I've never understood why the structural flaw of unfettered capitalism isn't obvious to most people.
The rich will keep getting richer, at the expense of peasants.
The rich will keep getting richer, at the expense of peasants.
Historically, the second half of that assertion is not borne out.
The wealthy reap mnore and more of the benefits of the economy than the average person, in ever increasing measures.
The fact that a working class person might now have access to 4k TVs and new cars on finance doesn't change the fact that overall, their share in the prosperity of their nation in shrinking, even though it might seem like gradual improvement.
Luxuiries don't mean shit when you can't save, afford to treat a major illness or have to work two jobs to pay the rent.
Half of the US doesn't even have any savings and are in a state of persistent debt servitude.
What exactly do you think the end result of that trend is if it continues?
You're framing this argument as if any increase in individual wealth is to be lauded and celebrated. Most people don't think that way.
All people will see, is their meagre wealth increases (if they are even lucky enough to have seen that) and the kind of increases seen by the top tiers in society.
They'll feel angry, depressed and feel like its an injustice. Then the social contract breaks down, which it already is.
You can keep pretending like there isn't any problem with how wealth is distributed currently, but you won't be able to forever.
Edit:
I am not arguing that the current system is problem-free, only that it has benefited the vast majority people, even if most people do not perceive those benefits or if they are jealous when they see the benefits accumulated by the rich. I suspect people would be much angrier if they were transported back in time and had to deal with the world as it used to exist, when people were poorer at every level of society. I am not claiming to have a political answer, but the facts are not easily denied: at every level of society people are wealthier today compared with the past.
IMO there is much more happening then arguing over slices of a unsustainably growing pie.
That's definitely the biggest problem with all of this in my mind.
The success of some does not mean that others have been defeated, or forced into a position where they are worse than before.
This fallacy is often repeated by people obsessed with egalitarian views, where they consider any difference in access to resources (even those which have been earned through hard work and not squandered away) as being somehow a major injustice.
Yet, just because some multimilionaire wastes wads of cash in conspicuous consumption that doesn't mean that societies based on capitalism don't enjoy humanity's highest quality of life and access to goods and services, to the point that some are even considered by "the people" as being infinite and a god-given right.
That line of reasoning makes no sense at all because it also implies that workers would also be responsible for all the wealth destroyed by the course of their work, which was very substantial in the dotcom burst.
But somehow egalitarian arguments are never made in regards to any support to share the burden of a financial investment that goes bust, and the focus is on all the envy around how their neighbor profited from an investment they never made themselves.
I'm honestly not sure what you mean by this, or how it's relevant to what the person you replied to said.
> But somehow egalitarian arguments are never made in regards to any support to share the burden of a financial investment that goes bust, and the focus is on all the envy around how their neighbor profited from an investment they never made themselves.
1. We don't really get a choice in that do we?
Most people can't afford to invest precisely because the problems we are telling you about here; and that includes the working and disappearing middle classes that can't even save effectively due to stagnant wages that don't reflect their increased productivity.
2. On the few occasions where 'egalitarianism' as you keep putting it, is actually applied in a 'share the burden' fashion, it appears to be when massive, wealthy companies need a bail out from the tax payer after what amounts to obscenely reckless behaviour.
The name of the current capitalist game seems to be to privatise the profits and socialise the losses.
I keep hearing people say the econonomy is no zero-sum, without ever explaining it. There is a finite amnount of wealth in the world today. There will be a finite amount of wealth tomorrow, and so on.
Each and every day, your share of that daily amount decreases, while owners of capital increase exponentially. Since the financial crash the richest in society have seen massive gains while the working and middle classes have been hit hardest, many even making wages barely competetive with levels in 1970.
I'm sure your assertion that there is plenty to go around will make those people feel better as they go yet another year without any real improvement in their income.
Capitalism is far from perfect but it seems to be the best system we've come up with so far.
(Also: God, "remain in balance with their ecosystem" is such a mendacious phrase. People use it all the time, as if animals have some kind of mystical gaia sense that says, "Woah, woah, woah lion, you're using too many natural resources here. Maybe just meditate today." Here's how lions "remain in balance with their ecosystem": they try to eat everything they can. Sometimes they're unsuccessful and they starve. Sometimes they're successful and cause a local shortage of prey and then they starve. Yaaaaaaaaaaay.)
As well, the absolute wealth of people does not stop discontent and violent revolution. The gap is what matters.
Things have gotten a lot better since then, but if you look at historic trends, they have stagnated again in the US since the early 1980s. There's been no growth in the pay for working class people since the 1980s, while money for the rich has sky rocketed.
It's time to pick up that fight again.
So, politics of envy. It's a disgusting state of affairs if it's not enough to enjoy a high quality of life, but it's also imperative others' must not be significantly higher.
I think this trope is misused. Peasants are better off and the world is wealthier because of science, not a political ideology. The industrial revolution, scientific medicine, the green revolution...
