Saturday, September 28, 2002
Economic religious fundamentalism
One of the great myths of our time is that Capitalism (which I am in favor of) is intrinsically a democratic system. The concept of individual choice is enshrined as the ultimate mover of markets.
This is absolutely untrue. Capitalism has as its fundamental axiom that the Market is infallible. But the market is rarely influenced by consumer choice. It is fundamentally dictated by the large economic entities.
For example, companies like Enron created an illusory energy market in California simply by sheer size of their market share. Also, an illusory market was created during the dotcom era. The market intrinsically leans towards the self-interest of the largest players, while the individual is completely marginalized.
The only time the market is democratic is when all the individuals act in concert. But what does that actually mean? it means that the individuals (who outnumber in sheer size any other player as a collective group) are acting as One. That is, they have also become a large player. The largest! Again, the market will respond.
If people are nuclei, then in MRI physics they would be an "isochromat" - a large group of particles all at the same resonant frequency. However, in nature, isochromats have randomized phase - that is, though everyone rotates at the same rate, they are pointing in different directions, so the net direction they are pointing is zero. Only when you apply an external field (ie a magnetic field) do the isochromats align themselves with the field and become in phase. When that happens, the signal is suddenly enormous.
This is exactly analgous to capitalism. The people are an isochromat, but they are usually out of phase. Only in certain rare instances do they act in phase. When they do, they become the dominant player. But it takes a lot of energy to maintain the common phase and slowly they drift out of phase again. Eventually the signal is zero again. Large corporations are smaller than the People isochromat, but they are always in phase. So, far from being democratic, its a king of the hill system.