Flint's most famous human product, Michael Moore, has turned his cameras toward Wall Street in his latest big-screen foray, Capitalism: A Love Story. That's a colon in the title, and we know what the colon produces.
Anyway, the money quote from this piece is this
"Capitalism is an evil, and you cannot regulate evil," the two-hour movie concludes.
"You have to eliminate it and replace it with something that is good for all people and that something is democracy."
The bad guys in Moore's mind are big banks and hedge funds which "gambled" investors' money in complex derivatives that few, if any, really understood and which belonged in the casino.
Let's tackle the low-hanging fruit first from front to back. I'm one of those few folks who understands most of those derivatives, although I'm rather green on credit default swaps. Those were designed to help people hedge risks, essentially credit insurance, but the models were ill-equipped to handle the meltdown in the housing market.
Even people who understand things can get burned badly by them. For instance, the two gentlemen who won the Nobel Econ price for their work on option pricing theory, Robert Merton and Myron Scholes (the Black-Scholes formula is the standard option pricing model; Fisher Black died before the Nobel folks came a'calling), were on the payroll of Long Term Capital Management, the first hedge fund most people had ever heard of. LTCM got totaled by faulty modeling of foreign currency options during the 1998 "Asian Contagion" that rocked many developing country currencies.
Capitalism and democracy can co-exist nicely; while there have been big-business friendly goons autocrats of the right in the past, the left tends to be more autocratic. I can trot out another film subject as People's Exhibit A, Caesar Chavez I of Venezuela, who (put on the hasmat gear) Oliver Stone has done a documentary on. "Stone film says U.S. demonises Chavez." Nay, he does a decent job of that himself, closing any radio and TV station that disagrees with him.
However, Moore is right in part, that capitalism is evil in that it stems from greed. People should be more generous with their money. However, that greed doesn't go away in a socialist state; it just gets turned to less healthy endeavors, like political power seeking, theft and laziness ("they pretend to pay us and we pretend to work"). Give Hedrick Smith's The Russians a read to see how those issues played out in the USSR of the 1970s.
At least in a market economy, people have a healthy outlet for their greed by making stuff or selling services that people can use; the creativity that gets spent in unproductive activities in a command economy can be used to make new things that people like, like movies bashing AIG.
If I can borrow Churchill's line on democracy, a free market broadly defined (our friends on the libertarian right would argue it isn't free enough, but we'll ignore them for the moment) is the worst form of economy... with the exception of everything else we tried. Economy democracy is where 51% of the voters can rape and pillage the other 49%; People's Exhibit B is Bobby Mugabe; well, he only claimed to have a majority, but give me some poetic license.
Neither are pure; Capitalism is good at creating wealth while government intervention/socialism is good at getting wealth to people who have problems getting enough to get by. You need a blend.
By the way, Mike. If you hate Capitalism so much, why not put your love story in the public domain rather than sell tickets? People invest money in your projects and get nice returns. Let's do our best Church Lady and say "Could it be..... Capitalism?"
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