cj#1155,rn> Guidebook 1.f. “Capitalism’s growth imperative and societal engineering”


Richard Moore


        (C) 2000, Richard K. Moore

   Chapter 1:

   How does the world work today, and where is it headed?

        a. Globalization and the West: a covert coup d'etat
        b. Globalization and the third world: empire by another name
        c. Kultur-kampf: enforcing the New World Order
        d. Economic globalization: Robber Barons writ large
        e. Decoding propaganda: matrix vs. reality
 ===>   f. Capitalism's growth imperative and societal engineering
        g. Elite rule and the Dark Millennium


   1.f. Capitalism's growth imperative and societal engineering

        "People of the same trade seldom meet
        together... but the conversation ends in
        a conspiracy against the publick, or in
        some contrivance to raise prices."
        - Adam Smith, "Wealth of Nations"

   Globalization is above all about capitalism, and
   about removing all constraints to the efficient
   operation of capitalist economics. The constraints
   which are being rapidly removed include not only
   tariff barriers and import quotas, but also
   environmental protections, anti-trust laws, health
   and safety regulations, and indeed the power of
   nations to plan or control their own economic

   The reasoning behind all this, we are told, is
   about the creation of 'free markets' that will
   enable the 'most efficient' operators to succeed -
   and thereby benefit everyone in the long run. The
   experience of the Robber Baron era, not to mention
   the condition of the world today, shows us that
   this reasoning is faulty. Let's look at the
   reasoning in a bit more detail to understand where
   it goes astray.

   The reasoning begins with Adam Smith, whose classic
   "Wealth of Nations" was published in 1776 just as
   the Industrial Revolution was getting underway in
   Scotland and northern England. He developed an
   elegant model of a "market economy," and showed
   that under the _right conditions_ such a market can
   provide a system in which everyone's self-interest
   works naturally for the overall benefit of society.
   David Ricardo later expanded these notions and
   showed that nations could benefit from increased
   international trade - again under the _right
   conditions_ - and when each nation specializes in
   producing those items where it enjoys a comparative
   production advantage. In "The Post-Corporate World,
   Life After Capitalism," David Korten summarizes
   those 'right conditions' which were identified by
   Smith and Ricardo (p. 38):

   Conditions necessary for a _market economy to function:
     1. Buyers and sellers must be too small to effect
        the market price.
     2. Complete information must be available to all
        participants an there can be no trade secrets.
     3. Sellers must bear the full cost of the
        products they sell and pass them on in the
        sale price.
     4. Investment capital must remain within national
        borders and trade between countries must be
     5. Savings must be invested the creation of
        productive capital.

   If these conditions were true in our society, then
   we might well enjoy the kind of beneficial economy
   envisioned by Smith and Ricardo. But these
   conditions are anything but true, and
   globalization's campaign to make capitalism 'more
   efficient' is systematically moving our society
   further and further from each one of those

   Conditions present in today's _capitalist economy:
     1. Transnational corporations increasingly sell
        products at inflated prices, based on market
     2. Rights in proprietary information are being
        greatly extended, so as to benefit the largest
     3. Corporations "externalize" (avoid) the costs
        of their production in many ways, including
        billions of dollars in government subsidies.
     4. Trillions of dollars of investment capital fly
        across borders everyday on unregulated
        electronic networks, and trade is highly
        unbalanced, especially between the West and
        the third world.
     5. Savings (retained earnings) are being invested
        increasingly in speculative financial markets
        rather than productive facilities.

   Korten summarizes this situation in the following
        "The nature of capitalism as a market
        pathology can be readily demonstrated by
        examining how it vigorously and
        systematically eliminates [the] five
        conditions [of the market economy]..."
        - "Post-Corporate World," p. 40

   Far from being a market economy, capitalism is
   instead a process which infects and destroys a
   market economy - replacing it with an economy
   dominated by a relatively small number of very
   large operators. Capitalism is the _antithesis of a
   market economy - it is what you get when you take
   away the regulatory balances which keep markets
   competitive and socially productive. The
   'efficiency' of a market economy is measured by its
   productive benefit to society. The 'efficiency' of
   a capitalist economy is measured by the rate at
   which the wealthy can further increase their wealth
   through investments, and this is what is reflected
   in Gross Domestic Product (GDP) figures.

   When orthodox _economists talk about market forces,
   they are referring to ideal market economies as
   envisioned by Smith and Ricardo. When _politicians
   talk about market forces, they are referring to a
   laissez-faire economy 'unfettered' by those
   conditions which make a market economy possible. By
   such Orwellian doublespeak officials are able to
   proclaim the theoretical benefits of a market
   economy while ignoring the actual consequences of
   our real-world capitalist economy. Just as a Priest
   might ask us to have faith in the next world while
   we suffer in this, so do our politicians ask us to
   have faith in their matrix dream world while we
   suffer the consequences of capitalism.

   Let us examine how capitalism arises out of a
   market economy, and observe how capitalism actually
   operates. In a market economy, there are not only
   producers and consumers, but also investors and
   bankers. Producers sometimes need to seek money in
   order to fund expansion, carry out renovations, or
   whatever, and this is supplied by bankers or
   investors. A bank gets its money back with
   interest, while an investor becomes part-owner of
   the producing enterprise.

