Peter Schiff vs. Michael Moore

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sundarb
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Peter Schiff vs. Michael Moore

Found the below well-written post at http://patrick.net/forum/?p=1131111

With the future bringing diminishing energy and resources, distributed and localized systems are a much more feasible way to go forward. These systems would be much more resistant to systemic shocks and sudden supply disruptions for essential goods and services.

The post itself discusses more on the ideological differences that lie between capitalism and socialism. Also highlights the need to find common ground among the people that understand today's predicaments of the economic system.

Peter Schiff and Michael Moore are not polar opposites even if one or both of them think so.

Similarities between Peter Schiff and Michael Moore

Corporate takeover of government is bad.

Both believe that there should be a wall between government and business, and that our problems are caused by big businesses buying control over government to gain an unfair and insurmountable advantage over others.

What is capitalism?

Despite using different words, both Moore and Schiff have a similar idea of what constitutes proper capitalism and the screwed up current system.

Moore: The reason we're not occupying Washington is that the elected officials are the employees, the mid-man, the servant of Wall Street. Capitalism in 2011 is defined as "an evil system set up to benefit the few at the expense of the many." A lot of people in this crowd (OWS) would probably support the old system of capitalism [before it became corrupt].

Schiff: What Moore refers to as "Capitalism in 2011" is actually corporatism. What Moore alluded to as the old system of capitalism is actually what capitalism is defined as. We currently live under a system of corporatism, not true capitalism, and that is the problem.

Sounds like they both are advocating a return to the implementation of capitalism that existed in the early 20th century before corporations got large and powerful and began controlling legislation. They use different words, but their underlying definitions are the same. To Moore, capitalism has become a dirty word, so he wants the old definition to be associated with a new word. To Schiff, capitalism is a holy word, so he wants the old definition to be associated with the old word. This is nothing more than a difference of semantics leading to miscommunication.

This miscommunication due to wording is so bad that both Moore and Schiff misuse terms while correctly using other terms. [Note that the video in the previous link contains Schiff's response to Michael Moore's CNN interview and is worth listening to before continuing to read this post.]

Schiff: "Michael Moore gets rich by satisfying the desires of other people. He entertains other people and as a reward he gets rich. That is the very essence of what capitalism is about. What, is he kidding? If this was a socialist country, what would happen is, the minister of entertainment would be figuring out what documentaries are made, they would hire Michael Moore and tell him this is the documentary you are going to produce, and then people would be forced to watch it whether they are entertained or not."

Peter Schiff is 100% correct that Michael Moore is a capitalist and a successful on at that. Unfortunately, the very word "capitalism" suggests that it is capital, not labor or production, that is the driving force behind wealth creation, which could not be further from the truth. Michael Moore wrongly disassociates himself from the word capitalism but for the right reasons. He does not just produce his movies, his labor creates them. Moore is both capital and labor, and being both he treats his employees fairly even though they are only labor and not capital.

However, Schiff is wrong when he tries to use the word socialism. The state control over the means of production and the force consumption he describes is not socialism. It is communism. Communism is about state control of the economy. Socialism is the sharing of the cost (and thus also risk) and the profits of an endeavor. Socialism and capitalism are not opposites, and socialism and communism are not the same thing. An economic system can and must have both socialism and capitalism. The question is how to structure these two aspects of the economy.

The Highway Transportation System is a perfect example of socialism in our country that absolutely is essential for our economy to run. Without public roads spanning our continent, our whole economic system would collapse. The HTS was paid for by the public and the whole public benefits from it. There is nothing anti-capitalistic about the HTS.

Conclusion: Peter Schiff and Michael Moore actually agree on the basic principles about how capitalism should work. They may disagree on many details, but the fundamental philosophies they both espouse is essentially the same. Unfortunately, both religiously use words to mean completely different things and thus make themselves appear to have less in common than they actually do.

Second Conclusion: Despite being a misnomer, the core of "capitalism" (the capitalism of Adam Smith) is not a system that favors capital over labor, but rather a system that rewards both in a just manner. The corporatism, or more honestly "fascism", we see today advocates capital siphoning all wealth from labor.