Saudi Arabia's "peasants" (or descendants of herdsmen, properly) are wealthier because of oil mining and modern energy industry, not monarchy or capitalism or whoever else wants to take credit.
I'm not saying politics doesn't effect anything, it obviously does but capitalism can't just claim credit for everything invented in the last 200.
Btw, this is exactly what Lenin did and what Orwell parodied in 1984.
I'm not saying you can't argue that capitalism benefited the poor, but you can't just claim everything good that happened after 1800 for capitalism.
Historically, both modern capitalism and the industrial revolution were born and raised in monarchies. The forefathers of modern global corporations were royal charter companies.
I think that's more of an example of how the actual distribution of power in society is the only thing that matters, the label of the system being purely ceremonial. If everyone in a society is allowed to participate in a free market, you will see the fruits of capitalism, even if the market is black and the politburo insist that the state is fully communist.
In the context of my earlier point, sure, if a monarch allows other people in their society to hold enough power to participate in capitalism, then, well, the system will start looking a lot like capitalism.
So yes, capitalism has helped the poor considerably, not just science. New tech without a proper distribution system is useless.
And study after study shows that humans very much define happiness in relative terms. It doesn't matter if quality of life is rising for everybody, if the gap is rising much faster - you're going to have the populace that is unhappy, and that unhappiness eventually translates to anger (it has already started doing so).
You can either work to fix that, or you can wait for torches and pitchforks.
I am honestly waiting. People are only going to put up with this for so long.
So I wouldn't exactly look forward to it. The educated, well-off classes in US need to understand that fixing the inequality problem isn't just about empathy, or some abstract political thinking. It is literally a matter of physical survival, if you look at it long term. Either we build a society which the majority of its members consider fair, or those of us who are significantly better off than the median will perish.
You might reconsider whether an appeal to fairness versus naked pragmatism is the winning approach.
For the most part, yes, the ruling classes have done fine - and so they did for the past 70 years (counting roughly since the last grand compromise of the New Deal, which turned the tide of popular discontent back then), and they grew complacent. Now the tide is rising fast again.
FWIW, I don't really consider it a fairness versus naked pragmatism - they are orthogonal. Thing is, when it comes to fairness, there's a perfectly understandable urge, especially among engineers, to get things right, even if it takes more time. And normally, I think, that's a good thing - rushing is generally not a good idea, when you can afford not to. I just don't think we can, anymore, and so a dose of naked pragmatism is needed to force the realization that we may need an imperfect solution now, because we don't have several more decades to hammer out, say, a perfect implementation of universal basic income.
Expectations may have changed, but a prophecy that we're 10 years from revolution needs more justification than you've given it. There's nothing in basic human nature that makes current levels of unfairness unsustainable.
By what metric?
It certainly isn't the case when you look at wealth distribution. Last time we had that much wealth disparity was right before the Great Depression. Given that it was followed by the New Deal, I think it's fair to say that political elites at the time didn't see that as sustainable.
Then also, you have to consider the differences in societies then and now. Greater wealth inequality is more sustainable with more oppression, for example. If you can suppress free flow of information, you can conceal the magnitude of the gap somewhat. If you can physically remove the "rabble rousers", you can slow down the spread of discontent. And so on.
Specifically:
> Historically, we're currently more than "fair enough."
There's no such thing as "historically fair enough". "Fair enough" is what keeps the majority content, here, now. It's inherently tied to the context. When people vote en masse for brazen populists (whether left or right wing) who promise fast solutions to all their economic problems, despite the obvious risks of that arrangement, that in and of itself is clear evidence that they don't see it as "fair enough" - and so it isn't.
Your point is that inequality is high by 20th Century standards. That's certainly fair! But the vast majority of history is some combination of feudal lords, monarchs, tribal leaders and strongmen. Ask a serf about fairness.
Also, I think that your account of the New Deal is weird and wrong. It was an (only arguably successful) attempt to deal with the Great Depression, not to combat people unsatisfied with wealth inequality in the 20's.
We've had lots of brazen populists in the world, including during the 20th Century. I could be convinced that the current status quo is rapidly heading towards violence -- I'm not convinced that you're wrong. But that's quite a claim, and the evidence you've cited is very sketchy.
You might be surprised, actually. Wealth inequality in UK was higher at the turn of the 20th century than it was at the turn of 19th, for example. And if you went a century back, it was lower still. A 16th century serf was less impoverished, relatively speaking, than a 19th century factory worker! And it was because of processes like this:
https://en.wikipedia.org/wiki/Enclosure
Going further back, you'll generally find that levels of inequality increased as economy went from feudal arrangements to capitalism. Under feudalism, wealth was mostly about land, and you could only hold as much land as you could protect - and other feudal lords would see to it that you wouldn't have too much, lest you became too powerful and threatening to them. But today, most wealth is intangible, and sky is the limit to how much of it can be in one hands.
https://voxeu.org/article/europe-s-rich-1300
So when I'm saying that our levels of inequality are lower than Victorian England, that's actually comparing to some of the periods of the worst economic inequality that we have witnessed, at least in the history in which we can reasonably measure such things. And if you only look at US, it's even worse - when I say that we're at the levels of wealth inequality last seen right before the Great Depression, consider also that it means that we're now at the levels higher than what they were at any time up to ~1850, and some reasonably argue that they are higher than they were at any point in this country's history.
https://www.washingtonpost.com/news/wonk/wp/2016/07/01/incom...?
