A Cautionary Tale of Crony Consumer Capitalism for China and America's Last Free Market

Welcome to today's Capital Account. More than 25 billion applications have been downloaded from Apple's store, according to the company. Likewise, according to Apple, it's app "economy" has created two-hundred and ten thousand jobs. Now, there isn't a lot of bureaucratic red tape standing in the way of someone creating a new application. Is this an example of the kind of entrepreneurship and innovation that is possible with capitalism, which we see in what could be argued is America's last free market -- the internet? We will ask our guest, Benjamin Barber, Author of the popular book "Consumed," all about it.

Meanwhile, as we stay on the topic of consumption and economic growth, China has lowered its growth target for GDP from 8 percent to 7.5 percent. China's premier said in a speech that the nation needs to shift to a more sustainable economic model -- cutting its reliance on exports and capital spending in favor of increased consumption. But what makes a sustainable economy really? Is the answer for China to emulate the United States, or to follow a new path free of consumerism to possible a new "producerism" based economy? Again, we will pose this question to Benjamin Barber who is also a distinguished senior fellow at Demos, and talks often about these issues. We will also take a look back at the history of consumerism, where it came from, and whether it is fair to see it and capitalism in the same light. Is capitalism the problem, or is the problem really propaganda, which not only created consumerism, but all the significant sets of artificial wants and needs in society today.

And lastly, remember iceland? They were the first and last to give the international banking mafia and its compliant government backers the middle finger in 2008, refusing to back themselves into the wall of servitude and debt serfdom by bailing out the extractionist elite of our time. Now, besides returning to growth before any of the other economies similarly hit but this debt deluge, the Icelanders are also leading the field when it comes to prosecuting the criminal establishment that put them in the mess that they found themselves 4 years ago. Iceland's former prime minister is now standing trial for his role in the 2008 financial crisis, something that we are still to see in the US. What will it take for Americans or Europeans to see some of their leaders, like Hank Paulson, held accountable for their roles in bailing out their buddies on Wall Street, Frankfurt, the City of London, etc. for their roles in this financial ponzi scheme that has left millions without their homes and millions more in poverty?

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[xlamentx]

I wish Lauren would have asked Mr. Barker "Who decides what companies are worthy to be given Government subsidies and which ones aren't worthy of it? How can we expect the Government to have prudent oversight and guarantee real profits and markets when they are the problem?" I can go on and on over the fallacies he's making because he seems to be nothing but an apologist for crony-capitalists and I wish Lauren would have called him out more on it, but she ran out of time. Perhaps in the future.

[CapitalAccount]

Good point. I don't think he is an apologist, I just think we all have different expectations about what government can and can't do effectively and honestly. I'm certainly with you on this one though, and I think its pretty clear that the government we have today has been baptized in a caldron of corruption and cronyism. It's hard to find a reason to trust it, and that's a shame, because there are things that we need government for in my view at least.

Demetri

[CapitalAccount]

However, I will say one thing: as much as I am against government subsidizes of any kind, there is a real case to be made for gov subsidies of alternative energy solutions, and that is exponential depletion and how markets cope with that sort of function. Markets are great at adjusting to price fluctuations where underlying fundamentals can return to some sort of mean, but in exponential environments they fail, such as in a peak oil scenario. We talked about this with Chris Martenson.

[catbuffalo]

lol nobody buys apps

[reactiontm1]

His incandescent bulb example pretty much disproves his point. Consumers will be forced to pay substantially more for these "new and better" bulbs. They claim to last substantially longer, however I already have had SEVERAL that died faster than incandescents. Oh, and the new bulbs contain mercury, which is nice. So, his argument is that the "market" wanted this?

[reactiontm1]

[there is a real case to be made for gov subsidies of alternative energy solutions]

Gotta be kidding me. The "alternative energy" market is ALREADY flooded with an absurd amount of subsidy. See ethanol as just one example. Government subsidy makes industries fat, flabby, sloppy, wasteful, and inefficient. Another insidious example, well short of outright subsidy: student loan guarantees. "Easy money" has caused tuition to skyrocket. May I send you a copy of Hazlitt's "Economics in One Lesson?"

[spark300c]

edit form most wind mills

[spark300c]

his sound like petrophobia which sum up as fear of burning any for energy. wind only make money becuase in Texas they can charge more if you want power for mostly wind mills. only biomass is economical if got good soruce. the biggest untap sources is corn cobs for fuel.

[spark300c]

well you government prevent fraud and thief to have a free market or end up with some that looks like a black market.

[monikasieniawska]

IMO it is not only the "upgrading" of functioning devices - the biggest problem these days is the durability. When I was young - these were built for life. Now it seems to be designed for 12-24 months, even the premium products like mentioned here Apple.

[TheMasterofrevenge]

this is all pretty pointless...unless you are in China or mexico where the manufacturing actually happens- the ussofa is the land of no jobs and will continue to be

[gudster]

@kaushiksays

'..free market..which is like socialism..'

WTF are you on about???

the only thing alike are the shared letters, m & a

[George G]

is it just me or is Lauren looking hotter and hotter every show?