Law has failed capitalism

Capitalism, as with democracy, is not a good socioeconomic system but is better than all the others experienced by mankind until now.

Serbian-US economist Branko Milanovic is right that greed is the ultimate driver of capitalism, but greed and its associated vices are part of the human condition. They are addressed religiously/ philosophically at an intellectual level or by the concerted power of co-operation via government.

The excesses facilitated by the liberal political viewpoint are the threat to the capitalist system. Laws and a huge power structure control the results when greed leads to what is defined as crime, but the arguments of liberalism as applied to the financial world prevent Western society from acting against the results of excessive financial greed. It is not capitalism that has failed but the legislative environment in which it exists.

Control of the excesses of capitalism is effected by governments and their legislation. Why are there not policies that result in the constraining of capital accumulation, which can also be viewed as a “crime”, or at least as so undesirable and harmful to social cohesion as to require limitation?

Of course, the other side of the coin is that too much legislation strangles the undoubted wealthcreating benefits of capitalism. If there is gross inequality in a country, it implies on the one side that legislation has not sufficiently created the circumstances that facilitate a more even distribution of wealth, and on the other that businesses do not strive to create opportunities to create employment and that wealth.

It is profit from successful businesses that pays taxes and fund government; it is profit that is reinvested to create more employment and pay more tax. This fundamental reality is not really understood by the greater part of the ANC and EFF. The performance of virtually all of the stateowned enterprises underlines this simple truth.

Robert Stone Linden