Monday, October 15, 2012

The Fallacy of the Capitalist Dragon

An often repeated villain throughout folklore and myth is the dragon.  The dragon is a giant and ferocious beast; it devours the innocent; it lays waste to the landscape; it tries to slay the hero; and the dragon hoards vast treasures of bountiful precious jewels and gold - not to mention the beautiful virgin.

With a quick examination of those characteristics, some of them are what we could say 'natural' to any large predator: a grizzly bear can be a giant and ferocious beast that has a voracious appetite and will fight those who come into its territory - just like any wild animal.  On a small-scale, even a field mouse can be a terror to organisms comparatively smaller to it as humans are to a grizzly bear.  Wild animals act as wild animals.

This leaves us with the hoarding aspect of the dragon.  Why would a dragon hoard?-and, especially why would it hoard treasure and virgins?  The dragon is not going to shop anywhere and is not going to attempt seduction.  There is no reason for the dragon to hoard the 'boons' it has.

As with any myth or fairy tale, the characters and items are all metaphors; the dragon is analogous to ideas or people in real life.  Let us look at the dragon.

What is it in the real world that gets ascribed as the victimizer, the devourer, the destroyer and the hoarder?-the rich.  They (individuals and businesses that are run by individuals) are the ones that need to have giant leashes placed upon them: leashes of regulations, licenses, taxes, quotas and such.  It is claimed that these leashes are needed for if the dragon was not restricted with them, the dragon would lay waste, consuming, destroying and hoarding without end.  There would be a Chernobyl and Deep Horizon oil spill happening regularly; the dragon would also be keeping the wealth, leaving the rest to starve.

Is that what the rich do?  Granted, there will be some who may - statistically, out of any group there are going to be those with malevolent intentions; however, that is not a necessary and sufficient characteristic of being rich.  Parasites exist in all classes.  What do the rich do?

(The rich, recently are called the millionaires, but that is a misnomer as the new calls for fairness and expanded rules begins at $250k earnings a year.  This 'rich' is only in respect to income, not assets already held.)

First, let us distinguish between those who create work against those who create wealth: the one who digs a hole and fills it back in against the one who creates a good for sale. 

Those who earn money do so by offering something to be sold.  What is this thing?-something that needed to be produced.  Produced how?-by combining resources, labor and expertise (at a minimum) into the given good.  What is does that mean?-through the interaction of individuals who choose (choice is a key component) to interact, they create something through which they each benefit: the one with the resources gets paid for the resources; the worker gets paid for the labor; the entrepreneur gets paid for getting the whole thing together.

This is true with a good being sold, or for resources to be combined with other resources to manufacture later goods - components need to be built before goods can be made from them, or for services.  It requires wealth to begin and wealth to maintain - maintaining meaning continuous interaction and therefore productive work to be performed by each party.

Does that sound like a dragon hoarding?

To add to the aforementioned, there are others who are also in the various fields of enterprise.  Those others may make their own and wholly different good, or create a similar good to compete.  With a whole new good, there is more to be had, and with a competing good there will be more pressure to invest wealth into production to make things more efficiently or of a higher quality so they can remain in business - still more for society. 

Some who do not succeed, or work in fields no longer needed may be out of work, but with production and people being open to create the new, those newly unemployed can find work elsewhere: e.g. we do not have a high demand for impact typewriter parts or service, but we do have a demand for those who can work on computers.

With all of this, the rich do not hoard.  Hoarding is taking what one has and not using it, not reinvesting it - the dragon only keeping treasure in its lair.  The rich do not do that. 

The aforementioned were references to businesses, but even a rich individual who puts the money in a bank is not hoarding it: it goes in a bank to earn interest.  Why does it earn interest in a bank?-because the bank uses the money in loans.  Banks put money to work.  The money in banks goes to loans for those who need help for anything ranging from purchasing a motorcycle to capital for starting a new business.  If the bank did not have the money placed in it, then it could not offer the loans and people would not be able to purchase the motorcycle or begin their business.

The Capitalist Dragon does not hoard, but makes sure its treasure is utilized.

Every dragon has its nemesis, and in the tales that is the noble hero.  We have an equivalent; however, as the dragon is not the same hoarder in the lore, neither is the hero so noble.

The 'hero' that wants to slay or control the Capitalist Dragon is the government.  That government hero does not see, or rather does not care the wealth that is 'hoarded' is not actually being hoarded, but is being put to use. 

Only what can be seen is what is important to the government hero; what cannot be seen is not relevant - the more distant a thing becomes, the less it directly affects the hero and those who praise him (for reelection); the more the long-term consequences will be ignored.  There is only the now: look at the treasure the dragon has - now let's take it, for it has too much.  The resulting harm to the interactions following taking the treasure by force is irrelevant, for it is a distant harm: the important thing is happy people dividing the spoils now.

The ways of taking the dragon's treasure include regulations, licenses, taxes and the like.  Each of these is a chain around the neck of the dragon, placed upon it by the threat of a sword.  These take from the dragon's treasure for now it has to spend its treasure on things not related to the actual production of a good, but to sate the government hero and those who praise him.

There are cries that if the government hero did not at least chain the dragon, that the dragon would lay waste to the people and the environment.  That is untrue: the only thing needed is to enforce property rights, and outside of that it is not anybody's business.  If there was actual harm, then with equal treatment of the law compensation could be made or activities halted.

Businesses would pay as little as they could?  Do not workers try and get as much as they can?  The free market allows people to exchange freely; if they can pay more (most jobs start above minimum wage), then businesses will pay more for a better worker.  And the one who is just starting a business, but cannot afford what the government hero said should be the minimum for employee wages, can still hire but for less - he is able to offer employment, and the employee is earning something where he was earning nothing beforehand, and gaining experience to earn more later. 

The same is true for the rich who puts the money in a bank; in the bank, the money is used for productive purposes; in the government hero's coffers, the money goes to sate bureaucracy where the money is not productive.  For the sake of creating work, one can be paid to dig a hold, and fill it back up; there is work, but not production.  Should the government hero's coffers actually produce anything it is first by the use of force taking it from where it already was productive and now first sating a bureaucracy before the remainder can be put to work.

There is a middleman between the Capitalist Dragon and the government hero.  This middleman is not to be confused with a moral middle-ground (there is no moral middle-ground), but merely as a go-between for pragmatic utility: gremlins.  Gremlins work in human society, but they do not create things - they destroy them.  However, at one time they were seen as beneficial.  With the illusion of beneficence, gremlins convince the people who praise the government hero and the government hero himself that chaining the dragon will bring prosperity.

The gremlins create bureaucracy of the government hero, and corporatism for him and fellow gremlins; they are never sated, never get enough of the dragon's treasure.  As parasites, they grow and continue to do so, feeding off the host, continuing to eat until they devour the dragon, and are left with nothing.

What are we left with?  The Capitalist Dragon does not hoard, but on the contrary, it produces.  There are monsters.  Those monsters are the government heroes who come in with their swords and chains to enslave the dragon or take its wealth, and the gremlins who act as humanity's friend, but work toward humanity's destruction.

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