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“Capitalism: A Love Story” is a documentary widely released to the public in the United States and Canada on October 2, 2009, which was written, produced, and directed by Michael Moore. The documentary tries to address the question: What is the price that America pays for its love of capitalism? Michael Moore makes determined efforts to find the answers in this fundamental question that most of us are even unaware of. He wants the viewers to have awareness of the issue, which he delivered in a quite humorous and outrage manner.
I find the movie really significant, especially as a student taking finance. It gave me an insight into how capitalism had taken over our everyday lives without even noticing it. The movie started with a series of robbery clips. This is what capitalism made us do. How did we get into this situation? Ancient Rome in the movie exhibits what is America today. Ancient Rome back then was the largest and most beautiful city of the ancient world. Romans had the most humane system of law ever devised. But the great facades cannot conceal the unhealthy dependence of their economy on slaves, and the undeniable disparity between rich and poor. Imbalance and irresponsible behavior of public officials had become major reasons for Rome’s eventual downfall. And the same is true with the United States. But what is more evident in America’s downfall than Rome’s? It’s simple, outrage capitalism.
According to the dictionary, capitalism is an economic and political system in which a country’s trade and industry are controlled by private owners for profit, rather than by the state. According to Michael Moore, capitalism is a system of taking and giving mostly taking. And this is true! Capitalism through the years did increase the gap between the rich and the poor, there is now nothing in between that connects both ends. The system makes the wealthy (1% of US population) richer, and the poor (99% of the US population) poorer. Michael Moore recalls when his father is an assembly line worker for General Motors in Flint, Michigan. All were great back then. They bought and paid for their house before Michael graduated from kindergarten, they have a new car every 3 years, they went to New York every other summer. They lived a good life. If this was capitalism, he truly loved it, and so did everyone else. During that time, a lot of people got rich. Their top tax rate was 90% which were used to build dams, bridges, they even sent a man to the moon! The middle-class family only need one income to survive. Union family had free health and dental care. Kids can go to college without getting a loan with a bank. And most people were able to save and not rely on debt. But what made the tables turn?
Michael Moore describes President Jimmy Carter’s Crisis of Confidence speech as a turning point, which culminated in the election of Ronald Reagan in 1980, whom Moore calls a “spokesmodel” for the banks and corporations, who wanted to remake America to serve their interests. It was a historic moment because Corporate America and Wall Street were in almost complete control, and America would never be the same again. He points to the influence of Donald Regan, the Chairman, and CEO of Merrill Lynch who served as Reagan’s Secretary of the Treasury and then becomes the White House Chief of Staff, and the dismantling of America’s industrial infrastructure, which was done for short-term gain by companies posting massive profits, and to destroy the unions. Unemployment and productivity increased as wages stagnated, the top tax rate was cut in half. Instead of being paid a decent wage, Americans were encouraged to live on borrowed money until their household debt was nearly 100% of GDP, the explosion of bankruptcies and the incarceration rate and sales of antidepressants and health care costs skyrocketed. All of these were a great news for the stock market and the America’s CEOs.
What happened to the middle-class? Is this outrageous capitalism also a great news for them? Absolutely not! Many workers were laid off from work, such as in the case of Republic Windows and Doors Corporation where there were almost 250 employees who were only given a three-day notice that they were being terminated. Another is the Dead Peasant Life Insurance Policy where the company avail life insurance policy for their employees naming the company itself as the beneficiary, and this insurance policy is unknown to the employee himself and his family. Extreme capitalism also drives out democracy in the case of PA Child Care Facility, were due to an arrangement between the owner of the facility and the judge of juvenile cases, conviction rates rose, so did the facilities profit. But the extreme of all extremes was the subprime mortgages that led to the financial meltdown on September 15, 2008.
Subprime mortgage, which Allan Greenspan refers to as “Tap your home equity” is a scheme where you borrow money against your home, and if you cannot repay it, you’ll lose your house. A lot of Americans had their homes foreclosed as they were unable to repay their loans due to high-interest rates. Due to skyrocketing number of foreclosures, banks also did not collect the money they lent. This destabilizes the Financial System. On September 15, 2008, the largest failure in US banking history occurred were banks go bankrupt. This led to Henry Paulson’s proposal of a $700 billion-dollar bailout of the banks. The Congress rejected the proposal on September 28, 2008, but due to pressure, it was approved on October 3, 2008. The bailout includes a “don’t ask, don’t tell” policy. And now, we have no idea of what happened to the $700 billion because the banks are not required to do so. All of these happened because of capitalism, where the wealthy wants more wealth, taking even insane courses of action if necessary. It takes one man to start the revolt of the American people against capitalism. Obama, known as a “socialist” whom the corporate capitalist feared, for he might take their powers over the country, won the Presidential Election. People were inspired to do things as they never would have done before. Democracy is beginning to shed light again in America as the darkness of capitalism starts to fade. Things are getting better there on. Warren Evans, Wayne County Sheriff who orders to end foreclosure; the Miami Low-Income Families Fighting Together, who re-occupy foreclosed homes; the successful sit-down strike by the Republic Windows and Doors Corporation employees against Bank of America which agreed to all their terms.
I know that you would agree with me that capitalism is good in its very nature or essence. The factor that changes the whole thing is the manner we use it. If used for self-interest, others will suffer and will pay. But if used wisely and for the common good like in the time Michael Moore recalls, were they lived a good life because of capitalism, everyone will benefit. As long as capitalism do not override democracy, everyone will prosper. So, I can say that the price that people pay for capitalism depends on how we value it against democracy. The more we value capitalism than democracy, the greater the cost, but if we let it as a secondary nature, secondary to democracy, it will be of lesser expense.
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