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Role of American capitalism on trial
Washington Post ^ | May 20, 2012 | Robert J. Samuelson

Posted on 05/20/2012 7:41:04 PM PDT by Innovative

This election is being fought along the traditional skirmish line of capital versus labor. President Obama projects himself as the protector of workers and families who are preyed upon by greedy and wealthy capitalists. Mitt Romney counters that the president doesn't understand business and that his antagonism discourages private investment and job creation.

A couple of observations on the table.

First, capital income doesn't flow just to "fat cats." It also goes to small businesses, retirement accounts, college endowments, ordinary shareholders, landlords and people who collect interest.

Second, labor's shrinking share isn't necessarily a disaster for workers. What else is happening in the economy also matters. ... If economic growth is strong, compensation can increase even if labor's share drops.

The bargain that capitalism makes with society is that profits won't simply be consumed but will also be reinvested. Jobs and living standards will increase.

But to hear Obama - his hectoring of oil companies, bankers, insurance companies and the rich - there's something more. American capitalism has become more predatory and exploitative. Naturally, Romney and his former employer, the private-equity firm Bain Capital, are cast as symbols of this pillaging capitalism. Government must provide more direction.

Just the opposite, say business groups and Romney. Government impedes investment. Hostility and policy uncertainties - about taxes, spending, deficits, regulations - deter decisions. A report from the Business Roundtable, a group of corporate CEOs, argued that costly and time-consuming permit requirements by different agencies delay or doom many projects. The process needs overhauling, the report said.

American capitalism is on trial. When Americans vote in November, they will unavoidably choose between these competing visions of capitalism. One would try to improve capitalism by controlling it more. The other would aim for faster economic growth by removing government obstacles. It's a fateful debate.

(Excerpt) Read more at ...

TOPICS: Business/Economy; Editorial; News/Current Events; Politics/Elections
KEYWORDS: 2012election; abortion; anwr; capitalism; classwarfare; deathpanels; election2012; elections; energy; gaymarriage; homosexualagenda; kenyanbornmuzzie; keystonexl; mittromney; obama; obamacare; opec; romney; swrdswllwngsdshw; zerocare
A very clear, intelligent analysis. Surprised the WP published it. It's worth reading and bookmarking the article for future reference.
1 posted on 05/20/2012 7:41:14 PM PDT by Innovative
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To: AdmSmith; AnonymousConservative; Berosus; bigheadfred; Bockscar; ColdOne; Convert from ECUSA; ...

Thanks Innovative. G’night all.

2 posted on 05/20/2012 7:49:09 PM PDT by SunkenCiv (FReepathon 2Q time --
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To: Innovative; Grampa Dave; tubebender; calcowgirl; ElkGroveDan; ScottinSacto; calif_reaganite; ...
Holy moley! I think I'm going to faint!!!

Don'tcha think this is a head fake? Well, maybe not if the major Milwaukee newspaper's editorial board just endorsed Governor Scott Walker in the face of the unions trying to recall him from office. Both items are shocking!!! (but I'm still guarded and skeptical)

3 posted on 05/20/2012 7:51:05 PM PDT by SierraWasp ("GovernMental austerity first, THEN conservative prosperity!!! Austerity breeds properity!!!)
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To: Innovative

ARRRGHHH!!! Deep breath ..... Okay, it’s Samuelson, and he’s trying to say some good things about “capitalism”, because he knows better than the complete fools (like Krugman), and it actually got printed in the Compost, so I guess we should be happy. Still, it sounds like an atheist finding some good things to say about religion, though he would prefer things be otherwise.

4 posted on 05/20/2012 7:58:01 PM PDT by cdcdawg
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To: Innovative

Thanks for this thread.

5 posted on 05/20/2012 8:25:56 PM PDT by Graewoulf ((Dictator Baby-Doc Barack's obama"care" violates Sherman Anti-Trust Law, AND U.S. Constitution.))
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To: Innovative

Excellent article. Thanks for posting.

Those of us dribbling dial-up instead of streaming broadband appreciate your linking to the print version.

6 posted on 05/20/2012 8:32:35 PM PDT by upchuck (Need is not an acceptable lifestyle choice; dependent is not a career. ~ Dr. Tim Nerenz)
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To: Innovative
Thanks. Capitalism has been "on trial" before. These words from Churchill:

>"When I see the present Socialist Government denouncing capitalism in all its forms, mocking with derision and contempt the tremendous free enterprise capitalist system on which the mighty production of the United States is founded, I cannot help feeling that as a nation we are not acting honorably or even honestly." - Winston Churchill, Woodford Green, July 10, 1948.

