The Little Engine That Could (Discredit Capitalism?)

The Empire State Building-sized cargo ship the ‘Ever Given’ has at last been freed from its perilous position in the Suez Canal, with traffic finally uncorked and dissipating, but it has made us all ask some serious questions about how things are being managed globally that won’t go away as easily.

Most have heard the old adage “capitalism is the worst economic system, except for all the others” and many have even had it incorrectly attributed to Winston Churchill by whoever it was that relayed that ‘old wisdom’ to them. In truth, Churchill didn’t even say that—instead he said that of democracy as a political system (even more cynical?), but nonetheless most internalize the logic at some point.

Few love the 'collateral damage,' or perhaps they might prefer to call them the ‘extravagances’ of capitalism we occasionally hear about—the sweatshops in southeast Asia, the child labor in the cobalt mines of the Democratic Republic of Congo, or the copper mines of Peru, the soft coups supported or even propped up abroad in the name of cheaper lithium—and yet, as people in the developed world buy that extra pair of shoes that maybe they didn’t need, or buy a new, second pair of earphones rather than find the old pair they hadn’t seen around in a few months and couldn’t be bothered to look for, they internalize the logic that the ‘benefits outweigh the drawbacks.’ Therein we internalize guilt—perhaps one doesn’t imagine child laborers every time an extravagant purchase is made, but when the topic comes up, however rare that may be for some, the implicit guilt is always palpable—we all know of our tacit complicity in the systems of oppression and injustice that ultimately enable our consumer goods to be within our reach, price-wise. Or two or three of them sometimes, even.

But what can we do? We ask ourselves and our friends, we wring our hands, we seek "local," “fair-trade” products, “cruelty-free,” and the like to assuage our guilt about how poorly workers are treated abroad, about unfair trade policies created by unjust governments, about a tilted global economy that has always openly favored the wealthy, even about how the animals are treated that we eat, or whose fur or feathers we stay warm underneath. Underlying our passivity, and our lack of much substantive action regarding any of said ‘extravagances,’ is the logic that with the sum total of its parts, this system is actually complex, and thoughtful, and poured over by experts from all fields—that it ultimately provides the most good, for the most people possible, and that any global economic system would ultimately result in ‘haves and have-nots.’

So for all that ‘expertise’ we’ve collectively put our faith in, all of the unknowns that operate ‘behind the scenes’ to keep things functioning smoothly(ish), a fairly unimpressive container ship did more to tear at the edges of that logic than most terrorists, political ‘disrupters,’ or revolutionary thinkers have yet managed.

Dullish dark green with a distinctive red belly protruding out of the water, and the word EVERGREEN scrawled across it in bold capital white letters, a boat that got lodged into the side of the Suez Canal captured the world’s attention for nearly a full week, starting on March 23. In perhaps a twist of fate, the ship was named the “Ever Given,” and though it gave news pundits, politicians, engineers, and critics of capitalism a lot to feast on, it should have provided nothing to celebrate—real crises were brewing as vital supplies were being held up in the blocked Suez Canal’s expanding traffic. 13% of maritime trade, and 10% of oil shipments by sea go through the Suez Canal (Faucon, Paris, Smith/WSJ) and as much as $10 billion of trade was lost in a week of the canal’s stoppage—about 0.2-0.4% off annual trade growth globally—but this was no GameStop/WallStreetBets scenario; everyday people were going to potentially suffer as well.

Many smaller Northern African and European nations already staving off oil and energy shortages stood to be seriously impacted by the blockage in the global supply chain—plans to put energy usage limits in place in a number of countries were drafted as the vital oil supply traveling through the Suez Canal was halted.

So why is capitalism at the heart of this problem? Wouldn’t any global economic system hinge on global trade and thus be subject to the same issues re: chokepoints and vulnerability?

Even just forgetting the obvious imagery of the very large container ship being saved by the many small tugboats? All jokes/cheap imagery gimmicks aside, the famed Suez Canal is one of four major trade chokepoints around the world (alongside the Panama Canal, the Strait of Hormuz, and the Malacca Strait), and has represented (since 1869) a major technological/diplomatic feat that eluded the pharaohs of ancient Egypt, the invading, crusading Romans, and French colonialists alike, all of whom tried and failed to connect the Mediterranean Sea to the Red Sea. It also, today, represents one of the major vulnerabilities of our global supply chain, and this event certainly didn’t calm anyone who was worried about it (Stevens/CNBC). Since the 90s, plans have been cooked up, and discarded by (now) a number of Egyptian regimes to expand the canal and make it less vulnerable to sabotage or accidents. Likewise, plans to build a secondary passage (and alternate to the Panama Canal) connecting the Atlantic to the Pacific through Nicaragua were concocted more recently, also having since stalled and now even being viewed by many as entirely defunct (Daley/NYT).

