The Challenges For Capitalism

Copyright © 2003 Dorian Scott Cole

Does the capitalist system promote ideas that money and the economy are just a game, encouraging people to treat it in less than sincere or even illegal ways? People win the lottery and live financially secure the rest of their lives. Is anyone hurt by that? People invent a product and live the rest of their lives on easy street. Jack works twice as hard as Phil ever thought about working, yet as a CEO, Phil makes over 50 times what Jack makes. What if Jack, from his job, makes a little extra on the side? Just as long as everyone turns a blind eye - no one gets hurt, do they?

Is it all just a game? Listen in as Joy and Rose walk through a grocery store.

Joy and Rose are walking down a grocery aisle full of cereal. Rose stops and picks up a box, shakes it, and says, "You know, when I open these boxes they are only full up to here." She points three-fourths up the box. "I'm buying a box!"

"Aren't they sold by weight, not by volume?" Joy asks.

"It says right here, 32 ounces. It's just like a measuring cup - volume.

"Uh, uh - that's 32 ounces of weight."

Rose looks like she could be knocked over with a feather. "You're kidding me. Well, isn't that misleading?"

Joy shrugs.

As they walk on, it occurs to Rose that she is still being misled. "I pick up all kinds of boxes in here - some are very big and have this little bitty item inside. I think that manufacturers do that on purpose to make you think you are getting more than their competitors offer."

"I'm sure." They arrive at the fresh fruit counters.

"I get so tired of being misled," Rose says in frustration. She picks up a grape and eats it. "Forget those - they have no flavor."

Joy picks up an apple and looks at it, squeezes it, and places it in her basket and reaches for another. Rose picks out an apple, and then bites into it. Joy looks at her in astonishment.

"What?" Rose asks, seeing Joy's look.

"You bit an apple!" Joy says, incredulous.

"Of course. You don't think I would buy these apples without trying them, do you?"

"I just couldn't do that," Joy protests.

"Why not? They're unwrapped."

"Because... because, it just isn't right. Those apples cost around 75¢ a piece. You can't just eat them."

"I do," Rose asserts. "The suppliers do everything they can to make me think that this is a good apple. Do you see how red this is? It has been dyed. And they spray all kinds of bug killers on it. It may be green, or it may be soft or bruised. It could be mislabeled. It may have a horrible taste. Manufacturers can hide little things in big boxes, but they are not going to sell me bad fruit."

"But it costs 75¢. It's like... stealing. What if someone sees you?"

"And if I get it home and the apples are no good, then I just throw away $4.00 on a bag of apples that I won't eat. They stole $4.00 from me through trickery. Do you think that they should get away with that? I'm not playing their game!"

There it is, the word "game." It is so much a part of our language that we don't even think about it, but we say what we mean. Business is considered a game. Everybody is playing a game to get money. Dishonesty is something that we expect from manufacturers, and we assume that they expect the same from us. The games mentality is endemic to the capitalist system.

How pervasive is this idea that business and money are a game? Business is often cast in the role of a game (or even a jungle war). For decades, prices have been based on "what the market will bear" and similar pricing strategies. The price has no relation to production cost, and very little to value.

The same goods, at name brand, discount, and surplus stores carry prices with no relation to each other, with the lowest price often even 1/3rd. the highest price. Shopping and negotiating strategies often help the purchaser save a lot of money. Price is something that carries very little meaning. Getting the best price is more related to gamesmanship than anything else.

Every day in the business world, there are winners and losers. The best product may win, but more often the best executed sales strategy wins. Winning in business is more related to gamesmanship than anything else.

During the late 1990s, with investor money flowing freely to the best performers, companies got carried away with the game, or became just plain greedy. In Enron, a strategy of fooling investors was used to make their company look phenomenally successful, and brought financial ruin on many of their employees. By February 19, 2004, 27 Enron employees had been charged in a massive scheme of wrongdoing, spun by Enron's top executives. Some of the techniques used by Enron are reported to be commonplace in many businesses, such as the worldwide Italian company, Parmalot. At least four major investment firms were implicated by evidence as being complicit in Enron's scheme.

