What is wrong with capitalism?

By capitalism I refer to the popular iteration as seen in countries such as Australia, USA, etc. I am including democracy in this.

Capitalism is largely the most successful iteration of a society the world has produced. In Australia for example, the majority of people have enough to eat and are by and large concerned with matters not crucial to their survival. This system is obviously superior to the largely weak and corrupt governments in other parts of the world.

Capitalism provides everyone with an incentive to strive as by doing so they can increase in personal wealth and power. This goal fuels society as most people focus and thanks to the fruits of science by in large have plenty.

Class still remains and is inherent when you see someone, yet almost all people don't go hungry. Even the homeless who are from a societal point of view complete failures don't really have to fear for their lives (need to check).

Through strong penalties "wrong doing" is prevented making people feel safe. There is a lot of good in this and a quality of life that has not been experienced in ages past.

The exclusion is some smaller tribal societies who have a mini version of the society that I seek to create. However, larger collections of people have inevitably led to a separation of class and exploitation of the weak and poor.

So the question, why change it? What is wrong? If it aint broke, don't fix it!?

1. Capitalism is not for the people

In a capitalist society the fundamental driving force is the generation of capital, not the enrichment of the people's lives. It is a side-effect that capitalism tends to result in the majority of people being relatively comfortable. In fact, it is more due to government control that the majority of capitalist societies retain humanistic elements. For example, the minimum wage helps stop exploitation and is needed as businesses are largely amoral, especially the bigger ones. | Considering that 50% of americans work for 1 of 10 large corporations this is very important (I heard this but have been unable to confirm without paying for an detailed analysis. I will keep searching and update. Either way I don't think it is far off.) |

This protection of humans is at constant war with commerce. Neither will ever win, commerce cannot exist with a government that is seen to look after the people and socialism cannot completely control commerce. This protection of the people is certainly a good thing, yet it doesn't resolve the core issue that society is run by entities looking to exploit.

A very classical example of the problem with this capitalism socialism war is the environment. The protection of the environment is too distant a concern for the short term focus of the masses. As such businesses get away with a lot of destruction and socialists can't protect it. The destruction of the environment is very bad for the people, but just in the long term.

2. Under capitalism resource distribution is uneven

That people tend to live pretty well is just a side effect of capitalism. Ultimately the spread of resources is very uneven which is unfair. For example, the average salary of the highest payed executives in the US is 4.7 million and the minimum wage is approximately 11,000. These executives make about 427 times the wages of minimum wage workers. Such executives may be specialised people, but it is unreasonable to say that they deserve 427 times the remuneration.

Further more, wealth not income is not the biggest indicator of money distribution. In the US the top 1% of people own 38% of the wealth. Further excerpts from the previous link:

Wealth provides another dimension of well-being. Two people who have the same income may not be as well off if one person has more wealth. If one person owns his home, for example, and the other person doesn’t, then he is better off.

Wealth — strictly financial savings — provides security to individuals in the event of sickness, job loss or marital separation. Assets provide a kind of safety blanket that people can rely on in case their income gets interrupted.

Wealth is also more directly related to political power. People who have large amounts of wealth can make political contributions. In some cases, they can use that money to run for office themselves, like New York City Mayor Michael Bloomberg.

And

The top 5 percent own more than half of all wealth.

In 1998, they owned 59 percent of all wealth. Or to put it another way, the top 5 percent had more wealth than the remaining 95 percent of the population, collectively.

The top 20 percent owns over 80 percent of all wealth. In 1998, it owned 83 percent of all wealth.

This is a very concentrated distribution.

The bottom 20 percent basically have zero wealth. They either have no assets, or their debt equals or exceeds their assets. The bottom 20 percent has typically accumulated no savings.

Obviously the US is quite extreme in this regard compared to most other capitalist societies. However the principle is basically the same, a select number of people owning a very large amount of the wealth and the majority of people without much wealth.

This is a faulty principle of capitalism in which the rarities of a person's skills and the demand for those skills has staggering effects on their quality of life. There is a correlation between effort and reward but it is weak.

Added to this unfairness is the issue that some people despite working hard, just don't have the money to rise to wealth in society.

3. A capitalist government is weak and self-serving

It acts as the arbiter between commerce and socialist forces and is ultimately reactionary. For a particular policy it decides if the people are more important or the commerce. If it is the people it is likely that the policy is a particularly public one as there is a limited amount of negative press a party can receive before it is deposed. If it is the commerce it is likely the policy has a large monetary impact on the industry (Need to check and get examples). As good for industry is good for the capital of the country. The fundamental metric of the performance of the economy will always be applied to the government.

A capitalist government always has the knife of the people to its throat and the knife of industry pressed against its back. The party in power performs an elaborate routine to keep all parties satisfied. This does result in some good, but is not instigative which for some problems is necessary. Like for example Global Warming (I am going to act as if this is a true and accepted phenomenon), the US government needs to ratify the Kyoto treaty and significantly cut greenhouse gas emissions. A strong government would impose this immediately as we are talking about gains for industry now that may be regretted for thousands of years. To scientific analysis this issue is crucial and we must act and yet nothing happens. The government will not cross industry this badly when the people don't really care.

4. The people don't really have power

The generally perceived quarter stone of capitalism is the peoples ability to change the government. This creates the illusion that people have power as any party is at the mercy of the peoples choice.

But what choice is there?

Typically there are two very similar parties and it is inevitable that one of them gets voted in. People can largely choose between and apple and an apple. This is a meaningless power and the real power/wealth remains in the hands of the rich regardless of the result. It is like being able to choose which mouse to drop into a deadly maze with not much cheese and many traps. Yes there is choice but the game is the real problem.

Secondly the people don't know about politics. Why should the opinion of a factory worker on the government be as valid as a political analyst? This is especially a problem when you consider there are vastly more factory workers than political analysts. Further more a factory worker's vote is generally up for grabs to the party with the biggest advertising budget. Yes the people have choice but they are largely ignorant and easily manipulated.

The truth that they are still the ones who ultimately decide and vote wont mean much for societies a 1000 years in the future working to undo our environmental damage.

Conclusion

Capitalism is an iteration of society that is ok. It isn't great, it isn't bad and it is a lot better than many other societies around the world. Despite these qualities it is far from perfect and with our amazing technology and knowledge we can do much much better.