Herein lies the problem—in a world where a few large economies vie for dominance and square off all over the globe, the competitive nature of not only modern economics, but also governance have become major barriers in terms of huge projects like the two mentioned. Investors come and go, competing economic and political groups seek to sabotage progress, myopically ‘financial’/’cost-effective’ approaches to infrastructural problems are adopted, most of which exacerbate territorial and environmental concerns; it all amounts to making these projects so herculean as to be impossible to undertake. Where major global and corporate ties can’t be forged, these projects can’t come into fruition, and when even then they succeed, finally military and territorial tactical concerns become involved and these projects become even more untenable. Decades of diplomacy and war have been enacted and/or perpetrated in order to shape who has control over what regionally, and such advantages aren’t likely to be ceded without a fight, even if it would benefit global trade and make it less prone to human error, bad actors, terrorism, or even just runaway cargo ships—The U.S.’s long-strained relationship with Nicaragua, compared to it’s amicable (‘financially-influenced’) relations with Panama certainly played a role in the region-at-large’s reception to that particular project in Nicaragua, for example.

To put this all on capitalism, all of the struggles of geo-political strategy, cooperation, and competition, would certainly be unfair, but not wholly. Hyper-competition is part and parcel with capitalism—the main concerns, resources, and advantages being stumbled over are corollaries of economic competition and resource distribution; who gets what, how, when, and perhaps most importantly, how fast. In the words of (famed capitalist economic theorist) Milton Friedman, “There is one and only one social responsibility of business–to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud.” Competition is the name of the game, so to speak, and one needn’t search around for Friedman quotes online to grasp that much—it’s coded into the economic theory that birthed the whole premise of capitalism. So when a project doesn't guarantee profit? When nobody wants to take such a big risk so there is no competition? Does capitalism simply cease to cater to any needs outside of those parameters?

It may seem wishy-washy to suggest that 'a spirit of cooperation' is what's lacking, or even to blame capitalism for it - many large-scale projects around the world have been completed under the watchful eye of capitalism, and they've merged giant corporations, or even gotten them to collaborate extensively on singular projects to great success. So what is the point of this opinion piece then? These specific types of projects, with the scale and degree of cooperation that they require across various industries and governmental agencies run the risk of falling apart and becoming giant, unending money pits until they do often fall apart. There are so many factors that can halt something of this scale at any given time that the risk factor and potential for lost revenue will always far outweigh the potential financial gains should one of these projects ever come to fruition.

How does one know this? One merely has to look around at our collective ability to complete these massive, new projects in the modern era; not much is on display, as mentioned in the cases of the Suez and in Nicaragua (but there are many more, such as more recently the Friendship/Islamic Gas Pipeline). These upgrades to/proliferation of trade passageways are desperately needed - with the potential for a stoppage at any of those 4 chokepoints now known widely. People's dependence on the resources at risk is so vast that the effects of such a stoppage are now thoroughly documented out of fear and in preparation for the inevitable day that it arrives.

Waiting for the next or more serious stoppage at one of these locations seems like asking for people to suffer eventually in the name of inaction now, which (to be fair) seems to be the norm for capitalist nations of late, especially being that it's in the name of profit-motivated (or demotivated?) inaction - see climate change or the coronavirus response, and how economic interests have been placed above human life as further evidence of this approach being the norm. Some things are bigger than a company's profit margin, and some projects are worth the financial losses they might incur in order to be completed for the greater good of humanity.

In a world where the global exchange of goods and services is increasing at faster rates than ever before, one can easily predict the mayhem that is yet to come - already the straits of Malacca are notorious hunting grounds for pirates, so one can imagine how little coordination would be required to create much more damage to one of these passageways than a single ship that was mistakenly lost control of managed to.

And so to tie this all up, the question is - if this doesn't all work then is it worth it? Remember the children working in mines, extracting raw materials for multinational corporations at inhumane wages, putting themselves at great risk? If what they're contributing to is a system that, in the name of 'cost-effectiveness,' actively ignores problems that we know will eventually create suffering to many people because we ignored those problems... are we sure it's worth it, for those kids in tin mines in Indonesia to live like that? Are we sure it was ever worth it to begin with, even if the economy 'worked?'

'Capitalism' has spawned wings (domestically and globally) that support more or less regulation on corporate greed and in turn, new hostilities and rivalries have been birthed based on how regulated these new sides think a capitalistic system/society should look. Regardless of the many efforts to usher global cooperation via capitalism (NATO, OPEC, The EU, the AU, etc.) the world feels like it’s at an all-time low as international relations seem to yet again be becoming competitive mechanisms of a new, growing cold war-like rivalry brewing between the US and China. Acts of diplomacy and aid geared towards 'development' seem designed to garner cold war-like P.R. support rather than being good-faith efforts to help others in need, or raise folks’ standard of living out of a sheer willingness to ‘help one’s neighbor’ or any such high-minded sentiment. The result has been more neo-imperialism; more resource-grabbing, more territory lines being re-drawn and disputed, more top-down economics furthering the gap between the wealthy and poor. In this context, projects that require putting aside old rivalries/hostilities in the name of alleviating the trade of goods needed worldwide seem like idealistic pipedreams.

For generations of children raised on hopes and dreams that their own (lived) future civilization would include flying cars, interplanetary travel, space colonization and the like, it’s a harsh smackdown to have entered the 21st century and to come to the realization that humanity can hardly even construct the dams and canals it needs to live here comfortably anymore. Even furthering a subway line down the east side of Manhattan to connect it to Brooklyn directly seems dream-like in its scope in 2021.

(Sigh).