August 5, 2007
The Theology of Capitalism Is Sweeping the World
Paraphrased from this week’s interview in Barron’s with David Richards:
“Two major developments have occurred in the last 10 to 15 years, but really got going in the last five or six years: One, the whole world has adopted the notion that market- economy-oriented policies are correct. In other words, there is a theology of capitalism that is sweeping the world, to borrow a phrase from British historian Eric Hobsbawm. There are 3.5 billion people from Eastern Europe to the Pacific and from the Indian Ocean to the Arctic that were living under socialism or communism, where it was not possible to trade and not possible for entrepreneurs to get rich — and they have been transformed.
This has to be thought of in terms of the kind of 20-, 30-, 40-year growth we saw during the Industrial Revolution in the 19th century, when peasant societies would become industrial societies within 50 years. Urbanization is happening all over the world, and there is no way to stop it, unless people lose faith in this new theology of capitalism.
Two, there has been a total collapse in the cost of communication and computation. Time and distance in communication have been eliminated through the Internet and fiberoptics. Communication is instantaneous and virtually costless, and, as a result, you can run businesses all over the world from a headquarters positioned anywhere in the globe.
This, together with the first point, means the whole global economy has to be transformed. There are huge incentives to do it, but there is also a necessity to do it. This gives huge advantage to big international companies or even small ones that have an international point of view.”
August 5th, 2007 at 7:40 pm
Capitalism is great. That’s why I think all this fake Chinese stuff and pollution will correct itself as their end consumers will demand from them better quality at low prices. The Chinese will be forced into being more efficient instead of throwing labor bodies into a factory.
August 5th, 2007 at 8:22 pm
Tom: Yeah, it’s great as long as you’re not the guy breathing in toxic fumes 16 hours a day for a dollar.
August 5th, 2007 at 8:41 pm
Well yes, that’s a problem now but Chinese labor will organize one day when they realize that they’re getting screwed wage and health wise. This is eerily similar to the US’s Industrial Revolution back in the early 1900’s.
August 6th, 2007 at 12:12 am
Actually theres a few good points there but the so called “Bush” agenda gives him too much credit. If it wasn’t Bush it would have been Gore but one thing for sure, - Whatever you call it, capitalism, fascism, or corporatism….it marches on.
August 6th, 2007 at 1:31 am
“but Chinese labor will organize one day”
Let’s leave aside how funny it sounds to say that unions will someday be created in a “communist” country… I agree that within a few years at the most, China’s growth will decelerate as they grapple with the consequences: pollution, climate change, population displacement and unions. Which will mean a throttling back in cheap goods and demand for raw materials.
August 6th, 2007 at 11:57 am
You don’t have to be big to capitalize on today’s international opportunities. The vast majority of my business is from outside of the U.S. (100% of my regular Sunday business today). Fact is, I sell as much or more to Chinese customers (goods and services) than I purchase Made-In-China goods. YOU DON’T HAVE TO BIG TO BE INTERNATIONAL. THERE ARE HUGE OPPORTUNITIES FOR INDIVIDUALS. I am just one sweet sole proprietor that is having fun and helping out the balance of trade in the process. Let’s hear it for all the mom and pop entrepreneurs making incremental contributions that add up to some decent numbers.