Are financial zero-sum games bad "shell games".

Both Moore and Schiff are completely against zero-sum games, speculation, and moving money around in complex and deliberately obtuse financial mechanism for the purpose of accumulating more money without producing anything. As Schiff says, "Maybe Michael Moore really has a lot more [in common] with Ron Paul than he really understands ..." And to a large degree Schiff is right. Although Michael Moore will disagree with Peter Schiff and Ron Paul on many nuanced details, all three of them are striving for the same basic goals. With the exception of how and where to apply socialism and to what degree, the basic philosophy of all three of these individuals is remarkably similar.

And even Ron Paul accepts some socialism. I sincerely doubt Dr. Paul would want to demolish the highway transportation system. He might, however, like the idea of socializing its cost over only drivers, the users of the HTS, rather than socializing the costs over all people and corporations. However, that is a difference in how to socialize rather than if to socialize.

Differences between Peter Schiff and Michael Moore

Does regulation help or hurt large corporations.

Moore believes that regulations are critical to ensuring that large corporations don't take control of the economy and deprive others of well-being. All historical evidence supports this statement.

Peter believes that regulations actually help large corporations and hurts both individuals and small businesses because the large corporations can easily absorb the costs of regulations and small business cannot. This means that people are forced to do business with large corporations since the smaller businesses have been driven out of the market by the very regulations that were meant to keep large corporations under control. This resulting lack of competition means that large corporations are better off and can abuse the power even more under highly regulated environments. Case study: Bloggers can compete with traditional newspapers and television because of lack of regulation.

Both are correct. The conclusion I reach is that regulation in its current form is not an effective mechanism to prevent economic tyranny and instability. Instead of creating thousands of tiny rules to address every use case, knowing that the large corporations have the resources to find or make loopholes, one should instead create a few simply, fundamental rules that change the economic landscape and fundamentally address the causes of problems. This would not hinder small business unfairly and yet would also be far more difficult, if not impossible, to subvert. For example, to prevent any future commodity bubble, as well as micro-trading, change the capital gains tax to be "1.00 - 0.01 * numberOfMonthsCommodityIsHeld".

Who is the cause of the financial crisis and our economic problems: government or capitalism?

Video

Moore: Capitalism is the problem. Capitalism corrupts government by buying politicians.

Moore does not seem concerned about the Federal Reserve. Which I find surprising since it's a private cartel of banks that steals money from the middle class and puts its cronies into high ranking government positions. I would have thought that Moore would consider the Federal Reserve to be the Mecca of evil crony capitalism.

Schiff: Government is the problem. Government corrupts capitalism by giving power to the Federal Reserve and protecting some business at the expense of others.

Again, both are right but neither tells the whole story. Both government and big business are willing participates in the corruption of government by lobbying. And the solution to both problems is the same: a wall must be erected between these two parties. Such a wall would have to include many aspect, but most important of all are public campaign financing and election reform.

What about Occupy Wall Street?

Moore: This movement in the next few is going to create a democratic economic system. In such a system, the people have a say in how the system works and is ran.

Schiff: They are half-right and half-wrong. They are right to be upset and the financial crisis, but they are blaming the wrong people. They should blame the Federal Reserve and the government for advocating its power over monetary policy to the Federal Reserve.

Both Moore and Schiff are half-right and half-wrong. OWS could become a progressive movement with a specific agenda that is obtained and improves the quality of life for the 99% of Americans, but it could also outright fail and become a footnote in history, an angry mob with no thought behind it akin to the Tea Party. It is impossible to tell which will happen yet.

Schiff is correct that the Federal Reserve "spiked the punchbowl and got Wall Street" drunk. However, the Federal Reserve was not the only cause of the financial crisis. There were many failures in our economic and legal system that led to the financial crisis and the Fed, Wall Street, the big banks, and the common man speculating in real estate all are 100% responsible. And yes multiple parties can be 100% responsible because responsibility is multiplied, not divided.

Conclusion: Only a mixture of progressive and economic reforms will prevent this problem from re-occurring. A permanent solution must address the Federal Reserve, fractional reserve banking, inflation, corporate influence on politics, anti-trust enforcement, and labor rights.

