Tuesday, May 17, 2016

Capitalism's biggest Isuue

Notice: I'm not a Communist, but nothing is perfect.

"Better, Faster, Harder, Stronger"

     Daft Punk sums up the goals of most capitalists pretty well: build everything we can better, build it faster, and make it harder and stronger at the same time. And, frankly, that's fantastic for progress. It puts people on the moon, it creates computers, it created the internet, the smart phone, the yada-yada and the blobbity-blabbity. In a time period where discovering things has become far harder than ever, we humans have been able to keep pace at least partially in thanks to it.

Notice 2: Yes, the USSR made it to space first. Yes, they were (extremely technically) communist. However, the actions of the USSR were in competition with the USA, and competition is definitely a concept that applies more to capitalism.

However, capitalism has (in addition to some obvious human rights problems it's caused) a major issue as a concept. 

Here's a chart from my favorite industry:

That chart shows a few problems. Most importantly, it's similar to the beginning of this chart

Recognize the importance of that title? (Notice: It's the number of employees because this is the graph that fits the timeline I'm looking for) The crash of the automobile industry in Detroit. OK, stay with me for one more chart:

     Other than agriculture and goods that absolutely require replacement over a certain time, every industry in America has followed this trend. 

     So, what does this mean? It shows that industries push production much further than demand holds. One of the causes of the Depression, the overproduction of crops, was exactly this. Businesses in capitalism are encouraged to maintain constant growth instead of simply maintaining the delicate balance of supply and demand. Instead of simply holding production steady, business invest massive amounts of marketing to try to appeal to more people. Where this wouldn't be a problem if these products only lasted a short time, it becomes a massive problem when products last the entire lives of their users or even longer. 

Normally, signs of the inevitable failure of production are about the same no matter what the industry: limited real advances in the product (occasionally in comparison to other companies: in the Detroit collapse a big factor was the higher fuel efficiency of competing brands that produced elsewhere), slowing growth of sales (this should be expected, but almost always comes as a surprise somehow), and consumers continuing to use older products from the same category instead of upgrading to obtain the newer products.

Why does this matter? Because somewhere around 90% of all production follows these unsustainable growth charts, and the world economy is definitely not in the best state right now.  


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