It is correct that these idelogies have not been able to achieve satisfactory results in the past. I would not assert that they have failed. I think its important to discuss them in context and understand why certain economic outcomes were realised. For example if you trace the advent of the Open International Financial Order you will realise that i making policy choices, countries are faced with opportunities and contraints. Historical accounts paints a very in teresting picture with regard to policy choices that countries make and external influnce in shaping the choices. Policy choice should be in line with a country's stage/state of development and not necessarily what the advanced economies prescribe. Take the East Asian Economic Miracle for example. The countries chose to defy the neoliberal economic policy prescribtions and adopted policies that would better intervene in their peculiar prevailing economic circumstances which helped set them on a path of success. Mny advanced countries protected their infant industries until they have reached a stage where they can be inserted into the global markets and compete. China has adopted such an approach by building firms withing closed doors and then once established they use these firms to compete globally and accumulate foreign reserves. Another strategy that they have used is to buy technology through acquisition of companies that are already at the technological frontier, e.g. their recent attempt to acquire VOLVO and SAAB is one example. For example, IMF and the World Bank prescribe wholesale current account convertibility but some economies would not cope in such a set up. So what should such an economy do? Create comparative advantage by targetting deliberately sctors in the economy that have the potential to benefit the country in the future. India has managed to build such an advantage in the ICT industry.

So in a nutshell a more Heterodox Model is urgently needed to advance the humanity? (TIME CONTRAINTS WE CAN DISCUSS FURTHER AT A LATER STAGE )

In my opinion capitalism is just great, it needs regulation though... and not keynesian :)) Less credit, less leverage, no drugs for economy... Then growth will not be parabolic, but there will be less crises also.

it depends upon the structure of economy ..every system can not work for every economy & in every stage , as you have indicated about regulation , it has a wider sense , purpose and objectives for giving a direction through appropriate policy measures. However , I appreciate your input & views!!!

Masha has analysed in detail about various aspects & stages which economies needs to adopt !!! grt !!!!

what matters is the institutional set up of the economies. I shared the idea that one system is not for all fit system nor does it mean a panacea for every economy. what is important is the existing institutional arrangement and the work habit of people in the given system. In opinion, the Keynesian system of regulated economy is better than the others.

Good. I agreed with you Prof Leyu !!! in fact besides the system the policies , their impact through governance and people creates an over all impact upon he economy !!

Its an original Research paper , recently published in a Journal -HUMAN FACE (ISSN 2248-0335) - Vol. 1, No.1 , May 2012 - An Annual

Research Journal On Socio-Economic Space (published by Department of Economics, Margherita college,Margherita, Assam. 786181, Assam )

based upon the Gandhian views.I tried to make a relationship between his views and contemporary problems .I find still his approach can

guide us in solving the various socio -economic problems and an suitable model can be prepared special for regional /developing economies. I invite your frank suggestions,comments views & Observations on it.

Attached - Research Paper

Title of the Paper:Relevance of Gandhian Approach : An Alternative Model of Economic Development for Regional Planning specially in the

context of Developing Economies (Attached)

Introduction :An attempt has been made in this paper for applying the Gandhian thoughts/approaches for suggesting the ways for solving various issues of contemporary world.The attempt has also been made for establishing the relationship between various approaches of Gandhi ji for the

purpose of preparing a model of economic development.

Further,the relationship has been established between Gandhian approach and various economic policies for achieving a model of self reliant development..

This model is useful for utilising the resources most efficiently and effectively ,for making the regional plans,for making the regions self

reliant and for strengthening the regional economies (specially the developing economies) through the uses of ingenious technology and efforts.

Let me congratulate Mr. Shukla for posing a timely question. Before venturing into eliciting my response, let us try to place the question in a context. Yes. It took almost three decades and collapse of world wide economy to come to an agreement that one size fit all economic policy, propounded and imposed by the so called Neo-liberal Triumvirate on the developing economies. These three decades witnessed loss of millions of lives in these countries due to lack of minimum livelihood opportunities to lead a hunger free life, leaving apart the dignified life, while the governments are tempting to improve the score card in the eyes of neo liberal scions.

To reflect up on the economic problems, we need to pin down ' of whom ?'. Because the changed environment in the policy making high ranks imposed an understanding that objective of economy is growth, simply growth and merely growth. I am stressing on this to note the lack of clarity on the ends of growth. Growth for whom ? How ? What are the indications of the so called growth ? Over the last two decades, at least in Indian experience, growth is being considered itself as an end in its own right but not as a means to achieve the sustainable development. The growth is being counted in the numbers placed in straight jacketed statistical modules developed in the board rooms of think tanks as an instrument to measure the growth leaving apart the most crucial impact and implication part of the growth. Hence it is time to ponder over the meaning of the growth, and crux of the economic problems.

The question has in it anther poser. It begins '"socialism and capitalism failed...." With out going in to much deep rooted analysis of the poser, I want to place on record one observation that it is due to socialism, call it by any color, the world is still surviving out of the current crisis caused due to the fault lines of capitalism. And also it is pertinent to note that it is merely due to Socialism in the then USSR the world is back on the path of development from the debris of the second world war. It is solely because of socialist economic practice in USSR and the newly liberated countries in the Eastern Europe in 1950s, that the capitalist world shunned its predatory exploitative practices at least for the time being, by adopting the welfare economic practices which unleashed a GOLDEN AGE in the history of Capitalism. Similarly it is because of China,the world economy is still surviving the present day crisis. So, my answer is that it is not the socialism as a developmental goal that failed in solving the economic problems faced by the humanity. But it is THIS SOCIALISM in ONE PART OF THE WORLD is helping certain portion of world population from falling under the debris created and generated by Capitalism.

Last but not the least, I concur the Masha's idea of heterogeneity of developmental practices that are the need of the hour for today's world to come out of the economic mess created by the World wide Capitalism in its today's avatar Imperialist Globalisation. The expansion of capitalism, would not and not willing to allow the multipolarity either in the developmental praxis or in the world political landscape. It is interesting to note that this is the same Capitalism which forced all the developing countries to open their markets in the name of competition. At the same time, the same Capitalism is not allowing the competition in the field of ideas. It wants the world to close its eyes and minds towards the alternative ideas of developmental praxis such as socialism, mixed economy, state capitalism, or state socialism.... So it is the time to bat for the promotion of multiple ideas to fight out to give the best available alternative in the world where ' the mind is free' in Tagroe's idealism.

Thanks Mr Veeraiah Konduri , for understanding the question in a very right perspective and giving very good explanation about development of world economy and its present scenario. I must congratulate you

Basically ,even before putting the explanation of the question I was of the view as explained by you i.e. it was not the abjectly failure of "socialism" but it is happened because of several reasons out of which encroachment of capitalism in to socialism was one of the prominent factor behind the down -fall of soviet socialism !!

I am sure you would like to share ,exchange and communicate the ideas. Hence, for more detailed and direct conversation , I am giving my e mail : [email protected] !!

look forward to receive & communicate with you !!

I have been struggling with this issue for decades. As a natural scientist I have found the assumptions and models of most economics to be ludicrous, breaking known scientific laws, using incorrect boundaries and failing to use the scientific method , our only hope for discerning something like truth. I would not allow my freshmen to get away with what many conventional economists do routinely. I think that most economic practitioners are ill suited to address this issue because they argue only on social grounds (which are important) I agree when the main drivers are biophysical. Few people understand that as of 2012 the base model for the limits to growth is essentially right on target with reality (Hall and Day, American Scientist 2009). For many reasons we are approaching the limits of the Earth to support more people at a higher material standard of living. I have written many papers and (more than) two books on this, e.g. : "Making world development work: :scientific alternatives to neoclassical economic theory" UNM Press) and "energy and the Wealth of Nations: understanding the biophysical economy" (Springer). I develop my criticisms and an alternative approach to economics in these books in great detail. Just for starters there are good reasons to believe that the decreasing or even negative growth found throughout OECD countries (not to mention developing countries) are a consequence to the end of cheap oil. There is lots of oil left to develop, but to do so is increasingly expensive in terms of money and energy, resulting in a declining EROI (energy return on investment) and the necessity to divert more and more of one's gross economic output to fuel the rest of the economy.

Unfortunately we have gained little traction with most economists: one's original academic toilet training (mine in the physical and biological sciences, most economists in social science) seems to be an insurmountable barrier.

I am not particularly interested in defending my views or responding to critics as I am way behind on many other things, but if this gets your attention see the enclosed.

In summary: The social issues are critical but must be dealt with within the biophysical context. Few have the systems training required to do this.

Best wishes to all on this important issue.

Charlie Hall SUNY College of Environmental Science and Forestry, Syracuse

I have been struggling with this issue for decades. As a natural scientist I have found the assumptions and models of most economics to be ludicrous, breaking known scientific laws, using incorrect boundaries and failing to use the scientific method , our only hope for discerning something like truth. I would not allow my freshmen to get away with what many conventional economists do routinely. I think that most economic practitioners are ill suited to address this issue because they argue only on social grounds (which are important) I agree when the main drivers are biophysical. Few people understand that as of 2012 the base model for the limits to growth is essentially right on target with reality (Hall and Day, American Scientist 2009). For many reasons we are approaching the limits of the Earth to support more people at a higher material standard of living. I have written many papers and (more than) two books on this, e.g. : "Making world development work: :scientific alternatives to neoclassical economic theory" UNM Press) and "energy and the Wealth of Nations: understanding the biophysical economy" (Springer). I develop my criticisms and an alternative approach to economics in these books in great detail. Just for starters there are good reasons to believe that the decreasing or even negative growth found throughout OECD countries (not to mention developing countries) are a consequence to the end of cheap oil. There is lots of oil left to develop, but to do so is increasingly expensive in terms of money and energy, resulting in a declining EROI (energy return on investment) and the necessity to divert more and more of one's gross economic output to fuel the rest of the economy.

Unfortunately we have gained little traction with most economists: one's original academic toilet training (mine in the physical and biological sciences, most economists in social science) seems to be an insurmountable barrier.

I am not particularly interested in defending my views or responding to critics as I am way behind on many other things, but if this gets your attention see the enclosed.

