
Is There a Crisis in Capitalism? - tmlee
https://www.gatesnotes.com/Books/The-Future-of-Capitalism
======
crispinb
There is. It's incompatible with the continuing existence of a living planet.

Naturally enough, a billionaire megaconsumer, having bought a moat intended to
separate himself comprehensively from physical reality, isn't fussed. But he's
a mammal. All mammals live in ecologies, not economies, whatever they tell
themselves.

~~~
andrewstuart
On the contrary I don't agree that capitalism is responsible for environmental
decline.

If anything environmental decline can be attributed to the form of democracy
in which companies control government policy via donations and lobbyists.

The government policy thus serves the interests not of the people but of the
companies.

Companies have no interest in anything but furthering their own goals,
typically to make money without any attribution of the collateral costs such
as environmental vandalism.

This is not about capitalism - it's about broken democracy, subverted to
become some weird system of government that serves companies and vested
interest above those of the citizens.

Nor are billionaires the cause of poverty. There's plenty of money to go
around and plenty of resources to go around with room to spare for
billionaires. Poverty exists because governments expend the resources to the
betterment of companies rather than the citizens. If we suddenly took all the
money from all the billionaires this would make zero difference to poverty
because the reasons for poverty have little or no relationship to the
existence of billionaires.

~~~
panarky
_> I don't agree that capitalism is responsible for environmental decline

> environmental decline can be attributed to the form of democracy in which
> companies control government policy_

These are the same thing everywhere except in theory.

~~~
crispinb
Yeah. Capitalism apologists now sound very much like the credulous lefties who
made excuses for the Soviet Union's many catastrophes, long after it was
manifestly a disaster. A benign idealist version might exist in some Platonic
realm, but for now the capitalism we have is a dire threat to all.

------
oijoijoijo345
IMO, and likely in many others' opinions there are simply too many oligopolies
in the world. Too much concentration of wealth in too few hands.

People see that the benefit the large majority of the wealthiest people /
organizations bring to society is far from optimal compared to their capacity
to do so.

I think it's not necessarily that there is an enormous divide between the
wealthiest and the poorest. I think the important point is it requires close
to an act of God, as a poor person (or just not wealthy), to make the kind of
dent most of us want to make in the universe.

~~~
oijoijoijo345
Replying to my own post :)

I think capitalism at its core: the human traits necessary to wildly succeed
in it, are not the most desirable traits to most people. Yet we're optimizing
civilization such that we should be striving to achieve them in order to live
successful lives.

~~~
crispinb
True - it is (very roughly) a Darwinian machine designed to select for traits
inimical to the flourishing of ecosystems.

------
hirundo
> Collier says we’re experiencing three big rifts: 1) a spatial divide between
> booming cities and struggling small towns ...

Strange then that in the US the "booming cities" are voting for more
restrictions on capitalism than the "struggling small towns". Yet this is his
primary explanation for a crisis in capitalism?

Does he mean that the crisis in capitalism is caused by its success? There may
be something to that. The most vocal protesters against capitalism tend to
come from more economically privileged classes, judging by, say, college
students versus blue collar workers. The Australian elections and Brexit
referendum echoed that pattern. It's as if protesting capitalism is a luxury
good.

~~~
jddj
This isn't so strange in a complex world.

When you're struggling to put food on the table you don't have time to
philosophise about how a better future would look.

You do have time to do the less coal = fewer jobs for your immediate community
math.

------
bawana
Capitalism as it was originally imagined - transactions between people- is the
best system. Unfortunately money is now transacting itself. With ai and
financial instruments as they exist, there is an order of magnitude more
wealth tied up in speculation than actually being used by humans. Money from
financial gains should be restricted to being used on products, services, and
human endeavor.

------
conception
>Ultimately, I agree with him that “capitalism needs to be managed, not
defeated.”

Says the man that used his monopoly to crush his competition, created
embrace/extend/extinguish and become the richest man in the world.

Exciting now that there are no stakes for him he's thinking about others (in
both this and his other philanthropic adventures).

~~~
GeorgeTirebiter
Have you ever met Bill, and chatted with him for a few hours? I have. I think
you'll find he's a geek's geek, with conscience. Thank Ballmer for most of
MS's excesses. Ask yourself: is the world a better place due to what he's been
able to do, so far? And, one would hope, continues to do through the Gates
Foundation? Mostly, please, don't be so quick to throw the first stone.

