Capitalism's Dark Side

Under certain circumstances, the weak and downtrodden can be driven to violence in order to gain their share of society's capital. This is a dangerous side of capitalism, and Israel's leaders must be aware of it.

Capitalism stands on three principles: the right to own capital, limiting the power of the state and reducing its grip on the means of production, and a strong legal system to them both. These three principles exist in Israel, so we define this country as a capitalist state.

But capitalism has a fourth principle: the idea that it should be based on the goodwill and cooperation of its participants. This concept stems from the assumption that most people would choose to embrace peace over violence as long as it's worthwhile.

Does this fourth and final principle exist in Israel?

Is it worth the population's while to work together and get along? Can the people who invest and the people who save practice peace, and at the same time hang on to their money? Do they have the power to peacefully block capitalists from emptying company coffers, be it through massive salaries, dodgy deals, or both? And can they peacefully prevent a company from taking loans and business risks, and then forcing the investors to swallow the majority of the losses?

Can a young couple, just starting out, peacefully safe for an apartment in a reasonable amount of time? Can a child who grew up in a poor home peacefully pursue an academic education?

The answer, most of the time, is no.

According to the law of capitalism, the weaker populations in Israel, which includes some of the middle class, will use violence to achieve their rights. They will do so when they understand that violence is a more efficient method than peace for obtaining their capitalist rights. Have we reached this stage? Not yet.

The social protests of the summer of 2011 were the first sign that peaceful means are no longer effective. Most of the underrepresented groups are starting to internalize the idea that using violence could be a rational step. I am not calling for violence, of course. I am merely interpreting the law of capitalism as it is written.

Capitalism is not exclusively for the rich. The right to own capital does not mean amassing it at the expense of the weak, in dubious ways. Capitalism is also the right of the weak to demand their share of society either peacefully or violently, whichever he decides is more effective. The rich and strong, through their actions, determine which will be most effective. A capitalist government needs to understand this, and plan accordingly.

A capitalism of values and equality is a capitalism that has mercy on the weak and takes care of it. It is a capitalism that values fairness before its eyes and also espouses, as much as possible, equality of opportunity. This type of capitalism allows individuals from the lower and middle classes to peacefully pursue their goals.

A capitalism in which every person seeks to increase his wealth without accounting for the other, without fairness and without decency, is a capitalism that will push individuals toward violence in order to survive. In the long term, it will be no longer possible to ignore this side of capitalism.

The writer is the CEO of Aviv Risk-hedged Funds Management.
 

Reuters