The Pitfalls of Capitalism

I don't normally do this many rants on governments, an I apologize to the few readers I do have. Maybe all of this government talk is because of the political talk around the next government and who's going to be president. I mean, the television ads for each candidates campaign are playing daily (and a bit too much so).

Anyway, I was sitting in the back of a car earlier today, nothing to do, and I started thinking about how great of a concept capitalism is. Yet even as I sat there, I couldn't help but wonder why if the idea of capitalism is so magnificent and should work, then why does it keep failing? I mean, successful capitalism says that there is a competition between companies that keeps each company striving to be better than the other ones. That there will always be jobs because there is always items that people want. That if one thing goes, then another thing will soon replace it. So in theory, it should always work as long as everything in the environment allows (as in we don't completely destroy our environment in making everything work). Still, it has failed in the past and, in America, it is failing again...

The Pitfalls of Capitalism:
So here's my personal list of how and why capitalism fail. It pretty much has everything to do with the greed and corruption involved in people, more specifically the owners. And I'm giving a bit of a historic lesson along with a little bit of a lesson towards future pitfalls as well. Also, I'd like to take note that some of these are greed and corruption of the entire corporations while others are greed and corruptions of a single person in the companies.

1. No Competition- Now remember when I gave the brief description of capitalism which states that companies are striving to be better than the other ones. Well, the minute there is no competition in the mix, it becomes easy for a company to jack up the prices to insure that they make maximum profit on everyone. Historically, we've seen this with things like the railroads way back when the only way to get goods across the country was to use the tracks. Basically, large railroad owners knew each other and stopped competing with each other for the rails, making bargains that if no one else used their tracks then they could all get rich by jacking up the price. And since that was the only way to move goods, the general population saw a huge increase in the mark-up for transportation. Take out competition and the whole things falls apart and was finally ended for the railroads when the government got involved and broke-up the monopolies.
2. Complimentary Goods- So the idea behind complimentary goods is that if you own two products that go together, or in a worse case one is needed to use the other, then you can make a profit by selling both at a reduced price because you don't need to make profit on one of them. So then the competition needs to buy your product and you end up ahead no matter what happens. This is classically shown in modern times with Microsoft and Dell, where back in the day they were both owned by Bill Gates. Since Bill Gates owned both companies, he used to give the Microsoft operating system to the Dell computers for free. This allowed Dell to produce computers at a cheaper rate and control the market. Again, this ended when the government came in and broke-up the monopolies.
3. Control the Government- Now this one is both harder to prove and harder to understand until after the criminals are caught. Basically, the government is infiltrated with greedy people who make a profit on the side by helping out a corporation, where they promise the public one thing but then end up siding with the what helps a company because it helps them as well. Historically, this was seen a lot during prohibition, where a government employee would take a dime or two out of the crooks pockets and allow the alcohol to keep flowing in. Please note, I'm not saying whether or not I agree with prohibition, I'm just stating the facts that someone took a cut in the government. Well, that's corporate greed which acts as a pitfall of capitalism for one reason; if one company does not have to follow the same rules and regulations as another, then they can get a leg-up and overall dominate. I do not doubt that things like this are happening now.
4. The Golden Parachute- The following type of pitfall to capitalism has two stories related to the highest guy in a company taking greed out and making capitalism fail. Basically, the guy at the top is corrupt, wants the most money possible, and works to inflate the companies perceived value while not actually inflating the companies value. Then word breaks out that the company is not doing well and usually at this point he has gotten out, making himself a golden parachute when he jumps from the window. Now, the second story of the idea comes from the following corrupt member who gets in there, and knowing that the business is dying he decides to really kill it. He takes large bonuses and tries to basically destroy the company, at which point the company actually will pay him to get out on his golden parachute. So in two ways, a single person becomes filthy rich at the demise of the corporation. If a corporation gets killed this way, then it's not really capitalism since, in real capitalism, everyone tries to make their company better than the others. The only way to stop this is to allow for greed not to get up there, which is nearly impossible.
5. The Great Divide- Much like the golden parachute, the great divide is actually a type of greed where everyone need the top of the company thinks they deserve more money than everyone near the bottom of the company. To keep it simple, the top corporate guys will give reasons why they deserve a larger paycheck for managing everyone (even though in modern times they really are just appearance, if even) and so they decide that it's time to cut the bottom of the pyramid's paychecks so that every year they can take a bigger bonus. I don't  understand this one, or at least, how people can feel so entitled to take more money when they don't even know what they are going to do with it. And to be honest, the only way you'll even see this is if you look at it from the charts that show the difference between the richest and the poorest people in a company and then compare them with other companies in other countries. It's truly an American problem (for the most part). Now, how other countries have gone about fixing this is they limit the maximum amount that the highest corporate person can make by a factor of their lowest paid employee. And sure, there are ways around that (such as splitting the company into two and always hiring the same lower-bodied company), but they tend to get caught. It's actually a genius idea, you limit the wealth available at the top by saying the bottom needs to be given more, which then helps the wealth flow down the ladder.

I hope my bit of a random rant on corporate greed did not make you feel out of place, I just really wanted to get these words out. And I hope that soon my whole government thing will end and I can finally get back to blogging about happy times. But I do like politics enough to think about how things are going, but not enough that I want to argue with my friends. Instead, I'd rather throw everything I'm thinking (and not my opinion of politics) up online.