Do you have faith in capitalism?

Reddune
Sun, 12 Jul 2009 06:30:30 +0000

There is an interesting perspective about capitalism and Darwinism in the Times:
http://www.nytimes.com/2009/07/12/business/economy/12view.html?ref=business

"Relative performance affects many other rewards in contemporary life. For example, it determines which parents can send their children to good public schools. Because such schools are typically in more expensive neighborhoods, parents who want to send their children to them must outbid others for houses in those neighborhoods.

In cases like these, relative incentive structures undermine the invisible hand. To make their funds more attractive to investors, money managers create complex securities that impose serious, if often well-camouflaged, risks on society. But when all managers take such steps, they are mutually offsetting. No one benefits, yet the risk of financial crises rises sharply.

Similarly, to earn extra money for houses in better school districts, parents often work longer hours or accept jobs entailing greater safety risks. Such steps may seem compelling to an individual family, but when all families take them, they serve only to bid up housing prices. As before, only half of all children will attend top-half schools."

Capitalism, like Darwinism, is about winning of the fittest. But the fittest individual might not be the best thing for the group. A super animal that consumes everything and kills everything can destroy the biosphere and wipes out all the other animals and plants, eventually killing itself by destroying its own resources. In case you’re wondering, that supper animal is us.