Capitalism: A Not-so-Lovely Story

She’s undecisive, a shopaholic, and takes forever to make up her mind.

This isn’t a harrowing roller-coaster story about a former ex.
This is a story about capitalism.

For the the better or for the worse, capitalism has become the de facto socioeconomic paradigm of the modern world and it looks like it’s here to stay. While we now see different forms of capitalism throughout the world, like “American capitalism” marked by meritocratic wage differentials, an infinitesimal social safety net, and poor public services in essential areas such as education and medical care to alternative forms like the “welfare-state capitalism” of the Northern Europe nation-states marked by more government intervention in the market, the key foundation of the capitalist paradigm remains universal.

Lately we tend to forget that capitalism used to have a antithetical counterpart: communism.
The interesting thing to mention here is that Karl Marx, undoubtedly a man who studied capitalism in earnest, viewed communism as the next rational evolutionary step as a means of production. In other words, communism would, Marx argued, suceed capitalism as a better socioeconomic paradigm.

However, history indicates that when communism is put to use, it has several fatal flaws. First, the government interferes far too much in the market which leads to the establishment of inefficient industries. Second, the government itself tends to become repressive, particularly when social capital begins to erode. Third, the lack of incentives for diligence and the lack of the profit-motive slows or even halts innovation.

Obviously, communism thus far has proven to be far from a utopian mode of production. It did not, contrary to what Marx had envisioned, become a sort of utopian “association of free men.”

This does not mean that we can write communism off, declare capitalism victor, and indulge ourselves in a capitalist society. Capitalism too has its flaws, which I believe are equally unsavory.

Modern-day capitalism has advanced to such a degree that we engage in what I would like to tentatively call “symbolic consumerism.” 

Take cigarettes for instance. Why do people smoke? Do they smoke for the nicotine high? In The Tipping Point, pop-sociology author Malcolm Gladwell tells us no. People smoke, he argues, because smoking “overwhelmingly [is] associated with the same thing to nearly everyone: [...] the ultimate expression of adolescent rebellion, risk-taking, impulsivity, indifference to others, and precocity.”

Ah, so people aren’t smoking because they like charring their lungs. I’d bet my dollar that smokers don’t want to be diagnosed with lung cancer either. But when cigarette warning labels became mandatory on cigarette packages, sales actually increased. Why?

The reason is because today, in this form of matured capitalism, people engage in “symbolic consumerism.” In other words, people are buying symbols. Smoking cigarettes makes you badass. Driving around in a Prius makes you an environmentally conscious citizen. Touting a Louis Vuitton bag suggests to people you’re a sophisticated lady. The list goes on and on.

When symbolic consumerism is at its nascency, cigarretes will still be carcinogenic and will still contain nicotine. But as the consumption of symbols is furthered, people will still buy cigarretes even if they become, say, e-cigarettes. E-cigarettes are “cigarettes” which are basically plastic cigarettes with LED tips. No smoke. No nicotine. No carcinogens.

In Japan, “alcohol-free alcohol” is now a hit product, another sign of symbolic consumerism taking hold in advanced capitalist economies.

So what effect does this have on the public sphere and society as a whole? In his book Buyology, Martin Lindstrom examines cigarettes and observes:

“Cigarette warnings […] had in fact stimulated an area of the smokers’ brains called the nucleus accumbens, otherwise known as the ‘craving spot’ [...] those same cigarette warning labels intended to curb smoking, reduce cancer, and save lives had instead become a killer marketing tool for the tobacco industry.”

In other words, we will now begin to crave products not for their actual properties but for what they represent to us as symbols. Our individuality will be expressed more and more by what we buy.

A visceral gut feelings tells me that a society where the pursuit of the accumulation of material wealth and the expression of the individual through symbolic consumerism as the defining characteristics of daily life lacks the kind of strong human bonds so vital to a healthy union of people.

