A Time Pussy Theory on Capitalist Economy

Economic activities of a capitalistic society are organized around the principle of free competition and voluntary trading. In a capitalist society, the right for private properties is divine and the right for political equality for all is regarded as god-given. Political and economical freedom, human dignity and civil rights are commonly promoted. The tremendous power unleashed from liberation of individual and collective human creativity has materialized into a trend of steady growth in productivity. Collective human productivity has reached an astoundingly high level. Despite all its shortcomings, capitalist societies are by far the richest and the happiest mankind has ever created. In the face of the recent economic down turn, questions on fundamental viability of free capitalist system are again raised by many. We have passed the stage of crisis. Recession did not evolve into a depression and the possibility of a collapse has faded away from sight. We are, however, still in the middle of a painful recession. Fear and doubt linger around, projecting a pessimistic shadow into men’s perception of future. For economists, there will be much to study and much change to propose but at present nothing is perhaps more helpful than spreading an optimistic message, for immediate prosperity of a free market economy is largely based on the confidence and trust of all involved in the system. In this essay I would like to introduce a theory that is overall optimistic. I would illustrate that, in a free market economic system, the profit businesses make today is the growth in future and that future growth is backed by a steady pace of advancement of modern science and technology, which has lasted for over three hundred years without a sign of slowing down in near future. The agent, who transforms the value of advancement of science and technology into business profits, is Joseph Schumpeter’s entrepreneur and the Federal Reserve. The entire economic scheme is like a time pussy of Issac Asimov. She digests at present what she eats in future. Capitalism came with the rising tide of science and technology. It will only meet its doom when that tide recedes. Only after scientific and technologic innovations reach a point of general stalemate, capitalist system and the civilization it created would then meet its doomsday. Civilizations rise and civilizations decline, as we have seen many times in history. What is in store to replace capitalism is hidden in an unforeseeable future and there is no reason for us to believe that this future will be either better or worse. The doomsday, however, does not appear to be close at present time, and what would follow afterward could be anybody’s fancy. The evolution of human society is full of surprises and unexpected twists. To predict an unpredictable future is a job for religious prophets. There are of course all other worries: the potentially damning consequences of a seriously damaged natural environment, the 2012 ending of the world, and the unpredictable second coming of Jesus Christ. But on none of these an economist could be of any help.