Well even people in the bastion of capitalism (New York City) are beginning to express their doubts. Here is NYU professor Nouriel 'Dr. Doom' Roubini on Marxism:
Nouriel 'Dr. Doom' Roubini: ?Karl Marx Was Right? - International Business Times
It's funny.. to recall that Marx wrote all his monographs using the facility of London Library, living away in a country where Capitalism was vogue.. and he did not earn a living there, always expecting hand-out coming from his friends in Germany!
Well.. Private Ownership, Means of Production and Distribution in the hands largely of private people, Market clearance following the dictates of supply and demand for a price etc etc WILL always be there..
As Amala pointed out, technology has changed so much that the equation now is NOT between the capitalists and the languishing labor.. the labor is now very sophisticated into KNOWLEDGE workers or Professional cadres of Engineers and Software developers etc.. etc..
However, small glitches.. in the form of recession/stagnation will come and go... Dr. Doom knows it very well...
One thing that puzzles me is this Deep Recession Since 1930s which started in 2008.. this seems to be of a different type -
There was fiscal stimulus of about $800 billion spent over two year period.. and there was massive monetary stimulus to the tune of about $1.8 trillions (by Fed's QE 1 and QE 2) - all this did not "prime up" the Employment Engine!
I believe more on Aggregate Demand as a stronger force in the economy than the Supply Side Vooddoo Economics of Reagan and Bush.
This means somehow the Govt policy must gear up Aggregate Demand by Govt Projects:
I favor massive Public Works:
1. Build 21st Century Electric Grid all across America/North America all underground with meters which can feed the grid from photocells on many homes and Govt buildings AND provide power from the grid (all seamlessly, trouble free).
2. Rebuild all the bridges and super highways to the highest standard.
3. Invest massively on alternate energy models: Solar, Wind, Thermal and Battery Power etc etc.
How to finance this?
By a Development Bank where Fed puts down some money, and attracts money from private investors by issuing 100 year tax-free bonds!
And make a slogan "Deficit and Debt don't matter... ONLY JOBS..and Growth matter"... Say it louder everyday!
What say you?
hi all im new to this site... i just needed of an answer to a question which is long due in my heart. can anyone help !
Question: As you all know in hindus most of us will light a lamp (vilaku) with a gajalakshmi statue, where laksmi is decorated with elephants in front and also in back. but most of the people calling this as "kamakshi villaku" why the name is called so. is the villaku name is kamatchi vilaku or gaja lakshmi vilaku
I am not an economist and so my views may not be theoretically correct or even acceptable to many, still, these are my ideas.
Communism required an ideal leadership to implement its ideal philosophy but failed almost everywhere because it is not possible to have anything like "ideal leader/s". The communist super power today, viz., China is not communist in truth, it is an oligarchy.
Capitalism provides for each person, freedom to improve his economic conditions according to his/her capability. So, naturally any capitalist society will give rise to economic inequality because people are not all equally endowed and so some will prosper more than others. A successful capitalist country should therefore have some system to redistribute the wealth so that the inequalities do not get aggravated beyond tolerable levels. For this the Government may have to do a bit of "Robin hood" job; take money from the rich and redistribute to those who do not have. The actual methods may vary according to the circumstances.
The type of Capitalism which the right in US prescribes, viz., the govt. should shrink, taxes should be reduced (or at least not increased), etc., may not be the type of Capitalism that will work any more anywhere.
In India we have too much of the Government thanks to our socialistic notions and so a reasonable reduction of Govt., can be done. But we are a corrupt people who are prone to take disobeying laws as symbol of heroism and possibly patriotism too Therefore, unless we embark on a massive, nation-wide, people-education programme and also improve, side by side our political masters to be free from corruption and feel that they are in truth "servants of the people" who elected them, this level of Government may be necessary. So, the IT boom and the consequent capitalist growth can be made good use of if we also bring about the people improvement programmes and gradually reduce Government.
Hence, all Capitalism is not dead imo, only some varieties of it.
You have put forth some interesting views and facts.
