single commodity economies with debt service blow in the wind. When a country commits to industrialize they place high bets in limited areas and they run this risk. Moreover, because global productivity constantly improves, especially in the high-tech era we live in, the longer a country waits to develop, the less they will have to pay for their new industries. Countries should not be rushed into industrialization because it?s supposedly in their interests. A myth-free capitalist can seek fair trade over free trade, choose to pay more to purchase goods with a broader value, they can come from any heritage, they believe that ideas must have a commons just much as the earth, and they have realized that plunging a culture from autarky into the hyper-competitive global economy isn?t always best for everyone. Part two will examine the remaining five capitalist myths? ?myth-free capitalists accept reasonable ?takings,? they aren?t dogmatic, they appreciate good government, they don?t try to get rich quick, and they place a premium on overall joy.