Our claim that capitalism is inefficient may seem strange when we know that it is an extremely, and increasingly, productive system. Long gone are the days when there were real shortages of food and industrially produced goods.

In fact, capitalism has developed productive capacity for life’s necessities so much that there is no longer any technical need for rationing what is consumed on the basis of people’s ability to pay. We could dispense with handing over £5 notes or tapping a bank card to get whatever we need .

Wasted effort

The fact that we still do that is an important cause of the inefficiency we have mentioned, because the system has to divert energies away from work that would meet our needs, wasting it instead in maintaining a now redundant exchange system.

So in Britain, in June 2022, as just a small example, 2.24 million people were uselessly whiling away their time and energies in the finance sector (banks and insurance).

There are many other ‘jobs’ that are required only in a capitalist society – 350,000 of them in the legal sector, 225,000 in advertising, marketing, fundraising, operating tills and checking tickets, 100,000 employed in gambling activities.

Wasted resources

The existence of the market system itself also leads to waste and inefficiency.

Profits can only be realised by selling – continuously – so one obvious trick is to make stuff that falls to bits sooner than it needs to.

At the same time, the advert fraudsters try to convince us that the wonderful stuff they were so keen for us to buy last year is not quite as good as the stuff that’s on offer this year .

The important thing is to sell – more than last year, and more than your competitors. Always.

And damn the consequences.

Next: Existential threats ➡️

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