Capital's Only Concern Is Capital

It’s always dicey to make a case about the downside of capitalism when you live near a state like North Dakota, the flag-waving spurs, barbwire fenced, scared-of-their-own-shadow people that are so irrationally conservative they would stop eating if the food on their plate was grown by Democrats. Plus, one will immediately be labeled a Marxist or Communist, since most don’t have any real understanding of either philosophy – only that someone told them it’s bad.

The petroleum industry, a capitalist enterprise, generates gargantuan profits all the while it is being heavily subsidized by US taxpayers. Petroleum capitalistic enterprises are against ‘progressive’ initiatives such as climate change mitigation, but not for the reasons you think. The current objections to these mitigations fall into several categories:

1. Climate change is a hoax

2. North Dakota will lose jobs

3. North Dakota will lose tax revenue

But the deeper reason is capitalism always and every time will defend its capital investments. Here is a paragraph that perfectly illustrates this truth by one of the 20th century’s most influential economists:

“...the maintenance of the value of existing investment – conservation of capital – becomes the chief aim of entrepreneurial activity, and bids fair to put a stop to all cost-reducing improvement. Hence the capitalist order becomes incompatible with progress. Progress entails destruction of capital values in the strata with which the new commodity or method of production competes. In perfect competition the old investments must be adapted at a sacrifice or be abandoned; but when there is no perfect competition and when each industrial field is controlled by a few big concerns, these can in various ways fight the threatening attack on their capital structure and try to avoid losses on their capital accounts; that is to say, they can and will fight progress itself.”

-Joseph A Schumpeter

Even North Dakota Senator Kevin Cramer had to school right-wing commentator Scott Hennen on the reality of the situation by telling him “If we don’t get this carbon thing under control, we’re out of business.” Capital couldn’t care less about oil worker jobs as capital only cares about protecting its investments. If lower labor costs are availalble they will grab them because capital moves around and labor lives in homes on the ground.

One of the biggest reasons we won’t see American petroleum companies abandon buying oil fro the middle east is because that crude is very ‘sour’ and the US had to build massive refinery infrastructure to refine to ‘sweet’ oil. Much of the oil from the Bakken is light ‘sweet’ crude and is refined differently. But you won’t see the petroleum industry stopping refining the sour crude because that means they would be leaving bajillions of dollars of capital investment lying idle. And that is a sin in capitalism.