In summary: The social issues are critical but must be dealt with within the biophysical context. Few have the systems training required to do this.

Best wishes to all on this important issue.

Charlie Hall SUNY College of Environmental Science and Forestry, Syracuse

"Does the failure of capitalism in solving economic problems..."

Who said capitalism has failed?

Welfare economics, where the meaning welfare=happiness, is likely to benefit the masses and is supposed to increase national welfare, as it runs parallel to Capitalism, is a concept of democracy where the motto is to oversee the capital generated within a system is widely and rationally, as well, efficiently allocated within the system.

Russia or the ex-USSR did not "invent" the concept of Welfare economics. It traces its origin from the teachings of John Locke, the 17th Century English thinker, as well, it was Adam Smith who (1776) has played an important role in the development of welfare theory(See Thomas Aronsson and Karl-Gustaf Löfgren, 2007). However, what the late USSR adopted the version of Western Welfare theory was flawed, since Welfare economics IS NOT possible without Capitalism, and of course Democracy, since you would need Capital to allocate, and there was no proper concept of private capital in the former USSR.

China has to shed its archaic tradition and adopt and embrace capitalism, as Masha has delineated above, in a more controlled model of social capitalism. China has more reserve capital and forex reserve than she had ever before, all due to the market economics where there are millions of private enterprise competing day and night in the international trade, just to maintain marginal profit from their manufacturing sectors, and hence profit from such proceeds, and hence more wealth in the hands of common people.

Welfare economics is meant for optimal allocation of capital for any society. But one must first need enough capital for such allocation, and capital is hence a product of human effort and intelligence, where, such capital itself becomes productive when invested in proper manner. The real problem with the modern capitalism is, there is NO problem at all; it just needs to be regulated and evolve into a better form of capitalism, say, Promethean Capitalism, or any other better version of it. Countries have benefited from embracing capitalism, the Whole of Europe, North America, now the BRICS, the East Asian Tigers (Hong Kong, Singapore, Taiwan, South Korea and Malaysia, followed by Thailand, one of the most freest economies which have allowed 100% FDI in almost every sector). So, all these countries embraced Capitalism, sometimes with some hiccoughs, but all have benefited just as the Nordic States. The Northern European Nations have almost wiped out poverty...!!!

The recent Global crisis is an evanescence of the Great Depression which was triggered by similar speculative bubble burst in the October of 1929. People in those time struggled hard, but never lost faith in American Capitalism. They did not renounced capitalism, but denounced it, rather fine-tuned it. So is the present time crisis. I am not able to see that Capitalists have "Renounced" Capitalism as a failed concept, but they have "Denounced" it. Rather, they have left it to market mechanism to determine the forces of equilibrium working in the markets. They may have proposed plans to regulate and moderate the functioning of the free market system, but never have any intention to abandon the beautiful essence of productive capital.

As Adam Smith has said, "“It is not from the benevolence of the

butcher, the brewer, or the baker, that we expect our dinner, but from the regard of their own interest”.

So, it is our own best interest that we choose how we should live, and let live others, decide what is best for us, and best for others, doing that for "others" is some welfare.

Hence, Capitalism is not a failed concept, but the real propaganda to dub it as a "failed" concept is by itself-- a "failed" concept.

The Gandhian Model is a good version as delineated by Amitabh above, since it leaves us with enough ground to be productive in our own, very indigenous way, and generate self-reliant capital, and be rich in our own way by our very own efforts. It can be very well adapted within the modern tenets of Capitalism...

The Hong Kong Experiment | Hoover Institution

www.hoover.org › hoover digest › 1998 no. 330 Jul 1998 – The Hong Kong Experiment. by Milton Friedman.

http://www.hoover.org/publications/hoover-digest/article/7696

http://www.youtube.com/watch?v=xqh0zXSd4vc

This is a good example of "faith" in the essence of Democracy and Free Market Capitalism. Democracy allocates freedom and liberty more "efficiently", which in turn helps to allocate "capital" much more efficiently.

Well I think Dr. Hall's book "Energy and the Wealth of Nations

Understanding the Biophysical Economy" --seems to cover some confounding issues related to the present problems of peak oil crisis.

Dr. Hall, could you send me a preface of the book if you have to my email? (Well sorry, I misread it as upcoming 2011 as 2012). From the Table of Contents, the book seems to be very interesting to get some alternative ideas about business cycles related to peak oil.

my email:

[email protected]

Thanks,

Sidharta

The african experience agrees with the assertion as the development plans prescribed for the continent from the capitalist countries have not resulted in moving majority of the indigenous populations out of poverty, but often worsened the situation.

Even Poverty is increasing in USA .recent data shows that poverty , shelter less population and unemployment is increasing .This is because of various reasons. data also reflects that concentration of wealth is also increasing in USA.

So, definitely it indicate that Capitalism has increasing the problems.

Mr Wilson Gadiel has described about its influence on African nations .

The unfortunate part is that it has led several socio-political and economic evils in developing and backward nations in the initial stages of development and their development process and plans have advisably affected and also the poverty level has increased.

Thank you Mr. Amitabh ji. Will be in touch surely. you can also be in touch with at [email protected]

Dear Mr. Wilson,

Did the poverty level really "increased" in Africa? When was it "less" before according to you Sir? Any citations, data or reports citing that globalization has "worsened" the economic climate of the African Nations?

Isn't there any developments in Africa in the last 30 years? I think Mr. Wilson is missing out some realities about massive FDI and investment inflows in some of the African nations from China, India and other emerging markets. Inequality of wealth capital has perhaps increased due to the tyrannic regime of some of the most notorious "dictators" in Africa, their wrong economic policies etc. Yes, the West have failed "politically" shielding some of the Central African nations from civil wars and ethnic conflicts, genocides and political bankruptcy, that I would agree.

What is still apparent is that, globalization has failed to penetrate deeper into the heartlands of Africa, but it needs more time and so the future is so far, better than the tumultuous past.

Sincerely,

Sidharta

Some citations of my above comment:

http://ideas.repec.org/a/eee/ecmode/v28y2011i3p795-805.html

http://www.un.org/esa/desa/papers/2011/wp102_2011.pdf

The point is, Africa, more so Sub-Saharan Africa suffered from under-globalization, according to some researches.

But McKinsey has something else to say, placing a silver lining on the growth prospects of Africa.

http://www.mckinseyquarterly.com/Whats_driving_Africas_growth_2601

Thanks,

Sidharta

I really appreciate the contributions made by Dr Sidharta on the issues . I would appreciate the communication i.e. a direct n detailed through e mail too !! my e mail is : [email protected] !!

Communism and Socialism have failed. Capitalism has passed through several crises and would collapse of its own dialectics. However, cunning, deceit and many other instruments as diverting public opinion by waging wars and appealing by nationalism and culture under threat etc. those who hold wealth and power are till now have been successful in preventing political crisis in their domain.

However. the unfortunate part is that these economies and societies are exporting their ideals to the other countries. Sometime give loans to develop via INF or WB or a little humanitarian aid. However, interest received via IMF and especially WB is manifold of the humanitarian aid.

I very often think why interfere in economic and social affairs of countries which have an altogether different culture and social structure. Let them struggle with their own problems and in the process they would develop concepts and models and ways to solve their problems. Since these concepts, models and ways would emerge from inside nations would be more compatible with their culture and social structure and if process of developing them keep pace with the development and changing social structure and culture, these nations would be able to solve their problems. Prefabricated concepts and models imported from outside cannot achieve what the people of these nations can achieve themselves.

I agree with most of your views which you have presented thereof, except one statement I fear I will need to argue:

that, "Let them struggle with their own problems"...is it not reasonable as much as necessary to extend support to some countries which genuinely require international mediation, as in times of civil war, economic collapses and other disasters? It might mean to leave those nations at their own peril and let the people of those countries suffer, bleed and undergo unending turmoils. The very reason that the League of Nations came into existence, then the IMF, the UN and the UNESCO, WB and many others as well. What would be the role of these premier institutions as an overseer of international affairs?

Globalization brings us even closer together as neighbor and function in harmony yet be competitive but cooperative. What about Human Rights Violations, Child Labor and Women's Rights being abused in many developing countries? Should they be left at their own peril and let them sink with their won problems? Perhaps a little helping hand and some mediation is always welcome than staying put as a mute spectator. The cost of such a social change may be a real burdensome, as each and every human being has every right to live, and live with dignity and adapt socially through change.

I was just referring to these aspects on international cooperation.

I did not mean that. The regional organisations are there to help and bail out these countries. The UN is also there which can interfere as it has done in the case of civil wars in Africa. But, interference of outside organisations or group of countries to which their own interests economic and political always remain at fore is quite unwanted. Besides by suggesting "Let them struggle with their own.." implies let them stand up on their own as a child do. After several failures, the child stand ups and after a while starts walking. If you provide people crutches or wheelchair they would take a very, very long time to stand up and to walk. But, theirs would never be a natural gate, they would walk like a robot which is trained to do so.

Of course there are some universal values which should be upheld everywhere but some are culture specific. Would you allow your wife, sister or daughter to indulge in all sorts of activities which have legal status and cultural sanction in some so-called advanced societies? I would rather prefer my daughter to remain little educated or illiterate than to pay university fee through prostitution as reported by media.

To impose some values or structures from outside is to ask a tribe living deep in the forest of Africa that since democracy is the order of the day, therefore, you also elect your chief via ballot. But, Dear Chatterjee, the chieftain has already proved his leadership on every front by leading his tribe during inter-tribal war or in hunting and gathering etc. A sign of weakness on the part of chieftain will bring a strong competitor and whoever wins will be leader. It is not like that people who never speak or participate in parliamentary discussion and contribute nothing to the nation except voting according to whims of their party represent us in parliament and elsewhere as our representative. Have we asked them to represent us? Or, they have proved their leadership or they have got this right simply because they have resources (money) to win an election. Can these people represent hungry, shabbily dressed people?

I think it is enough to clarify whatever I have meant in the earlier response.

A child always needs some preliminary help from her parents, as incubators do support premature babies.

