Adumbration

An earlier version of these remarks date to 13 December 2009

Firstly a clarification from my prior post.  Along the way to dispute the identity of money and wealth, I said that money developed from commodities that held intrinsic (albeit subjective) value and had those other characteristics, as distinguished from wealth, which makes us materially comfortable.   Since the money commodity has intrinsic value then it contributes to making us materially comfortable, such as by providing decorative value.   My inadequately explained point:  many other goods and services (beyond such commodity money) constitute wealth, in as much as we value them toward making our lives comfortable.    Of course the case of fiat money - paper currency - does not have the property of intrinsic value.

 So I am impelled to ask the question, wealth, at what or who’s expense? Is wealth obtained at the expense of others or in cooperative and mutually beneficial interactions? I don’t think I need to enumerate examples to make the point that the wealth of today’s wealthiest are obtained through the impoverishment, intentional or unintentional of many

People create wealth when they convert some resource from a lower value use to a higher value use.   Such resources include goods and services, their trade creates wealth by virtue of each party obtaining higher value.  In the prior analogy, I converted soup to almonds through trade with the nut guy.  I preferred the almonds to soup, he preferred soup to nuts; we each converted resources from a lower value to a higher value use, we each created wealth.  This mutually beneficial interaction represents more than an exchange of equal value, because each party obtains something they value greater than what they currently possess.   They both increase net value, and create wealth in the process.

Other ways to obtain wealth include all those symptoms of the corporate welfare state I mentioned near the conclusion of my prior post, but such restrictions on voluntary interactions diminish wealth by compelling people to sacrifice a higher value for a lesser one.  As for the source of wealth of today's wealthiest, the recent banking bailout shows state power being used to forcibly transfer wealth to some of the richest people on the planet, but other examples include licensing restrictions and monopoly grants.  I do not support such anti-competitive behavior.

Is our purpose material comfort or physical, mental, emotional and spiritual well being? Is our aim and motive social harmony, friendly fulfilling and valuable relationships both human and nonhuman, to live autonomously and express our creative urges, creative freedoms? My answer would include all and not just material comfort although I don’t devalue that comfort.

Purposeful action applies in material and non-material domains;  each of us decides among such choices within the constraints of our environment.

There is no social harmony if people do not get along.  People create ways to get along in many ways that do not involve exchange of goods and services among relative strangers (i.e do not involve features of the market).  The value of capitalism applies to the areas that do involve such exchange.

One last point. Your last paragraph outlines the government involvements with the welfare corporate establishments that I claim does indeed represent capitalism. I think it is the essence of capitalism and we have been propagandized by both Rand and Libertarian philosophers to equate capitalism with freedom through, among other avenues, the newspeak of the “free” market.

I aim with this writing to contrast modes of human interaction.   Such interactions can be voluntary or coerced.  I oppose coerced interactions, but voluntary interactions are not "free" if by that we mean "without constraint";  there are trade-offs among our options, we make mistakes, we misjudge the future, we fail to appreciate consequences, and some desires are not possible to attain.  Economically or otherwise, decisions that look good one day can appear awful a year later.

The shorthand "free market" represents the hundreds of voluntary exchanges of goods and services we each make every month, aggregated across the entire population.  In the full development of such uncoerced interactions we have "capitalism".   In contrast, where people with special interests can manipulate state power they will find a way to do so, to enrich and entrench their established positions, whether for business, professions, labor or the arts.  Such manipulations diminish material wealth for the population at large.  This is why I take exception to redefining "capitalism" and "free markets" to mean what amounts to "corporatism" or "fascism".