Is free-market capitalism sustainable? (America, service, legislation, organizations, reform)

[Mathematician]

Without taking into account public interference via laws (anti-capitalist), I'd like to know if anyone believes free-market capitalism is sustainable. The United States makes up less than 5% of the world's population, but consumes 25% of the world's natural resources being pumped through the world economy. With countries like India and China joining in on the fun, how can we expect the planet to sustain the human species where the only incentive for business is profit? Right now the major resource problem we have is energy. Everyone has been exposed to the futurists' warning. More wars in the Middle East and secret plots in Latin America to drain up the energy for ourselves against the Euro and Chino markets. In fact, many argue we see the babies of the problem right now in Iraq.

But there's other problems, too. clean water, lumber, coal, minerals, naturally cheap labor markets...

How can free-market capitalism sustain itself?

[jonny]

We need to move towards renewable resources and reduce waste as much as possible. We are making progress. For example, purchasing movies and music over the Internet (as opposed to a physical product) makes a small difference. Lots of small differences make a big difference.

We need to conserve and reduce waste. Otherwise, I don't think we can sustain ourselves indefinitely. I don't think this has anything to do with free-market capitalism. I think this has to do with how we approach using our natural resources.

If it does have something to do with capitalism - Capitalism says that we do what is in our best interest. It is in our best interest to conserve.

[rojse]

I think that we will either continue our thriftless ways, and end up mining entire asteroids and planets for resources to sustain our wasteful ways, or go into such an economic depression when the resources run out that we will end up as a totally changed society. I would lean towards the first option, should you ask.

[PureX]

Originally Posted by GeneCosta

Without taking into account public interference via laws (anti-capitalist), I'd like to know if anyone believes free-market capitalism is sustainable. The United States makes up less than 5% of the world's population, but consumes 25% of the world's natural resources being pumped through the world economy. With countries like India and China joining in on the fun, how can we expect the planet to sustain the human species where the only incentive for business is profit? Right now the major resource problem we have is energy. Everyone has been exposed to the futurists' warning. More wars in the Middle East and secret plots in Latin America to drain up the energy for ourselves against the Euro and Chino markets. In fact, many argue we see the babies of the problem right now in Iraq.

But there's other problems, too. clean water, lumber, coal, minerals, naturally cheap labor markets...

How can free-market capitalism sustain itself?

Fortunately, the "commerce is our God" methodology of social organization has a huge weakness, and that is that it only works if we all let greed be our motive for economic decision-making. As long we are willing to let greed dominate our decisions for us, we'll remain divided against each other. But the moment the buying public begins to act together in their own best interest, they will discover that the power of their boycott trumps any, every, and all free-market strategies. The only business enterprise that can stand against a boycott is a total monopoly on a necessary product or service. And at that point, I would suggest the public use of outright violence.

I'm hoping that in the near future people will begin to realize that their quality of life is under direct and serious attack by commercial enterprises that are based only on greed and profiteering as their motive of operation. And when people do finally wake up and recognize this threat, they will also quickly discover that they have within their power the ultimate method of retaliation. And that method is the boycott.

Business corporations no longer fear government, because they know that they can buy most of the governments of the world off with money. What they truly fear is a buying public that has become aware of the fundamentally anti-social goals of business, and are willing to act in concert against them. Organizations built solely for the sake of profit, as commercial business corporations are, will implode and collapse very quickly when those profits are turned off. And that's their Achilles' heel. Greed works because it divides us against ourselves. But when we unite against it, the tables are turned, and the purveyors of greed soon divide against each other.

[Terrywoodenpic]

The whole ethos is out of step with reality.
Businesses need to continue to produce so as to make money, or they go out of business.
They do this by redesigning products to attract new sales. It is not in their interest to sell products that Last a very long time. Nor is it in their interest to make products that are continuously updateable.
Recycling is not done by them selves, so they have no interest to make it an easy process.
neither is it in their interest to make products that major on efficient use of energy, so they major instead on performance.

Most things can be produced to minimise waste and life time cost in terms of manufacturing and energy use,. But it would require major legislation, to ensure it happened.

However The major problem of a continuous Business process would remain.
No business = no employment
No employment = no wages
no wages = no purchase power
no purchase power = no Business

The capitalist model would then break down.
I do not know of any system that can complete this Circle.

[rojse]

It is not in their interest to sell products that Last a very long time.

I buy many of my goods with an eye on how long I will get service out of it. It's usually cheaper this way. Others do too. There could be an advantage to a business, in terms of overall sales, should they consider this. I do agree, however, that some people will just go cheap and forget the long term cost economics.

