Big-Self Capitalism

The poem I wrote in the previous post captures the essential reality of all great civilizations, from Hindu (the “untouchables” suffer even now after three thousand years), Egyptian, Persian, Greek, Roman, Mogul, to the modern European/American. Each and every civilization was built using the blood and sweat of the lesser human beings. Modern nations and modern economic systems evolved from this broad human reality. The original cause behind the fatal attraction of the proletariat to communism was centuries of exploitation by feudalism and capitalism. Communism was simply a revolt by the masses. Like any revenge of the mobs, it was a release of anger, hate, and insanity by big parts of humanity. And, of course, revenge is often crueler than the exploitation that causes it. Science, communication, and weapons made it possible for the proletariat and the insane rulers in their “name” to kill twenty million in Soviet Russia, sixty million in China, and few more millions in other countries. Trying to achieve the impossible task of making all human achievements equal, communism led to the repression of all freedoms, economic, social, and spiritual.

In contrast, free-market capitalism worked well in spreading democratic values and general uplifting of the living standards of many people, though many were exploited and left behind. Two essential instruments of capitalism were innovation and exploitation. Historically, exploitation was not only its main instrument, but was often used as the bow that shot the arrow of innovation. Some men could think because others toiled in slave labor. The biggest exploiting groups gave birth to the greatest innovators. This continues even today, may be in more subtle forms, even though after FDR’s New Deal and advancements in technology, there was hope that innovation would replace exploitation as the main instrument of capitalism. Curiously, libertarians such as the famed economists Ludwig von Mises, Milton Friedman, and the pop philosopher Ayn Rand spent their whole lives preoccupied with the instrument of innovation, never acknowledging seriously the instrument of exploitation in the success of early capitalism.

The interaction of innovation and exploitation creates three forms of capitalism. Small-self capitalism, which increases efficiency mostly by exploitation (of workers, customers, and the environment). Modern capitalism which increases efficiency using both innovation and exploitation. And, big-self capitalism which increases efficiency mostly by innovation. The influence of money on government is highest in the stage of small-self capitalism, and lowest or non-existent in the stage of big-self capitalism. Only a complete elimination of the influence of money on law-makers can guarantee that laws against exploitation can be effectively passed without being blocked by the exploiters. In the 20th century, the western countries moved from small-self capitalism to modern capitalism. The big question confronting most industrialized nations today is whether we can move from modern capitalism to big-self capitalism in the 21st century?