Death By A Thousand Cuts

Whatever the name for today’s failed system is, “capitalism” is not that name

By Keith Weiner

Capitalism died when they decided to subsidize railroads for the sake of national prestige in the mid 19th century.

Capitalism died when, to compensate for the consequences of subsidized railroads, they passed anti-trust laws in 1890, under which it is illegal to have lower prices, the same prices, and higher prices than one’s competitors.

Capitalism died in 1913 when they started taxing income, and created a central bank.

Capitalism died after 1929 under the failing interventionism of Hoover.

Capitalism died in 1933 when FDR confiscated the gold of US citizens, outlawed gold ownership, and defaulted on the domestic gold obligations of the US government.

Capitalism died when FDR stacked the supreme court, and created a veritable alphabet soup of regulatory agencies that could write law, adjudicate law, and execute law.

Capitalism died when FDR created the welfare state replete with a ponzi “retirement system”.

Capitalism died in 1944 when the rest of the world agreed to use the US dollar as if it were gold, at Bretton Woods.

Capitalism died under Johnson’s Great Expansion of FDR’s welfare state (Medicare).

Capitalism died when Kennedy removed silver from coins.

Capitalism died in 1971 when Nixon defaulted on the remaining gold obligations of the US government to foreign central banks.

Capitalism died when rampant expansion of counterfeit credit led to a near-death experience for the US dollar in the 1970′s.

Capitalism died when they ended the era where investors paid a firm to rate the debt they were going to buy. Congress enacted a law giving a government-protected franchise to Moodys, Fitch, and S&P.

Capitalism died when they decided to tax dividends at a higher rate than capital gains, thus distorting capital markets.

Capitalism died when they created Fannie, Freddie, Ginnie, and Sally.

Capitalism died when in 1981 Reagan and Volcker conspired to begin a long boom by a process of falling interest rates that continues to this very day, destroying inconceivable amounts of capital with every tick either up or (mostly) down.

Capitalism died when Greenspan discovered that market corrections could be overruled by another shot of crack cocaine, i.e. dirt cheap credit effluent, i.e. lowering the rate of interest.

Capitalism died with the growth of laws and court decisions granting legally privileged status to some kinds of employees but not others (and trampling all over the rights of employers). For example, the Americans with Disabilities Act.

Capitalism died with the passage of Medicare Part D.

Capitalism died with the bailouts, stimulus and other lies, deceit, fraud, and theft post 2008.

Capitalism died when Obama set aside the rule of hundreds of years old bankruptcy law and precedent to give unions priority in the bankruptcy of GM.

Capitalism died when Obama socialized medicine.

Capitalism died with every new regulatory package for financial markets: “Operation FD” in the late 1990s (as I recall), Sarbanes-Oxley, and now Dodd-Frank. With each one of these, the process is the same. Congress floats an idea publicly to “go after” the banks and dealers and brokers. Then the banks must go to Washington, spend money like water, and 6 months of back-room deals later, a multi thousand page document emerges as law. Then the regulatory agency must write regulations, so the banks spend more money, and a year of backroom dealings later, a hundred thousand page regulation emerges. Then this is to be enforced by armies of regulators. …

Capitalism died with Zero Interest Rate Forevah(TM).

Capitalism is long since dead. Whatever the name for today’s failed system is, “capitalism” is not that name.