Revised November 17, 2013
In the previous article we started to deal with the Capital Destroying Class of Capitalism. We discussed the fact, earlier, that there are two classifications of Capitalism. There is the prosperity creating classification and there is the prosperity destroying classification. The prosperity creating classification is Capital Producing Economics. Producer Rewarded Open Market Economics is a Capital Producing Economics System. Capital Producing Capitalism is a Capital Producing Economics System.
The prosperity destroying classification is Capital Destroying Economics. Capital Destroying Capitalism is in the Capital Destroying Economic System. Communism and Fascism are also in the Capital Destroying Economic System.
Capital as used in economics means; the amount of money or property that a company or a person uses in carrying on a business. Capital also means; national or individual wealth as produced by industry and available for reinvestment in the production of goods.
Destroy or destroying means: 1. to break to pieces; make useless; spoil; ruin: 2. to put and end to; do away with. Destroy means: to make useless by breaking to pieces, taking apart, killing, or in any other of many ways.
When non-producers and counter-producers take money without an exchange for it they cause the value, energy, wealth and power in money to be less. Money loses purchasing power when non-producers and counter-producers take it without an exchange, of an equal production value, for the money. Rewarding non-producers and counter-producers causes money to have less value and energy per money unit; they spoil and ruin the value and energy in money. When Banks expand the money supply, they cause money to have less value and energy per money unit. They spoil and ruin the value and energy money possesses.
The Capital Destroying Economic system is predominantly being used, today, on planet earth. This system of Economics causes wild fluctuations between prosperity, recessions and depressions in the field of Economics. Much confusion is caused when attempting to produce prosperity using Capital Destroying Economics. It is a covertly destructive and chaotic system of economics. Anytime prosperity is achieved, the Capital Destroying Economic system eventually goes into a self-destruct mode and collapses the economic prosperity.
This economic collapse is brought about by allowing non-producers and counter-producers into the Marketing system. It is caused by allowing non-producers and counter-producers into the Money Supply. This economic collapse is caused by believing we should allow rich and powerful people to take money without an exchange or not enough exchange for it. An economic collapse is also brought about by believing we need people in the emotional states of chronic anger, hostility and covert hostility running our Companies, Corporations and Political Systems. On the Planet today, people of the emotional states of chronic anger, hostility and covert hostility are mistaken for sane and able people. After all, they appear to “know,” with such “force and/or smoothness!” They appear to know what they are doing and they appear to be “right!”
People in the emotional states of chronic anger, hostility and covert hostility are destructive. They, because of their negative emotional state, are non-producers and counter-producers. Their product is the destruction of the companies they work for and the countries they run politically. They are destroyers of Capital! They hire and promote people of their own emotional state; chronic anger, hostility and covert hostility. The companies, corporations and nations that do prosper, prosper despite the counter-efforts of the leaders in the emotional states of chronic anger, hostility and covert hostility.
They prosper because they have a few Super Producers working in key positions in the Organizations. These Super Producers make production happen despite anything. They are very able individuals; they don’t let the destructive leaders destroy the Organization. They produce and produce and find ways to get around the counter-efforts of the destructive non-producing and counter-producing leaders. Usually they get promoted to a certain level and don’t get promoted any farther even though they carry the Organization on their backs. The destructive non-producers and counter-producers leading the Organizations; believe it is leading by anger and hostility that is causing the success of the Organization. When the Super Producers leave the Organization, the Organization collapses. The destructive non-producing and counter-producing leaders can’t understand what caused the collapse. They are usually clueless because they live off the back of the Super Producer. They are unaware the Super Producer was the key to the organizations success. The destructive non-producers and counter-producers have their attention on destructive activities. They don’t notice constructive activities in progress.
You can spot the chronically angry, hostile and covertly hostile person (leader or worker) by observing how they communicate and by what they do in their activities. They communicate in general terms. They are very often out sequence and non-sequitur in their discussions. They can be very literal in their interpretation of a piece of communication. They can be found involved in excessive alcohol and drug use. They can be found to be involved in unusual sex practices, such as with prostitutes and with many partners. The Producer and Super Producer will overlook and compensate for the faults of the chronically destructive leader and worker. Meanwhile the company, corporation or nation suffers and follows an economic decline as money, value, energy, wealth, capital and power is destroyed. The destructive leaders destroy prosperity.
In many Organizations on Planet Earth; when you find the Organization prosperous, you will find a few Super Producers holding it up despite all the counter-efforts of the destructive leaders and workers in the Organization. In many Organizations on Planet Earth you will find a Super Producing Leader maintaining a high prosperity level despite the counter-efforts of some destructive non-producing and counter-producing workers inside the Organization.