As regarding this statement, " I would rather prefer my daughter to remain little educated or illiterate than to pay university fee through prostitution as reported by media.", I have little to say but highly contend that even if such education comes by any price / means (as reported by media through prostitution or other means, I have never known such cases being reported in India), it has a long term, permanent effect on the girl/daughter, those girls who are destitute, socially and economically ignored. Keeping them illiterate is a greater sin than allowing them to be educated by whatever means, since by education, she can face up to the uncertain world, and be able to manage her own economic problems, desires, hopes for a better life, and be self-dependent as well help other girls to live a decent life.

Well, you are clever to contend back on the cog wheel of self-dependence by putting an example of culture in advanced societies. I find nothing wrong in their attitudes( your example of 'pay university fee through prostitution as reported by media', is debatable) and culture; they are more open to accept change and challenges, and the reason they do perhaps, sacrifice something else for something in addition (education, income) to survive. One should survive first, then adapt but this adaptation is necessary for further survival in future (and so fitness is essential for survival-Darwinian concept)since times are becoming more uncertain. Yes, prostitution is bad we all know, but it is the same product of a society from the individual often under compulsion or due to some other constraints.

What if someone is rich enough to support her girl child for a fair education but holds her back deliberately to remain 'little educated' or 'illiterate'? Where does the hell 'prostitution' comes in here? You are educated and perhaps have enough means to support your girl child's education so why would you hold it back? Could you ever agree to this? Is it not a regressive thinking?

The same fate happens to the citizens of a nation whose leaders deliberately by corrupt ways do not create "means of access" to higher education, or fails to create enough equitable wealth capital for its people by wrong political practices and weak economic policies. Since the economy creates means for productivity and generates capital, economic policies should aim to sustain and evolve such a fair system and not hinder otherwise.

Dear Dr. Khan,

Yes, I agree to that portion of your analysis concerning the corrupt leadership aspect of a country and the theory of ; vote by force rather than by "will". But don't you believe that knowledge increases awareness, and education gives one knowledge to be aware of moral rights and wrongs?

A more openness to liberal thoughts and ideas about 'propagation of knowledge' is better than closing oneself into the 'confinement of destiny and ignorance'-, isn't that more acceptable?

What is your idea about education, liberty and interdependence? We are all independent nations in this world but we still need each others help and cooperation and assistance, whether by trade or by other means. Why?

Sincerely,

Sidharta

I find the assumptions of the question wrong. Neither socialism, communism and capitalism failed. Socialism and communism failed to compete with capitalism, that's all. In former socialist countries from Est Europe we have experienced all of them, and transitions in both direction (capitalism-communism/socialism in post WW2 times and communism/socialism-capitalism after the fall of Warsaw Pact and CAER). The cost of re-engineering have diminished the benefits of the all transitions. As there is no science that can predict the outcome and best ways to do such transitions, it was a try-error process.

Even capitalism has many shapes and models, to say that all have failed is a pretty hard assumption to make. Some models may have, but others are thriving.

If there is a change, it is already happening, we just may not have a doctrine for it.

I suspect that rich-poor boundary being entrenched due to crisis, and law over-growth, making equality less and less probable, the system evolves towards a capitalist Neo-Feudal system, mixed with a caste system. This also explains the social tension that we notice, as masses do not support such a system.

The main issue is that social sciences benefit from far less funding in research compared to health, energy, environment, informatics, and technical research. basically the social sciences lag behind evolution of the society.

The issue is, i think, that we need to expand. We need to colonize, to find new territories and ways of life, to expand humanity. We need to expand to oceans, in space, and find ways to grow beyond our current virtual expansion. Maybe the Virtual World expansion (Internet) has proven able to contain to some extent the human desire to expand, it will not hold forever, as it has it's own dangers within.

Dear Dr. Bolos,

Your excellent analysis points to a new theory that sounds pretty good; "socialism and communism failed to compete with capitalism". This is a good thinking which never came into my mind.

But this assumption is debatable: "The cost of re-engineering have diminished the benefits of the all transitions."

Re-engineering costs comes down by continued development in technology, and trial-error process.

Every transition has got some benefits and disadvantages attached to it. While transition from capitalism to communism is painful and does really diminishes most of the benefits, but one may not assume this to be true the other way-from communism to capitalism. Yes, there are certain costs of transition, but if such transitions benefits the masses and presents as opportunity with continued benefits in the long run, one may afford to shoulder such costs.

Your last paragraph is interesting since we are already running out of resources, so perhaps, we should look for alternative means of harnessing energy and resources from other planets or extraterrestrial sources, our own moon, without damaging our own ecosystem further.

a good reference for innovation and re-engineering cost is perhaps well described by Michael Boldrin.

Best Regards,

Sidharta

Dear Sidharta,

Re-engineering of a society is a process that involves destruction as well as construction. While destruction is a quite easy process, the construction is a complicate, try-error process, so benefits take quite some time to be obvious. Our transition from communism to capitalism led to massive unemployment, and a whole range of difficulties as the new system was constructed. Social unrest, increase criminal behavior, corruption, abuse of power, disorder, they all happened. To some extent, all of those were manageable as the majority of the population desired the change.

So, i would say, costs always diminish benefits.

Best regards,

Bradut

Sorry to interfere at this stage Dr. Bolos, but again, your statement "Our transition from communism to capitalism led to massive unemployment" seems to be a commendable statement but violates the tenets of what good economics teaches us. Well i have no proper answer to this proposition that transition from communism to capitalism creates unemployment and job losses...well, when it was better for job seekers under communist regimes? Which political theory supports more employment-communism or capitalism? If that was so, then one should have been lamenting over the demise of communism which leads to massive unemployment.

When I look at the history of political and economic thought, and about human development, I would better find that transition from communism to capitalism creates enough opportunities which are monetized which again expands the economy and support jobs. The rest of the issues you have mentioned is the problem of most of the emerging nations.

There are some genuine costs associated with transition/change, but they may diminish benefits transiently while in the long run, such costs are minimized when the benefits overtake the initial costs. Consider every innovation involves some cost of R&D. Now, why do firms innovate their products which involves substantial costs to such initiatives? Future profit and surviving the competition. Yes one should survive but the quality of survival depends. Even street dogs and cats survive but look at their quality of living and then look at the quality of survival of pets owned by rich people. In communism(sorry typos), there is no competition for anything except corruption and power, no competition for jobs since there aren't any much jobs available when the economy is not properly productive. People Do Survive under communism too, but the quality of survival matters and this is what that differs from the quality of continued existence under capitalism.

Best Regards,

Sidharta

"costs always diminish benefits."

Agreeable. But again one should look for the reasons behind such costs and the nature of future benefits to be accrued. Costs diminish benefits transiently if such costs are meant for the betterment of human society. Such "diminished" costs become permanent when the goods produced or change becomes useless or detrimental to the human society (the theory of zero benefit).

Ref:

[PDF]

Optimality and the Theory of Value - Stanford University

http://www.stanford.edu/dept/MSandE/cgi-bin/people/faculty/luenberger/pdfs/oattov.pdf

Dear Sidharta,

I am by no means a advocate of communism. What i do say, is that we should be aware of transition costs, and have a very clear path designed for every transition in order to achieve maximum cost/benefit ratio.

We had no statistical significant job-seekers during communist times. The downside was that people were sent wherever the state needed them. So people had no choice, or little choice. In terms of employment, communism beats capitalism. That said, companies had oversize staff, generating higher production cost and lower productivity, so they were usually less efficient than capitalist counterparts. This is one of the reasons communism could not compete with capitalism.

But this is not a debate about communism and capitalism, as that battle is done, the winner is clear, communism is history. The weird thing is that Marx has designed a transition from capitalism towards communism, while the reverse was theorized only during transition. In a sense capitalism won a victory it was not prepared for.

I pointed out the transition because the question of the topic suggests the need for a new system. Any system design should take into account transition feasibility, costs and benefits. Any sustainable system has to be implemented in a feasible and sustainable way. Some costs may appear "collateral damage" but that always applies to other people. Seeing whole factories deserted, seeing industry being ruined is not a sight easy to forget. It is a whole civilization that faded into the past, and left memories both good and bad.

If you want, you should start a topic on communism and capitalism.

Best regards, Bradut

Dear Sidharta,

A comment on:"your statement "Our transition from communism to capitalism led to massive unemployment" seems to be a commendable statement but violates the tenets of what good economics teaches us. "

I am not sure about what "good economics" are, and if there are, they learned from our transition, as it was without precedent. If they did not, than i fear "bad economics".

The communist society was focused on rewarding work, the capitalist society is focused on rewarding investment, while work is a commodity. For workers, the change was definitively bad, except the few ones that understood the change and invested, building businesses. A simple worker in a factory during communist times had a good wage, a flat, a car, paid holidays. Today workers could hardly get those from their wage, as work is a cheap commodity, and getting cheaper every day.

Best regards,

Bradut Bolos

Dear Dr. Bradut,

Well, indeed we may follow up this discussion in a new thread about comparative analysis of well-being in communist vis-a-vis capitalist regime, but your recent statement, another one, is a bit perplexing when you say that "The communist society was focused on rewarding work...". What is the nature of those work which they rewarded? National Propaganda against the capitalism, exploitation of worker's freedom to choose their occupation according to their own free-will, suppression of Liberal property rights, non-ownership of private property, wage-stagnation, freedom of speech and many more.

But what did it actually give the workers as benefit? Job guarantee for incompetent workers as well for the competent alike, equal rights to public property and social stability, access to public distribution systems which provided measured nutrition, and certainly, job stability, public pension system (as their only good welfare measure so far), as well, access to free medical aid (quality matters). Overall, yes, people do survive at the cost of liberty, freedom and choice. There was no entrepreneurship or innovation since there was nothing sort of competition among free market enterprises.

)cont(

Why wouldn't one agree that capitalism is focused on rewarding work too? One is rewarded by his/her own actions and the talent matters most as well as hard work. There is no limit for capital accumulation in capitalism, one is free to create wealth by business and profit, which also serves the end users (aka consumers). Capitalism do not force someone to buy or consume things they don't prefer, it just provides the consumer with innumerable options to choose from where choice matters in every aspect of our life, in occupation, education, expression, leisure and busyness( in capitalism, people earn their profit from business).

