Brookins Head Shot*Sears recently announced that it would be closing somewhere in the neighborhood of 100 Sears and Kmart retail locations. This is the perfect example of the dark side of capitalism.

Sears has made poor strategic decisions over a number of years so in a sense this was inevitable. If the people who are in charge don’t do their job well, it is almost impossible for the rank and file of a company, and the company overall, to be successful. But this situation also highlights the way in which capitalism encourages the wrong kind of decision making.

The great thing about capitalism and the freedom of thought and decision making afforded people in our country is that with the right idea anyone can prosper. The origin of the Sears company is that they had the right idea: supplying people with tools they could not otherwise afford or get their hands on. Over the years this basic business model was expanded on until a Sears retail location today gives shoppers the ability to buy exercise equipment, get an eye or ear exam, take family photos, buy clothes, buy appliances, and of course tools. My local Sears even carries mattresses.

Sears basically ignored their core business to focus on expansion. Two things were working against Sears though. Other retailers were better at providing goods and services in the retail location form; the managers at Sears were picking the wrong stuff to diversify with (real estate for example).

My preferred economic system of socialism would not necessarily prevent the failure of Sears in this instance. But capitalism encourages the kind of decision making where an entity plays a game in which the odds are fixed against it. Normally Sears, the big company that it is, would benefit from stacked odds. But as we all found out with the real estate bubble of the last decade, no one has been in a no lose position with real estate in recent years. Capitalism fosters an environment where industries flourish under false pretenses and people feel they must become involved or get left behind. Sears fell victim to this mindset.

As I said socialism is not a panacea for this kind of point of view. But it does mitigate against the profit motive becoming too dominant while allowing for people with good ideas to prosper.

It could be that Sears is destined to fail; no business remains viable forever and over 100 years is a hell of a run. Nevertheless their downfall was hastened by their greed – the main ingredient in capitalism.

Trevor Brookins is a free lance writer in Rockland County, New York. He is currently working on a book about American culture during the Cold War.  His writing has appeared in The Journal News. You can reach him at [email protected] or follow him on Twitter @historictrev.