When I was a bright, young economist fresh out of graduate school, I was fascinated by the writings of Nikolai Kondratieff, who was an obscure Russian economist that rose to become the Deputy Secretary of Food for Russia. Unfortunately, he would up in the infamous Gulag Archipelago with the famous Russian dissident, Aleksandr Solzhenitsyn.
Communists at that time believed the major weakness of capitalism was the never-ending cycle of economic recessions and depression, inflicting unreasonable and unspeakable misery on people. Kondratieff agreed with that. He added that there were several different types of cycles of varying lengths. He is most famous for his work identifying the long cycle of 48-54 years, following a predictable pattern. (Long ago, I concluded this cycle was ended in the U.S. by the creation of transfer payments, such as unemployment, welfare, and pension payments.)
But, his crime was concluding that the economic cycles of capitalism were beneficial, as it eliminated the weak and inefficient from the marketplace, similar to Darwin's evolution. He even compared it to a woman's menstrual cycle, saying that women lived longer, because they were able to eliminate impurities that men cannot. He concluded that each bottom in an economic cycle was better than the last bottom and that each top in an economic cycle was better than the last top. In other words, capitalism offered greater economic progress but was often violent. For this "crime," he suffered and died in that prison.
Today, I finished reading "Zombie Capitalism" by Chris Harman, where he details the misery caused by our capitalistic system during the global financial crisis. While I found it both well-researched and well-written, I kept waiting for him to make the moral judgment as to whether that was good or bad in the long run. He would NOT have been sentenced to the Gulag with Kondratieff . . .
My faith in capitalism is generally infinite, even though my faith in laissez-faire capitalism is generally finite. But, doesn't everybody enjoy the occasional flashback?
