capitalism

Is there something wired into our brain that makes us distrust capitalism? That makes us skeptical of economic success?

What, oh what, could possibly explain the explosion of prosperity in the last 200 years? Image courtesy of Adobe Stock.

Imagine we could convert the 300,000 year history of Homo sapiens into a 24 hour clock. We could divide the time on that clock into the most recent one minute and the previous 23 hours 59 minutes.

Up until one minute ago, almost every person on the planet was terribly poor. The rare rich person got that way by stealing stuff from the poor. A Viking Jarl or King got that way by plundering the English, Irish, Frankish, or Slavs. The well-to-do in the Roman era stole from conquered countries or lived in luxury on the backs of their abundant slaves.

It has only been in the last minute (meaning the last 200 years) that widespread wealth and prosperity has emerged. That corresponds to the beginning of the Industrial Revolution, if you’re looking for some link and cause.

What is the major difference before and after one minute ago?

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By Jim Ulvog, ago

As expected, socialism failed when the Pilgrims tried it.

Under socialism, the Pilgrims barely survived. With property rights and personal responsibility, they thrived.

One of many defenses for socialism and its sibling communism is those type of economic arrangements have never been really tried. All previous efforts were partial efforts. You see, if we were to ever try pure socialism or pure communism it would be wonderful and glorious and perfect and utopia on earth. It’s just never been implemented right, you see.

Helen Raleigh explains socialism has been tried in all its purity here in the United States.

And it failed.

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By Jim Ulvog, ago

Capitalism is not all about greed. It is about serving others.

[youtube=https://youtu.be/-KmfYLnBlzo]

One of the main Big Lies against capitalism is it consists of is rewarding greed – capitalism is all about greed.

Brooke McIntyre of the Colson Center addresses this lie in her video Is Capitalism All about Greed? Video is embedded at top of this post.

The core lie in that false accusation hides the reality that the only way to make money in capitalism is to satisfy someone else’s need or desire.

Several people want fresh baked pastries in the morning so if you can get up at four in the morning, make donuts, and have them ready for the morning commuter crowd you will make money.

If you can design an app that people enjoy it will make a bunch of money.

If you can handcraft beautiful furniture with a pleasant finish that people enjoy, you will make enough money to live well.

If you can develop software that makes work easier for tens of millions of office workers you will make a fortune.

Video points out three powerful rebuttals to the lie that capitalism is all about greed.

“Taking responsibility for your own interest is not the same as selfishness.”

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By Jim Ulvog, ago

Magic of the price signal to change production levels.

Fourteen wells on one pad, located on the southeast side of Williston, N.D. Photo by James Ulvog.

The double black swan of COVID-19 pandemic from the demand side and Saudi Arabia flooding the market from the supply side is creating a sales problem and storage problem for the oil industry.

Regulators in Texas are thinking about about ordering a pro-rate reduction in production. In other words, they are considering giving each producer an order on how much to cut.

North Dakota has no such plans.

North Dakota is planning to rely on capitalism to rapidly adjust production.

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By Jim Ulvog, ago

Capitalism or fascism? Which economic system will better resolve the supply shortages?

Image courtesy of Adobe Stock.

How do we get enough of the respirators, personal protective equipment, and medicine we need to get through the COVID-19 pandemic?

Fascinating to watch the press conference Saturday 3/21/20 with various federal officials and members of the coronavirus task force.  Most fascinating feature was looking at the various comments and questions/answers from an economics perspective. Thought about Friday’s briefing as well.

Here is the difference in perspective I perceived: do we rely on capitalism or fascism as our model to get things done?

Underlying the comments from all the federal officials is the idea that the private sector can figure out how to provide everything we need.

The common thread underlying a huge portion of the questions from media is the idea that the federal government should tell which specific companies how much of which specific products to produce, specify they price they will charge, and provide the addresses for where to send each pallet of supplies.

In other words, should we use a capitalist model to provide goods we need or should we use the fascist model?

As a thumbnail description, in the fascist economic model the means of production are owned by the private sector but the central planning authority tells companies how much of which product to produce. In contrast, the next step away from freedom is communism, in which the means of production are owned by the government and a central planning agency decides how much of each specific product to produce.

Capitalism?

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By Jim Ulvog, ago

Didn’t ever expect I’d personally experience Soviet Union and Venezuelan style grocery stores.

Chaika 3 (on redscale film) – Queue by Jaroslav A. Polak is in the public domain (CC0 1.0). Lines like this outside a grocery store were normative in the Soviet Union.

In the Soviet Union and Venezuela, grocery shopping involved/involves listening for rumors of which store got a shipment overnight, standing in line for hours, looking at lots of empty shelves, and going to the store daily to see if what you need might actually be on the shelf today.

If you have been awake the last seven days, you know that is what grocery shopping looks like in the U.S. today.

The difference between the Evil Empire and the worker’s paradise of Venezuela on one hand and the United States on the other hand is that the supply chain in the U.S. is still stocking the shelves and in a week or two or three will have them filled up.

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By Jim Ulvog, ago

The 2010’s: best decade in history.

Image courtesy of Adobe Stock.

Matt Ridley explains the best improvement in living standards for us humans over a single decade is the decade that ends today, 12/31/19.

He explained his point from multiple directions on 12/21/19 in Spectator: We’ve just had the best decade in human history. Seriously.

A few of his points that caught my interest:

The rate of extreme poverty in the world has dropped from 60% when he was born to under 10% in this decade. If you ache to seek less people in dirt eating poverty that is a wonderful thing.

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By Jim Ulvog, ago