Consumers, often in collusion with dishonest businesses, sometimes treat companies, like insurance companies, as a target in an illicit game. ABC News Thursday PrimeTime, on March 18, 2004, reported on their own undercover investigation, and a separate FBI investigation, in which unnecessary surgeries are being sold to willing individuals as a scam to get money for scam artists, physicians, surgery centers, and patients.

The money from this insurance fraud is typically used for other services, like cosmetic surgery. The scam comes complete with various different names for the surgery centers to make it more difficult for insurance companies to track. These scams cost the insurance companies billions. Who pays for it? Every one of us. Some pay through higher insurance premiums. Some pay in blood because they can't afford insurance because of the high premiums.

Journalism may report on these things, but journalism itself isn't immune. In recent years, journalists at major newspapers have been exposed for making up stories. Noteworthy is the attitude developing among politicians about the news media. Nixon and Agnew considered the media to be filled with "effete snobs" (depleted, self-indulgent).

Today's attitude is markedly different. Quoting the 2004 Annual Report on American Journalism, "After spending time at the White House, the New Yorker writer Ken Auletta concluded that senior staff members there saw the news media as just another special interest group whose agenda was making money, not serving the public - and surveys suggest increasingly that the public agrees."*¹

Every year the question hangs more heavily in the air, does the news media bring us the news we need to know, or does it create media spectaculars for the purpose of getting ratings and audience share. Is the news role to inform, or like a circus, to focus on spectacles for its own gain, or even to focus on dissent, which incites? It used to be that certain programs were well known for spectacles or bias, but today they all seem to compete in the arena of the spectacular.

Even colleges are affected by the competition for money. College athletic programs bring in continuous income to the college, and can even bring in $14,000,000.00 by winning the season. College players can only receive scholarships, not money, so it all goes to the college.

Because of the money factor, college competition is intense to get students... and even more intense to get sports stars, who attract big money. Some way, without using money, colleges have to recruit the most talented players. So insidious is the lust for this money that colleges turn a blind eye to the unlawful practices of the players, in order to retain them. Colleges are now represented in the public eye, not by the best scholars, but by criminals that, not by coincidence, reflect the makeup of professional sports. Only 2% of the average college student body is involved in crime, but on average, 23% of those in the college athletic programs are responsible for campus crime.

It isn't just the sports players. Not a year goes by but some college athletic department is investigated and reprimanded for unfair recruiting practices, and this year (2004), there are allegations of using sex for recruiting, and even turning a blind eye to recurring rapes. In sports, and college, where big money flows, getting away with crime is just another game.

A college education has never accurately reflected the ability of a graduate to perform competently. A degree did represent a level of knowledge attained that leveraged many into exclusive positions for higher paying jobs. This usually galls people who can do the job better, but lack the piece of paper, giving the entire educational industry a hollow ring - just a another game played by those with enough money to go to college and bluff their way through.

It doesn't help that most jobs in business and manufacturing can be performed quite well with a solid 8th. grade education, and for management, some training in working with people. Oddly, people seem to come out of college devoid of people skills. (The need for science education is quite different.) I often hear people wonder what they achieve by spending four years in college - they never use it (even though I myself use all of my education, and strongly recommend college for its well rounded educational benefits). Regardless of dubious placements, a degree no longer even represents a level of knowledge.

Cheating, and using other devices for grades, begins in high school and continues through college, through copying from others, study guides filled with strategies that guarantee unbelievably high grades on SAT exams, using composition services or other students to prepare written reports, lowering academic standards for athletes, stealing test answers from discreet repositories...

For some, succeeding in college is just a game that prepares one for succeeding in similar games in business, politics, and life. Does a degree currently represent the ability to use shrewd and dishonest strategies? A degree reflects a college, and a college reflects the standards that it sets and upholds.

Even homemaker extraordinaire Martha Stewart apparently was a very bad girl in the money game. A jury convicted her of "obstruction of justice" charges for lying to federal investigators. Martha apparently thought she would save herself a few thousand dollars when advisors let her in on some illegal "insider information" about ImClone stock going to take a plunge. Based on this information, she sold her stock. Financial gambling in stock is all just a game, isn't it. Was Martha just swept along in the wake of the ImClone, Enron, and WorldCom scandals? If she just had more rapport with people, wouldn't it just all go away?