> It was an (only arguably successful) attempt to deal with the Great Depression, not to combat people unsatisfied with wealth inequality in the 20's.
It was one of the most massive wealth redistribution programs in the history of the United States, and it created a great deal of the modern social safety net. Even if reduction of wealth inequality were not the explicit goal, it certainly served that purpose.
But if we look at the political campaign promises at the time, it's very clear that New Deal was sold to the public quite explicitly as a way to deal with income inequality. I mean, it was literally right there in the speech that gave us the very term "New Deal", the one that Roosevelt made in his first presidential campaign:
"Now it is worth remembering, and the cold figures of finance prove it, that during that time there was little or no drop in the prices that the consumer had to pay, although those same figures proved that the cost of production fell very greatly; corporate profit resulting from this period was enormous; at the same time little of that profit was devoted to the reduction of prices. The consumer was forgotten. Very little of it went into increased wages; the worker was forgotten, and by no means an adequate proportion was even paid out in dividends -- the stockholder was forgotten.
Enormous corporate surpluses piled up -- the most stupendous in history. Where, under the spell of delirious speculation, did those surpluses go? Let us talk economics that the figures prove and that we can understand. Why, they went chiefly in two directions: first, into new and unnecessary plants which now stand stark and idle; and second, into the call-money market of Wall Street, either directly by the corporations, or indirectly through the banks.
Throughout the nation men and women, forgotten in the political philosophy of the Government, look to us here for guidance and for more equitable opportunity to share in the distribution of national wealth.
I pledge you, I pledge myself, to a new deal for the American people. Let us all here assembled constitute ourselves prophets of a new order of competence and of courage. This is more than a political campaign; it is a call to arms. Give me your help, not to win votes alone, but to win in this crusade to restore America to its own people."
Those were the promises that FDR got elected on, and re-elected three times after. You think that people who voted for him in droves didn't have them in mind?
Whether or not the gap is widening, that definition of happiness is very problematic. There's something wrong when, as an example, someone is happy with a "rice-and-beans" lifestyle when all their neighbors have the same lifestyle but is unhappy with a better "chicken-in-every-pot" lifestyle because some of their neighbors have caviar and foie gras (insert your preferred luxury foods).
But supposing that theory is right - then all we need to do to secure social stability is to ensure that $70k income for the majority of people in the country. Are there any ways to do so without massive wealth redistribution - which would, coincidentally, also reduce wealth inequality? It feels to me that regardless of which of these two theories are really correct, they prescribe essentially the same treatment, at least short-term.
The point is that once you get beyond that figure (which I have seen quoted at around $80k, but the general idea remains), increases in income correspond to rapidly shrinking marginal increases in happiness.
So it's certainly not that once you get past that, you're stuck, flat, forever. It's that below that, lack of money is a major thing preventing you from attaining the full measure of happiness that a secure member of modern society can.
> "peasants" are enjoying the best quality of life in humanity's history...
BUT there's a whole lot more to the quality of life. Things like self-actualization-- the stuff at the top of Maslow's hierarchy.
People can thrive in all kinds of economic systems (capitalism included). However when a small number of people re-arrange "the universe" for their exclusive benefit, there's going to be a reaction to that and it won't be pretty. I think we should favor measured incremental adjustments to curb the worst aspects of capitalism over all-out revolution.
Banning employers from having a say in what work a terminated employee takes in the future is one such measured response.
Problem is, you can't sustain a large population that way, so civilisation has always used larger and more technologically advanced populations to push out smaller and more primitive ones. But that doesn't mean the larger and more advanced populations were necessarily happier.
Now life in general is absolutely better today than it was in the past, but that doesn't mean it's better for everybody in every respect. Peasants in the West may not get slaughtered by warlords anymore, but especially in the US, there are definitely poor people who struggle to make ends meet, and are slowly sinking deeper into poverty.
Peasants in northern Europe may be enjoying the best quality of life ever, but that's not true in many other countries.
The best system we've come up with so far is clearly regulated capitalism with plenty of protections for the poor.
This is a short story I think may be relevant.
Some commenters below seem okay with the growing inequity in society so long as people have a better quality of life compared to the past. Is that how we measure progress in our unprecedented information age society? to a past that can't relate to the present?
IMO don't let what was be a guide for what could be. If people always did that we wouldn't have the internet to comment on.