Deep Pockets

If there's one thing that illustrates the similarity between capitalism and socialism it's “deep pockets.” Clearly that requires some elaboration, and the best place to start is with a definition and explanation.

The term usually refers to a party that is well endowed – fiscally, not physically. It may be an individual or a commercial enterprise, but it's one with a lot of money. So the term indicates someone or something that has its “pockets” filled, or even overflowing.

Whoever has deep pockets, therefore, is a target for someone wanting the money. He's rich. Probably one of the 1%. So it is someone (or some organization) we hate, and about whom we feel no guilt when trying to obtain some of his (her, its) funds. It may be in the form of an unwarranted or inflated insurance claim, a legal action, or the call for a handout. Whatever it is, you pay. And whoever is nominally billed doesn't really matter – you pay, one way or another.

One of the most publicized forms is by law suit, or the threat of one. A claim is made against a(n individual or a) large corporation – one that is very rich – and whether the claim is or is not legitimate is irrelevant. The cheapest way for the corporation to make the problem disappear, and to minimize the negative publicity, is to negotiate with whoever is suing – and that means with the legal firm that is handling the claim (as it has done many times before with similar justified or unjustified claims). A moderately large settlement with the plaintiff, or a huge one with the “class,” can usually be arranged to end the unpleasantness quickly. Even if the claim has no merit, it is usually cheaper to settle than to fight and risk a hostile press and public.

That's especially true since we live in a capitalist system, and the cost of the settlement is incorporated into the cost of production, so prices rise. After all, the stockholders shouldn't be made to suffer. Even if the claim is legitimate, the costs are passed on (to you) after a scapegoat is found – usually a low-level employee who can't fight back. No executive is ever considered responsible unless the publicity or the political exposure requires it. And the company will get back the costs anyway. They'll raise their rates and charges, and the price of the settlement will actually be split among members of the population – including you. The company is in business to make money, and they'll do so by passing on the costs to the consumer. Cough it up. You need them.

There are occasions, however, when a case goes to trial and a congenial jury can be made to identify and sympathize with the plaintiff's plight, although that may have nothing to do with the claim. There are occasions when such a jury will decree large enough verdicts – both “compensatory” and punitive – to bankrupt the company. Which means that a product or service is no longer available to you and the remaining companies control more of the market. It's inconvenient, but that's fair repayment for all the “suffering” that the plaintiff has endured. You'll certainly be sympathetic, even if you suffer because of it. After all, it could have been you.

And if it is you, all the better. You'll become rich and have your own deep pockets if you succeed, but you can live with that. After all, you're not one of “them.” You'll never be one of them, one of the 1%. You're just a hard working citizen, indemnified for what you've been through.

The same is true with insurance. Whatever the cost of claims made against the company, they'll eventually be passed on to those buying the protection. It doesn't matter if the claims are justified or not – though the insurer may investigate astronomical or obviously false claims to lower expenses and increase profits. Still you can be sure that the deep pockets will be yours, and, eventually, you'll wind up paying for all those claims.

But, lest you think this is solely a product of capitalism, the same is true in the public sector, though the language is changed a little. We're all sympathetic of the plight of the needy, and we demand that our government help out. They certainly will, and so will the politicians who seek their votes. In a society that provides various kinds of welfare, a society that tries to take from the rich and give to the poor, the deep pockets belong to “the government.” But that's the taxpayer – you – so you wind up paying. (Or your children and grandchildren do.)

“From each according to his means …” So the earnings of the workers are apportioned to those who lack. It's a redistribution of income from the “rich” to the “poor.” Karl Marx was right. It's socialism. We call it generosity, or the provision of services to the poor, or concern for the needy among us. It's the least we can do. We feel good about what we've done. (We do, however, curse the politicians for raising taxes to pay for all the programs we favor.) But whether or not it's “right,” it's socialism.

In short, whether it's capitalism, as exemplified by a “greedy” company, or socialism, in the form of support of “needy” citizens, you fund it. No matter who submits the bill, you wind up paying. The “deep pockets” are inevitably yours, irrespective of the economic system. They have that in common. There's no such thing as a free lunch.




November 3, 2016