Costs and Benefits of Hyphenated Capitalism
Regarding Andy Kessler’s “Quit Modifying Capitalism” (Inside View, Nov. 20): Sustainable, inclusive, socially responsible, conscious, state-managed and other hybrid breeds of capitalism elevate state central planners into roles that override and pervert economic relationships among investors, producers and consumers. The result is a neutered or otherwise impaired economic system.
Unadulterated capitalism involves too much volatility and unequal outcomes to be a viable alternative in the 21st century, but the more adulteration that occurs, the more capital is misallocated and the slower economies grow, leaving less money for government. Hybrid capitalist systems dilute the economic efficiencies and results of free markets, delivering inclusive stagnation or decline. At that point, the left adopts a new and improved modifier for capitalism and the vicious cycle repeats.
Frank Allen
Charlotte, N.C.
Mr. Kessler calls attention to the knowledge incorporated into the “price” of a good or service in a capitalist economy. That price is the historical record of countless decisions made by “self-interested” individuals to cooperate with one another for mutual benefit—decisions made willingly by buyers and sellers, none of whom got all that they wanted, but all of whom recognized the benefit of working together in peace.
The hyphenated capitalism Mr. Kessler leaves out is the key to capitalism’s current bad name: “crony-capitalism.” There is no greater monument to that than our current tax code. It picks winners and losers under the guise of achieving laudable social goals, but is influenced by the too-cozy relationships government and the private sector. In the process, markets are distorted and the information in prices rendered useless. This is worth considering during the current season in which tax reform has morphed into tax cuts, and the process has remained one of determining centralized parameters of division and redistribution, rather than efficiently funding the government.
This won’t change until enough titans of industry realize that their enlightened self-interest is truly the public interest.
Luke Perkocha
San Francisco