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Early on in one of my harder math courses at the university, the professor stood up in front of the room, writing on a chalkboard. He proved that all possible problems of the class we were studying had a solution. He was quick to point out though, that no one was guaranteeing that you could find it. I spent the rest of that semester increasingly frantic as I couldn’t find those solutions.
All too often, when presented with a problem, conservatives will wave our hands and say “the market will provide a solution.” The certainty of our inevitable triumph absolves us of any need to bother with anything in the meantime. And make no mistake; I believe in the inevitable triumph of market forces as much as anyone. But we should spend a little time thinking about what all that implies.
This AEI Events Podcast features Fredrik Erixon and Björn Weigel, coauthors of “The Innovation Illusion: How So Little is Created by So Many Working So Hard,” hosted by AEI’s James Pethokoukis. Erikson argues that the declining pace of innovation in Western economies during the past few decades can be attributed to the increasing dominance of financial institutions over capitalists, corporate bureaucratization, globalization that reduces competition in certain markets, and restrictive, opaque regulations.
Erikson and Weigel are joined by AEI’s James Pethokoukis and George Mason University’s Tyler Cowen in a panel discussion. Dr. Cowen argues that even though economic growth has slowed, there is more invisible innovation in society. The discussion is moderated by AEI’s Stan Veuger.
Do modern campuses actually value ideas and intellectual discourse? Should there be limits on capitalism? Is modern architecture bad? Sir Roger Scruton and Christina Hoff Sommers join ‘Viewpoint’ on the AEI Podcast Channel to discuss each of these topics and more.
This conversation originally aired on the AEI YouTube Channel on March 22, 2017.
Donald Trump yesterday warned that companies like Carrier “are not going to leave the United States anymore without consequences. Not going to happen. It’s not going to happen, I’ll tell you right now.”
When I heard the President-elect make that threat, I responded thusly on CNBC, calling the comments “chilling.” Money manager Doug Kass was even stronger: “I believe that speech was one of the most dangerous and reckless speeches I have ever heard from a President or President-elect.”
And nothing I’ve heard since then sounds much better. From the New York Times:
Europe is a rich, well-educated, orderly place. And many Americans not only like to visit and do business there, but also see it as an aspirational economic model.
Well, not Greece and Italy so much, but certainly the Nordic nations. Many progressive Democrats really have a thing for Scandinavia and its egalitarian social democracies. “I think we should look to countries like Denmark, like Sweden, and Norway, and learn from what they have accomplished for their working people,” Bernie Sanders said during one of his debates with Hillary Clinton. And there are certainly Europeans who agree. For instance, I recently had a long chat with by Anu Partanen, a New York-based Finnish and American journalist, about her book “The Nordic Theory of Everything.”
In another Q&A, however, my AEI colleague Stan Veuger was skeptical that going Nordic was as easy or efficacious as progressives and Partanen believe. Along the same lines, a 2012 analysis by Daron Acemoglu, James Robinson, and Thierry Verdier argues that even though many countries “may want to be like the Nordics with a more extensive safety net and a more egalitarian structures,” it’s not really possible to have “cuddly” capitalism with America’s more high-pressure, competitive, or “cutthroat” capitalism. From their research:
Capitalism is progressive, socialism is not… The champions of socialism call themselves progressives, but they recommend a system which is characterized by rigid observance of routine and by a resistance to every kind of improvement. They call themselves liberals, but they are intent upon abolishing liberty. They call themselves democrats, but they yearn for dictatorship. […]
Among the historical narratives regarding the late 19th and early 20th centuries is that of exploited and low-paid labor, incessant strife between labor and management, child labor, and the harsh and brutal world of The Jungle. We look back on this era of one of widening gaps between rich and poor, of growth but also […]
Ed. Note: Jackson Fall is a freelance web designer for Ricochet, here to share a different perspective from across the political and generational divide.
(Trigger warning: Millennials, Animated GIFs.) I think I can speak for most of us when I say that with California (and a few other states) voting yesterday, we’re beginning to see the light at the end of a very long, dark tunnel. Over the last week, Donald has been out making friends in the judiciary community while Bill has actually taken over running Hillary’s Snapchat account to further her rock-solid image as a cool, relatable candidate while she was giving a speech on inequality. Bernie is still promising a contested convention, but seeing how the vote went we could be at the end of an era. I hear your sighs of relief.
Many years ago, I wrote my senior thesis on the origins of capitalism. I argued that capitalism can be defined as the ability to leverage one’s own assets, coupled with a legal system of equality under the law. This sounds easier than it is. In most of the world, throughout most of history, property has ultimately belonged to a lord, a king, or — most critically — to the future generations. If one is farming a piece of familial land, then the property is not actually owned by the farmer. He is, instead, a steward, connecting the past to the future. He cannot mortgage the property, because he cannot lose it. Capitalism requires the ability to lose one’s investment, and a society where the real estate is held as familial land cannot free up the capital required to achieve the enormous growth in wealth that capitalism enables.
Equality under the law is quite difficult as well. Almost every legal system has different rules for different people, and some kind of immunity for rulers. This kind of law, however, ultimately comes at a steep price for the populace. Only a fool invests in a new venture that the king can seize on a whim, so the most successful nations are the ones that put the law above any man. In order for capitalism to work, the system has to allow, at least theoretically, a poor man to sue the king for a property violation – and win.