   There is no inherent reason, in a market economy,
   why an enterprise would need to grow. A village
   shop, for example, can remain the same size through
   the years, be passed on to an heir, and continue
   indefinitely as long as it sells things consumers
   want to buy at a competitive price. In my adopted
   town of Wexford, Ireland, a pharmacy and a butcher
   shop have been operated by the same families
   continuously since the 1600s. An ambitious operator
   might want to grow an enterprise, but that comes
   from the ambition of the operator, not because the
   enterprise demands it. Even today, a great many
   independent businesses operate on a basis of
   ongoing profitability, rather than constantly
   striving to grow.

   Such stable businesses, however, are not likely to
   need much outside funding, especially after they
   are established. Banks and investors are much
   better off when there are lots of new businesses
   starting up, or when existing businesses are
   oriented toward growth. New businesses and growing
   businesses require funding, and growing businesses
   increase the value of an investor's share in the

   The technologies developed in the Industrial
   Revolution were designed to increase the scale and
   efficiency of production. This led to the
   development of new enterprises, and to growing
   enterprises, which applied the new technologies as
   they emerged. Bankers, and even more so investors,
   were faced with unprecedented opportunities to
   increase their wealth on the coattails of these
   growing enterprises and industries. They were quick
   to exploit these opportunities.

   As banks and investors prospered, a new
   investment-oriented elite arose whose interests
   were distinct from those of Britain's aristocratic
   elite - and different as well from the
   entrepreneurs who were actually running the new
   industries. This new elite didn't deal with
   production or commerce directly, but with money,
   shares, credit, and various kinds of financial
   instruments. To this elite, an enterprise was
   simply an "investment vehicle" - a means of using
   money to make more money. Over time, this new elite
   gained enough wealth and influence to begin making
   fundamental changes in British government policy -
   changes which both _compelled and _enabled
   enterprises to continue growing, regardless of
   whether any social benefit was created.

   Land taxes were increased, making traditional
   agricultural practices unprofitable, and forcing
   landowners to either sell out or else adopt
   industrial techniques and increase the scale of
   their operations. Import tariffs were adjusted to
   maximize the growth of British industries. Some
   tariffs were lowered to provide cheaper raw goods,
   while others were raised to reduce competition from
   external producers. Tax policy was adjusted to
   encourage growth, and to favor investors. These and
   other pressures toward growth forced businesses to
   increase their borrowing - and the repayment burden
   increased the growth pressure still further. A
   stock market was developed, making it easier to buy
   and sell shares in enterprises. The common-stock,
   limited-liability corporation evolved into a
   finely-tuned machine whose management is always
   under pressure to grow - to increase the size of
   the corporate assets. Capitalist elites had
   succeeded in injecting an artificial _growth
   imperative_ into the British economy.

   This same pattern was followed time and time again
   as other nations emulated Britain, industrialized,
   and adopted capitalism. The growth imperative
   forced these nations to pursue a new wave of
   imperialism in search of cheaper raw materials and
   new markets. This led to competition for
   territories, and thus capitalism's growth
   imperative has been the root cause of European
   warfare from the Industrial Revolution up until
   1945 - a fact one would never glean from orthodox
   histories or mainstream literature.

   The history of capitalism is the history of elites
   hijacking societies and using them to accumulate
   monetary wealth. It is not societies or market
   economies which need continual growth and
   development, rather that is an imperative
   artificially injected into economies by
   investment-oriented elites. These capitalist elites
   engage in an ongoing process of societal
   engineering aimed at maximizing capital growth and
   removing any existing societal barriers to growth.

   Globalization is simply this engineering process
   unfolding on a final global scale - the
   implementation by elites of a global society,
   firmly controlled by that elite, and in which
   growth itself is the one and only economic
   imperative. Through globalization, the parasite
   (capitalism and its elite) seeks to permanently
   enslave its host organism (humanity and society.)


Recommended reading.

Jerry Fresia, Toward an American Revolution - Exposing the
Constitution & other Illusions, South End Press, Boston,
1988.  Online: http://cyberjournal.org/cj/fresia/
    Did you think checks and balances were designed to
prevent tyranny? Guess again. "...the Constitution was
designed to ensure that real political power in this country
would always be held by the handful of very large property
owners and it is no coincidence that that is the case today."
Jerry traces elite machinations from the days of the Founding
Fathers up to the present.
Lundberg, Ferdinand. "The Rich and the Super Rich: A Study in
the Power of Money Today," Lyle Stuart, New York,1968. Online:
   "Lundberg was a student of American wealth and the power
that flowed from it. He wrote several books; this one is the
summation of his life's accumulated wisdom. Reading it will
thoroughly disillusion anyone who believes the American
dream. I have reread this book about once a decade since it
was first published and with each reading I discovered that
almost everything I had thought I had learned over the
recent decade about America and the global economy to have
already been present in "The Rich and the Super Rich."  To see
the original dustjacket notes, click here. This is a very
sizeable book; it may take you a lifetime to fully
assimilate everything that is in it so you may as well start
now." - from the above website