Capitalism needs an upgrade – UPSC GS1

Capitalists insist that private producers of vaccines must make profits because that is their compensation for investing in research and production.

They believe that they are not morally compelled to serve the poor at a loss.

For the poor, governments must step in and buy from private producers and subsidise sales to poorer people, for which resources are generated by taxing the private.

At the same time, private companies press governments for lower taxes and the government is also pushed by them to keep out of business (through privatisation). Thus, public service delivery gets impacted. The Indian government is facing this crisis right now.

Businesses convert natural capital into financial capital (leading to over-exploitation) and use it for generating profits and more capital for themselves.

For ex. Pollution, Over exploitation of Ground Water etc.

Modern regimes of intellectual property rights (IPR) help capitalists to create intellectual property monopolies.

This ignores the fact that the public contributes to the creation of scientific knowledge in many ways, for example, through government research and development grants and subsidies.

Even natural treasure like neem and turmeric has been patented.

Many economists do not like ‘public sector’ enterprises and prove that these enterprises do not produce as much shareholder returns as they would if they were ‘privatised’.

Public benefits are ignored.

The COVID­19 crisis has revealed the inadequacy of Capitalism to fulfil societal needs.

With artificial intelligence algorithms in social media, capitalist enterprises are able to manipulate human minds.