Donald Trump, thus far, it seems will be the Republican Nominee for President in the 2016 race. One of his most touted characteristics was his knowledge of the economy and “capitalism” along with his prescriptions of how the American economic structure should be ordered and the like. The economy itself is generally a high ranked issue […]
“Are you a Redneck or a Hillbilly?” the little boy asked our friend, Beckie. “Our family is Hillbillies, but we buy guns from the Rednecks.” It does seem like a rather limited range of choices, but choices have been limited for a while in McDowell County, West Virginia for a long time now. Widely known […]
Although the results are startling, Harvard’s questions accord with other recent research on how Americans think about capitalism and socialism. In 2011, for example, the Pew Research Center found that people ages 18 to 29 were frustrated with the free-market system. In that survey, 46 percent had positive views of capitalism, and 47 percent had negative views — a broader question than what Harvard’s pollsters asked, which was whether the respondent supported the system. With regard to socialism, by contrast, 49 percent of the young people in Pew’s poll had positive views, and just 43 percent had negative views.
An astonishing 51 percent of millennials do not support capitalism according to a recent survey by Harvard University. They look around at the inexpensive, abundant goods provided by the free market, and the billions of people that have been lifted out of poverty by that market, and say, “nah.” Of course part of that is that […]
Back in 1995, now-Democratic presidential candidate Bernie Sanders said, “I personally happen not to be a great believer in the free enterprise system for many reasons.”
And having watched Sanders during this primary season, it doesn’t appear to me that the self-described democratic socialist has much changed his opinion of capitalism. Which is both amazing and appalling. The single greatest story of human achievement of the past 2,000 years is the dramatic rise in living standards of the past 200 years. It’s an astounding ascent — see above chart — driven by innovative, entrepreneurial capitalism. Free enterprise. Economic freedom.
Yes, workers in advanced economies today are many multiples wealthier — almost incalculably so — than their counterparts in the early 19th century. But here is another way of looking at, thanks to a new study by consultancy Deloitte showing how technology-driving innovation has radically altered lives in Britain for the much better:
Donald Trump says Bernie Sanders is a probable “communist” and “total whack job.” Sanders calls Trump a “pathological liar,” his policy ideas “pathetic.” Trump would cut taxes by $12 trillion over the next decade, and Sanders would raise them by $14 trillion. Also big differences on issues such as climate change and immigration.
But over at Vox, John Judis sees some important similarities, suggesting there’s a big chunk of American voters that disagrees with the “market liberalism” or the “neo-liberal consensus” — free trade, immigration, deregulation, easy taxes — that dominates both parties. (To put it another way, if you got together a bunch of current and former Obama economic advisers and sat them down with some of their GOP counterparts from the McCain and Romney campaigns, there would probably be lots of agreement. One group might want a 50% top tax rate, the other 30%, neither 90%.) Both parties are “pro-business.”
But Sanders and Trump are saying something different. Judis: “Both men are foes of what they describe as their party’s establishment. And both campaigns are also fundamentally about rejecting the way economic policy has been talked about in American presidential politics for decades.” Sanders wants to break up the banks, install single-payer healthcare, and sharply raise taxes. Trump sees mass immigration and free trade as negatives. And he rejects entitlement reform, a pillar of modern GOP economic policy. Taken together, Sanders and Trump are “harbingers” of a “revolt” against the economic order driving both parties.
When the Cambrian measures were forming, They promised perpetual peace. They swore, if we gave them our weapons, that the wars of the tribes would cease. But when we disarmed They sold us & delivered us bound to our foe & the Gods of the Copybook Headings said: “Stick to the Devil you know.” That’s […]
China may be having a hiccup in the economic rise it has been experiencing over the past decades. But should China wind up as comparable in economic status to the United States, it might be a good thing all around.
China has had it rough economically for a long time. It was defeated in the two Opium Wars with Great Britain and split between the Spheres of Influence of the Great Powers. The disastrous Taiping Rebellion further disgraced the Qing Empire in the Victorian Era. It was immediately followed by China’s humiliating loss of Korea to the Japanese Empire in the First Sino-Japanese War. This led to the collapse of the Qing Empire, the creation of a republic, and the outbreak of civil war between forces loyal to the Kuomintang-led government and forces loyal to the Communist Party of China. Meanwhile, decades-long Japanese imperial policies matured, prompting Japan to instigate the Second Sino-Japanese War in 1937 and hastening the onset of World War II. The Communists won the Civil War and Mao Zedong came to power, a series of catastrophes in itself.
This century-long period of political depravity clearly doomed the Chinese economy. But following Mao’s demise, China began to slowly to thaw. It began experimenting with free markets in such arenas as farming and businesses, leading to the expansion of its private sector economy. The Party didn’t interfere so long as it didn’t threaten the state sector. Ronald Coase and Ning Wang tell the story of China’s economic transformation in an essay based on their book, How China Became Capitalist.
Good morning and happy new year! I’d like to share some thoughts I’ve had regarding a rather esoteric issue. It’s how accounting may always “stack the deck” towards capitalism. I’ve had these thoughts for quite a while now, and a recent article advocating for the abolition of private property provided the impetus for me to […]