Tempered Capitalism

Tempered Capitalism

After contemplating the issues surrounding the AB 1139 act and its amendments, I began considering the current debate on what is being called the 'evils of capitalism'.  Many, it seems, have begun to accept the claim that capitalism is only a greed driven, individualistic system that when practiced tramples on the disadvantaged and only favors those who wield the wealth.  I question the validity of this type of claim because it seems to only be a concoction of scattered seemingly-related truths.  As for myself, I suggest that the word 'capitalism' must be modified to better communicate that there exists a form of capitalism that cannot be divorced from certain underlying principles that time and study have revealed.

Tempered Capitalism.

Capitalism is most effective when it is implemented with Pareto optimizations.  This form of capitalism demands debate and discussion on the many objectives that society is attempting to achieve.  In order to find a best solution, certain objectives are given more importance.  For me, the protection of unalienable rights including personal civil liberties and freedoms is of highest importance.  Security of the society must play a subservient role to such protection in order that the society may both be free and reasonably secure.  Fairness must be accepted as a very subjective concept and intricately tied to human capacities and faculties.

Touching on WEALTH

It is important to remember that wealth is created and distributed within society to accomplish desired objectives.  The people, the individuals, create the wealth.  It seems to me that there is a popular claim that too much of the wealth is held in the hands of a very few which is termed 'not fair'.  Play-ground politics aside, this uneven distribution of the holding of wealth, does not rob or prevent the individual from creating wealth and using it to achieve their own objectives.  Too many believe that a lot of currency in the bank equals wealth.  It is undeniable that 'wealthy' people have such holdings, but that must not be the only aspect of being wealthy.  There is a common proverb that states, "it takes money to make money," which is believed to be absolutely true.  Most people it seems take money to mean currency.  If we then rephrase it to better match what many seem to believe, it would go, 'it takes currency to make currency.'  I suggest that currency is nothing more than an asset that can be used to create wealth, but it is not wealth itself.  Our tax laws justify taxation using the phrase, 'an ascension to wealth' which for convenience involves legal currency to be tendered for the public debt the one being taxed owes to the society that it is assumed provided a nurturing, safe and structured environment for such an ascension.  But this very phrase implies that the individual or whatever is being taxed, is the one that created the wealth and society demands its 'fair share' of that wealth.  

Robert Kiyosaki in his speech 'Keep them poor!', reiterated a truth that poverty is a learned mindset and by extension, wealthy is a learned mindset.  According to him and others, the expression, 'I can't afford...' is a clear indication of which mindset is held by the individual who stated it, the poverty mindset.  In contrast, the wealthy person will question and ask things such as 'how can I afford...', 'do I need to afford...', 'how else can I accomplish...', &c.  Statements close the mind, questions open the mind.  Simple enough.  Wealthy individuals have open minds in this regard.  

Wealthy people are problem solvers.  They seek out paths to accomplish seemingly impossible enterprises.  This adds wealth to the society.  Their accomplishments, properly done, benefit all in society, sometimes directly, but most often indirectly.  This added wealth is sometimes converted to currency and held liquid for other enterprises that will add wealth to society.  In contrast, the individual who has learned and operates by the poverty mindset will feel trapped and hopeless because they do not have access to such liquid assets.  As a result, they will tend to use what assets they do have and trade them for relatively worthless trinkets that depreciate rather than appreciate and thus add little to no value to society.  They do this as a form of medicating themselves to cope with their believed to be 'hopeless' situation while crying out, "it's not fair!"

Back to TEMPERED CAPITALISM

Capitalism fosters and encourages the individual to choose to create wealth most times with the promise that the individual may maintain control of the bulk of the wealth to be used for their own desires.  A free society will be one that creates incentives and encourages the individual to apply their created wealth to enterprises that will more directly benefit the society as a whole.  In capitalism the concept of profit is very pronounced and plays an integral role in the incentives for the wealthy to invest their wealth toward profitable enterprises.  Since profit is linked to 'wealth' usually via currency, then there is an impetus to maximize profits in order to maximize wealth.  It must be made clear that profit is not wealth, but rather it is linked to wealth, usually via currency.  So maximizing profit is not maximizing wealth, but plays a role in maximizing wealth.  Therefore, profits must not be increased without limit as if they are the only consideration or objective at play.  Tempered capitalism recognizes the need to maximize profit within reasonable bounds while also considering the other factors that are at play within society.  Our history of forbidding monopolies is an example of the recognition of limiting profits by encouraging market places to dictate 'prices', and consequently profits.

In short, tempered capitalism is a good model to implement within a free society where debate and discussion is encouraged and laws and regulations are created to reflect society's prioritized objectives on the Pareto front when optimizing and trying to find the 'fair' and equitable solutions.