Nor is it in their interest to make products that are continuously updateable.

They might make a product that continually updates should they make money off these updates. Video games are a good example. People buy video games that have a lot of expansion packs that improve gameplay.

neither is it in their interest to make products that major on efficient use of energy,

Some people purchase things based on economy rather than performance. This explains why some people are buying the new hybrid cars. If they spend more to purchase the car, they spend less to run it. It is cheaper in the long run, too.

However The major problem of a continuous Business process would remain.
No business = no employment
No employment = no wages
no wages = no purchase power
no purchase power = no Business

The capitalist model would then break down.
I do not know of any system that can complete this Circle.

There are several other economic systems that have this circle. Socialism has that circle. Bartering has your circle. But these have the disadvantage that they do not consider the human greed factor. Many people want to own all that they can, myself included.

[PureX]

Originally Posted by rojse

I buy many of my goods with an eye on how long I will get service out of it. It's usually cheaper this way. Others do too. There could be an advantage to a business, in terms of overall sales, should they consider this. I do agree, however, that some people will just go cheap and forget the long term cost economics.

Greed actually makes people act against their own best interest.

Originally Posted by rojse

They might make a product that continually updates should they make money off these updates. Video games are a good example. People buy video games that have a lot of expansion packs that improve gameplay.

The problem with upgradable products is that almost inevitably, the company that makes and sells them gets greedy, and forces consumers to buy the updates by making the originals scarce or unworkable by the upgrade. So the product becomes a trap.

Originally Posted by rojse

Some people purchase things based on economy rather than performance. This explains why some people are buying the new hybrid cars. If they spend more to purchase the car, they spend less to run it. It is cheaper in the long run, too.

There is a foolish business maxim that says new product should enter the market at the high end. And then the costs will slowly come down as the new product becomes more popular. This is foolish because it's fueled by greed. Greed dictates that it's better to sell 10 cars for $50,000 that to sell 50 cars for $10,000. In either case you make the same amount of money, but in the first case you only have to build 10 cars, as opposed to 50, so your profit margin is higher. And to get people to pay that much money, you fill the cars up with unnecessary luxury and complexity, making the cars a greater service liability to the buyers.

There is a company out west that has an excellent 2-seat electric car that they call a "commuter car". It goes 80 miles on a charge, and is very fast, safe, and easy to park, because it takes up half the space of a regular car. It cannot replace the family car, but as a commuter car, and errand runner, it would be excellent. Yet for some completely idiotic reason, they are trying to enter the market at the high end, with a commuter car that costs $100,000, and has all leather seats and expensive stereos and power windows and A/C. And as a result, no one is buying them.

This is very unfortunate, because they have a great idea. Most families have more than one car, and one or both of them is usually used by only one person, to go to work and run errands. An inexpensive electric commuter car would be a perfect product for those tasks. And they would improve the quality of life in big cities enormously.

see commuter car "Tango"

I think they should have approached this like Henry Ford did with the 'Model A': make an electric commuter/errand car that works, is reliable, and is very reasonably priced. Had this company done this, I believe we'd be seeing their 'Tangos' on the roads, now.

Greed makes even corporations stupid.

Originally Posted by rojse

There are several other economic systems that have this circle. Socialism has that circle. Bartering has your circle. But these have the disadvantage that they do not consider the human greed factor. Many people want to own all that they can, myself included.

Free markets work fine for luxury items. Where they fall short is in producing goods and services that are essentially necessities in our modern interdependent societies. That's where greed gets the upper hand through commercial monopolies, and exploitation and suffering and general stupidity results.

Socialism is the answer, because it can allow a free market for luxury products and services while retaining social ownership of essential products and services. The only stipulation is that it requires a strong government with a clear set of constitutional guidelines that it must adhere to, and that can't be bribed of bought off by corporations. (The United States was somewhat this type of system until the Reagan republicans foolishly convinced the public to let them "deregulate", and sell off their essential services to private entrepreneurs. And the result is that we are now being gouged by government created and sanctioned monopolies.)

[Jaiket]

Originally Posted by GeneCosta

How can free-market capitalism sustain itself?

By reforming and evolving as it has done before.

I think the idea of an unsustainable voracious capitalist monster that will eventually start eating it's own tail has only a small reflection of reality. It no doubt suits those who who'd like to imagine that we can sit back and let the world fix itself, and the old-left Marxist-Leninists who still tingle at the imagery of the sorcerer conjuring forth from the nether world the weapons that will destroy him.