The paper "The Road to Supercapitalism" is a perfect example of business coursework. The history of supercapitalism had its foundation in the technologies which came out from the Cold War. Cargo ships, containers, planes, satellite communications systems, and fibre-optic cables are some of the advancement that characterized the growth of supercapitalism. pp. 50-56 Reich traces the history of supercapitalism to the 1970s that commenced with deregulation. He points out that supercapitalism may have started long ago than it can be imagined possible in the 1950s and 1960s. He discredits the theories of the emergence of supercapitalism. pp. 56-59 Reich discusses the disturbance of the oligopolistic system.
Reich explains the role of the department of defence and other allied institutions in the shattering of the oligopolistic system to give way to supercapitalism. The development in the department of defence technologies and other technological advancement opened a way to the growth of the economy internationally. Internet was developed out of the need of the Pentagon to communicate. pp. 60-63 Reich looks at the effect of globalization. He focuses on the increase in international trade as War-torn countries look for ways of rebuilding themselves.
There was an increase in manufactured products in America. Reich reports that global supply chain deepened and lengthened. He goes ahead to mention some of the businesses that were involved in international trade growth. pp. 64-65 Reich examines the impact of new technologies on communication and service delivery. He mentions telecommunication, insurance, and banking as being able to provide customers with services to meet the exact needs of their users. The growth of the internet made oligopolies unnecessary. Numerous new technologies came to take up stable production systems which had previously been dominant. pp. 65-70 In this part, Reich explores the impact on economic deregulation.
The 1980s was a period that saw increased deregulation. There was a spirited campaign to deregulate businesses in Congress. Deregulation was seen as stifling innovation. The means of transmitting information changed drastically with the advancement in technology. pp. 70-75 Reich argues that financial deregulation brought some relief to some savers in America. Mutual funds were seen as exotic and funds in the money market were yet to be discovered. Very few people had invested their saving in shares. Corporations were in the ownership of individuals who kept stock certificates at very safe places.
There was no distribution of profits through dividends. There was a tremendous change in the money market. Reich emphasizes that it was not greed which led to hostile takeovers, junk bonds, corporate raiders, proxy fights, or leveraged buyouts that occurred in the 1980s; or occasioned the private equity firms, hedge funds, minority activists, and one more time of proxy fights and leveraged buyouts. pp. 75-80 Reich discusses the role of corporate statesmen in the balance of interests of all parties. pp. 80-86 Reich investigates the involvement of labor unions in the welfare of workers.
Reich asserts that membership to trade unions declined substantially. Union membership in the private sector was at its lowest. pp. 86-87 Reich summarizes what he recounted in the chapter on the growth of supercapitalism. Outline of the Main Arguments Reich traces the development of global chains as a result of the collapsing of oligopolies as new technologies took shape. Globalization saw an increase in international trade as countries took advantage of water transport and other means to get necessary goods. Reich discusses the decline of union membership as a resulting of shifting economies.
The falling apart of oligopolies intensified competition and provided more choice to the consumer. Unionization was weakened by an increase in competition. Reich explains the development of deregulation in the advancement of the economy. Initially, investors had very few places of investing their funds. Financial deregulation brought about increased opportunities for investment. Other forms of deregulation like Airline deregulation led to increased competition from other low-cost companies. Airline and trucking deregulation occasioned new opportunities and new ways of competition. Reich explains labour union activities and the involvement of Ronald Reagan in them.
Unionism seemed to decline in the wake of new trade following an increase in supercapitalism and advanced technology. Reich compares the development of trade in different countries after the Second World War and attributes supercapitalism to cold war and technology advancement. Reich’ s main evidence for his argument Evidence for the first argument of the emergence of supercapitalism Reich discredits many theories that tried to explain the growth of supercapitalism. Reich refuses the suggestions of capitalism as the as a result of deregulation which commenced in the early 1970s. Globalization occasioning capitalism has also been objected to by Reich.
Other people indicated paroxysm of egocentric greed as being the result of capitalism. Globalization and deregulation are mentioned as having a role to play in the advancement of capitalism. None of the theories given explains changes in democratic capitalism. Most theories used in America do not explain the similar happenings in Japan and Europe. The real explanation for technologies empowered investors and consumers deals which were better. The fall of oligopolies which was the anchor of the American system collapsed giving way to the development of capitalism (Reich, 2008, p.
51). Evidence for globalization and collapse of oligopolies Increased in globalization was as a result of growing competition and advancement in new technologies. The ability of large corporations to set process declined dramatically. Deregulation, technology, and globalization led to increased competition in companies as they struggled to attract investors and keep consumers. Entrepreneurs pushed for deregulation of markets through the removal of regulatory barriers. Stable oligopolistic systems were shattered in the event of the cold war. Fall of oligopolies paved the way for the growth of capitalism.
Free trade and the elimination of barriers led to an increase in globalization (Reich, 2008, pp 52-54).
BibliographyReich, R 2008, Supercapitalism the transformation of business, democracy, and everyday life, Scribe: Melbourne.