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I'm a fairly thorough-going relativist, which means I believe in stuff like "cultural relativism." That's the doctrine that people are capable of supporting different cultural systems, and that many different social systems are viable. That is not the same thing as saying that the adopted social system is what people would prefer. Most social systems ("cultures") are the result of trade-offs between competing preferences, with more or less satisfactory results. An operational social system might just barely creak along, or it could be an example of efficiency, or it may even assure human happiness. Depending on the components, the participants may or may not feel satisfied (or "happy"). They may or may not be wealthy, healthy or wise. The only thing cultural relativism "guarantees" is that different choices are possible, yielding different results, when the selected social system is operable.

The reason for holding such a theory is simply observation of many different human cultures, all of which manage to survive for long periods of time. Whether one system is "better" than another, or more satisfying, is entirely in the eye of the beholder; i.e., the value of a social system is debatable. So, right off, I concede that an ultra-capitalist system might work according to its precepts. But, then, so can the sort of Welfare State I approve and advocate. Keep in mind "social system" or "culture" is just short hand for the interactions of all its members. We can compare those relationships and make our choices according to our preferences.

The market fundamentalist system is a winner-take-all affair. It benefits those who get to the top of the economic heap, however they manage it. That is why ultra-capitalism is often called "Darwinian:" it subscribes to a Law of the Jungle struggle in which the "fittest" survive. In this context, "fittest" simply means whoever has the most money, or the most control of economic assets. But, the word is not really used in the Darwinian sense, since, in evolutionary theory, biology and ecology, fitness ends with reproductive success. All that is required in the Darwinian theory is that creatures survive long enough to reproduce, and that the offspring live long enough to reach maturity. There is no "comparative advantage" or wealth or social position in the Darwinian world. Thus, it is more appropriate to label market fundamentalism "Social Darwinism," a label gladly accepted a century ago by its proponents which is recently being brought back to life. (In between, Social Darwinism was discredited because it justifies Fascism, Nazism and other repugnant "isms.")

Ultra-capitalism (AKA "neo-classical economics" and "market fundamentalism") focuses on a simple idea, that amassing capital in one account can have dramatic effects. If $1 million is distributed among 1 million people as $1 each, there is very little any individual can do with the money. On the other hand, $1 million in one pile can do a lot, which can be accomplished by each of 1 million people foregoing (saving or investing) $1. By this accounting, movie Stars and Athletes are unadorned Smithian capitalists, because a relatively small amount is charged for admission to their performances, which totals up to a huge sum when many people buy tickets. Of course, this is only the secret of mass marketing: get a small, easily dispensed amount from each person while providing practically nothing tangible in return. It made Bill Gates Jr the world's richest man. Having accumulated a huge pile of credits, the capitalist can now direct effort into selected projects. Again, this is the key capitalist argument: the project would never have been done, had not the credit (which is the power to command performance) been brought under centralized control. The accumulated capital builds buildings and creates industries, and introduces labor saving machinery.

Now, all of that seems true, but ignores a simple substitution. Exactly the same effects may be achieved by taxation, since the principle is collecting small sums from large number of individuals to create a large investment pool. What's different about the substitution of taxes for the purchase of tickets is this: taxes are an imposition of the government, which decides what to do with the money. Taxes are generally felt to return nothing to the payer, whereas an entertainment ticket has a temporary feel-good reward. That problem has been solved for many people by the introduction of State lotteries. Lotteries are a very expensive way of collecting taxes since, typically, only $1 is returned for $3 spent, but the players are entertained for a while. Other kinds of indirect taxes are often favored for similar reasons: the payers feel they get something for their money, and are only minimally inconvenienced by the higher price. So, taxes can be made more palatable, which leaves the mostly ignored central issue: who decides what to do with the money. The hidden capitalist value - really an assumption about society and government - is that it is better when a "private entity" (individual or company) decides how to save and invest instead of the government. On that view, government is necessarily an evil, a thing to be abhorred, which is a core Conservative belief. The heart of the American anti-tax movement made popular by Howard Jarvis is exactly that belief. The Bandit repeats his catechism, that government is bad, and private control good, as often as possible. But, the anti-government attitude is not examined in economic theory, just assumed.

