Diary: Flaws and Solutions to Capitalism -- Part 1

� ��"Flaws and Solutions to Capitalism� �� " Part 1.

The � ��˜Fatal Flaw' in capitalism is the known market flaw of ignoring 'externality costs'.

Specifically, the system is 'gamed' (by using entrenched wealth-power over the political system) to allow a highly hierarchical ruling-elite corporate/financial Empire to dump negative externality costs into the broader social/environment.

Until recently these negative externality costs dumped were in the form of wastes from the industrial process (ie. asbestos, tobacco smoke, green house gases, etc.), but with the identical research reports from Citi, UBS, and (the late) Lehman in early 2007 the 'smartest guys in the room' switched to dumping the more ethereal (and less punishable) negative externality cost of 'debt' on the outside world.

The rest, as they say is history.

Checkmate for unrestrained finance-capitalism, or � ��˜Corporate Communism' (as Dylan Ratigan on MSNBC calls it), or � ��˜ruling-elite corporate/financial EMPIRE' (as I call it).

Whoever said that derivatives, like CDSs (Credit Default Swaps), were a nuclear/financial WMD was right, and like the real A-bomb, the US was the first to drop this new � ��˜debt nuke' on the world in the 2007/8/9" explosion. And like a neutron bomb, this new nuke � ��˜debt bomb' wiped-out the people without hurting the big bank buildings and corporate headquarters.

However, as the late Billy May used to say, � ��"But wait, there's more!� ��

The � ��˜more' could be that the American people get sick or this � ��˜fixed game' that the ruling-elite EMPIRE is playing in our country and with our political-economic freedom and that they decide to take action.

Here's a brief outline of such an � ��˜action plan' once the American people are educated and aware of the crimes of the corporate/financial EMPIRE (or � ��"Corporate Communism� �� ):

1. � ��"Wealth Reform� �� --- modeled on � ��˜Land Reform'

In many countries and societies where the government has been taken over by an entrenched ruling-elite, and where the balance of resource distribution of land is no balance at all, but rather an elite and unproductive monopoly, the best and proven reform is � ��˜Land Reform'. This frees up the captive resource of the land and allows the peasants to become free farmers and more efficiently use the key agricultural resource of their own land.

In � ��˜our' country today the resource which is most tied-up, monopolized, and poorly used only for private gain is not land, but CAPITAL.

The ruling-elite corporate/financial EMPIRE that now (almost fully) controls our country and government by hiding behind the faÃ �ade of their two-party � ��˜Vichy' sham of democracy (and protected by their equally � ��˜Vichy' corporatist media), has enforced a quais-legal monopoly on investment CAPITAL which they monopolize and very inefficiently use purely for � ��˜private interest' gains, rather than � ��˜public interest' benefits

The shocking degree to which capital resources of accumulated WEALTH are locked-up, monopolized, and misused by the ruling-elite EMPIRE in America can be compellingly demonstrated by what economists call their � ��˜gold standard' of income and wealth inequality --- the GINI Coefficient of Income and Wealth Inequality. This simple to understand measure of income and wealth inequality is based on a scale from 0 to 1 --- in which 0 equates with a society in which all income (or wealth) is equally held, and 1 in which only one person holds the entire national income or wealth.

On the basis of this GINI universal economic measure of inequality the level of income and wealth INequality in the U.S. (� ��˜our' country) is not only � ��˜off the charts' compared to all other developed countries ---- but it is worse than Russia (former Soviet EMPIRE) and (Corporate) Communist China --- and still more shocking it is very close to the GINI inequality of Robert Mugabe's dictatorial kleptocracy of Zimbabwe! Here are the figures:

All 'social democracies' of Europe and Japan --- 0.23 to 0.31

Russia and Communist China --- 0.41 and 0.46

� ��˜Our' United States of America --- 0.49 (and rising fast)

Mugabe's plutocratic dictatorship of Zimbabwe --- 0.53

Any doubt about the good old U.S. being a virtual (but hidden) EMPIRE should be dispelled.

A massive and serious program of Wealth Reform (like Land Reform in of Central and South America's � ��˜Banana Republics') must be undertaken immediately � ��" and is long overdue.

This � ��˜Wealth Reform' would minimally distribute the important and monopolized resource of investment Capital (or accumulated Wealth) throughout all of our society such that the GINI Coefficient of Wealth Inequality would at least be in the range of all other advanced/developed social democracies.

In doing so, this would free-up entrenched, monopolized, and frozen private wealth that is not currently available for constructive, positive, socially beneficial, progressive investment opportunities that would have a balanced � ��˜public and private interest' rather than counter-productive or harmful � ��˜private only' misuses.

To be continued in Diary -- � ��"Flaws and Solutions to Capitalism� �� Part 2

Alan MacDonald

Sanford, Maine