Entrepreneurship is claimed to be the most important positive ramification of capitalism. Well, business entrepreneurship is indeed a very important ramification of capitalism, but entrepreneurship is not just about business entrepreneurship; in fact, capitalism subdues the other forms of entrepreneurship for the benefit of business entrepreneurship. Moreover, entrepreneurship is a painful and risky calling, and not everybody is interested in taking it up; furthermore, the growth of big business entrepreneurship increases the entry cost for new entrants, so eventually the majority end up working for the big business entrepreneurs or, should we say, are forced to work for the big business entrepreneurs, for either they have no other option or they get frustrated taking huge risks for small benefits. Creativity takes a backseat, and “work for money” becomes the most important consideration for employment – no behemoth can offer creative fulfillment, Google or Facebook; the most they can offer is the satisfaction of basic needs like the security needs. Ironically, the most important promise of capitalism is what is reneged the most under capitalism.
However, the misery doesn’t end here. The satisfaction of basic needs, even in developed countries like the USA and the UK, is guaranteed only to a few. The markets become the reference point for all social and professional engagements and are superficially projected as the perfect models for engagements, but, in fact, they can never be perfect for the people never make ideal rational choices, whether individually or in groups; so there is always a cause for imperfection. Rather the escalation of commitment to the market based economy produces cronyism in search of rationalism within a closed group, which leads to elitism protected to the hilt through biased governance – something which is happening in India now. The natural ramification is the exploitation of the poor under the promise of satisfaction of their most basic physiological need of hunger, which they could have anyways satisfied in any damn system.
Eventually, the solace is searched in the form of numbers like growth (GDP), employment, etc, which the majority doesn’t understand, nor does it make any sense even otherwise. Activity is a physiological need and employment is just a means; a body will always find ways to stay active in order to survive; rather, in the tertiary sector, the body tends to become inactive in desk jobs, which accompanied by stress makes life miserable. The truth is that, under capitalism, the humans are considered no more important than the resources like capital and land, and “unemployment” is considered as a source of economic inefficiency, which may or may not be the case: An artist, if given the guarantee of satisfaction of his basic needs, can do wonders to the society, which contribution doesn’t get accounted for in a capitalist system unless he churns millions in five-star concerts or produces filthy item numbers for the Bollywood. Growth is the most misunderstood number. There can just be no growth without distribution, and it is never the other way round. The man, through the exploitation of natural resources, has created material benefits for itself, more often than not, at the cost of destruction of natural resources, which cost never gets accounted for; the US has been at the forefront of this exploitation. This exploitation leads to accumulation of both short-term and long-term capital in multifarious forms (including food, durables, housing, technology, etc), a part of which is consumed and the other is applied further to make more capital and so on and so forth. The real growth as far as the individuals are concerned comes from the re-distribution of capital, which, if left alone to the markets, is reflected in the dollar/rupee votes that is the earnings (disposable incomes) of the individuals. Ironically, over the history of capitalism, the capital has flown from the poor countries to the already rich countries — the Colonization was the one most important medium of such a flow, and, now, it seems, the US has found an even better medium through globalization. And that’s the truth of capitalism: It allows the producers to supply as much as they can and, under imperfect competition (which is the only truth), at whatever prices they wish and forces the consumers to purchase from the producers; and that’s because it assumes that the only way an economy can be efficient is by being on its Production Possibility Frontier (PPF).
Even if we were to argue that the exploitation of resources is the real reason for universal growth, then also it is debatable whether the growth, as it takes place in the capitalist systems, does any good to the people, and, if yes, at what cost! Is there a better way to achieve the same, or a slightly lesser, growth with far greater satisfaction? The man is served the most if they are left free and independent to pursue their callings in the way found most suitable by them and at the place found most suitable by them, and this can happen only if there is equality of opportunity. Capitalism can never guarantee equality: It feigns to award merit (which per se is perfectly in alignment with the equality of opportunity), but, in fact, it awards obsequiousness of the powerful, and this obsequiousness becomes the only opening for opportunities. The free access to natural resources like the land, rivers, minerals, the flora and the fauna becomes subject to the “law of the land”, which, in a capitalist economy, favors the large-scale commercial exploitation by big entrepreneurs; and a price tag is, thus, put up on all resources. The day air becomes a prized commodity, humanity will cease to exist, and that day also seems not too far.
I am surprised how capitalism is thriving in so many countries; this only shows the stupidity of men, which Einstein recognized rightly in his quote: “Two things are infinite, the universe and human stupidity, and I am not yet completely sure about the universe.”
© 2012 Ankur Mutreja