RebelCapitalist: Financial Information for the Rest of Us

What’s the point of government?

Dec 01, 2010 | By: Mr_Blue | Tags: capitalism

An age old question and which can lead to very different responses - particularly ideological ones. Considering the capitalist economic system we have - what do you think? Hell yes that’s a loaded question.

The following items prompted the question:

1) A tweet from @PragCapitalist “IF IT CAN’T PROTECT ITS CITIZENS WHY DOES GOVERNMENT EXIST AT ALL?”

2) Republicans Block Unemployment Insurance extension for 2 Million Americans.

What drives a capitalist economy? Consumption and profits for capitalist/ownership class. Labor (provided by people) and materials are tools or resources that are used by capitalist/ownership class to generate profits from themselves. Yes, workers are tools or resources to be exploited. But workers are needed not just to slave away for meager wages but to consume the things that capitalist/ownership class produces.

There’s an inherent conflict between the economic interests of workers and capitalist/ownership class. Worker’s need wages to provide things that are necessary to live and maintain a certain living standard while capitalist/ownership class, due to competitive pressures, need preserve their profits and one way to do that is by paying workers lowest wages possible or not employing workers. What has happened over that past 30+ years is that workers have not experienced increases in wages but capitalist/ownership class has benefitted tremendously from higher profits.

But what about retirees? Well if they are not consuming more than is required to support them then they have no value in a capitalist system. Same goes for disabled. As for children, their parents are consuming for them which is a plus in a capitalist system but they have to be educated - right?

Our capitalist system is at best indifferent to plight of workers, retirees or children or at worst hostile - particularly if people are not contributing to economy via labor or consumption. Reality of our economic system sucks. But it leaves us with a moral dilemma - do we ignore those people left behind by our capitalist economic system?

Some would argue that’s what charity is for. Sure, but the amount of charity given doesn’t even come close to matching the level of charity needed. Besides, how much charity would exist without a charitable tax deduction from the government?

“If it can’t protect its citizens why does government exist?” Great question particularly with a capitalist economic system. It’s very much a moral question. From a moral standpoint, government is needed to protect or provide a safety net for people left behind by our capitalist economy. What other entity is in a position to do it?

If you disagree then are you comfortable with survival of the fittest and the potential for political instability?

Good luck.