Religion and the Demise of Capitalism
It is too early to inter capitalism, for although it appears – judging from the sensational collapse of the stock markets – to have expired, reports of its death are greatly exaggerated. It is, after all, making great headway in China and Russia; and the CPR manipulations performed this week by the world's central banks may yet revive it in the West.
Capitalism has of late changed greatly. It is no longer characterized, at least in part, by what might be called 'religious values': by a strong work ethic, by a deferral of gratification, by thrift, by honorable dealings, by avoidance of debt and the habit of saving for the seven lean years. Late capitalism is very much the reverse of these virtues. Corporatism (an alliance of big business and the state or what is sometimes called Mussolini's business model, National Socialism or 'socialism for the rich') has replaced unfettered competition. The savings rate is at best a pathetic 2 percent of income. Instant gratification is the by-word. Behavior in business is governed by what the law (when exploited) allows and not by one's word. And so on. Clearly religious values no longer shape economic behavior. It is The Market which dictates behavior now. Individual success depends (as in the Darwinian drama) on how well an individual is adapted to the 'System,' and not on his acting independently according to a moral conscience.
It the bad old days, it was a case of the workers having only their labor to sell to the 'bosses' who owned the jobs or the 'means of production.' There have been many changes in the relations between Labor and Capital since. There has since occurred a democratic leveling, I believe. I put this leveling down to the fact that the laboring masses have gained access to easy and nearly unlimited credit. Once upon a time, only a wealthy minority could borrow and invest; (the rest were crucified upon a cross of gold.) In the present day we are all borrowers and investors. We borrow to satisfy present needs and invest to have more than enough to live on in medicated retirement.
If credit is to continue to flow freely year after year, then the economy (i.e. GDP) must grow incessantly in order to keep pace with the burgeoning interest charges on credit (or debt.) In recent weeks, the credit pump appears to have suffered a cardiac arrest. While the reasons for today's credit freeze must be many, I put the cause down to the fact of the wheels coming off the U.S. economy as long ago as the 1970s, when the country first ceased to produce more than it consumed and began then to incur a trade gap which was obligingly filled by foreign lenders. Two billion dollars a day is now required to fill that gap. Loans from overseas have substituted for real economic growth for nigh on 40 years, as factories and jobs have been relocated abroad and the economy transformed into a credit-driven (70 percent of GDP) service economy.
At some point, of course, the gravy train had to come off the rails. If you can keep on borrowing, then you can keep on expanding credit and thus cause your credit-addicted economy to 'grow.' Nevertheless, a debtor cannot keep borrowing forever. Something will come along to destroy 'confidence,' as it did in the present case when the collateral offered to our foreign lenders turned out to be fraudulent – not AAA but sub-prime.
All of 'King' Henry Paulson's horses and all of his men are trying to get the credit pump working again. Clearly their idea of a solution is my idea of The Problem. Their idea is to get the economy 'growing' again by revving up the shopper once more, and to do this by renewing the flow of loans into the U.S. credit- (cess-) pool. This makes about as much sense as opening up the drug routes so that addicts can indulge their bad habits once more. Foreigners are being tapped for loans once again, but the bulk of the lending is coming from sources at home: the Treasury and Warren Buffet, with the tin cup being finally passed to the taxpayer.
The Government's panicked actions imply that the The Problem lies in the failure of the ersatz 'growth' machine. Life support (credit support) has been switched off and the machine is flat-lining. The Government's answer is more of the same; more of the perpetual 'hormone' (credit) injections to fill the gap between production and consumption. I consider today's bust to be a moral failure in the first instance; not an absence of credit, but an absence of 'religious' values governing behavior in the markets and exchanges.
Of course I do not mean to say that a person without religion can't act morally. At the same time, it is clear that a moral conscience does not emerge from chance mutations naturally selected, but from the spiritual source that is venerated by religion.