~~~
bantunes
I'm sure your few hours conversation with him overturns the evidence the DoJ
managed to collect about their plans for Netscape laid out in emails and
memos. Stuff signed by Gates saying “take away their oxygen supply”, “crush
them” and “knife the baby” in regard to killing Netscape while they were up
and coming.

Bill Gates is a bully, and no matter how much money he throws at malaria
research to redeem it, the sad bit is that he set the bar for Bezos, Zuck,
Kalanick et al to reach and they've largely reached similar heights because
over the years the US government has successfully been defanged.

And regarding the Gates Foundation:

> ...there’s clearly a conflict of interest that Gates does have that’s at
> stake here. And that’s this, you know, look, if you look at one of the main
> problems that the Global South faces right now is that they have a lot of
> difficulty paying the patent licensing fees that they need on sort of basic
> medicines and technology including for renewable energy access. And one of
> the reasons for that is because of the TRIPS agreements, the Trade-Related
> Aspects of Intellectual Property Rights, which is an agreement that came
> into force under the World Trade Organization in 1994, which basically
> massively extends corporate patents law around the world. And Gates has
> benefited singularly from that because that’s where the vast majority of his
> profits come from and what funds the Gates Foundation is rent effectively on
> intellectual property.

[https://medium.com/@CitationsPodcst/episode-58-the-
neolibera...](https://medium.com/@CitationsPodcst/episode-58-the-neoliberal-
optimism-industry-and-development-shaming-the-global-south-cf399e88510e)

~~~
AnimalMuppet
He was a bully. He really was.

 _Was._

People change in 20 or 30 years. I sure don't want to be judged by some of the
things I did 30 years ago, when I was a hypercompetitive jerk (also socially
clueless, and a few other things).

And I don't think that the "vast majority" of Gates' profits came from
_patents_ in the Global South. It came from _copyrights_ , and primarily in
the First World.

~~~
bongobongo
Not everybody worships wealth. Not everybody buys into the myth of the tech
genius/entrepreneurial wizard. Some folks, myself included, don't feel that
it's even remotely possible to amass billions in personal capital without
doing some truly dirty, nasty, awful things to many other people along the
way.

So, frankly, I don't really care that Bill Gates is now a soft sweater-wearing
sexagenerian who likes to talk about solving global problems with his ill-
gotten gains, instead of a cutthroat corporate executive crushing his
competitors and perverting the market in the process. The fact is that one led
to the other.

I want to hear less from delusional, egotistical billionaires who think that
they themselves can solve the problems we face as a society, and more from our
actual, you know, political leaders. I didn't vote for Bill Gates, thank you.

~~~
crispinb
I'd always be more impressed by a poacher-turned-gamekeeper who returned his
gains and then lived like the rest of us. Continuing to live a megaconsuming
existence while consolidating power over fellow humans via 'philanthropy' is
just more of the same.

------
blacksqr
Everybody knows the fight was fixed.

The poor stay poor, the rich get rich.

That's how it goes.

~~~
nkkollaw
Nice try Karl Marx, but that simply isn't true, especially in the States.

If you provide value, you will get out of poverty and even get rich. You don't
always need money personally to provide value.

~~~
dagss
How do you get the mental resources and education to "provide value"? How do
you become resourceful? Simplest way is: Do not be born in a poor family.

On a more narrow level -- if people have to worry about food on the table, the
stress itself causes IQ to drop, also in experiments.

Of course there are exceptions, but on a statistical level, poverty is
inherited -- because of what you mention, not in spite of it!

~~~
6cd6beb
Two kinds of people in this system. One of them thinks if you work hard you
can climb your way out of poverty through your own self determination and hard
work.

~~~
afuchs
> Two kinds of people in this system.

Three or more if you count more realistic viewpoints.

> Two kinds of people in this system. One of them thinks if you work hard you
> can climb your way out of poverty through your own self determination and
> hard work.

Self determination and hard work is necessary for success but it doesn't mean
much without opportunity. Opportunity is unevenly distributed.

What one person see as value, which creates someone else's opportunity, is
often determined by subjective social and cultural factors and isn't always
objective or rational.

~~~
nkkollaw
Everything is unevenly distributed. Race, height, money, attractiveness, IQ,
etc.

If you are unlucky, you have to work more.

If opportunity doesn't present itself, you go look for it.

