Capital Reporting | Capitale Chine

The promise of Capitalism, or at least of a federally guaranteed Capitalist society, is that it prevents the hoarding of resources. That's the theory, anyway, and while this interpretation of Capitalism may be both simplistic and overly generalized, it is useful for an analysis of problems currently burdening economies in the Western World.

Really, even before anything as formal as nations, governments and complex economic systems, tribal cultures developed currency and ascribed monetary value to goods and services. This system prevented the person who grew or hunted food from trading that food to the person who made blankets at an exorbitant rate, and leveraging his food to also corner the blanket market, to provide a very elementary example. The blanket maker would charge for his blankets according to what he had to pay for food and be assured that he would never have to exchange all or most of his blankets for an amount of food significantly less than equal in the exchange. Over the centuries, this very basic Capitalist system has developed and matured, immensely. So why isn't it working?

Everybody Wants to be Rich

In 1998, in a discussion of the expanding wealth gap between the upper and lower classes, Alan Greenspan noted that the expansion in the differences in income was notably greater than the expansion in consumption. His argument was that earnings were not as important to the national economy as spending power. What this argument failed to account for was the drive to feel equal to one's neighbors.