The English Philosopher John Locke was a profound supporter of free market and ownership of private property.

Resolution, Policy and Politics:

The point about the revival of this age old debate is that, part of human memory is lost in such nostalgia. The present financial crises cast a shadow so deep and according to many, created a gap so large between the rich and the poor with rebounding inequality taking ugly shape that some people are rather depressed and unhappy with the model of how capitalism works( I AGREE WITH YOU). Their faith in this system has started to dwindle without ever considering the long run benefit that capitalism has created, the mass-benefit effect I would sat, and likely to produce the same in future. One can observe and feel the lost episodes of Occupy Wall-Street, a failed attempt to topple the elitist owner of capital, and the forces of anti-globalization often peeking out in times of global trade summits here and there.

What does these transitional revolutions gives us?

Change...

Now, it seems that technology and revolution has explicitly guided us in our evolutionary phases while, accessory and implicit byproducts like the internet, globalization and the social networking is fine-tuning these evolutionary phases. All that for just one great cause-change!

As human, we want to change our way we think, move, live and do business. Evolutionary process is never stationary- it is dynamic. And so it brings on continuous change-and it’s up to us whether we accept those changes and adapt to these, or discard for something better-since, we know change is dynamic and hence innovative.

So, if someone is appreciating the contribution of private enterprise implicitly, then, one is valuing and realizing the importance of technological revolution explicitly that changed our society, and the way we live our life. And hence, it is science and scientific endeavors that gave birth to all those ingredients of change-whether through social networking, globalization or simply, by revolution. But technology and science needs investments, and access to capital.

So, can we be less appreciative about that technology and ingénues’ who led the forefront of our evolutionary cycle- Charles Darwin, Newton, Max Plank, Einstein, Edison, Alexander Fleming, James Watt, and other Great Minds who have shaped our technological evolution and w...

Dear Dr. Bradut,

Sure now as I assume why you wrote about state run mismanagement production and inefficient companies which existed. Exclusively nice explanation I would say that you were able to bring forth the fallacies of the Marxian ideology (communism). The debate is still important as I can well perceive because of people's hidden belief in such a distorting system which was once conceived as a savior of the poor people and the working class. It was more about organizing the working class against the owner of capital, which was meant to be destined for an egalitarian, classless society free of prejudices but alas, it turned out to be something else.

You have made a great point by saying that “Any system design should take into account transition feasibility, costs and benefits.” This is important since the designers of any system often overlook this essential part. The building blocks of a system contribute to its successful functioning in as much as the same way that the organization of the building blocks should contribute equally to the whole system’s stability. The cost/benefit ratio indeed is an indispensible element in any system’s design to foresee the utility of the system into some near future, which Marx failed to observe though being a great thinker himself.

If one would agree how some wrongly framed political ideologies brainwashed the less privileged, less disadvantaged section of the society at a time which was crucial for the development of that particular impoverished section, the working class. What is more distressing is that, people in some parts of the world consider ‘politics as tricks’ of brainwashing the masses employing collective sentiments. They often forget that emotions can easily override good reasoning and logic, and emotion being a humeral property, has the capacity to move the masses with a greater force than reasoning and logic. These collective emotional aspects were well exploited by the Marxian thinkers who thought well about how to organize mass movements in order to decouple people from rational thinking, reasoning with intent and simple logic. Communism, the word as we know, has its origin from the word “commune”, a village in France, meaning gathering of a community- I suppose it was based on empathic imperatives of the common people. It is not the fight between socialism, communism or capitalism as of who wins the race, but the three above ideologies do need collective understanding and participation to function properly.

Capitalism too cannot function efficiently without collective efforts. It is the fight between one going by rationality as against irrationality, between raison d'être and thinking by heart rather than by brain, between simple logic and judgment as against romantic indoctrination.

Sadly enough, people in some parts of the world choose to follow the path to move just by emotions leaving all other aspects of reasoning at the bay. This is the reason that emotions can often go wrong. One going by pure numbers is far more confident about the reality than one who goes by emotional intelligence. Capitalism is based on the first principle; going by numbers, reasoning and logic.

Concluded.

Many Thanks,

Best Regards,

Sidharta

Ref: (Follows)

The prime questions are;

>How labor and labor force, both is organized to perform efficiently.

>Men and Women should be paid the same amount for similar jobs.

>Is it ever possible to achieve an Egalitarian, class-less society? Yes, only Promethean Capitalism, as a version has answer to this (the second) problem.

>Where everyone is rich but again, the producer is richer than the consumer. So, this is not Egalitarian, since how can someone be richer than the others?

Allocation of capital is Not at the hands of the Capitalists in capitalism. It is the same Government who does the efficient allocation of capital and provisions for the welfare aspects of the society.

> There is More "Utility" of Capital and Wealth in Capitalism.

> There is genuine acknowledgment of Merits as Meritocracy. But that doesn't mean that the less meritorious would be left behind. Freedom in Choice of Educations deals with this problem of meritocracy.

> Social Progress is Profound under Capitalism than Communism.

References:

[PDF]

DESTINED FOR EQUALITY - New York University

www.nyu.edu/classes/...of.../RMJ_Destined_PositionalVsStatus.pdf

Social class in New Zealand - Wikipedia, the free encyclopedia

en.wikipedia.org/wiki/Social_class_in_New_Zealand

Meritocracy - Wikipedia, the free encyclopedia

en.wikipedia.org/wiki/Meritocracy

Capitalism and Social Progress: The Future of Society in a Global ...

www.cardiff.ac.uk/socsi/research/.../brown-additional-7.html

Sidharta you make it sound like the only possible economic theories are variations on capitalism and communism.

We need to get away from "isms". In reality, there is never a 100% "ism." It is often a sham. What we need is to be pragmatic and use critical thinking.

What works for one region may not work for another region, at a particular point in time. At other points in time new solutions may become more appropriate to a given region.

Very unfortunately, the "isms" often become rallying cries for WAR.

What we need is RESPECT for one another and for one another's belief systems, even if we do not agree. Try to find common ground, even if it is tiny - it may be built upon to find PEACE.

characteristics are named in to capitalism, communism and mixed economy.

Please remember these alone cannot bring results.The broad based HUMAN DEVELOPMENT INDEX(HDI) need to be understood. The quality parameter is another important base for success. and these are not similar as each and every country have their own cultural base. As Prof Siddarth pointed out else where in the discussions "equality in wages between male female for similar job(which is non existent even today). Even in the liberalisation period in India Employment elasticity came down substantially. Base where we start and the characteristics of development observed are important. More than that the governance. Capitalism supposed to create more employment- again it differs in the catch ups level. So we should understand like Doctor administering medicines and the recovery differences from disease for different patients . so mere capitalism or communism cannot be the issue for the analysis for the success rates

I find capitalism one of the most dangerous entities on this wonderful planet of ours, capitilism breeds greed and that in turn severely disrupts our world, we have people who serve capitilism and people who take, there are more people living in poverty now in the west than ever before, which shows the model does not work.

I see the only way forward is community co-operatives where you are responsible for your neighbour and vice versa, with all of the co-operative having a say in how things are run and where money is being spent, consumerism comes out of capitilism and thats why so many are debt in the western world which is good for the banking system and money markets, but after recent crashes even they are now vulnerable.to the pitfalls that capitilism brings.

i still believe the perceptions are with the persons than any isms. the initial drain is high and it may stabilise. More than these the kind of polity in existence matters much.

It differs between countries. we can never have a flawless system. All that we can do is to minimise many deficiencies. This is the way we have to look at "isms". Goal setting and values are more important in any system as well as policy making. So it is better to look at this way in following systems.

Ah...there you are welcome to this thread Graeme. You may have missed just few things which I have mentioned in the posts above. Its not just about few “ism”, what I meant to defend is the measure of Social and Economic, that is, Socio-economic progress which so far that matters most.

Economic policies are grounded on political ideologies and practices. There are some political ideologies that enable free movement of labor and capital, whilst there are some which do not. Consider the case of Myanmar I believe you are all aware of Nobel Laureate Aung San Kyi, who fought for democratic rights for the people and her attempt is to pull Myanmar from isolation, both economic and social. The military junta, in this case, is the policy-making govt. body whose tyranny has ravaged the country so far that saw spectacular growth and prosperity during the early 1960’s. Decades of isolation has left her people in great despair and poverty. This is not due to some “ism”, but extreme form of autocracy and military dictatorship which caused innumerable pain and damage to the prospects to this land of the Golden Pagoda. How would one explain this social progress and compare this kind of rather socio-economic regression with the nature of poverty if one really means that so in some context when comparing to USA or developed nations? Why is Myanmar left to suffer at the hands of the military regime when their people are expected to live a better life? Ask their people if they are happy enough to tolerate the junta regime or they need change? So why did Aung San Suu Kyi fight for, and why she tirelessly fought against the regime which dispelled monocracy and despotism?

Who is better off, Canada, USA or Myanmar? And then why that country is better off?

Which political theory enables more social progression and propagation of knowledge and distribution and allocation of wealth in a fair way? If the grounding theory is not good enough, it cannot support a fair system whether capitalism or communism or “anyism”. A country like Myanmar spends nearly about twice more on defense than on health and education (barely spends enough on the last two).

It all about social, economic and intellectual progression, as well as the cultural too which matters what policies the government frame and practices.

No, the only variations are not about just capitalism or communism. There are many political and economic theories in between. People in the west are now shouting that they are in debt, but it it is the same consumerism which pulled them in debt, and stopping someone from consuming something which she likes is a greater sin, if she can afford, by whatever means, is not a greater sin. Because some political systems create the environment of freedom and liberty to choose, desire and wish. Demand creates supply, and good demand creates better means of supply, where one’s desire is fulfilled beyond subsistence. Shall we live in subsistence and see others consuming at will only due to the fact their economy support such consumption, the economy which is grounded on such a political system which supports such levels of production of goods and services in such an economy?