Is greed good? Was Gordon Gecko right?

Moore: No, greed is the most immoral sin according to all major religions.

Schiff: Yes, greed when applied to increasing production in good. However, greed when it enters government is evil. Furthermore, criminal activity is evil regardless of whether or not it is motivated by greed.

My opinion: Greed like hatred or love is just an emotion and as such is neither good nor evil. It is the actions that you performed that are good or evil. Laziness can lead to good or evil, too. If laziness causes you to not do an essential job, then the consequences of the laziness are bad. If laziness causes you to invent a tool to make a job easier, then the consequences of the laziness are very good. This same principle applies to greed and even the dark emotion of hatred. Emotions are simply tools that our genes use to control us into doing what they "think" will ensure their survival.

That said, excessive emotion is always a bad thing. So greed can certainly get out of control, and has a tendency to do so. A good economic system would punish excessive greed. Fascism does not punish the excessive greed of large corporations and banks as proven by the great bank bailouts.

Utopia as seen by Peter Schiff and Michael Moore

Peter Schiff's idea economy is a return to Adam Smith's vision of a free market, a market controlled by no government, corporation, or cartel including the Federal Reserve. He wants to eliminate fractional reserve banking and return to a commodity-based currency, particularly gold, as a means to ensure that money retains its value. He wants no regulation other than enforcing normal laws regarding theft, fraud, etc. However, he wants no bailouts for corporations that fail, and he wants to eliminate the collaboration between corporations and government.

Michael Moore also wants to eliminate that collaboration. However, Moore foremost wants to restore the balance of power between labor and capital, which currently heavily favors capital, to one which puts labor on equal footing. In doing so, Moore believes that labor will be able to keep the fruits of their production rather than having those fruits stolen by capital.

Moore also has an interesting idea mentioned in this video (first posted by user Anonymousone) and also mentioned in his movie Capitalism: A Love Story. Moore says, "This movement [Occupy Wall Street] in the next few is going to create a democratic economic system. In such a system, the people have a say in how the system works and is ran." . Also in his movie, Moore interviews members of a company that is ran democratically in which the workers own the company in a similar manner to depositors of a credit union owning the credit union.

It is unfortunate that corporations are structured in hierarchies. Capital loves hierarchies because they allow for maximum syphoning of wealth from producers by controllers. However, nothing in Adam Smith's philosophy of capitalism requires that corporations be built based on hierarchies. Since the 1970s, software has replaced hierarchical databases with relational ones and other hierarchical systems with distributed systems including peer-to-peer systems. Even currency can be made into a peer-to-peer system with no centralize control or parasitic opportunity as proven by Bitcoin. What can be done with software can also be done with economies.

Already today, the Millennials think distributed whereas their Boomer parents think centralized. Distributed thinking is taking over from centralized thinking from software to energy production to music distribution to news reporting. Distributed systems are the future and they have already arrived. Michael Moore's idea of a company in which the power is distributed among peers will eventually become the norm because distributed systems are more adaptive and efficient than centralized ones, a lesson well learned in the software industry. The mother of all distributed systems, the Internet, is all the proof you need.

However, making the transition between centralized solutions and distributed ones will require the cooperation of people like Michael Moore and Peter Schiff. As such, they would be much better off opening a direct dialog and resolving their differences than pretending to be opposites. And that requires a bit of compromise on both their behalves. But if done, what a force would they be. Image a united front composed of Michael Moore, Peter Schiff, Ron Paul, Elizabeth Warren, William Black, Jon Stewart, and Bill Maher. I think I just jizzed in my pants.

 

No_Fiat's picture
No_Fiat
Status: Silver Member (Offline)
Joined: Oct 20 2011
Posts: 104
 If you yourself do not

 If you yourself do not know what is really going on, studying what others say will drive you insane. The answers are in a few basic questions such as how does money come into existence, what impact does a growing population have, and what resources are renewable and which ones are not. Practice your natural intellegence and be leery of artifical intellegence which is book knowledge. 

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