Tuesday, August 16, 2011
Free Market Economist Nouriel Roubini: "Karl Marx Had It Right. At Some Point, Capitalism Can Destroy Itself. You Cannot Keep On Shifting Income From Labor To Capital Without Having An Excess Capacity And A Lack Of Aggregate Demand"
Communism Sucks ... But the Type of Capitalism We Have Now - Socialist Upward Redistribution for the Rich - Isn't Great, Either
As several people have previously noted, everything the communists said about their system was false; unfortunately, some of what they said about capitalism was true.
(Of course, we don't really have capitalism in America ... but the Russians didn't follow all of the communist ideals, either).
Nouriel Roubini: If You Redistribute All of the Wealth Upwards, the Free Market Capitalist System Self-Destructs
One of America's leading economists, Nouriel Roubini, told the Wall Street Journal:
Karl Marx had it right. At some point, Capitalism can destroy itself. You cannot keep on shifting income from labor to Capital without having an excess capacity and a lack of aggregate demand. That’s what has happened. We thought that markets worked. They’re not working. The individual can be rational. The firm, to survive and thrive, can push labor costs more and more down, but labor costs are someone else’s income and consumption. That’s why it’s a self-destructive process.
In other words, runaway inequality causes depressions. See this and this.
And government policies which redistribute money upwards are killing capitalism.