TMF: Corrupitalism / RodgerRafter's Investing Journal

TMF: Corrupitalism / RodgerRafter's Investing Journal: "Under Capitalism, we mainly had capital controlling the production of goods and the distribution of wealth. Under Corrupitalism, we mainly have people in positions of power controlling the production of goods and the distribution of wealth. There have always been elements of both systems within our economy, but over the last half-century the American economy has shifted along a spectrum from Capitalism toward Corrupitalism.

With Capitalism, labor is caught in a productivity trap. As increasing capital accumulation leads to productivity increases, there is less demand for labor. As population grows and resources become scarce, capital commands a greater share of wealth relative to labor. The gap between the rich and the poor and social unrest grow unless wealth is broadly distributed and workers have access to sufficient capital of their own.

With Corrupitalism, capital is caught in a liquidity trap. Too much money is created and distributed within the power base. Wealth and profits are taxed with the proceeds being distributed among the power base. It becomes increasingly difficult for outsiders to earn a return on investment that keeps up with inflation as the corrupt claim the greatest share of wealth relative to labor and capital.

The Capitalist model did not guarantee happiness for working people or even a decent standard of living for working people. Labor constantly battled against declining bargaining power. However, a more capitalistic society was generally efficient in the allocation and use of resources and tended to compete well in the global economy.

The Corrupitalist model is inherently inefficient. Resources and wealth are misallocated based on political purpose rather than economic need. Economic booms and busts are created and manipulated for the benefit of the well positioned. Government spending is directed toward the politically well connected. Industries are created and destroyed to "