Occupy Wall Street was able to capture media attention at the end of 2011 and early 2012 as they camped out in various cities across the country to protest bailouts and other policies that they believe favor big banks. While they had a point in protesting taxpayer-funded bailouts, they were incredibly misguided to believe that the government that doled out taxpayer funds to irresponsible banks would actually solve the problem.
Rather than targeting Congress and the Federal Reserve with their frustration, capitalism, which they believe led to the bailout of the biggest banks in 2008, was their most frequent. Of course, this is because they don’t understand the difference between corporatism and free market capitalism.
Corporatism — collusion between the government and “private” industry — is the economic system that most resembles what we have in the United States. However, capitalism is an economic system that forces private-sector businesses to stand or fall on its own merits.
During a recent debate on Occupy Wall Street at Oxford Union, Daniel Hannan, a Conservative Member of the European Parliment, explained that the frustration from the movement was justified, but also misdirected.
In his 10-plus minute talk, Hannan expressed some frustration, noting, “I can’t believe that I’m having to come to the Oxford Union and explain that subsidies and nationalizations are the opposite of capitalism.”
“In a capitalist system, bad banks would have failed, their profitable operations would have been sold to more efficient competitors — bond holders would have lost money, shareholders would have lost money, some depositors would have lost money, taxpayers would not have contributed a penny,” said Hannan.
Furthering his defense of a free market, Hanned explained, “The failure of a business, and its replacement by a rival, is not a sign that the capitalist system isn’t working. It’s a sign that the capitalist system is working; just as you weed your garden to make space for new growth.”
“It’s precisely that replacement of inefficent, old producers by better new ones that has raised humanity to the highest standard of living we have ever enjoyed,” he forcefully added.
Watch the Hannan’s full presentation below. You can check out other videos from this particular discussion at Oxford Union’s YouTube page: