Are we still capitalist?

Back in the Middle Ages, towns and merchants had to beg the permission of powerful rulers in order to be able to engage in commerce.  We didn't exactly prosper.

Capitalism and industrialisation took off when the powerful stopped being able to interfere with business.  We prospered - the more free market a society, the better off her people.

Indeed, perhaps one of the reasons why the industrial revolution took off in Britain first was precisely because we were a society in which people like Arkwright and co would not have their wealth expropriated from them by the state.

Yet today we seem to be slipping backwards.  Free market capitalism is being replaced with a sort of cartel capitalism.  Think of the regulators and the health and safety rules and the endless state quangos whose say so you now need? 

You can trade, if you win the say so of the state to do so.  You need permission to transact your business.  And then when you do so profitably, the state nicks a vast chunk of the wealth you have created.

No wonder business is moving to the East.

I used to think de-industrialisation was an organic process - a natural consequence of free trade and development.

I'm starting to see it as a consequence of over regulation and taxation.  If we want to regain our economic vitality and strength, we need a society in which producers no longer have to beg to produce and create wealth. 

Posted on 2 December 2009 by Douglas Carswell

Comments

"I'm starting to see "

only starting to see, now thats a worry.

Posted on 2 December 2009 15:04 by Johnny Norfolk

The only way to achieve that is to get out of the E.U.we need a referendum now.

Posted on 2 December 2009 15:06 by R.Rowan

For God's sake Dougie Old son, and you've only just picked up on this?

Ever since Thatcher invented 'regulation' in order to ensure that monopolies transferred from State to private ownership we were bound to end up cartelised. Why? Because the moment the idiot lefties got into power they would morph 'regulation' into a combination of nationalisation by regulation (well, you can take cl 4.4. out of the manifesto but you can't take it out of socualists) and bureaucratic socialism.

Posted on 2 December 2009 15:28 by Lola

You're only just "starting to see it as a consequence of over regulation and taxation"? Out here in real world, we've been dealing with the consequences of over-regulation and over-taxation for years.

It's why small businesses are struggling with staff numbers, or disposing of perfectly servicable machinery. It's why I'm still having to chase money for work that I've done. It's why customers are waiting until the last minute to place an order, then leaning on us to meet an impossible schedule.

It's why when politicians make promises, we are rather inclined to wait and see what actually happens....

Posted on 2 December 2009 16:51 by Mick Anderson

And do you know the biggest cartel of them all Douglas? The 'mother' cartel as Churchill called it, and the one that's just ripped through our capitalist economy like a wrecking ball? The land cartel.


Sure lets take back our country from the EU, but afterwards lets not hand over to a cartel that want to charge the inhabitants of the UK the earth just for being here.

Posted on 2 December 2009 17:33 by chefdave

Great Britain pretty much has no exports and natural resources. We are very much a tertiary based economy and to lesser extent, secondary. That is, our chief product is service. This is something that can actually be done anywhere and over-regulation and over-taxation are making businesses large and small make real that fact. Off-shore call-centres are one example. This country could very soon have nothing left to offer overseas businesses and investors as the returns would be stifled by these two burdens.

Posted on 2 December 2009 17:47 by Joe Bloggs

If you want to see real capitalism in action follow the money and take a look at look at Asia. Socialism and regulation has won the war here and we will all suffer as a consequence.

Posted on 2 December 2009 18:51 by R Abrahams

Glad to see you return to this one again. I was talking to an Aussie who has sold his company and come to the UK (for good reasons), and telling him about New Labour's "IR35" tax. He was incredulous that civil servants can decide to penalise a small business with 46% tax rate, unless the business man can prove to their satisfaction that he is a "legitimate" business. Even if he works for himself, holds his own insurance, pays his own pension, has his own clients, gets no employee benefits whatever -- they can decide he is an "employee" and demand 100k from him, 6 years later.

In this country the very idea of starting up in business looks like climbing a mountain. This is insane. We need to encourage everyone to be trading; not make doing so a special caste, treated with suspicion. How else can a country that manufactures nothing and imports everything survive?

