Originally posted by Rajk999
You have still not defined the word capital.
In the Economic sense capital is the man-made resources used in the production process and includes machinery, factories, equipment etc.
In the Accounting sense capital is finance used in business.
Both arise in different ways. What kind are you referring to?
By neither definition could the poor be said to creating capital.
The financial capital employed to purchase productive assets represents a form of accumulated wealth. An entrepreneur seeking to construct innovative business in a way that adds value on any level has to have access to financial capital as a condition of doing business. However, it has to be seen that the supplier of financial capital represents a "stakeholder" and is not a sufficient condition for any successful enterprise. Plenty of money has been sunk into failed enterprises over the centuries. There are a lot of important questions to be asked about the role of finance in any economy, its relative power and its entitlement to reward.
Multinationals, which can integrate the value chain from raw materials through to retail sales, represent a triumph of financial engineering over any values that apply to productive enterprise. The Vesey Brothers were one of the early exponents of this model, integrating the chain from Argentinian cattle ranches to European retail outlets. Their wizardry established a standard model because they could determine both costs and prices at every stage of the chain. Argentinian ranchers were offered pitiful prices and European markets paid high prices, but the costs were siphoned away into intermediate parts of the chain like transport, insurance and other costs, all in the control of the Vesey Brothers. It is called "transfer pricing" and it ensured that nobody anywhere got a fair price, except the Vesey brothers, who not only decided where in the chain to take their profits, but also evaded taxes at every point in the chain. You can only really tax profits, so when taxes were imposed, profits disappeared, to reappear magically elsewhere in the value chain. Even when it came to taking profit out of the business, this was chanelled through trusts which in turn could evade both tax and accountability. That was in the early days of the 20th Century. Things today are far more comfortable for this type of project.
Because multi nationals can manipulate costs and prices in this way, they are able to out compete any rival that is not equally taking advantage of the cross border flow of financial assets. Increasingly, any enterprise that shows signs of success is quickly absorbed into a multi national corporation which does not add any value whatever, but can maximise profit by financial engineering. Indeed, mergers and acquisitions have become dominated by purely finance led entities which hide their assets offshore and rest on speculative levels of debt raised in the offshore markets.
Stop kidding yourself. Wealth today is not creating enterprise or jobs, nor is it paying a fraction of its share towards the social capital (education, health, legal structures, environment and infrastructure) which makes capitalism possible and on which it depends. That social capital is the product of collective effort by whole communities and it is in this respect that the poor create wealth. Maybe you can quibble about the destitute and the incapable poor, for whom Nazi Germany had a more frank and up front solution than the vicious callousness of modern capitalism. However, it is the collective effort of the great majority of ordinary folk, who have not benefitted from any of the fruits of economic growth since the Seventies, who continue to create the social capital that that supplies the wealth which is skimmed off and enjoyed by the very rich.