Our Current Distortion of Capitalism isolates management from the real ramifications faced by consumers/taxpayers on one side of the equation and shareholders/taxpayers on the other—one or both of whom will pay the “ax.” A defender of taxes on banks, as punishment, recently wrote, “Banks will pass those taxes onto consumers only if consumers let them. We have a free enterprise system enshrining competition. If Bank A raises fees, then we can go to Bank B.” That’s how capitalism should work, but clearly it doesn’t. Why not?
We Believe that “Tax” Equals “Punishment.” We believe that “Bank A” can be made to operate differently than “Bank B.” We believe (on the Left) that “greed” is inherent in capitalism or (on the Right) that “yes, but it’s a necessary component.”
Neither Side Knows What Adam Smith Had to Say About It. We need to learn the value of taxes. We need to learn the price that each line employee at the bottom pays so that each CEO makes the eight-digit salaries—and bonuses—at the top.
If We Continue to Think of Corporations as the Enemy, then we are sunk. But if we continue to think of corporations as equal to citizens under the law (absent the vote, but free of the risk of incarceration), we will continue to feel enslaved by these very entities that are required, by charter, to serve public need.
If We Continue to Think of Government—We, the People—as somehow doing other than what we send it to do, we will continue racing through the rapids with just one oar in the water. We reward elected officials for limiting the amount that they displease us. We continue to act is if our elected officials operate in a vacuum, like dictators or kings, when in truth, their job is to keep the voters as happy as possible, while keeping the ship of state afloat.
It’s Really All a Failure of Education.
We Don’t Know What We Have Here.
We Don’t Know How It Works.
And We Keep Turning to Expressive Communicators—politicians, pundits, commentators—who don’t really know enough more about it than we do.
Before Any of Us Really Do Anything Else, we ought to get out our Wealth of Nations and see if a better title might not be Well-Being of Nations. Adam Smith’s work is predicated on his first volume, A Theory of Moral Sentiments, which sets the foundation for the civic good that capitalism and corporations serve best.
Says Smith, We Humans Are Motivated to Do Good. Capitalism provides the best engine. But no engine runs itself, and it behooves all of us to read the operating manuals.