Doctor of Leadership in Global Perspectives: Crafting Ministry in an Interconnected World

The capitalist system

Written by: on January 20, 2020

The capitalist system

market is a social structure that brings together a buyer and a seller to agree on a price to exchange goods or services. … The nature of market is such that the market always tries to bring itself to equilibrium.

The question I ask myself about the issue is capitalism.

where does capitalism go? We may not know the details, but what is certain is that it will survive because it is the economic subsystem of the immediate future, a future that could last if other events such as environmental catastrophe or decay do not interfere.

At the moment, it is firm and sure, with its frequent crises. They are rather recessions. The capitalist system has a crisis and will have them as it happens now: we are immersed in one of them, although we are not in the crisis ups and downs happen, and they do not occur every five years. There is no regularity. In western Europe, it fell at the end of the 18th century with the French Revolution, but in the 17th century, feudalism was still advancing in Poland and other countries in Eastern Europe.

History and its hundreds of economic systems throughout humanity attract my attention.

For example, the eastern despot of the Aztecs, Egypt, or China, with a network of centralized ownership in the royal power of the sultan or emperor and also includes the Incas and the Maya; the feudal, which we know in purity in Europe and Japan.

How does capitalism begin?

He says it started in Cataluña and Italy and expanded in the late Middle Ages to the north in Holland, Germany, England, and other secondary and peripheral places. Then the United States and Canada do not fall behind. The Anglo-Saxon world looks like an amoeba. Today they embrace the entire plant, including Russia and China.

In Latin America and the Caribbean, the first phase of neoliberal globalization accentuated the processes of denationalization of the economies as well as the conditions of a structural impoverishment, in the midst of internal polarization that favored the formation of transnationalized economic-political elites and fragmentation of the popular movement and forms of resistance.

This globalization under the neoliberal scheme has formally meant the abandonment of national development projects and instead has favored macroeconomic issues such as inflation control and the reorganization of fiscal finances for example, with consequences aimed at the destruction of trade unionism and the in formalization of the economy and with a considerable concentration of profits, as well as an increase in social inequalities.

For the Latin American and Caribbean countries, this situation resulted in the unilateral opening to foreign trade, the privatization of state-owned companies, the liberalization of the capital market, the fiscal adjustment and the reduction of public spending, as well as the weakening of state interference. In the macroeconomic administration with a very irregular growth of the economies, but with an intensified increase of the external debt and therefore of the conditions of the dependence of the capitalist world market.

But all this management of economic conditions could not have been carried out without an active role of the States, which meant their transformation with transitions to “democratic forms” that favored the domination of elites linked to the international market and the large corporations; and to a model of society whose basic sensibility went through the absence of alternatives.

In vain was trade resumed, in vain did swarms of international conferences display the idylls of peace, and dozens of governments declare for the principle of freedom of trade—no people could forget that unless they owned their food and raw material sources themselves or were certain of military access to them, neither sound currency nor unassailable credit would rescue them from helplessness. Nothing could be more logical than the consistency with which this fundamental consideration shaped the policy of communities.

Polanyi, Karl. Great Transformation: The Political and Economic Origins of Our Time, Beacon Press, 2001.

ProQuest Ebook Central, http://ebookcentral.proquest.com/lib/georgefox/detail.action?docID=3117969. Created from georgefox on 2020-01-20 08:08:18.

https://www.google.com/search 2020-1-20 09:36am.

Zucker, L. (1986). The production of trust: Institutional sources of economic structure, 1840-1920. In B. Staw, & L. L. Cummings (Eds.), Research in organizational behavior (pp. 53–111). Boulder. CO: JAI.

White, H. C. (2001). Markets from networks. Socioeconomic models of production. Princeton: Princeton University Press.

Williamson, O. (2000). The new institutional economics: Taking stock, looking ahead. Journal of Economic Literature38, 595–613.

About the Author

Joe Castillo

7 responses to “The capitalist system”

  1. Darcy Hansen says:

    I think you’re brilliant. I must confess I know zero about economics, but it is clear you do. I actually am not quite sure what all the above words mean, but what I hear is frustration and pain for a people you love dearly. Here’s my takeaway from your post. Please clarify if I am missing something.

    The effects of poverty due to the implementation of a liberal, capitalistic, globalized economic system has made the rich richer, and the poor poorer. Latin American countries have taken the hit full on as people and nature are commodified and markets are left to regulate on their own. Leaders allowed passivity to the plight of the people to dominate their decisions. It’s easier to look away and rest in one’s riches than to step in, confess their destructive role in the circumstances, and then work to upend the perceived economic “utopia.” I have been and continue to benefit from the capitalism that dominates this world. My complacency and that of millions of others drives this destructive system. Forgive me, please. I am working to make change where I can, but the system feels so big and impossible to fix.

    As a pastor, how do you speak into the helplessness felt among the people? How do you begin to dismantle the oppressive system of capitalism? Can capitalism be redeemed (this is a question I’ve been asking since I took a class on poverty and restorative eco-justice a few years ago)? If so, what is my role, and the role of my community and nation? Is there a better way?

  2. Joe Castillo says:

    very good questions that most people ask themself. Times change but history also repeats it selft so. Our role is towards the kingdom of God and his values.

  3. Greg Reich says:

    You stated, “But all this management of economic conditions could not have been carried out without an active role of the States, …” In any economical endeavor in order for something to succeed people need to cooperate. When people refuse to cooperate things crumble. In either case innocent people are sucked into the vortex. When an entire world economy is based on a supply and demand market, driven by exports and imports consumed by people, how do poor countries compete that have nothing to bring to the table? I am not blind to the many benefits of Capitalism over what Communism and other forms of Socialism failed to do provide. Nor am I blind to the negative addictive side of the consumerism Capitalism provides. Often those who take the hit are those that can bring little to the table either in intellectual collateral or commodities. I wonder if this is why certain countries have turned to making drugs their economical commodity?

  4. Shawn Cramer says:

    Joe, I’m sitting at your feet as you tease out Polanyi in a specific context. Do you see liberation theology as a result of the neoliberal globalization you mentioned? I’m trying to follow your train of thought and extrapolate at the same time.

  5. Jer Swigart says:

    Joe. As a missionary, I wonder if and how you see the connection between the spread of capitalism and short term mission approaches by the US American church. Did mission follow capitalism or vice versa? And are there similarities in effects in non-US locations between capitalism and US-based mission? Any thoughts?

  6. Steve Wingate says:

    “neither sound currency nor unassailable credit would rescue them from helplessness.” So, I wonder how we would rank $ and self-interest in an order of how important they are to helping educate others to eliminate poverty in our neighborhoods.

  7. John McLarty says:

    Joe, as you wrote about the abandonment of national development projects, I started to wonder about the impact of the privatization of what was previously a government program. Whether it’s private military security contractors that step in when US military leave an area, private correctional facilities that replace federal prisons, contracts with companies to oversee detainment facilities at the border, etc. None of this is new, but I wonder how this will impact the global economy. Are we moving to a place where global boundary lines will be blurred and the State’s power to govern will be replaced by corporations?

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