Of course, I don’t think communism provides a sound alternative. But perhaps communitarianism, a resurgent form of communism with communism’s biggest flaws ironed out, may provide a good antithesis to modern-day capitalism. This year’s Nobel Prize in Economics laureate Elinor Ostrom wrote extensively about The Commons, which are tight-knit communities that provide not just essential goods and services to its members but also strong emotional ties as well.

Capitalism’s flaw lies in how the accumulation of material wealth doesn’t necessarily equate to happiness. The anonymous story The Fisherman and the Investment Banker is quite telling of capitalism’s inherent flaws:

The American investment banker was at the pier of a small coastal Mexican village when a small boat with just one fisherman docked. Inside the small boat were several large yellow fin tuna. The American complimented the Mexican on the quality of his fish and asked how long it took to catch them.

The fisherman replied, only a little while.

The American then asked why didn’t he stay out longer and catch more fish?

The Mexican said he had enough to support his family’s immediate needs.

The American then asked, “but what do you do with the rest of your time?”

The Mexican fisherman said, “I sleep late, fish a little, play with my children, take siesta with my wife, Maria, stroll into the village each evening where I sip wine and play guitar with my amigos, I have a full and busy life.”

The American scoffed, “I am a Harvard MBA and could help you. You should spend more time fishing and with the proceeds, buy a bigger boat with the proceeds from the bigger boat you could buy several boats, eventually you would have a fleet of fishing boats. Instead of selling your catch to a middleman you would sell directly to the processor, eventually opening your own cannery. You would control the product, processing and distribution. You would need to leave this small coastal fishing village and move to Mexico City, then LA and eventually NYC where you will run your expanding enterprise.”

The Mexican fisherman asked, “But, how long will this all take?”

To which the American replied, “15-20 years.” “But what then?”

The American laughed and said that’s the best part. “When the time is right you would announce an IPO and sell your company stock to the public and become very rich, you would make millions.”

“Millions.. Then what?”

The American said, “Then you would retire. Move to a small coastal fishing village where you would sleep late, fish a little, play with your kids, take siesta with your wife, stroll to the village in the evenings where you could sip wine and play your guitar with your amigos.”

Perhaps the clash between the ideals of modern-day capitalism and communatianism will sublate to form a new socioeconomic basis: one that allows for more humane social relationships while still retaining the innovative energies of capitalism.

//By Ryo TAKAHASHI

14 Responses to “Capitalism: A Not-so-Lovely Story”

  1. kazuki says:

    i see uve made good use of what we did in 経済Ⅰ today lol

  2. Tavo says:

    I like the fisherman and investor story.

    “15-20 years?” Then his kids will be all grown up…AHAHAHAHAAH seriously…

  3. Shogo Okuda says:

    I heard that some firms are developing smokeless cigarette… Life is full of irony isn’t it?

  4. Ryo says:

    Kazuki>
    Yeah, definitely.
    I’m taking Developmental Economics class for sure :)

    Tavo>
    The story’s cute, isn’t it :)

    Shogo>
    Mhm. There are a lot of products out there that are no longer what the profess to be.

    Also, the ultimate example would be currency. Take for instance Roman coins, where the amount of precious metal content in the coin no longer represented the exchange value of the coin itself.

  5. [...] a previous article, I wrote about how we’ve entered an era of “symbolic [...]

  6. Amy says:

    i see uve made good use of what we did in 経済Ⅰ today lol

  7. Paul says:

    I like the fisherman and investor story.

    “15-20 years?” Then his kids will be all grown up…AHAHAHAHAAH seriously…

  8. Adam says:

    I like the fisherman and investor story.

    “15-20 years?” Then his kids will be all grown up…AHAHAHAHAAH seriously…

  9. Brad says:

    i see uve made good use of what we did in 経済Ⅰ today lol

  10. Dennis says:

    Kazuki>
    Yeah, definitely.
    I’m taking Developmental Economics class for sure :)

    Tavo>
    The story’s cute, isn’t it :)

    Shogo>
    Mhm. There are a lot of products out there that are no longer what the profess to be.

    Also, the ultimate example would be currency. Take for instance Roman coins, where the amount of precious metal content in the coin no longer represented the exchange value of the coin itself.

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