What should be your opinion and how it shall be based on a scientific foundation of social and economic progress-suppose I am asking to a scientist per se?

Dear Clark:

You theory sounds too good for any practical purpose, the purpose is no doubt noble but lacks rational thinking.

No two persons have similar desires, not everyone wants to share everything they should be having, again, all the people do not think in same ways, and there are variances in wish and desires. It is like forcing someone to abandon dreaming about, desiring about and wishing about something personal.

Greed results from envy and there is enough providence of Veblen effect as you know it better. These subjective feelings cannot me measured and summed up in a barometer common for everyone. My desire is something different from yours, and we may or may not wish to be cooperative and if not, that results in competition. You cannot stop human desire, endeavor and longings.

Seven (7) billions persons in this world have 7 billion or more kinds of feelings about taste, perception and choice. The options are still too meager, because the productivity is not enough and Capitalism is at its infancy (not and old fellow as yet). Capitalism is not producing enough for everyone, not enough to fulfill all our desires and wills.

Think about any system which can do this; unlimited production with infinite choice horizon. It would really be difficult to choose the right things then, but would leave enough for each of us in a fair amount. So consumption cannot be stopped but curtailed for the time being, since consumption is the mother of all economic concepts. If you don't consume, there is no good in producing goods, and no such incentives to be derived. Do you want to kill the human essence of consumption by optimizing all our demand and consumption patterns into one single variable:

Cooperation is good, but competition is better and there can be cooperation in competition too.

Thanks,

Best,

Sidharta

I think Prof. Gopalan got a point to be clinched where he rightly mentions "Goal setting and values are more important in any system as well as policy making. "

Values define policy-making I would agree, and goal setting is important because it is for our goals what we intend to do, act and behave in order to achieve that goal.

and I believe, as Clark has mentioned above (sorry for being rhetoric ), perhaps our goal is not to destroy the essence of individual identities, choices and desires. We can't be regressive at this stage when technology is ruling us and we are just it's tools. It is too late, but never too early to think about such possibilities... all ideas are welcome as long as they are based on rational economics.

Well Antonio, very well said, PEACE. Some people in the East and perhaps in the West too, believe that "Capital is the origin of all the Evils." Remove Capital, and so gets those evils removed? If there is no capital at all then there is but little greed. But that's not possible, but "Peace" can be carved out even in times of violent troubles. and even the most peaceful times has evoked violence as is proved by history. So, it is not related to any 'ism' per se.

most of the time it is the path that we question than the person on the path. I believe still in the statement of yours,"Cooperation is good, but competition is better and there can be cooperation in competition too.", We should not all the time try to show the west that we do have rockets, but we have happiness that they should see. Our Plan models are the second word best...but in governance....Milk dairy of Anand may be a good example to show the best governance without policing. so let us think from the below and make every one cooperative and competitive

Yes, we have a thriving Amul Dairy which is a competitive cooperation since, cooperation cannot alone thrive in the face of competition; that is, something which is meant to profit from such initiatives. NGOs also do survive, which is an altruistic form of cooperation but the whole world cannot become such an organization. Someone must be a producer of goods for someone who is a consumer. One cannot produce all the goods neither can one consume all, so division of labor and consumer are important factors.

A system must have some intrinsic value to be believed. Belief in such a system should be valuable to the believer as well. Blind faith based on collective emotions gives one enough chance to revolt without knowing for the cause one is revolting; Communism is an example of such a system whose believers are more nostalgic. Capitalism do not force anyone to believe in it, but rather provides some incentives for such belief.

Communism had a bad byproduct; extremism.

Capitalism too has an evil byproduct: greed.

Yet still, 'greed' is "less" poisonous than extremism.

Dear Sidharta, dear Carl,

It is weird to see "greed" described as a byproduct of capitalism. "Greed" is a human characteristic like "pride". It is not Capitalism or any other "ism" that created "greed". Greed is neither good or bad, it is something we should always take into account. Adam Smith, in the Wealth of Nations said that greed works better as an incentive than goodwill (the baker example). Capitalism uses greed, it is not blaming-it. Communism attempted to repress greed, but did not work, and all religion i heard of blamed greed as a sin, but never managed to repress-it.

People want more, people love owning stuff, and we can always count on greed, as even a small child, without being conditioned to "want more" desires and demands toys, and foods, and attention, just like grownups. We just refine and expand greed as we evolve.

I have doubts that any system that does not manage greed could work, and any system that attempts to repress-it will be fake in his nature, repressing lower classes greed fro the benefits of upper classes greed.

So, i am not going to debate ethics, i just say greed is unavoidable, and should be accepted as being unavoidable and always present in society. It has no limits, except maybe a socially acceptable manner of masking-it. It may be linked to survival instinct and insuring the best survival conditions.

Best regards,

Bradut

Agreed Dr. Bolos, that greed is purely human behavioral element just like lust and envy. While envy is good (as I was discussing this topic with Dr. Tucci in another thread where his research is aimed at envy reduction), greed originates to a great extend from envy. I am not blaming greed as a sin, but less toxic than other forms of extremism.

Yes greed is unavoidable but often leads to irrationality. As you may have noticed in the financial markets that too much greed leads to excessive risk assumption where the level of such risk do not rationally collate to the amount of return to be expected from the market. The design of sophisticated pro-ducts and by-products of asset backed derivatives pledged as financial innovation went to get sold in the markets unregulated, without one having proper perception of risk associated with such products. This led to the catastrophe we all know. So, just like fear plays some role in avoiding risk, too much greed perhaps leads to one assuming excessive risk. But this greed is a personal psychological trait which is not avoidable, but perhaps one should be rational to be not so greedy.

Wall Street now has backed down on such exotic products for the time being, but will be back with a bag full of new innovative instruments to model and profit from risk. Profit is not bad, perhaps too much profit is also good, but one must respect the market fundamentals without relying too much on risk-taking technical. One cannot blame a system for such a practice if its users are irrational.

Best Regards,

Sidharta

Some of the answers to this question are mind-numbing. Indeed, so is the question itself. What is the evidence that capitalism has failed to solve development problems? None that I know of. Indeed, a reading of Angus Maddison's work makes clear that capitalism has resulted in huge gains in well-being over the past few centuries. The real problem with development is not market failures but rather government failures. I would take the message of Acemoglu and Robinson's book, as well as its many predecessors, to be that government is always the major problem - either doing things it should not do (corruption, protecting special interests from foreign competition, etc.) or not doing things it should do (such as not protecting property rights).

To dismiss capitalism as an "ideology" is to disclose ignorance of what capitalism is and what economics has to say about how it works. Capitalism is the private ownership and control of the means of production. There is nothing ideological in that. The first and second welfare theorems say that capitalism can be expected to work pretty well. The only issue is an empirical one, whether capitalism really does "work." The evidence is that it does. Around 400 years ago, most of the world was poor and barely growing economically. Subsequently, trade, the industrial revolution, and the demographic transition changed all that for a large part of humanity. The part of humanity that has not gotten rich is the part under the thumb of autocrats protecting their own and their friends' interests. Communism hasn't worked. Mao Zedong inadvertently killed around 40 million (stop and think about that number) of his own people with his idiotic collectivization and central control of agriculture in the so-called Great Leap Forward. Stalin had a similar experience with his exploits in collectivizing agriculture. Nothing like those catastrophic failures ever has happened under capitalism. Quite the contrary. Capitalism has fed a world population of unprecedented size.

None of the foregoing is intended to argue that markets are always perfect and do not need government intervention. The usual market failures are well-known. However, as a first cut, there can be no doubt from the historical evidence combined with what economic theory teaches us about how to interpret that evidence that capitalism has been a source of almost unimaginable gains in well-being. It's defects are small potatoes compared to its successes. The only reason capitalism has failed to deliver the same gains to some parts of the world is that it hasn't been tried there yet.

Innovation is a two edged sword, while it may increase productivity, it also increases the hidden risks, by coming up with new ways to hide them.

Consider MDF originally designed as a way of increasing productivity by allowing the use of lower quality wood in the building of furniture, in it's natural state it tends to also be obviously a poor building material, if only because the merest hint of moisture tends to cause it to swell and delaminate.

Today we have multiple means of masking the risk of delamination, including a number of coatings, and coverings that can be designed to look so closely to wood, that it is virtually impossible to tell they are artificial. As a result, with only a small amount of gain in strength and lasting, MDF can be designed to fool the most exacting analysis short of actually drilling a hole to see what is the center of the wood.

This wealth of ability to fool people into thinking that MDF is actually good wood, is a triumph of capitalism, because not only does it produce more product, but the same product can be sold multiple times, in multiple disguises to the same customer because the risk of self-destruction is so high. Good quality wood on the other hand has become so expensive that no-one can afford anything made from it. Partly this is because the cost of growing it is so much higher in comparison to the cost of the cheaper woods, and the supply has dwindled because the demand has gone down with respect to the demand for MDF.

Dear Sidharta Chatterjee

I have not related about media report from and advanced country from the foreign soil. If you want to confirm search Times of India’s website with appropriate keywords along the name of one of the oldest universities which has given a number national political leaders. Good Luck!

In the context of denying education to girls in spite of having means to support it, I would like submit that it is not justified in any case on any ground. Half of the humanity cannot be denied its birth right to bring light in their life passing in the darkness of ignorance. It is another thing that most educated persons are followers, not leading lights. However, why an educationally and economically backward community does not send its girls to schools, colleges/universities even though they are free or charge nominal fee. It must be crystal clear to you. When its educated and highly qualified boys cannot obtain a job and have to engage in menial and arduous work in family occupation to make two ends meet, why get its girls be educated instead giving no formal education and training at home in some vocation so that they could contribute to their household’s earnings. In modern period education is considered a means to earn livelihood, social and occupational mobility. However, it is not my idea of education; you may have some idea of my concept of education from my post on ResearchGate:

https://www.researchgate.net/post/What_is_education_THEN_What_is_mathematical_education

Your argument to be educated or to earn money through prostitution does not hold true even in the case of advance society, the report of which is being discussed. “Rape” even there is a stigma and according to experts a cause of underreporting but not in that proportion as that in ours. The words like “prostitute” and “whore” are considered highly demeaning, offensive and abusive and rarely pronounced in the presence of ladies.