"We shall not allow the advance of society and economic well-being of the nation to be regulated and curtailed by the pace of the weakest bretheren among us. Proper incentives must be offered and full freedom given to the strong to use their strength in the commonweal. Initiative, enterprise, thrift, domestic foresight, contrivance, good housekeeping and natural ability must reap their just reward. On any other plan the population of this island will sink by disastrous and agonizing stages to a far lower standard of life and two-thirds of its present numbers." - Winston Churchill, speech, Blenheim Palace, August 4, 1947.

"The difference between what is seen and what is not seen was often noticed by the old economists. What is not seen is the infinite variety of individual transactions and decisions which, in a civilized society, within the framework of just and well-known laws, insure the advantage not only of the individual concerned, but of the community, and provide that general body of well-being constituting the wealth of nations. All this is blotted out by an over-riding State control, however imposing some of its manifestations may be. It is the vital creative impulse that that I deeply fear the doctrines and policy of the socialist Government have destroyed, or are rapidly destroying, in our national life. Nothing that they can plan and order and rush around enforcing will take its place. They have broken the mainspring, and until we get a new one the watch will not go." - Winston Churchill, speech, House of Commons, October 28, 1947.

"It is in the interest of the wage-earner to have many other alternatives open to him than service under one all-powerful employer called the State. He will be in a better position to bargain collectively and production will be more abundant; there will be more for all and more freedom for all when the wage earner is able, in the large majority of cases, to choose and change his work, and deal with a private employer who, like himself, is subject to the ordinary pressures of life and, like himself, is dependent upon his personal thrift, ingenuity and good-housekeeping." - Winston Churchill, speech, Blackpool, October 5, 1946

"Liberalism (classical liberalism) has its own history and its own tradition. Socialism has its own formulas and aims. Socialism seeks to pull down wealth; Liberalism seeks to raise up poverty. Socialism would destroy private interests; Liberalism would preserve private interests in the only way in which they can be safely and justly preserved, namely, by reconciling them with public right. Socialism would kill enterprise; Liberalism would rescue enterprise from the trammels of privilege and preference. Socialism assails the pre-eminence of the individual; Liberalism seeks, and shall seek more in the future, to build up a minimum standard for the mass. Socialism exalts the rule; Liberalism exalts the man. Socialism attacks capital; Liberalism attacks monopoly." - Winston Churchill, Kinnaird Hall, Dundee, May 14, 1908.

"The British nation now has to make one of the most momentous choices in its history. That choice is between two ways of life: between individual liberty and State domination: between concentration of ownership in the hands of the State and the extension of a property-owning democracy; between a policy of increasing restraint and a policy of liberating energy and ingenuity: between a policy of levelling down and a policy of finding opportunities for all to rise upwards from a basic standard." - Winston Churchill, speech in Woodford, England, January 28, 1950.

"It is curious that, while in the days of my youth I was much reproached with inconsistency and being changeable, I am now scolded for adhering to the same views I had early in life and even of repeating passages from speeches which I made long before most of you were born. Of course the world moves on and we dwell in a constantly changing climate of opinion. But the broad principles and truths of wise and sane political actions do not necessarily alter with the changing moods of a democratic electorate. Not everything changes. Two and two still make four, and I could give you many other instances which go to prove that all wisdom is not new wisdom." - Winston Churchill, speech, Bele vue, Manchester, December 6, 1947.

"It is not Parliament that should rule; it is the people who should rule through Parliament." - Winston Churchill, speech, House of Commons. November 11, 1947.

"We have to combat the wolf of socialism, and we shall be able to do it far more effectively as a pack of hounds than as a flock of sheep." - Winston Churchill, speech, 1937.

:Athough it is now put forward in the main by people who have a good grounding in the Liberalism and Radicalism of the early part of this century, there can be no doubt that Socialism is inseparably interwoven with Totalitarianism and the abject worship of the State. It is not alone that property, in all its forms, is struck at, but that liberty, in all its forms, is challenged by the fundamental conceptions of Socialism." - Winston Churchill, B.B.C radio address, June 4, 1945.

"The inherent vice of capitalism is the unequal sharing of blessings; the inherent vice of socialism is the equal sharing of miseries." - Winston Churchill, House of Commons, October 22, 1945.

"Socialism is the philosophy of failure, the creed of ignorance, and the gospel of envy." - Winston Churchill, Perth, May 28, 1948.

"I do not wonder that British youth is in revolt against the morbid doctrine that nothing matters but the equal sharing of miseries: that what used to be called the submerged tenth can only be rescued by bringing the other nine-tenths down to their level; against the folly that it is better that everyone should have half rations rather than that any by their exertions, or ability, should earn a second helping." - Winston Churchill, London, June 22, 1948.

