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Modern Capitalism Essay

¶ … Capitalism Growing Gap between the Rich and the Poor: Is Capitalism the Culprit?

Since Karl Marx powerfully challenged Capitalism and criticized it for being exploitative, Capitalism as a system has always come under attack. Although by the end of the twentieth century, Capitalism seems to have triumphed over Communism and the socialist system of command economy, many people renew their criticism of Capitalism in times of economic crisis. Recent protests in Wall Street, which has been expanded to the other parts of the United States and many places around the world, symbolize growing frustration with Capitalism. But is Capitalism to blame for the economic crisis and other problems such as class inequality, the erosion of many social benefits and the attacks on the remaining ones, and the domination of world economy by corporate powers? This paper argues that the problem is not with Capitalism per se, but the way it is understood in the corporate community today. Corporate powers that crave for monopolies have their own understanding of running businesses and that is at the heart of current economic problems in the United States and elsewhere.

One of the ironies of current understanding of Capitalism is that the supporters of corporate and monopolistic powers often invoke Adam Smith and his argument that "the...

What is generally ignored in the discussion of Smith is that the famous British economist was wary of monopolistic powers. He argued that a competition among many enterprises would ensure the forces of supply and demand produce greater good for everyone. The way modern Capitalism functions, however, is that big companies merge and take over small businesses, lobby governments to reduce or eliminate corporate taxes, outsource foreign cheap labor to maximize their profit, and, most importantly, do not believe in the concept of laissez-faire, i.e. free market.
Advocates of monopoly Capitalism argue that the government should stay away -- or intervene the least -- in the everyday functioning of the economy, allowing businesses to compete and be more efficient. But the truth is that corporate powers are not against government intervention in the economy. They are against government intervention that does not serve their interests. Corporate powers are very much in favor of government intervention when the government removes corporate taxes, anti-trust laws, and produce favorable climate for monopoly Capitalism. As David Harvey (2007) points out, multinational corporations and their spokespersons in the International Monetary Fund and the World Bank pressure small states in the Third World…

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References

Batra, R. (2011) The Occupy Wall Street Movement and the Coming Demise of Crony Capitalism. TruthOut. Retrieved on 16 October 2011, from http://www.truth-out.org/occupy-wall-street-movement-and-coming-demise-crony-capitalism/1318341474

FOSTER, J, & MAGDOFF, F 2010, 'The Great Financial Crisis -- Three Years On', Monthly Review: An Independent Socialist Magazine, 62, 5, pp. 52-55, Academic Search Premier, EBSCOhost, viewed 16 October 2011.

Harvey, D. (2007) A Brief History of Neoliberalism. New York: Oxford University Press.
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