The repercussions are, in trying to save herself ~$50,000.00 and lying about it, Martha's empire lost millions; stock in her company took a major tumble; her companies are in jeopardy, with stations beginning to cancel her programs and K-Mart suing Martha; 500 employees may be looking for work; and K-Mart, which is a struggling corporation teetering near insolvency and that depends heavily on her brand, may find itself, its employees, and suppliers financially damaged. Martha is certainly culpable for her actions and responsible for the consequences.

But wait, this is not the end of the story. I heard from Geraldo on his first FOX broadcast after returning from Iraq, that Federal Prosecutors got Martha in a room by herself and baited her with a lie that someone had offered damaging evidence. Martha's reaction: she apparently lied to protect herself. They elected not to prosecute her for her actual crime of insider trading, which might not have held up since they baited her, but for lying... after they lied to her.

I'm not clear on who should have been prosecuted, Martha Stuart or the Feds? Apparently lying is part of the game, and whoever has the most power wins the game. I have to say that I have little respect for law enforcement officials who act more like criminals than the people they are after. Lying to people in an official capacity would probably be a federal crime... if there weren't so many politicians doing it. President Clinton raised lying to an art form, and escaped office with little legal penalty for his lies (censure by impeachment is a big penalty). For government, lying is a game. For the rest of us, its a reason to go to prison. I wonder when the government ceased representing the will of the people and became a law above the law.

I guess I shouldn't be surprised. Like business, government has in all ways dodged responsibility for any of its actions. Governmental agencies, like businesses, stand behind their people and shield them from any action against them. But just get behind on your taxes and they are knocking on your door with threats to take your home away, or your other property. People need their cars today nearly as badly as people needed their horses in the old west. Stealing a person's horse was a hanging offence. People can't work and earn an income today without a car.

Taking your home for taxes? We may feel that the Israelis are wrong for displacing the Palestinians from their homes, or the Palestinians for wanting to force the Israelis from their homes, as are other nations who do, or did, the same, but in the US, Federal and State tax collectors still have that power, as do others who can sue you. For the government, people seem to be just pawns in a game in which the government always holds the winning hand. It is all just a game, isn't it? (More on responsibility in Article 5.)

Part of the way that we think of money and the business world may have to do with our very definition of how a game is played. As mentioned in the previous article, we commonly see three types of competition: competing against ourselves, competing against individuals, and competing collectively with ourselves to the point of destruction. In only one of these we are really a winner: competing against ourselves.

Most forms of competition create one winner and hundreds of losers. It is interesting that we are so in love with the idea of maybe being a winner that we are all so willing to become losers.

A fourth form of competition is when we all work together to accomplish something great. No, were not going to sing KUM BY YA now, I'm talking about something very practical. As examples, we each contribute something great to create a mosaic. We each work together as a team to make something great happen. We each do our share of tasks in conquering something like a disease. Competition makes it more fun, and in each of these, everyone wins. This form of competition makes everyone feel good, is productive, and usually improves our world.

Why is it that we are so willing to sell ourselves short to admire one individual at the pinnacle of success, when competition that involves team contribution has so many more benefits to us all? Is it any wonder that our competitive view is so prevalent in the financial world? What we see is, ourselves winning $ and everyone else defaulting to loser status, and we are comfortable with that. Why does winning have to mean tearing others down or leaving them out? Do we need to start learning the value of team contribution to reach common goals?

Capitalism dominates the world economy, and the world is becoming globally highly competitive. We have already witnessed the destructive results in displaced businesses and jobs, and a wide disparity between those who can be part of the system, and those who are left in the dust. Perhaps capitalism is not a game. Perhaps it is the way we all survive. Perhaps the emphasis should be on "all" winners. This is a rethink not only of our view of capitalism, but of what we consider to be the appropriate result of a game.

One challenge for capitalism is to consider whether we want a world dominated by jungle strategies of winning and losing? What value do we get from a jungle warfare approach to capitalism, and what world consequences will we have to live with? Do we want capitalism to be a game of grabbing as much as you can, any way you can? Or do we want to make capitalism ensure the future prosperity for all of us?

- Scott

Article 4 footnotes, references, bibliography

1. Intro, The State of the News Media 2004: An Annual Report on American Journalism.

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