The Keynesian view starts with a similar observation about the distribution of money, but also notes that people are likely to spend $1 indiscriminately, since it is (today) a very small amount of money. According to Keynes, the $1 spent by 1 million people is not lost in the economy, but in fact gets "multiplied" (on the average by 3-4) as it passes through many pockets. That is, the incremental $1 is also spent by whoever receives it, and then by the next receiver, etc, before the bill is "sunk." $1 "sinks," or is trapped, when it is taken out of circulation as savings or investment, or put in the Piggy Bank, or destroyed. Thus, the Keynesian theory predicts that $1 spent by 1 million people multiplies, which is supported by empirical measurement. $1 million spent by ordinary consumers has the effect of $3-4 million saved, invested or destroyed, which shows that consumer spending is an inefficient way of accumulating money. Thus, if Keynes is correct, a consumer spending $1 puts 3-4 times more money into the economy than $1 of capital spending. The Keynesian theory also explains why the consumer economy is the dominant factor in economic expansion or contraction.

To be fair, what is measured in the Keynesian analysis is not the same thing as what is counted in the neo-classical theory. The Keynesian view looks at the economy dynamically: the flow of money and its effect on consumer activities is measured. The neo-classical view is static, and just counts money and the cost of things, not what the money does. This difference is also related to a profound difference about the value of money (classical "hard" money v "fiat" or "soft" money). The Keynesian view fully supports the relativity of things, and sets human scales of value ("In the long run, we are all dead.") The classical view is fixed and deterministic; values are set in gold, stone and concrete. I believe these differences are historically important, in the same way Newton's Mechanics precedes, and is implied by, Einstein's Relativity. In that manner, I take the neo-classical presentation as a special case of a more general economic theory.

The "pure" capitalist system can be made to work, but it does not produce the immense wealth the First World acquired after World War II. Today's economy is the result of corporate and government management, not a free market. If the American economy were forced into the classical capitalist mode, here are a few steps that would have to be taken:

Does this sound familiar? It's what happened in the late 1920s, which developed into the Great Depression. Accumulating capital does not of itself increase spending and consumption. Nonetheless, the capitalist system can be made to work, if the people are willing to accept its drastic consequences. Since the Great Depression, and until recently, most Americans were unwilling to repeat that experience. Maybe they are still unwilling to try that, but their recent voting behavior seems to support market fundamentalism. The Bandit government, of course, is hell bent on undoing all the institutions and reforms of the New Deal; i.e., to put things back to where they were prior to 1933 (or 1900? 1890? 1860?). So, we may have another test of capitalism in our not too distant future. (How many times do we need to learn the same lesson?)

In the old American Confederacy, an ancient culture of poverty was pervasive and persistent. Despite the resurgence of the South as the "New South," much of that old culture is still present. Southerners have resisted the post-War world, especially because post-industrial, post-modern society denies theitr "values." Southerners have opposed liberating blacks, women and workers. They oppose community-based health care systems, and treat public education as the poor man's welfare. In short, traditional "capitalism" is rampant in the South. A Southerner, the Bandit, is imposing on the rest of us the virtues of that old discipline.

That sort of society has certain correlative social values. Unliberated women are not equal, but are "put on a pedestal." Women's virtue means sexual frigidity, because a women who enjoys sex is a whore. The position of women in traditional Southern society is expressed by the fundamentalist preachers, who say a woman should obey her husband; women are chattel. For Southern men, the important thing about women is the ability to provide sex and children, and otherwise serve men. The reason women are put on a pedestal is the fear men have of losing that personal service. This makes each man possessing a woman the enemy of all other men.

The South still resists Unions, as dramatically and recently evidenced at WAL*MART. That Southern corporation will do almost anything to avoid a Union, even close stores where workers are Union friendly. The lesson is simple: it isn't worth doing business if the boss isn't The Boss. This harks back to slavery days, or the virtues of the chain gang, in which people are teamed up under a driver who alone cracks the whip. Once one becomes a supervisor, he is separated from the run-of-the mill crowd in every way. Whip crackers live in a different part of town than line workers. They shop in different stores, go to a different church, and send their children to a different school. Capitalist society is highly differentiated and stratified. It is sensitive to the smallest differences in status and authority. Historically, this is the sort of society that existed before the French Revolution in France, and before the Enlightenment in England. (It's what the Revolutionaries abolished in America, and what immigrants came to North America to escape.)

Capitalist society doesn't provide for ordinary people, because its main concern is the accumulation of wealth (capital). That is the concern of aristocrats and the haute bourgeoisie. Paying for the educational, medical and physical needs of "the masses" is a waste of money under old-fashioned capitalism.

For those who've arrived in the post-modern world, it's easy to see why Toyota is moving North. It's easy to see what's wrong with WAL*MART. And, it is easy to see why the United States is suffering from increasing problems of paying for schools, medical care and all the other things ordinary people need - including safe food and housing. The problem is Capitalism.