Friday, April 20, 2012

The myth of 'free market' efficiency (Paul D'Amato at Socialist Worker)


It's true that capitalist competition provides incentives, but not for the capitalists to produce things human beings need. It's to make greater profits. 

"WITHOUT CAPITALIST competition, creativity and invention would stagnate. There wouldn't be an incentive for people to work."

This is one of the oldest arguments against socialism. The implication is that capitalist market competition encourages creativity, efficiency and hard work.

Karl Marx and Frederick Engels dealt with the question as far back as The Communist Manifesto in 1848. "It has been objected," they wrote, "that upon the abolition of private property all work will cease and universal laziness will overtake us."

Marx and Engels' answer is as simple as it is devastating. "According to this," they wrote, "bourgeois society ought long ago to have gone to the dogs through sheer idleness; for those of its members who work, acquire nothing, and those who acquire anything, do not work."

While it's true that capitalist competition acts as a spur to increase production, it's also an extremely wasteful system. One need only think of the multibillion-dollar advertising industry or the military-industrial complex to see how much labor is wasted on essentially worthless enterprises.

Imagine what the hundreds of billions of dollars spent on weapons of mass destruction or on ads to convince us to buy one brand of, sugar water over another could do in fixing crumbling schools, providing universal health care and cleaning up environmental degradation.

Moreover, because capitalist enterprises depend on increasing profits and market share, they must continually sell their products in ever greater quantities.

There is therefore a built-in incentive on the part of capitalists to produce things that don't last. Think of the college textbook industry where the same $60 book is reissued with a new introduction and rearranged chapters in order to prevent students from using older editions.

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THE HEALTH care business is probably the most distressing example of what happens when we "let the market decide." Health care for profit means delivering the least amount of health care service for the maximum amount of money.

... full article at Socialist Worker.

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