Free Market Capitalism, R.I.P.
Free market capitalism is dead. As in a human being’s death, it may be awhile before this fact sinks in. Free market and globalization enthusiasts have been touting their model for many decades portraying government’s restrictions as unnecessary obstacles to growth. To be fair, unrestricted capitalism generated prosperity. However, this prosperity was too thinly spread among the poor and the costs too thinly spread among the rich.
President Franklin Roosevelt saved capitalism by his New Deal that regulated the banks and stock markets. President Ronald Reagan started the deregulation wave that lead to the current crisis that writers like William Gleider and Chalmers Johnson have been predicting for many years.
The much touted self regulation was always a fantasy. Capitalism is inherently unstable with periodic depressions. When President Bush was the Texas governor, he let the petrochemical industry regulate itself. As a result, my former home town, Houston, replaced Los Angeles for the dubious distinction for having the nation´s dirtiest air.
Major corporations are amoral entities that work in the public interest only when someone (a governmental entity) makes them comply with health, safety and environmental protections.
When Rachel Carson released Silent Spring in 1962, the chemical companies started a public relations campaign dismissing her as a nutcase. Automobile makers fought tooth and nail against public safety. The most obvious example was their opposition to mandatory safety belts. To this day, corporations give only lip service to climate change to convey the impression that they give two hoots.
To pay for the current rescue package that rewards the rich and greedy people who caused the mess while it impoverishes the victims, the federal government must cut back somewhere. Since conservatives like to talk about reducing government´s size until the cows come home, I offer three places to start: 1) our military, 2) our prisons, and 3) our war on drugs.
Our military budget is equal to the rest of the world combined. Why do we need 737 military bases in foreign lands? Can we get along with fewer aircraft carriers? Leave Iraq and Afghanistan. Use intelligence, police work and anti-poverty programs to deal with terrorists.
The United States has 23% of the world’s prisoners. There are cheaper ways to punish most criminals. Start using them.
Our war on drugs is a failure. Illegal drugs’ quality rises while the prices drop. I cannot distinguish the war on drugs from the 1919-1933 Prohibition. It is cheaper to regulate currently illegal drugs as we currently regulate alcohol. This measure would reduce our prison population that has a high percentage of non-violent drug offenders.
As a revenue measure and an environmental improvement that reduce the number of mansions, yachts and country club members, impose a 100% tax on personal income over $10 million per year. Also, reform the tax code to prohibit the current corporate practice of moving their headquarters to a post office box in the Bahamas for tax avoidance.
Famous filmmaker, Michael Moore, offers 10 specific recommendations for the financial markets’ bailout:
1) Appoint a special prosecutor to criminally indict anyone on All Street who knowingly contributed to this collapse.
2) The rich must pay for their own bailout.
3) Bailout the people losing their homes, not the people who will build an eighth home.
4) If your bank company gets any of your money in a bailout, then we own you.
5) All regulations must be restored. The Reagan Revolution is dead.
6) If it is too big to fail, it is too big to exist.
7) No executive should be paid more than 40 times their average employee and no executive should receive any kind of parachute other than the very generous salary he or she made while working for the company.
8) Strength the FDIC (Federal Deposit Insurance Corporation) and make it a model not only for protecting people´s savings, but also their pensions and their homes.
9) Everyone needs to take a deep breath, calm down and not let fear rule the day.
10) Create a national bank, a ‘’people’s bank.’’ The bank would offer low-interest loans for people to own a home, start a small business, go to school ore begin an environmental endeavor.
Hopefully, the next president will enact Mike’s rescue plan. When this happens, I will feel no sorrow for the nation´s rich and those who will go to jail. Possible, the Republicans will call for prison reform. I am old enough to remember an old Julie London song:
You can cry me a river,
I cried a river over you.
Ed O’Rourke now lives in Medellin, Colombia. While living in Houston, he was active in environmental, peace causes and Precinct 224 Democrats.