Jun

23

 The works of Charles Darwin and Adam Smith are often compared. My wife the high-school science teacher has informed me that despite the descriptor "Darwinian" often being attached to economic or capitalist ideas (Darwinian capitalism, Darwinian economics), rather it was Darwin who got his ideas for Evolution from Adam Smith. Hence we should really say "Smithian" in reference to Evolution, rather than Darwinian in reference to Economics. Nevertheless, that is the way the language has evolved. In the world of Nature or Evolution, the incentive structure is that of "jungle capitalism". That is where the term originates, I believe.

That being said, I don't find the line between "jungle capitalism" and what most of us believe in, which for contrast is often referred to as "rule-of-law capitalism" to always be that clear-cut or well defined! Well known Capitalists (e.g Gupta) often cross the line into jungle capitalism, and vice versa (refer to the "Godfather" movies where the mafia goes "legit" in Las Vegas, but still using violence and their ill-gotten capital to do so.) Other historical examples: union-busting by Andrew Carnegie and grey areas: anti-monopoly laws (a subject for the courts), "Bundling" by Microsoft (a subject for the courts), and most recently "too big to fail".

To my mind, too-big-to-fail clearly crosses the line into jungle capitalism. Here a company does not have to follow the same rules, or face the same risk profile of smaller competitors, simply because of their size. Granted there was presumably some merit involved in attaining this size, but once it has been attained the same merit is no longer required to maintain it. I like the idea of the Beekeeper! Perhaps we as a society should put legal incentives in place that incentivize large corporations to "swarm" once they reach a certain size. (Spin-offs, de-megers are obvious ways of doing this.) Although the benefits of size are well-known (and espoused by Jamie Dimon, was it?) the benefits of diversity are also fairly obvious (for ex, the honeybee, which has been around for roughly 100 million years). I am also a beekeeper, BTW.

Best Regards from vacation,

balloon boy


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