L. Neil Smith's
Number 181, July 8, 2002


Is Capitalism at Fault for the Current Financial Debacle?
by Ragnar Danneskjold

Special to TLE

I have been reading stories in the mainstream media, blaming capitalism for the current market woes. It's the greedy capitalists, they say, that are responsible for the faltering economy. "The bottom line is the only thing those capitalists think about, without any consideration for the long-term economic outlook, employees, or social welfare", says one reporter. "Capitalism gives the executives of companies such as Global Crossing, Enron, and WorldCom incentives to cook the books", states another.

True, executives pay attention to the bottom line. That's their job. And some of them commit fraud by cooking the books. But why indict capitalism? That's like blaming gun manufacturers for violent crimes. Oh, but wait. That's the whole point. We like to blame everything or anything other than the individual. The first thing the mainstream media does is blame everything else, and the individual is a side- story, an unimportant tangent.

The devil made them do it or, rather, the capitalist system. Why blame the executives when they are just pawns of capitalism, doing what capitalism tells them to do? Why put all the blame on the murderer for the murder, when there are larger social issues involved? Why blame anyone for anything?

When we play such blame games, we diffuse the issues. We make the subject irreconcilable. If there is no one person to blame, but many, or even a whole system, or society as a whole, why blame anyone? Our attention is diverted. The issue is diffused to the point of irrelevancy.

Rational people should understand that responsibility must rest on the person pressing the trigger, or the accountant signing a financial statement knowing it is false, or the executive who looks the other way. Fraud is fraud under capitalism, socialism, communism, fascism, or any other economic or political system. The real issue, therefore, is fraud, committed by unscrupulous executives. And they must be punished. It's as simple as that. There is no need to look anywhere else to complicate matters. Sure, the reporters and columnists like complication. Who wants to write a boring story centering on another instance of fraud. Let's spice it up, make it look like there's a problem with the entire system or society as a whole. Nationalize or globalize it. That's the ticket. Confuse everyone and muddle the issues.

In reality, however, all we have are a bunch of people who thought they could get away with cheating. They are no different than credit card fraudsters or pick-pockets. Sometimes the simple answer is the correct answer, even if it does not sell as many newspapers or magazines.

Capitalism is a system that allows people to pursue life, liberty, and property. Blaming this system for the acts of duplicitous executives is an insult to all business people everywhere. I am a capitalist, but I do not cheat people. Do you?

Ragnar Danneskjold is Editor-in-Chief at www.LibertyImpact.com and Reporter/Editor at PlanetGold.com


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