When I posted Dubai: Free markets, Unrestrained, Unregulated Capitalism. Phooey, Jeremy wrote and posed an interesting question:
If the default (or possible default) of Dubai is evidence of capitalism's failings, I'd be curious to know what you thought the lesson of the collapse of the Soviet Union was.
As best I can tell communism failed in Eastern Europe for four reasons, three of which can collapse any economic system. The three that can impact capitalism as well:
- They devoted too much of their resources to military expenditures and not enough to education and building domestic infrastructure.
- Lousy management which relied on slogans, ineffective efforts to motivate workers, failure to listen to the the workers, rules that stifled everyone when the problem was isolated, production based on correcting bad work after the fact with inspectors, and not listening to the customers. (Read any good book on quality production. It is scary how communism and capitalism have so many common traits caused by correctable failures from leadership.).
The one reason that Communism failed that was inherent to the system was lack of freedom of expression, which has less to do with economics and more to do with the power of rock n' roll.
People want to be free. Not so much to chose between forty-seven different automobiles, but to choose what to read, say, think, and feel. Part of that freedom is to make an honest living.
Curiously, since the fall of the Berlin Wall, we have constricted the freedoms of expression in this country, not the freedom to make money or rip people off.