The news this morning was ominous enough...another banking buyout, a bail out supposedly close at hand, the European banking system strained improbably (and, of course, being bailed out). The entire financial world seemed to be at the gate, chests heaving, snorting and stamping their hooves in anticipation of the race.
But the race won't come, I fear.
Forgive me for the dramatic flourish, as well as the confession I am about to make: I am a capitalist. I am not an acolyte in the cult of Ayn Rand, but I do have an enduring belief in the free market in general, and a capitalist system at large. You see, you can pretend not to like capitalism, or not to support free trade, but if you shop Wal Mart or buy gas or wear clothes or eat food (which I have a sneaking suspicion at least some of you do), you enjoy capitalism, too.
Now, we can all wear our little liberal hair-shirts and claim that we don't care about money, or we only buy organic, or we only support local business, or we only support fair trade, but honestly? All that does is prove my support of the free market. The free market has allowed you the luxury of choice, at a price you are happy to pay. While regulation is required, subsidies have destroyed the simple elegance of this system. But that is not what I want to talk about today.
As I listened to the steady BBC and NPR reporters bloodlessly reporting the end of an economic era (in velvet tones designed to not strike fear into the hearts of delicate listeners), I found myself wondering, "Are we witnessing the failure of the free market?" I percolated for a while before I firmly decided that that was not the case at all.
No, this strikes me as something completely unknown to our generation, mainly because it has been buried for decades beneath heavily biased tariffs, punitive trade regulations, and mountains of subsidies that conceal the market truths. This, my friends, may be the death of economies of scale that we are witnessing.
That long-loved theory that bigger is better, more efficient, and therefore more beneficial to everyone is a crock. We (not as in "you and me" but more like our nation's economic arms, the IMF and the World Bank) have long known this. The history of American money flowing into resource-rich, cash-poor countries to build industry and agriculture bigger than ever, only to have it fail miserably in less time than it took to create-- the proof is there. You could spend several lifetimes reading scholarly papers written on the subject, or visiting nations ruined by these massive infusions of cruelly ineffective aid.
The problem is that once an entity grows too large, it becomes unmanageable. It becomes impossible to account for, unpredictable, a monstrous, disastrous thing destined to implode. And when I look at all the mega-banks merging, all that concentrated power and all of the strategic moves designed to put more power in the hands of the Federal Reserve Bank... I see a monster rising up out of the sea of nasty possibilities.
Meanwhile, I see small banks flourishing, small-scale agriculture thriving, mom and pop businesses doing decently (sometimes), and I wonder when we stopped wanting to support people genuinely like us, people who we can look in the eye as we hand over our money for goods or services.
I don't see an end in sight, a bottom to all this falling. Of course I hope I am wrong, but in the event that I am not I would like to see a smaller, more humble government emerge, one that actually watches spending. I'd like to see a tighter investment market (though that is highly unlikely). I'd like to see smaller systems that can be regulated internally and with ease, where positive feedback loops can be detected before they threaten the integrity of the system.
I believe in these things not because I am a hippie, or a commie, or a socialist, but because I am a capitalist, who believes in sense, decency, and ethics. And I want to believe that other people do too. Capitalism is a wonderful system, it tells us who we are, what we desire, what our values are. This mad, distorted thing, I do not know what it is. But if it is a mirror it is a horror-show, carnival funhouse mirror, that tells us what we fear rather than who we are.
And guess what? We are constituents. We elect the electors. And we can all do this better. And we should. The time has come to pay attention.
