Jeremy Rifkin on capitalist societies

By Alex Singleton | 24 June 2005

Jeremy Rifkin (pictured) had an article in the Guardian on Wednesday repeating several misconceptions about free-market economics. Firstly, he writes that captialism is causing the world to become more unequal:

Today, while corporate profits are soaring around the world, 89 countries find themselves worse off economically than they were in the early 1990s. Capitalism promised that globalisation would narrow the gap between rich and poor. Instead the divide has widened.

And yet, thanks to the Asian Tiger economies, world inequality actually decreased in the second half of the twentieth century. It is true, as Mr Rifkin says, that many African countries have become poorer. This is not the fault of capitalism, but the fact that those countries have not practiced it.

Secondly, Mr Rifkin promotes an alarmist view of environment, when on most measures the world's environment is getting better:

The champions of capitalism pledged to promote sustainable economic development; yet we continue to squander our remaining fossil-fuel reserves, spewing increasing amounts of carbon dioxide into the atmosphere, destroying the world's ecosystems and habitats, with the prospect of catastrophic climate change.

The reality is that energy sources that do not pump out carbon dioxide - such as hydrogen and pebble-bed nuclear power - will replace oil as our main energy source in the 21st century - not because fossil fuels will run out but because they will be cheaper.

Finally, Mr Rifkin rails against corruption in free-market societies, but this is hardly of the scale exhibited by communist countries to which he refers. Humans will act immorally in any economic system, but the fact that irregularities at Enron led it into bankruptcy indicates that capitalism, unlike communism, has the ability to deal with corruption.