13 January 2012

'The problem with capitalism is capitalists.'

Milton Friedman, a defender of capitalism if ever there was one, once said: "the problem with socialism is socialism; the problem with capitalism is capitalists." He meant, I presume, that the ideal of socialism was inherently flawed, while the ideal of capitalism is a good one that few practitioners actually live up to. That may seem to leave us little to choose from, but it looks like a relevant point in light of the Republican inquisition over certain candidates' criticism of Bain Capital and Mitt Romney. There are indications that the attacks made by Newt Gingrich and Gov. Perry are backfiring and provoking the conservative constituencies they considered theirs by right to circle the wagons around Romney. Even Ron Paul -- though I'm not sure why I wrote "even" in this context -- is defending Romney, and Bain by extension, and criticizing Gingrich and Perry for crossing a red line. The two offenders are unrepentant. Gingrich in particular rightly contests the charge that to criticize any capitalist is to criticize capitalism itself.

I do think it's kind of absurd that there has been this general response, mostly by Romney supporters, that to question his record is to be opposed to capitalism. Mitt Romney said he had two criteria for being president. One was his record as governor, which he now doesn't want to discuss because it's too liberal for South Carolina. The other was that he claimed he created 100,000 jobs. Well, the Washington Post yesterday gave him three Pinocchios on that jobs claim. They pointed out that in 1994, running for the Senate, he claimed to have created 10,000 jobs. And then he wasn't at Bain Capital in a management role after that. And they said they couldn't find any evidence that he created 100,000 jobs....So I have asked questions about let's look at the record. Let's see the details. Don't just give us the claim. Show us what actually happened. That somehow got turned into questioning capitalism, which is baloney. This guy is running for president. He is making a set of claims. He bases a lot of it on his career. If you ask about his career, it's because he is running for president. I think he owes the country a much more detailed answer about what his career was like, what decisions they made. Because we're looking at the judgment, the values of a particular person, not of a system, but of one guy, Mitt Romney, who wants to be president.

Gingrich and Perry argue that Romney is a bad capitalist who took shortcuts to profits by laying people off. It's their prerogative to argue that Romney's alleged practices don't reflect on capitalism as a system, but as I've been arguing this week, the debate over Bain Capital raises provocative and potentially destabilizing questions about what Republicans or conservatives mean when they invoke capitalism as their ideal or use the word as a synonym for free enterprise. The truly dangerous subject broached by Perry and Gingrich is the propriety of layoffs. Their critics would presumably have us all except the necessity of layoffs for the survival of companies and as the breaks of the game for working people. Romney's critics have dared suggest that there are circumstances when layoffs are unfair or just plain wrong. We probably shouldn't give Gingrich or Perry too much credit for insights that probably wouldn't occur to or resonate with them were they not running against (not to mention behind) an alleged corporate raider. But even broken clocks are correct twice a day and approximately correct slightly more often, and it's the other Republicans who seem out of sync with the times. The GOP establishment thinks that Perry and Gingrich are giving the Democrats ammunition to use in the general election, but if the establishment means to argue that capitalist practices can never be criticized and that layoffs are never wrong -- only "tragic" -- that sounds like ammo enough for anyone willing to use it.

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