Steve Jobs is an example of a Super Producing Leader. The Board of Directors of Apple fired him. The company almost died. He came back and brought it back to prosperity. When you find an Organization being led by Super Producers, the Organization is usually doing very well. The trick is to get all positions in an Organization filled with Producers or Super Producers.
Over many, many years, Capital Destroying Economics has brought about much suffering and hardship for many people, organizations, families, societies and Nations. Capital Destroying Economics in its basic form rewards non-production and counter-produces. It provides for the concentration of wealth along with the power derived from wealth to be placed into the hands of a small group of non-producers and counter-producers. These non-producers and counter-producers have not created products that can be exchanged on the Open Market for the wealth.
Capital Destroying Economics provides for the transference of wealth, created by the Producers and Super Producers in an Organization. The wealth is transferred from the Producers and Super Producers into the hands of the chronically destructive leaders of an Organization. Wealth is also transferred from the Producers and Super Producers into the hands of all other non-producers and counter-producers existing in an Organization.
The concentration of Capital into the hands of a few non-producers and counter-producers has given them tremendous power. They have used this power to take over the political system. With these political systems, Communism, Fascism, Right Wingism and even Left Wingism, they establish laws that create a legal structure they use to funnel much of the Capital created by Producers into their hands.
Production is the action of doing and converting energy into a product. Marketing is the action of exchanging products for products among Producers. This is basic Marketing; exchanging products for products. Barter is exchanging products for products. In more advanced Marketing, Products are exchanged for money units. When products are exchanged for money units, money units are being used as a medium to transport value from the product. We take this one step further; we say money is also a symbol in which the energy generated to create products is transported to the money unit during Marketing.
The energy used to create the products continues to flow in a society as long as products are “always” exchanged for money units. More and more energy is being created and added to the Open Market. As this energy level grows we see money velocity increase. This increase in money velocity means money is changing hands more rapidly in the society. This energy can be felt when a society achieves prosperity. The individuals and the society are much more alive and vibrant. Non-producing and counter-producing Capital destroyers don’t like this high energy level. Producers love this high energy level, they revel in it!
When money is taken from the Market with no exchange in production, energy is being removed from the Market. When this energy is removed from the Market it gets destroyed disappears or vanishes. The money units, that are the symbols for this energy, lose value. This is where money (Capital) gets destroyed. Money velocity slows. Money value and the amount of energy in each money unit decreases. A recession starts, if ever so slightly. With the out-exchange increasing, more and more money value or money energy (Capital) gets destroyed. Money loses value and energy causing money velocity to slow. Money value and energy, as Capital, is being destroyed. All other forms of Capital start to lose value. What we are describing here is a state of Capital Destruction.
Banks expanding the money supply, speculators who exchange nothing for the huge sums of money they take are huge destroyers of Capital. Excessive military spending and wars are huge destroyers of Capital. Any out-exchange activity is a destroyer of Capital. Monopolies are destroyers of Capital. Many of the most ardent advocators of Capitalism practice Capital Destroying Economics. They are engaged, in a big way, in the destruction of Capital.
You ask, “Why is Capital Destroying Economics so destructive?” Capital Destroying Economics destroys prosperity, it eats up wealth and Capital, it consumes prosperity until a society literally dies and if it doesn’t totally die out it causes tremendous hardship and suffering.
Examples of Capital Destroying Economics at work can be found around the world and throughout history. Almost all wars are the result of Capital Destroying Economics at work. The depressed conditions of Third World Nations are traced to practices of Capital Destroying Economics. The current Great Recession of 2008 is the result of Capital Destroying Economics being practiced. Communism is a Capital Destroying Economic System developed as a solution to past practices of Capital Destroying Economics. Communism came into existence as an answer to Capital Destroying Capitalism. Desperate people under the rule of the Capital Destroying class of Capitalism agreed to accept Communism. They had two choices, death or Communism. They chose Communism which wasn’t any better than Capital Destroying Capitalism. They are still mired in a Capital Destroying Economic system. Communism is a Capital Destroying Economic System. They went from one Capital Destroying Economic System into another Capital Destroying Economic System.
Now that we have seen the consequences of Capital Destroying Economics we can see why we need to insist on working toward a pure Capital Producing Economic System. It is self evident that Capital Destroying Economics slows money velocity and destroys Capital. It also is self evident that Capital Producing Economics, Producer Rewarded Open Market Economics, increases money velocity, increases the value and energy in Capital and money and leads to abundant prosperity.