------
qmanjamz
Is there a country with an economic system other than capitalism that is even
remotely competitive with the US?

Saying there's a crisis in capitalism because some people are poor is like
saying the Warriors are in crisis because their bench players aren't getting
much playing time.

~~~
conception
We've tended to go to war (hot or cold) with them before they have the chance
to compete.

~~~
blotter_paper
And here, I thought war (hot or cold) _was_ competition.

I get that momentum is hard to overcome, but I think a sufficiently
competitive system will overcome that barrier and eventually outcompete
capitalism as we know it; we haven't found that system yet, though it's
theoretically possible we've tossed out some better systems that weren't
better enough to overcome the first-mover-after-WWII advantage.

I think the major innovation of the next paradigm shift will relate to how
groups of people handle intergenerational wealth (and perhaps some related
structural questions), as I think this is the most glaring inefficiency of the
American system. This is a minefield of a problem with a lot of naive, popular
answers.

------
onemoresoop
This is relevant, why did it get flagged??

------
robertAngst
>But no other system comes close to delivering the innovations and economic
growth that capitalism has sparked around the world. This is worth remembering
as we consider its future.

I ask great authors post this at the start and end of bash of capitalism. It
is good we all acknowledge how great markets are, what kind of damage can we
do fighting it?

------
joe_the_user
Just in terms of definitions, a crisis of capitalism would be the possibility
of some sort of collapse, say financial, from too much QE, stock buy-backs and
so-forth, or environmental, from climate change, say.

What he's talking about broadly merits being called "problems of capitalism",
"injustices of capitalism" or similar labels. These pressing problems but only
for those who experience them or those who take the time to discover them.

That said, I think one could say a ruling class that is fairly secure is often
ruling class willing to toss some benefits to those below whereas a ruling
class that's worried can be a ruling class that grabs everything it can. My
feeling is the global ruling class is acting worried.

~~~
rectang
I've always considered myself a capitalist, and 20 years ago I used to be very
annoyed by what I considered insufficient appreciation for marketplace
competition on the left.

But runaway inequality and the intransigent insistence of people like Gates
that said inequality is not a problem has me questioning whether I need to
reassess. (In my view the problem with inequality is that political power
corresponds roughly to economic power, so unlimited amounts warp our political
system.)

If you're losing people like me, maybe a crisis really is on the way.

~~~
task_queue
> _I 've always considered myself a capitalist_

Curious as to why? Do you derive your livelihood from your ownership in
capital? Or do you have to work, but value private property, markets and
liberal economics?

I ask, because when I think of a capitalist, I think of someone whose wealth
and power are derived from significant ownership in companies and assets, real
or financial.

There are plenty of ideologies that value market economics from the very left
to the very right. Examples include market socialism on the left and American
libertarianism on the right.

~~~
humanrebar
Capital is a synonym for wealth and a synonym for property.

Being against capital is a fairly extreme position that has been tried and has
a much worse track record.

What people think of when they say capitalism these days is more like
kleptocracy or corporationism.

------
dpweb
My technical background instructs me that when faced with a seemingly
intractable problem or unexplainable outcomes - we’re asking the wrong
questions.

Capitalism is essentially our new religion. Suddenly responsible for curing
all ills, but it’s simply an economic model.

It necessitates people be productive, but it also inherently directs income
from the poorer to the richer. We in the western world redistribute trillions
in taxes for social welfare to attempt to offset its natural effects.

As far as creating our utopia, it doesn’t help that political solutions
designed to help the middle and lower income classes actually can have the
opposite effect.

Does making 401k contributions tax deductible, when big banks take a fee on
all such deposits, help the middle class save, or does it just more direct tax
dollars into corporate profits.

~~~
sologoub
401k by itself is a great idea.

Making it optional, not requiring employer match and allowing fees to run
rampant - not such great ideas.

Vanguard is a great example of a low fee fund manager. Many good companies
provide strong match and help secure the future of their workforce. But the
problem is that these are all optional in the spirit of personal choice and
empowerment.

Problem is, to most people these are disempowering because the compulsion to
spend is too high. If all make a little less take home, but their retirement
accounts are filled like the IRS coffers, overall prices decline because of
less disposable income, but in the end, people get to retire.

For those that unfortunately doesn’t make it to retirement, it would be good
if the accumulated wealth could be inherited and/or donated.