Keep on talking about what New Labour has done to our business sector. Even in Zimbabwe the massive businesses can survive, by bribery and "influence"; it is an index of the freedom and health of a country whether the little man can do so.

Posted on 2 December 2009 20:34 by Roger Pearse

You are making a hbit of calling it right, Douglas, but let's all remember where the bulk of our regulations now come from in the first place - the EU.

Posted on 2 December 2009 21:58 by Iain

It is bordering on corporatism. The means of production many not be state owned but they are doing their bit to help the Government.

Big companies do the work of the state via making portions smaller, stopping selling particular light bulbs even though they are not illegal, etc. They do not push back against the State they actively lobby it. Nobody stands up for the consumer. In return the Government has nationalised contracts of employment by creating a statutory minimum standard which companies can exploit - they no longer have to haggle with their workforce.

Our purchasing habits are recorded. The Government would love to get their hands on that data. It is only a matter of time.

Posted on 3 December 2009 00:48 by Gareth

You're right, as ever. But what good is being right if nobody that can implement is listening?

Posted on 3 December 2009 01:38 by Steve Tierney

Aha! Allow me to introduce the economics which work:

http://www.cobdencentre.org/literature/primer/

It's time we aligned ends and means. If we want to prosper, if we want to lift everyone into prosperity, we had better figure out how to generate real wealth and soon.

Posted on 3 December 2009 07:54 by Steve Baker

Interesting. if you are interested in morality though capitalism is essentially an immoral system as the capital that accrues and makes production more efficient is always derived by exploiting others - badly paid local and third world workers, third world natural resources, too cheap fossil fuels etc.

Posted on 3 December 2009 08:22 by Chris Southall

Douglas, I'm thrilled you've seen the light - "joy shall be in heaven over one sinner that repenteth, more than over ninety and nine just persons, which need no repentance".

Now to do something about it!

Posted on 3 December 2009 09:22 by Alfred T Mahan

I think you underestimate the importance of scientific progress. Athenian Greece was a pretty free market place but Arkwright did not set up his spinning jenny there because the technology had not been invented. I realise economic freedom & scientific freedom are closely related but if I had to choose one as a wealth creator, over the long term, I would go for scientific freedom. This is fortunate since scientific progress is greater than at any time in human history, technological progress is significantly slower because the Luddites are preventing its use.

Posted on 3 December 2009 11:30 by Neil Craig

Chris Southall @08:22. Nonsense. Utter nonsense. Capitalism , or more accurately freedom and markets, are the most moral way of organising wealth creation and distribution. Pricipally because no one person or elite group sets the rules.

Local & Third world workers are not at all badly paid. In most cases they are paid better serving international trade than they are working for local employers. Sweat shops (as you would have it) are the first necessary step out of poverty for less developed societies and permit indiginous labour to take advantage of their competitive edge, low price. This makes the manufacture of goods and the supply of services go down in price, which in turn enables more developed societies to buy more of them so helping the third world worker and so on....

You are unable to judge whether or not the price of fossil fuels is too cheap or too dear. You do not have access to, nor could you, as an individual, process all the information needed to decide what that price should be. But 'the market' can. By efficiently and simultaneously conducting billions of calculations in the blink of an eye 'the market' arrives at the right price for anything.

Posted on 3 December 2009 16:55 by lola

Hallelujha

A Tory politician finally discover free markets and small business. About time. Please break the news to Tory Kent County Council before they put any more small businesses out of work.

@ Chris Southall

Complete and utter total load of nonsense you speak.

@Lola far better explanation than mine, thank you

Posted on 3 December 2009 21:31 by libertarian

"Third world workers are not at all badly paid."
Whatever planet do you live on Iola?

Posted on 6 December 2009 10:20 by John

On a completely different track: re Douglas's comments on medieval trade. The reason that towns and merchants were able to overcome the power of rulers was by establishing cartels. When Henry VIII for example, found that it would cost too much to pay the cartel of stained glass painters in Southwark to put glass in the extension of King's College Chapel, he imported workers from the Netherlands at lower rates to undercut them - and that's how capitalism has worked ever since.

Posted on 6 December 2009 11:28 by John

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