From Iceland — Capitalism: Its Last 100 Years

Capitalism: Its Last 100 Years

Published September 3, 2009

Capitalism: Its Last 100 Years

Capitalism is dead. This may come as news to no one, but the implications are vast. In fact, it changes everything. We have always known that capitalism was a brutally unfair system of distributing society’s wealth. What we did not know was that capitalism would be so bad for the capitalists themselves, or that they could be so incompetent when it came to creating wealth. We did not know that the capitalists had no clue when it came to making money.
In fact, capitalism has never created anything (bar misery). All the technological wonders that have changed our lives so much these past 100 years have been created by gigantic government institutions. Perhaps there was a time when independent entrepreneurs such as Edison or the Wright Brothers could come up with something new, but that time is long past. Inventions these days are so costly and time consuming that it is only governments on a war footing that have the resources to commit to them. The jet engine, the computer, the internet, GPS and GSM are all compliments of World War II or the Cold War. They are then handed over to private enterprise, which makes inferior versions that need to be upgraded every other week.
This is not to say that war is good, only to stress that capitalism cannot do anything right. It corrupts our bodies and our environment, and in the end it even does the one thing it said it would never do, it destroys the market itself.
The 100 Year War
So, capitalism, as we all know, is dead. In fact, we can soon celebrate the 100th anniversary of its demise. For you see, the capitalist system broke down in 1914.
By the early 20th Century, capitalism was spinning towards its inevitable conclusion. Every part of the world had been colonised and the magnates wept for there were no new markets to conquer. All of the five richest men in history had amassed their wealth and were alive during this period, according to Forbes magazine. The American oligarchs Rockefeller, Carnegie and Vanderbilt controlled US industry. Even tsar Nicholas II of Russia was infinitely richer than his predecessors, while his countrymen remained destitute. The fifth, Asaf Jah VII of India, was under the protection of the British until India became an independent country and deposed him in 1948.
The Germans wanted colonies of their own to squeeze, but the British and the French were busy squeezing and in no mood to let others in on the game. And so the major industrial countries, Germany, Great Britain, France and eventually the US, along with the industrialising Russian Empire, invented a new kind of warfare, total war. By its nature, this led to a breakdown in trade and massive government intervention on every level. The war, which was partly fought over access to markets, led to their demise. The backbone of capitalism, the Pound Sterling, went off the gold standard. After the end of hostilities, an attempt was made to resurrect capitalism. The gold standard was reintroduced in 1925 but eventually abandoned in 1931. The attempt to revive capitalism had led to financial collapse and even a Great Depression.
The End of the Capitalist Experiment
Most thinkers at the time realised that the capitalist experiment was over. It was only saved by the timely outbreak of World War Two. This again led to massive government intervention and technological advancement. After the end of the war, no attempt was made to revive unregulated capitalism. Instead, regulation became the order of the day. This was partially because of the lessons of the Great Depression, partly because the fear of communism led the leaders of capitalist countries to adapt some of communism’s attributes. In fact, this system worked so well for almost 30 years that it seemed this strange hybrid of government regulated capitalism might prevail.
But it was not to be. In 1971, as a consequence of the Vietnam War, the US Dollar went off the gold standard. Nothing had any real value anymore, and governments gave up all attempts to control markets. We are now seeing the logical conclusion. Even if it may temporarily revive this system, which has been kept artificially alive for almost a century, it is in its death throes. In two or three or five years time, another crisis will hit and the people will again be called upon to bail out banks and corporations that have become too large to be allowed to fail without dragging the whole world down with them. But these solutions are temporary. The time will come when there will be nothing left to squeeze out of the pockets of taxpayers or even out of the soil itself. This system cannot stand. It is time for another.

Support The Reykjavík Grapevine!
Buy subscriptions, t-shirts and more from our shop right here!


Enough. Stop. Now.

Enough. Stop. Now.


Show Me More!