You praise Gandhian model of economy for sustainable development, but forget her motto, “achieve right ends through right means” that justifies his nonviolence approach to attain independence. It was his moral conviction. WE MUST BOW TO OUR MORAL CONVICTIONS OR PRESUMPTIONS WHICH, IN DESPITE OF CRITICISM, WE STILL EMPLOY FOR THE REGULATION OF OUR LIVES. OTHERWISE, ANARCHY OR CHAOS WOULD TAKE OVER THE SOCIETY.

However, morality emerges from consciousness a nonphysical property of higher life that is essentially different from the stuff of which the physical world or body is composed of. This consciousness has developed a value system to give direction to the society. We must regard even our most basic moral convictions as local conventions either evolved through experience or revealed from a supernatural power, scientifically with no rational grounding, that various moral norms- such as the idea that we should not repress “difference” and oppress the “other” or to be “honest”, “truthful”, “altruist” are universally valid. Either you believe in Adam and Eve or some other couple send by God or some god on the Earth or you believe in evolution, according a recent survey new generation in the West considers racism as one of the gravest sins, forget Bible. It is another matter, that supremacists or killing others (inferiors) in the West.

However, for people at the crossroad of consciousness, torn between human and machine, morality has no meaning and everything goes to achieve a materialist goal.

You need not worry about my daughter; she is highly qualified and more qualified than me to discuss morality, consciousness and robotics, electronics etc. being a physicist in her own right and having inherited interest in philosophy, religion and mathematics.

You have made a single point an issue of your argument, which to you is highly contended and I also noticed when you find no counter argument you say that it is not a proper place to discuss these points as in the case of Bradut Bolos.

@Dr. Khan:

On your statement,

[[“When its educated and highly qualified boys cannot obtain a job and have to engage in menial and arduous work in family occupation to make two ends meet, why get its girls be educated instead giving no formal education and training at home in some vocation so that they could contribute to their household’s earnings. In modern period education is considered a means to earn livelihood, social and occupational mobility.”]]

This is one of the most irrational explanations I have ever read which makes no sense at all to put students out of their educational paths for the fear that highly qualified boys cannot get a job. Did you know about a concept of “voluntary unemployment”? Moreover, it is a false notion that highly educated boys cannot find a job. Look the premier institutes in our country which sets higher standards in education and training and you will find that they just not only “Choose” where they should work, but they make the corporate sectors decide for them how they should be able to compensate them for their engagements. Different levels of skill sets have different sets of work related values and compensation benefits to match their abilities and proficiencies.

Yes, the quality of education matters, I would agree with you on this concept only but still, job-seekers with even mediocre skill-sets are able to find jobs provided that there are many options and opportunities to choose from.

A country with no or just a fewer corporations (private)have a very little to provide to its job seekers in terms of varieties, but a more open, liberal and entrepreneurial, industry oriented country provides its boys with more than enough and different kinds of job as and according to their skill-sets and educations. If the boys so not get jobs or may not wish to engage in the labor force, they are free to choose entrepreneurship and create jobs for others. You must remember that there are a great number of CEOs who couldn’t succeed to find a job during the beginning of their career but set an example by choosing the path of entrepreneurship where they became tycoons and in turn created jobs for the million. Capitalism facilitates such an environment to be creative and pursue personal dreams (a good example is N. Krishnamurthy who was once denied a job by Azim Premji (CEO) of Wipro, but Krishnamurthy started Infosys which is in fact NOW a bigger corporation than Wipro itself). So, has been the case of Steve Jobs of Apple Inc. They are leaders to derive inspiration from. The case of Krishnamurthy is an example of “Voluntary Unemployment”.

So, it is unlikely to be led into such an indoctrination that educated and highly qualified boys cannot obtain a job, in fact the other way around is true for India that companies are not getting enough highly educated candidates for their requirement. There are numerous mentions of talent crunch in the IT/Services and the manufacturing sectors in newspapers and tabloids, so I wouldn’t accept such an ill-conceived explanation.

Another statement of yours:

“Your argument to be educated or to earn money through prostitution does not hold true even in the case of advance society, the report of which is being discussed.”

Since you have raised this issue of prostitution ‘first’ in this thread, let it be clarified a bit more:

You have perhaps misread my post posted several days ago where I never mentioned that “prostitution” is a good practice, contrary thereof, if I remember I mentioned clearly that it is a “bad” practice.

I have delineated an entirely different context to address the situations of girls being forced into prostitution or destitute. So, let me again repeat what I have mentioned before.

What are the causes of prostitution in India? How do girls get into such an awful profession (illegal though it is)? What if some of the victims (innocent poor) fall prey to pimps and end up therein due to various reasons beyond her own control (circumstantial constraints)?

The answer to my last question:

Should you consider those moral souls, yes, (because prostitutes are human beings too) and they are just victims of social dogma or poverty be doomed? Shall not they get the chance for rehabilitation and live a normal life if they afford to do so or given chance? Most of these girls in India engaged in such profession comes from the low socio-economic backgrounds (with little education thereof, since this fated profession do not require educational grades), and if they find enough chance to get back into social life, shall they not be given a place to start their career and be self-dependent in a much more respect manner?

Capitalism has enabled us to raise our moral standards by and through education and learning and hence speaks “about and for” the Social Reforms, social progress “more than any” other political doctrines which I have known. It never “rejects” anyone but accepts anything which is free to be debated and open for consideration.

The destined, secluded girl (prostitute) in her appalling profession may have saved enough money to think about going back to normal life by “choosing” to get educated and then live a normal life. What can be a better option than this? I have known about few great scientists and personalities in the west who are now leading scientists in their own domain (more educated than some of us) who used to work as “bargirls” before. Not just that, they are now national figures to be admired and respected thereof.

We should provide incentives for them living under shadows to change and as well provide enough moral support to them to shine in their own life. This is morality, and moral norms.

"However, morality emerges from consciousness a nonphysical property of higher life that is essentially different from the stuff of which the physical world or body is composed of. "

This statement is highly debated within the Philosophy of Mind circles as well among scholars alike. Nobody is that certain about whether "consciousness a nonphysical property" since there are issues related to mind-brain dualism, and monism. Your statement flashes out simply that consciousness is a different property from the properties which originate this phenomenon, that is dualism.

I am confounded with this problem as well, but have a belief that it is not a non-physical property, rather founded in Quantum (State) Field Physics and it might really be possible to understand human conscious processes using the tools of science and physics.

One physical process can give rise to an entirely a different physical process, that physical process which is perhaps not discernible with the modern tools of science, but time will prove whether dualism or monism rules the mind.

"You need not worry about my daughter; she is highly qualified and more qualified than me to discuss morality, consciousness and robotics, electronics etc. being a physicist in her own right and having inherited interest in philosophy, religion and mathematics."

And finally, since you have given you daughter what she deserves best, why should you mention anything about denying this for others who can or cannot afford? You can help it extend to others or do something about which should facilitate and enable the poor and the downtrodden to receive what they deserves best, they are also daughters of other parents, so they deserve the best the society can provide. One may choose to be a reformer if that is for collective benefits, providing education and knowledge and lifting them from the veils of ignorance. To be an example himself, one must but first reform himself / herself and open the doors of the mind to such infinite possibilities.

Perhaps I have very few better things to say about Capitalism what Prof. John Seater has said above which in a nutshell, defines the true, beautiful essence of Capitalism, entrepreneurship and free-market and the tyrannic history of Communism.

I simply agree with his last statement where he mentions a very important aspect:

Quoting him,

"The only reason capitalism has failed to deliver the same gains to some parts of the world is that it hasn't been tried there yet."

To which I would like to add, Capitalism is not welcomed there as yet, it first must be there to unleash its potentialities and welfare. Embracing capitalism would end their corrupt practices, brain-washing of the political mass and put an end to their dictatorship and autocracy, help develop a free-market system, bring in efficiency in managing welfare and boost productivity that would create jobs and bring down the level of poverty ( as well increase their HDI).

@Graeme:

"This wealth of ability to fool people into thinking that MDF is actually good wood, is a triumph of capitalism, because not only does it produce more product, but the same product can be sold multiple times, in multiple disguises to the same customer because the risk of self-destruction is so high."

There are few truths in your statement, well you are good enough to model it according to your own ideology.

This answer is grounded in production function, production possibility frontier and profit (including the old tenets of supply & demand).

Yes it is true that capitalism produces more goods but there are differences based on price and quality demanded by the consuming mass. It just provides you with some options to choose from, and the same generic product may be branded in new shapes and colors but remember, there is product differentiation. Our needs are not uniform but dynamic, and the capitalism works best on the notion of equilibrium between supply and demand. A consumer is free to choose what is available in the markets, but the structure of the market is important.

One would expect to find fewer goods in a simple roadside grocery than in a supermart since those work in economies-of-scale (EoS). A large giant hypermart like Walmart, Tesco or Carrefour would likely provide you with enough to choose from, based on pricing and quality, from cheaper stuffs to high end consumer durable. You will definitely find a huge variety of items, even some same items packaged in different formats having different price tags from different producers, or from the same producer. As a consumer, you have a "right to choose" and discard a commodity which you find is not up to your mark. So, its me suppose I am who is both a foolish customer or an informed consumer. Once I know that a particular product is good and why it is good or bad, its up to me to be fooled or get enlivened by my own choice. Its all about the matters of choice and options.

And if you really think that a product is fooling you, then as a consumer, you are a king and have consumer forums to deal with. Products are often recycled or are taken out of the market with new, innovative goods being replaced as and according to consumer psychology.

Sincerely,

Sidharta

@ Graeme:

Some useful dialogues; References,

As a consumer, you have a choice.

http://www.merchantcircle.com/blogs/MI-Howell-48843?start=10

http://econ.ucdenver.edu/beckman/research/readings/baumol-contestable.pdf

Capital Structure in Perfect Capital Markets.

http://e.viaminvest.com/A7CapitalStructures/Perfect/Model_IrrelevOfCapStruc.asp

http://groups.haas.berkeley.edu/marketing/sics/pdf_2012/paper_gaynor.pdf

Free to Choose:

http://highered.mcgraw-hill.com/sites/dl/free/0077117875/576843/03_economics_ch03_056.pdf

Thanks.