1. I envy people earning in US if they don't have to pay taxes for earnings up to US$48k p.a. In SA, we start paying income tax from the level of US$15k p.a.
2. If higher income group is taxed at a higher rate, isn't it like punishing someone for his ability (to earn more)? In my opinion, it is not a good sign of Capitalism.
3. Yes, curbing black markets is very essential in Capitalistic environment. Handling corruption, however, is a political function (raaj neethi) than an economic function.
4. I tend to differ from Dr.Prahalada's view that the bottom of the pyramid support the top in economics. I think it is other way round. If the top does not exist, the bottom would not be visible at all. It is the top of the pyramid that is supporting the whole pyramid in economics.
Yes, I see that your views on Capitalism does have a touch of Socialism. Even I had socialistic views and I think I still have. But I like Capitalism (Free Market Economy) more.
i like this. this is like the great depression 'new deal' projects like the TVA.
but then, FDR had a desperate nation, a democratic house/senate and even though opposed tooth and nail by wall street, was able to pull it off.
i thought obama would have that type of stature, but has proved NOT.
so, in the light of the current political usa environment, the tea party movement, in light of already huge debt, army in iraq and huge expense of military bases abroad (in 1930 usa had no base abroad barring cuba) & above all the dominant policing job that the usa has taken upon itself around the world, ...
i see no chance of any further government expansion or borrowing in the future. if at all anything, chances are that california like, 'mandatory balancing budgets' may become reality at the federal level.
obama could have been visionary, but i think he tried to be a 'nice' guy. 80 years later, FDR is still hated intensely by right wingers for his 'socialism'
Dear Sangom Sir:
I agree Capitalism is not dead - it will weather thru all the challenges, I believe.
I want to ask some basic questions and get answers from readers:
1. How much should be the total taxation (direct taxes like income tax and indirect taxes like VAT) by ALL Gov'ts?
Today, Obama collects about 14.8% of total GDP (including payroll tax etc) at the Federal level, and States and local Gov'ts collect about 20% of the total GDP to run their show.. so the total is about 35% of the total GDP... this is much lower now than in say 2006 - the pre-recession period, when these entities collected as much as 45% of the total GDP.
I will say about 45% of the GDP should be the size of ALL Gov'ts. The rest 55% must be in private hands to spend the way they want it.
Please see my comments on the previous item above. I am sorry I don't have comparative Indian figures with me.2. Who should be taxed, and what should be taxed and how much income should not be taxed?
I say the Capital Gains must be taxed at the highest marginal rate (say 39%) and the highest income people should be taxed at the same highest rate.
Dividends can be taxed as ordinary income.. it need not get special preference.
In US today, an income of $48,000 in a family of four is not taxed at the Federal level... but States can collect tax via sales tax (like TX does, very punitively). But payroll taxes apply which goes towards Medicare and Social Security, which come back as Entitlements.
I would like to get equivalent figures for India... somebody can provide the numbers for comparative analysis.
One discouraging feature of Capitalism is, IMO, that bulk of the people are left behind as in India... Why?
By enforcing the laws and curbing the black markets, abolishing corruption in walks of life Capitalism CAN protect the poorly skilled people trapped at the lower income level from abject poverty as it is in India today (about 800 millions subsisting on Rs. 20 income a day).
Educating the masses for the labor market is the best way of creating ladders of opportunity to ALL people, and must be funded by taxing the very top! Yes this is the Robin Hood role that an Elected Govt plays.
However, one Dr. Prahalatha of MIT says, "The Bottom of the Pyramid Supports the Top of the Pyramid, in economics also"
Perhaps, he means that Consumers at the bottom are the people supporting the wealthy siting at the top!
ps. You all could get a smell that I was a former Socialist! Lol
Marx did predict that Capitalism would fail as Servall mentioned. He was after all an economist. However he failed to take into account that technology today would be so advanced as to allow capitalism to provide a higher standard of living in developed countries.
Its not dead yet and it may never die. But currently the future of capitalism sure does look bleak.
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