Is Capitalism A Problem?

In the July 11, 2017, article in Fast called Are Your Ready To Consider That Capitalism Is The Real Problem, Dr. Jason Hickel and Martin Kirk write:

In February, college sophomore Trevor Hill stood up during a televised town hall meeting in New York and posed a simple question to Nancy Pelosi, the leader of the Democrats in the House of Representatives. He cited a study by Harvard University showing that 51% of Americans between the ages of 18 and 29 no longer support the system of capitalism, and asked whether the Democrats could embrace this fast-changing reality and stake out a clearer contrast to right-wing economics.

Pelosi was visibly taken aback. “I thank you for your question,” she said, “but I’m sorry to say we’re capitalists, and that’s just the way it is.”

The following 2-minute video sheds some light about how some millennials view capitalism:

There’s little doubt in my mind that capitalism is leaving people behind. The 1% has dramatically increased their wealth while the middle class has been diminishing. Many jobs are becoming unnecessary, e.g., steel and coal, while other jobs have been pushed overseas to produce products at lower cost to create higher profits. Many college graduates are struggling to find jobs worthy of their education and student loan debt.

While these maladies might be attributed to capitalism, a lot of it is due to greed and corruption. Companies that sell products and services in global markets have learned that the consumption of their products should be accompanied by job creation internationally. For example, Dell sells products and services in India. India wants Dell to create jobs in India. This is capitalism at work and a win-win for all.

When HP purchased 3PAR, all the manufacturing was sent off-shore immediately. I met the lone guy who was the liaison between Silicon Valley and the overseas manufacturing. He was aghast at what happened. There was sufficient margin in their products to make the company worth a $3 billion price tag, but, the desire for more and more profits cost hundreds of people their jobs.

Let’s consider the U.S. healthcare system. I’ve wondered for sometime if capitalism is the right model for U.S. healthcare. In June of 2016, I was in Stanford hospital for 28 hours. I had 2 MRIs, 2 CT scans, and had to go through the tPA protocol. The total bill was $148,000 dollars, $3700 of which were for my doctors. It didn’t cost me a dime. My insurance company likely paid a lot less than $148,000. I don’t know about you, but that price seems exorbitant by a factor of 2 to 3 times, maybe more. Many people are travelling to places like India for elective surgeries at a fraction of what it would cost here.

Profits over people. That’s what millennials are seeing. Soulless companies is what they are seeing. It’s no wonder many millennials are sour on capitalism.

Is capitalism bad? No. But, some strategies are undermining capitalism in the eyes of those who are suffering in the current economy. We need to think about what we are doing and the implications of what we are doing. Course corrections are needed.

Thought for the week:

Hurricane Harvey, now a tropical storm, is the source of tremendous devastation and pain in south Texas right now. This impacts people, pets, livestock, the homeless and first responders not to mention the cost of repairing or replacing homes and infrastructure. South Texas is in my thoughts and prayers.

What do you think? I welcome your comments! Dave Gardner

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