I endorse many points of positives of capitalism. fittest will survive. Can we adopt this for underdeveloped, developing? why then most of the African countries not gained much and have high poverty. Competition-efficiency- market mechanisms are not safe methodology for underdeveloped and developing nations to some extent..

Monopolistic competition perhaps may be a good example for the wastes.

Are the capitalistic nations safe- again not true. They also enter in to some controls and distributive mechanisms. Now there is no pure communism and capitalism in existent . All that i argue is for a convergence which is more realistic and practicable.

Dear Dr. Gopalan:

Your concerns are genuine and factual. Concerning African development issues, regretfully, one is compelled to revisit the colonial past which in some respect, shaped many aspects of the continent. As you have noted, “fittest will survive”, this statement is a misnomer since capitalism enables everyone to survive and creates an environment to attain inclusive fitness by providing freedom to access to education, knowledge and creativity. Its not that only the fittest survives under capitalism, since that dictates an extreme form of capitalism: corporate capitalism or Fascism, which was an utter disgrace to the human civilization.

Capitalism was born out of experimentation from other failed concepts of market mechanism and industrial revolution. It is a refined concept standing on the four pillars of social progression:

>Democracy

>Liberty

> Freedom

>Welfare

Incidentally, these four aspects were missing from the political scenarios of Africa. Past colonial exploitation has also left some of the African nations to bleed heavily; the traces were left as ethnic conflicts and racial prejudices. Africa was much left to suffer between the incomplete transgression, neither toward capitalism, nor communism. Intergenerational conflicts between the different warlords and dictators left the continent in utter political chaos, there were no coherent policy tools to bring in developmental efforts aimed to alleviate poverty reduction and industrial development. In a nutshell, industrial development did not take shape as it should have been in other parts of the world.

Economic growth requires market development, which was lacking in Africa. The African economy much functions as a shadow economy with the unorganized, informal sector catering to the needs of the people where in such instances, there were no market mechanism to oversee supply and demand. This was rooted in bad politics of the public. Some of the countries in africa passed into the hands of tyrannical dictators who virtually unleashed genocide and fomented and supported ethnic conflicts to grab leadership and political power. As I have said above, any country missing the essential elemental groundwork comprising of the four pillars of socio-economic progression would invariably be left in the dark and isolated. So were most of the Sub-Saharan African countries isolated from the global growth story and industrial development.

This is further rooted in lack of means of education drive and literacy programs elsewhere in Africa.

Your another concern:

Well, if “Competition-efficiency- market mechanisms are not safe methodology for underdeveloped and developing nations to some extent..” not suited for underdeveloped nations, what could be the essential possible mechanism for rapid progression and socio-economic development?

It is true that no markets anywhere are fully efficient, but they reflect price and supply-demand mechanisms to some great extent. In times of sudden jump in oil prices, people would tend to say that oil companies are highly profiteering from such rise in price, and which increases the cost of living, and in such times, government often place a ceiling on the market price of oil. That prices often fail to reflect properly is due to the inefficient transfer of information and sudden rise in demand. Speculation is a secondary problem and for a free market to operate efficiently, speculation is sometimes a necessary evil.

A one-sided monopolistic competition is not superior to free-market competition where scores of players compete on price and quality. Monopoly cripples free-market capitalism since consumers are left with fewer choices and options but either to buy or refrain from consuming their desired goods. Competition opens up the ground for lively entrepreneurship and expands the consumption horizon with new companies coming up with innovative models of production, process and goods which brings down both price and increases optimum choice functions.

If economics is stated as a “science of choice” (Paul Samuelson), then free-market is the art of bargaining and discovering prices. Russia started its price liberalization in 1991, and following breakdown on Mao’s bureaucracy, China embraced the path to wealth and liberalization. India followed up by reforms onward 1991, and Poland did embark on a kind of “Shock Therapy” to incorporate markets into their economy. It is much about developing a market structure where not only goods, but labor would move freely and without much friction.

There are some examples of Egalitarian societies, Sweden and Netherlands whose welfare system are far better than other pure capitalist countries. Why not emulate them?

The examples of LDC (less developed countries) are staggering examples of why they did not embrace market system. Countries with low per capita income outnumber far more than countries with high per capita incomes, only because they lacked efficient reform and industrial development (Max Weber). Adult illiteracy rates in LDCs are higher than their upper-middle income and high income economies. You can now judge by such merit why literacy drive is important and how education drives economy, employment and labor force.

Capitalism is about Human Development, not regression. It is about developing human capital to compliment natural resources. Productive Capitalism is hence indispensible for rapid economic progress. Economic stagnation is iniquity and nuisance, which predispose a country toward further inequality.

I am not a sole Paragon of capitalism, but I would prefer to judge a system by its intrinsic values and virtues. It is also imperative to say that capitalism is free from encumbrances, there are many inefficiencies associated with this system, as like no system is purely error free, but as also, this particular politico-economic ideology is not error prone as either.

I have just mentioned that Capitalism is perhaps exhausted of its means and purposes, though it served its purposes very well, it has not failed as a concept, and not even ever been ineffectual, but just become exhausted in dealing with the problems of inequality and disparity in wealth creation and allocation. But the need of the hour is something of a refined version of capitalism with similar flexibility and freedom, a move toward more welfare system grounded on the same four basic pillars of social progression.

Perhaps some of you have read the accounts of (Count?) Alexis de Tocqueville (1805-1859) regarding the USA, its politics, and its economics. His prescience was astounding. He was able to predict that Russia and the USA would become enemies. The USA that he saw was simpler and easier to understand. But the same fundamental relationship between politics and economics holds today.

There is basically no difference between politics and economics, in theory, practice, and goals. And those in economic control will twist theory to advance their personal agendas and interests of the moment.. Just empty words to suit their present interests.

Except for people who follow the Scientific Method, very few humans are objective and reach conclusions based on evidence and logic. Instead, they have a "gut" reaction, and then use (or abuse) evidence and logic to advance their preconceived "gut" conclusions. This is typical of politicians and leaders of "isms".

The over all discussions have thrown open , whether to tools in the market mechanism serve to what is left over now - inequality, poverty and misery of the poor and still many could not participate and/or take gains out of this market situations . Does capitalism have some more hope & Tools on"SOLVING THESE? so much discussions went on this issue can any one be in position to sum it up for people like me to benefit out of it.

Capitalism, communism, socialism and fascism, these are all "ism" no doubt. Out of these, Fascism and communism failed (Fascism was an extremism form of nationalism which was wiped out), communism is but opposite of capitalism, Socialism and Liberalism survives in some countries as social liberalism.

There is no politics the history could mention following industrial revolution beyond few 'isms'. Now, the question is, as Antonio has mentioned above, is to explore beyond these "isms". We do have another ism too; collectivism, altruism and cooperism per se.

So, going beyond some "ism" as a political tool to manage economy we don't have much choice except capitalism which has become crony in some nations. The world do not perhaps wish to recycle some of these "ism" for sake, so, there is a version of capitalism which is still not experimented: Promethean.

Some have a view that real free market is similar to fascism to which I object. There is no logical point in this but in fact, the other version, anarcho-capitalism is perhaps a derivative of extreme form of capitalism.

The point is, who shall control the capital, and how it should be controlled, generated and allocated? Do we need more government intervention(i am not a communist) or less govt. intervention, or no intervention at all (real free market).

Siddharji is is a nice sumup . I too feel that we exhausted the tools but left with the popularity in Capitalism., . How safely we can rely on a convergence thesis and how to select tools for the operational efficiency and more so- human friendly.

Thanks Prof. Gopalan for your moral support. Just like to share an article i wrote about this issue some time back in RG following my discussion with Dr. P. J. Palms I remember, it was a fruitful discussion which led me to write this original article. I have discussed these issues in some detail which you may wish to go through.

Regards,

Sidharta

I shall be grateful if you get me the copy of the paper i will definitely go through and may be in a position to discuss more.

There are some thinkers that extrapolate into a future in which mega-organizations such as: multinational corporations, the European Common Market, and political nations will breakup into smaller entities, much like city states, such as Singapore, which can be more responsive and efficacious in meeting the local current needs of their members. When and if this happens, there will be much less reason for having "isms".

The "fly in the ointment", however, might be security against a belligerent neighbor - maybe military coalitions for mutual defense (such as NATO) would be necessary. Otherwise, smaller is better.

Dear Mr, Antonio Lucero,

Regarding the thinkers you mentioned, they cannot discard the "nation" as easy as it seems. Mega-organizations and mega-corporations are at the core of current crisis, up to the point that some say they have failed, and corporatist-capitalism has failed.

The good part of normal capitalism is that it allows failure without systemic risk. The corporate capitalism at it's extreme creates critical central nodes in the economic network thus increasing the systemic risk. Imagine such mega-corporation failures without any authority able to deal with, and manage consequences. And there is only one sure thing, any corporation no matter the size will eventually fail. They only make a bigger bang when they crash. Just because some are 50 years old, does not mean they are immortal. You surely heard of the East India Company. They practically invented corporatism, and lasted from 1600 to 1858. We really want that back? Ask our Indian friends here how they feel about such an idea. Standard Oil again, this time without a Supreme Court above, as it has no nationality, and there are no nations anymore.

Corporatism pattern is not new, it's old. It's not progress, it's against the very foundation of free market.

So, about those thinkers, i am sure they are better paid than most, as they say what powerful people like, just like painters making the kings taller and the queens younger.

@Bradut: Thank you for your comments.

My initial reactions:

The Futurists are not trying to "discard" anything. They expect that these huge institutions will disintegrate under their own weight. As you say the mega-corporations are at the core of many of our problems.

Left by itself Capitalism can cause systemic failure. In the current economic crisis, it was only with the intervention of the governments that systemic failure was averted.

