Creative Destruction

[Richard Fiero]

David Morris wrote:
>The original source of the term:
>
>"The opening up of new markets, foreign or domestic, and the
>organizational development from the craft shop to such concerns as
>U.S. Steel illustrate the same process of industrial mutation—if I may
>use that biological term—that incessantly revolutionizes the economic
>structure from within, incessantly destroying the old one, incessantly
>creating a new one. This process of Creative Destruction is the
>essential fact about capitalism. (p. 83)"
>
>Y'all (Ian & Richard) are taking this "creative destruction" way too
>political/literal for my taste.  The Pynchonian aspects in my eyes
>are:
>
>1.  Most directly, Luddism Vs CD.  The human (and inevitable) cost of
>"progress."
>2.  Anthropomorphizing of "Capitalist Progress," as if it were an
>autonomous creature.
>3.  Inherent Imperialism of Capitalism: "opening up of markets," and
>thus justification of the human costs.
>
>I'm just surprised I've never see TRP use the term.
>
>Davis Morris
. . .
I don't see P having a dog in any of those fights.

The original usage of the term probably is a 
metaphor drawn from a misunderstanding of a 
machine-like natural balance. Economists have 
lifted a great number of metaphors from the 
physics and ecology of 150 years ago. We now call it Neo-Classical Economics.

Just my opinion, largely quite uninformed and 
shortsighted not to mention ill-advised is that 
the term "creative destruction" has fallen into 
disuse. If we want to describe capitalism, we 
should probably mention the rentier position of 
successful capitalists which is wholly 
unproductive. Something like our financial 
industry which has, under the government of 
friendly and bought-off politicians produced a 
many-headed machine for extracting wealth rather 
than creating wealth. Now I am striving to be 
ideology-free and would prefer something that 
actually works, regardless of what it looks like.
Alice may claim that bankers do financial 
engineering of a complex and intricate nature but 
the fact is that bankers have staff to do that 
and that bankers do relationships. That these 
morons believed highly paid staff's assurances of 
the models' accuracy and low risk is testimony to 
their abilities which is countered by their 
ability to buy the officials needed to make 
themselves whole while dumping the costs to the public.
Since we are in a gilded age of capitalism, it 
may be instructive to look at the great railroad 
robber barons that did not have the wits or 
interest to run successful roads but enriched 
themselves and their friends and large numbers of 
congress people by hollowing out their own 
companies. Creative destruction, indeed.