"Socialism is based on the idea of an all-powerful State which owns everything, which plans everything, which distributes everything, and thus through its politicians and officials decides the daily life of the individual citizen." - Winston Churchill, London, January 21, 1950.

"The British and Americans do not war with races or governments as such. Tyranny, external or internal, is our foe whatever trappings and disguises it wears, whatever language it speaks, or perverts." - Winston Churchill, Speech, Dorchester Hotel, London, July 4, 1953.

"You may try to destroy wealth, and find that all you have done is to increase poverty." - Winston Churchill, speech, House of Commons. March 12, 1947.

"Nor should it be supposed as you would imagine, to read some of the Left-wing newspaper, that all Americans are multi-millionaires of Wall Street. If they were all multi-millionaires that would be no reason for condemning a system which has produced such material results.: - Winston Churchill, speech, Royal Albert Hall, London. April 21, 1948.

"Rich men, although valuable to the revenue, are not vital to a healthy state of society, but a society in which rich men are got rid of, from motives of jealousy, is not a healthy state." - Winston Churchill, speech, House of Commons, April 24, 1950.

7 posted on 05/20/2012 8:36:58 PM PDT by loveliberty2
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To: Innovative

Both sides are defending giant corporations that bribe them.

We need Main Street back - that’s free enterprise.

8 posted on 05/20/2012 8:37:17 PM PDT by donna (The fruits of Feminism: Angry fathers, bitter mothers, fat kids and political correctness.)
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To: loveliberty2

Thank you for taking the time to post all those excellent quotes. I am bookmarking your post. :)

9 posted on 05/20/2012 9:18:40 PM PDT by Innovative (None are so blind that will not see.)
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To: cdcdawg
This was a decent article considering it was in the Washington Post. However, I must disagree with the following: The bargain that capitalism makes with society is that profits won’t simply be consumed but will also be reinvested. Jobs and living standards will increase. One reason for the recovery’s weakness is that there’s been a partial disconnect between swelling profits and higher investment. Companies are hoarding earnings. At year-end 2011, non-financial corporations had $2.2 trillion in cash and short-term securities, up 60 percent from 2008.

Capitalism does not consume the profits. It either reinvests them in the company or distributes them to the share holders for whom they work. Reinvestment or distribution of profits both benefit the economy and create jobs.

Government taxation rules destroy millions of jobs in this nation. These onerous taxation rules is what cause American Companies to move operations outside of the country. In addition the taxation rules on bringing these profits back to the United States make these companies expand their operations overseas instead of here in the United States

There is one area that capitalism consumes capitol. That area is "Crony Capitalism." A basically corrupt but politically well connected company or investment bank will make incredibly risky bets. If the bets pay off the top guys in the company reap bonuses in the millions and in some cases hundreds of millions of dollars. If the bets do not pay off, the taxpayer bails the company out, as in Goldman Sachs etc.

If there was but one company in the world that I wish would disappear before sunrise it would be Goldman Sachs.

As a matter of note, the Democrat Party receives far more money from Wall Street than the Republicans, even thought they continually demonize Wall Street. Wall Street knows the Democrat Party must do this for votes but they also know that the Democrat Party is not their enemy but their partner in Crony Capitalism.

10 posted on 05/20/2012 9:26:54 PM PDT by cpdiii (Deckhand, Roughneck, Mud Man, Geologist, Pilot, Pharmacist. THE CONSTITUTION IS WORTH DYING FOR!)
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To: loveliberty2

Bump for later copy and post to my about page on Free Republic, with your permission.

I always admired Churchill and his speeches. It was nice to have many of his best quotes in one page.

11 posted on 05/20/2012 9:45:13 PM PDT by cpdiii (Deckhand, Roughneck, Mud Man, Geologist, Pilot, Pharmacist. THE CONSTITUTION IS WORTH DYING FOR!)
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To: donna

Corporations have become more callous towards American workers and less ethical in a Western sense with globalism. “Citizens of the world” have no loyalties to anything but themselves.

I am not sure today’s liberal CEO’s are concerned with share holder’s income as they are with advancing their on radical social agenda. See JC Pennys shifting to a gay advertising scheme for the latest example. See the bankster’s low and no income house loan scam cooked up with Rubin and Clinton for a horrendous example.

These guys are only interested in immediate gratification which is a personlity and value sytem they they share with our prisoners. They need to get their paws out of the US Treasury and politicans need to stop looks at “creating jobs” in China the same as they look at creating jobs in America.

12 posted on 05/20/2012 10:26:05 PM PDT by SaraJohnson
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To: loveliberty2

It is remarkable that Churchill knew the threat to a nation that Socialism offers to its survival. Another is Keynesian economics. This flawed theory has been proven a failed system. The Democrats and their leader, Obama have put Socialism in high gear with the flawed Keynesian economics as its economic engine. This is a recipe for major failure. The Democrats and Obama should know this. History has told them in big bold letters that they have orchestrated failure. Now they have a big responsibility for answering why they did it anyway.

13 posted on 05/21/2012 12:16:22 AM PDT by jonrick46 (Countdown to 11-06-2012)
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To: Innovative; jonrick46; cpdiii
Writers have been exposing socialism's tyrannical principles and goals for a century now. Those who have understood it best declared that its policies lead to tyranny and oppression.

Yet, we have arrogant Americans, born in liberty, and viewing themselves as "intellectuals" and "progressives," who have embraced socialist ideas over the ideas of liberty and are determined to impose its deadly limitations on a once-free people. Note the writer's warning in the following excerpt from a much larger work that the "scheme of socialism is wholly incomplete unless it includes the power of restraining the increase of population."

From the Liberty Fund Library is "A Plea for Liberty: An Argument Against Socialism and Socialistic Legislation," edited by Thomas Mackay (1849 - 1912), originally published in 1891, Chapter 1, excerpted final paragraphs from Edward Stanley Robertson's essay:

"I have suggested that the scheme of Socialism is wholly incomplete unless it includes a power of restraining the increase of population, which power is so unwelcome to Englishmen that the very mention of it seems to require an apology. I have showed that in France, where restraints on multiplication have been adopted into the popular code of morals, there is discontent on the one hand at the slow rate of increase, while on the other, there is still a 'proletariat,' and Socialism is still a power in politics.
"I have put the question, how Socialism would treat the residuum of the working class and of all classes—the class, not specially vicious, nor even necessarily idle, but below the average in power of will and in steadiness of purpose. I have intimated that such persons, if they belong to the upper or middle classes, are kept straight by the fear of falling out of class, and in the working class by positive fear of want. But since Socialism purposes to eliminate the fear of want, and since under Socialism the hierarchy of classes will either not exist at all or be wholly transformed, there remains for such persons no motive at all except physical coercion. Are we to imprison or flog all the 'ne'er-do-wells'?
"I began this paper by pointing out that there are inequalities and anomalies in the material world, some of which, like the obliquity of the ecliptic and the consequent inequality of the day's length, cannot be redressed at all. Others, like the caprices of sunshine and rainfall in different climates, can be mitigated, but must on the whole be endured. I am very far from asserting that the inequalities and anomalies of human society are strictly parallel with those of material nature. I fully admit that we are under an obligation to control nature so far as we can. But I think I have shown that the Socialist scheme cannot be relied upon to control nature, because it refuses to obey her. Socialism attempts to vanquish nature by a front attack. Individualism, on the contrary, is the recognition, in social politics, that nature has a beneficent as well as a malignant side. The struggle for life provides for the various wants of the human race, in somewhat the same way as the climatic struggle of the elements provides for vegetable and animal life—imperfectly, that is, and in a manner strongly marked by inequalities and anomalies. By taking advantage of prevalent tendencies, it is possible to mitigate these anomalies and inequalities, but all experience shows that it is impossible to do away with them. All history, moreover, is the record of the triumph of Individualism over something which was virtually Socialism or Collectivism, though not called by that name. In early days, and even at this day under archaic civilisations, the note of social life is the absence of freedom. But under every progressive civilisation, freedom has made decisive strides—broadened down, as the poet says, from precedent to precedent. And it has been rightly and naturally so.
"Freedom is the most valuable of all human possessions, next after life itself. It is more valuable, in a manner, than even health. No human agency can secure health; but good laws, justly administered, can and do secure freedom. Freedom, indeed, is almost the only thing that law can secure. Law cannot secure equality, nor can it secure prosperity. In the direction of equality, all that law can do is to secure fair play, which is equality of rights but is not equality of conditions. In the direction of prosperity, all that law can do is to keep the road open. That is the Quintessence of Individualism, and it may fairly challenge comparison with that Quintessence of Socialism we have been discussing. Socialism, disguise it how we may, is the negation of Freedom. That it is so, and that it is also a scheme not capable of producing even material comfort in exchange for the abnegations of Freedom, I think the foregoing considerations amply prove."

14 posted on 05/21/2012 8:49:44 AM PDT by loveliberty2
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To: Innovative

It shouldn’t be called capitalism because almost no major capital is required to start a business, and what little capital is needed can be borrowed. It should be called free enterprise, or the free market. Free is a word even the Democrats can love. Many of the largest corporations today started in a dorm room or garage with minimal capital. Most of the traditionally high capital businesses are now in China.

15 posted on 05/21/2012 9:09:32 AM PDT by Reeses
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