We have to avoid thinking in terms of idealized models of economic-political institutions. Instead, we need to learn what the messy, detailed reality is. It requires more work on our part, but it will keep us from thinking in stereotypes.

@Antonio

Sorry, i have misunderstood your previous answer. In fact we are on the "mega" failure on the same tone. I agree about smaller companies, not about smaller states. I don't believe a city state is functional unless it has a huge strategic significance, like Singapore (Sea Trade node), Venice, Genoa, Byzantium, Carthage, in the past.

I am not so sure about averting the crash, at but states delayed-it for sure.

I think that States, realizing that they couldn't support the heavy weight of mega-corporations did not attempt to avoid the crash so much as delay it until the Mega-Corporations had exhausted all resources for hiding their new found wealth.

While the Central Banks are quick to NOT say anything to point fingers, rumors have started that many corporations are sitting on money that the economy needs for its best health. If they do not soon re-invest in the economy it is feared that they will precipitate a new round of bank failures. The intimation is that the State has done it's share, someone else needs to put their finger in the dike.

There are certain risks which need to be addressed to the above suggestions of Antonio's i would like to adress:

First, Breaking MNCs would not be a universal phenomenon, since not all countries would likely follow this suggestion. Consider that Russia or China would not follow such policies, and instead of breaking up, they would grow up and devolve all other "broken-up" smaller companies and rule the board. Those who control big MNC's also control the policy-making.

Second: Firing tax would depress hiring process and jobs would be outsourced to other countries who would never follow such policies.

So, anything as one would observe, is NOT possible at this scenario since there are problems of enforcement and acceptability.

The MNCs as such, would remain and grow big I suppose, so no breaking 'em up.

Remember Tobin Tax?

@Nina, I think you are right there, in that energy is not being properly taken into account in economic measures meant to evaluate the health of countries. I live in an Oil/Gas producing province in a confederation of provinces where the Manufacturing Sector used to be the main economic engine, but the Energy Sector has taken over leading all other sectors. Mulcaire the New Democrat Leader asked seriously if my country wasn't suffering from the "Dutch Disease" where the Energy Sector is the tail that wags the rest of the economic systems dog, by keeping energy prices high, and thus causing the dollar to be over-valued. The province has unfortunately pinned its hopes on a $90.00 barrel of oil, which was unreachable for half the year. It plans to have a deficit where it has to dip into reserves to keep going. The rest of the country is more or less dependent on transfers from taxes to keep the lamps lit.

If you use the GNP as a guideline, Canada is doing well, yet the manufacturing sector is devastated and may never return to prominence. There are three main factors keeping it down. 1. the reliance on the U.S. Market which has still not recovered

2. Energy Prices which keep edging higher, and 3. the exchange rate which because Canada's economy didn't tank with the U.S.'s remains high enough that prices do not support export. If Mulcaire is right, two of these at least can be dropped at the energy sectors doors. Nothing can be done about 1 except look for better markets, and for growth in the American Economy again. Because the economics of shipping favor Eastern Ports over Western ones, The rise of the West as the new economic engine has not increased shipping even to west coast customers. Instead pipelines are being fought over in an attempt to ship bulk products directly, reducing the development opportunities in the local market and making it likely that the province will be even more dependent on royalties from high oil/gas prices.

We can see both sides of the equation here in Alberta, the dependency on high prices for royalties, the come and go of employment as oil rigs are parked and then released again, and the rising costs of doing business including the cost of fuel for heating and car engines. Here in Alberta we can see both the relative prosperity of the oil industry and the death of local manufacturing when shipping or energy cost becomes a factor in its survival.

Dear Nina,

Your statement is correct no doubt, but the underlying economic processes which cause such volatility in energy prices should be underlined as well.

"Stated in the simplest of terms, when the price of 'energy' is low, the economy flourishes since businesses can afford to develop and expand."

Indeed there is a direct correlationship between oil price shock, energy market fundamentals and economic cycles.

It is true that businesses suffer from high energy costs which rips off substantial portion of their profit proceeds. When the energy price is low, which means the demands subsided, or the supply increased (supply demand mismatch), may be duw to various economic or political reasons, but affect or is by itself the effect business cycle as a whole. Business cycles are dependent on energy prices, no doubt, but we generally find that energy prices rock bottom "only" in times of a severe recession, more so, the tail end of a recession. This bottoming of energy / oil price is a good sign indication of a possible rebound in the economy and markets. Businesses take this opportunity to invest more, and is an ideal time for entrepreneurship (due to low cost) and presenting opportunities.

The times of peak oil or say when the crude touched $120 a barrel, is also a sign of forthcoming danger and damage to the economy, since energy prices do not generally sustain for long at such a price which invariably takes toll on the economy and on the financial markets. Fuel prices do fuel economic bubbles, but seldom is the only cause of depression or economic boom. Rather, it is the effect of such booms and bust. Prices are reflected as real demand and supply of oil/energy reflecting the health of the economy.

The history of economic depression and booms *(baring the only incidence of 1971-76 oil crises induced recession) has been more correlated to the real growth/contraction of credit money, housing, stock market bubble or contagion or the present Subprime crisis related to the Mortgage Market Collapse. Energy prices played secondary role here but it is true that the market became unsustainable when the price of crude touched a record high of $147/ a barrel in mid 2008.Soon following the crash, the recession started, and the oil priced bottomed out $32/barrel in February 2009, and it was from March 2009, the market rebounded, and the economy somewhat stabilized but invariably passed into stagflation (zero-bound Fed Rate). Soon started the QE and bailout processes while oil prices stabilized for the time being, only to peak again from late September last year.

Regards,

Sidharta

Then, not to forget, there is certain role of speculation in energy-oil price volatility.

both capitalism and communism are tested failures to a large extent as each of them posses positives and dangerous negatives. A convergence these have to be worked out considering the characteristics of the population and problems without forgetting the politics. In all the good governance and social acceptance are must

What I am interested in, is collective capitalism, the idea that people work together and share from the income of capitalist processes that have a dual bottom line, one line being profit and the other social benefit. We see this trying to come into existence with the Class B or "Benefit" businesses forming in the U.S.

Another example is "Real Stew" an attempt from New Zealand. That unfortunately uses it's members as leverage in what seems to me to be a cynical way.

To add to this, I think we need Social Banking where there are banks that understand the second bottom line and do not attempt to push only the financial one.

Currently over 50 percent of businesses in the UK, start out as social enterprises but end up as capitalism because the environment simply does not support social enterprise.

for the time being let us forget the isms choose the best to reduce unemployment, reduction in poverty and inequality. and in total good governance and people friendly policy. For such a situation let us christen it with a nice name

@Roman Maltsev: You need more than one social bank, you need enabling legistlation to open a whole new banking system, with slightly different rules from the current banking system. Just as you have securities rules to protect the bottom line of normal banks you would have social securities rules to protect the social bottom line of Social Businesses.

China is still NOT a capitalistic country. In fact the Capitalisits in Hong Kong are very leery of how the laws of HK are being changed by China.

@ A. Gopalan

I believe it is called social capitalism or sociacap for short.

The soviet Union was centrally controlled, what is needed is a more distributed model of socialism based on capitalism.

The fake insurance and bought ratings wouldn't have even been attempted if there weren't securities rules to be got around, getting the government to back them with anything more than lip service is the problem. Conservative power brokers played down the governments role in letting that level of infraction be passed.

I don't think that a system driven by individualism whereby individual being agent of society becomes self-serving agent. Naturally, people driven by such a philosophy believe in making money on any cost, even on the cost of entire humanity. All conflicts world over are the result of the processes either economic or political set into action by this philosophy at individual or national level. Capitalism in the form of no-colonialism, imperialism etc. is controlling world resources and markets. As one contributor has pointed out that concentration of capital is increasing in the nations which believe in this philosophy. The ordinary people including those who put their lives at stake for these few people, whatever get is nothing a trickle barely enough to meet standard of life in those country.

Sustainable development forgone, such a politico-economic system cannot guarantee even welfare of people for long.

It is quite obvious that we meet our needs by converting natural capital into monetary capital. This conversion processes does take place within the environmental system. We cannot go on converting this natural capital into monetary capital indefinitely. It needs responsibility on a politico-economic system to put checks and bounds in place. However, it requires a responsible economic system be it capitalism or socialism. However, both depend on materialistic philosophy whereby selfish gene is at work and human animal in struggle to survive (to accumulate wealth, concentrate power or maintain life style) is eating up others. To safeguard humanity from its own invited extinction, a sustainable development with justice and equity is only possible if a politico-economic system has strong moral base rooted deeply in religious values.

If human beings consider themselves animals, not responsible for their deeds hereafter, they are bound to eat off others' food. A responsible capitalism or socialism is only possible, if one is afraid of punishment for one's deeds by a supernatural entity. It is interesting that both the systems contributed to the demise of such moral roots for their selfish ends.

@Roman Maltsev

You tried brainwashing to accept a doctrine. Religion is more narrowly according to materialists a dogma. But, according to evolutionists it is wire-bound human brain for societal needs or community forming to face cooperatively. Therefore, its force is more than that of brainwashing. It will work and has worked.

The Eastern and/or Western philosophical principles of balance, personalized education, pragmatism, taking the long view, actualization of real democracy, and practiced critical thinking are required to achieve prosperity and well-being in society in the long-term.

Unfortunately, the forces of taking the short-term view, focus on yearly (or immediate) profits, taking the expedient approach, antipathy towards education for universal personal self-actualization, and obsession with satisfying greed and personal advancement are dominating the current financial and (now social) picture. It ultimately leads to disaster, followed by recovery, then disaster again, etc., continuing as the pendulum swings back and forth from one extreme to the other, if we survive in the meantime.

You need a distributed socialism where the unit of social agglomeration is small, perhaps 5-25 adult people which is the way the brain is wired. 5 is the maximum number of people that one can control directly 25 adults is the natural size of a villiage.

Ideally they self-organize, and form business relationships with each team of 5 call it a house, having a different role in the call it a villiage corporation. Competition from villiage to villiage is set up, at the corporate level, and villiages combine into a larger group call it a district etc. Not too far from what a church I once knew was trying to set up (and failing) back in the 70's.