From Grand Rapids: Re-Evaluate Capitalism

 

“You can try to fix anything you want. But if the outside environment is not supporting it ­— if it’s actually working against it — then all those little fixes are not going to make it go away. Is our society really structured in a way that supports change for the have-nots, for people who need change? Are we just struggling upstream against this raging torrent? We have this economic system that leads to and creates the have-nots; we can’t function without it.”

While I did say the words above, quoted in a 2024 Minnesota Women’s Press article, I take no credit for the concept and meaning. I am not an economist, but many economists have spoken and written about how, in the words of Tejvan Pettinger, “capitalism can cause inequality, market failure, damage to the environment, short-termism, excess materialism, and boom-and-bust economic cycles.”

I’m a social worker, so my business is mopping up the debris of capitalism. Of course, I also have invested my retirement savings in the stock market. Seeing this in print is guilt-inducing; I guess that’s the irony of the capitalistic dilemma we’re stuck in. But not stuck with, if our society can muster the courage and conviction to change.

During my career in social work and mental health, I witnessed people in poverty disenfranchised by the economy from which I was benefiting. I watched people who could not function at an average level of performance — due to physical, mental, and behavioral differences — be kicked aside or chewed and spit out by all but the most compassionately engineered businesses.   

I put in 50 hours per week trying to make our economy and social system work.

I agree with Pettinger that the U.S. is not practicing pure capitalism because “government intervenes in many areas of the economy, like business regulation, health care, and education.” But the government has not intervened enough, even prior to the current administration, to make a significant and lasting difference in addressing inequities.

We need to find a better balance in rewarding those who excel without exploiting those who do not or cannot. If we don’t balance ourselves, I fear our nation will continue to tear apart, a chasm between haves and have-nots that democracy cannot rescue.

Germany’s Dr. Wolfgang Merkel wrote in 2014: “Socioeconomic inequality has risen continuously and has transformed directly into political inequality. The lower third of developed societies has retreated silently from political participation; thus its preferences are less represented in parliament and government. … If these challenges are not met with democratic and economic reforms, democracy may slowly transform into an oligarchy, formally legitimized by general elections.”    

This sounds frighteningly familiar, as I observe the results of the 2024 presidential election. In 2023, Betsey Piette cited a study titled “Survival of the Richest,” by Oxfam International, which reported that in 2020 and 2021, the wealthiest 1 percent of the world’s population accumulated nearly two-thirds of all new wealth. In the previous decade, 2010–20, the richest 1 percent had amassed around half of all new wealth.

Piette goes on to make the case that, “Under the economic system of capitalism, to earn money to survive, workers must sell their labor power to produce goods and services for the bosses who own the means of production. Workers are never compensated for the full value of what they produce; in some industries they are paid only a tiny fraction of it. The difference between the value workers add to a product and the lower wages they are paid becomes the profits that make up most of the billionaires’ accumulated wealth.”

It’s clear to me that capitalism exploits workers. CEOs make millions while their employees earn pennies in comparison. Jobs are not the goal of business — making money is the goal.

Menial labor, and the folks who work it, are being replaced by machines. Industrial and clerical employees are being replaced by computers and technology. Tech workers are being replaced by AI. An investor friend said the stock market is powered by money but driven by greed and fear.

My financial advisor at Edward Jones supplies me with weekly updates on economic performance. Edward Jones and Bloomberg state that average hourly earnings since June 2023 exceeded inflation by 1–1.5 percent. Still, average interest rates on savings accounts are less than 1 percent at most local banks. Mortgage rates claim 7 percent or more, making it nearly impossible for working class families to buy homes and send kids to college.

I’m a capitalist, motivated by making more money, invested in the stock market. I shop and eat at franchises. Capitalism is woven into the way we think, everything we do, most of our beliefs.

Democracy and capitalism are not synonymous, however. Let’s separate them in our thinking. Let’s start evolving into a different capitalism.

That means we may need to first align our beliefs, or at least mutually agree to put the welfare of the have-nots on par with the haves. What if we set a maximum percentage for CEO compensation compared to employee pay? What if jobs were not a mere side effect of profit, but businesses were valued by the number of employees and the amount they were compensated?

Our country spent a shameful 400 years building national wealth on the backs of slaves.  It took a civil war to end slavery, though we never really completed the social transformation of acceptance and equity. Will it take another civil war — a rebellion by exploited workers, people of color, people who are differently gendered, people who are just “different”?

What if our legislators crafted law that truly took the welfare of all of our individuals and our families into account? What if certain basic needs — like nutrition, health care, education, child care — were considered rights? What if they were protected by law, policy, and funding?  Not funding based on eligibility criteria, but on inalienable rights. Because without those basic needs being filled, you can forget about the pursuit of liberty and happiness.

We tend to perceive capitalism, socialism, and communism as rigid, impermeable silos.  We should apply these concepts to the institutions and situations where they will work the best to build equity. Let’s break loose from artificial dogma and do what’s humanistic, instead of capitalistic.   

Are you part of solutions to correct income inequities in your community? We want to hear from you. Contact community@womenspress.com with “Inequities” in subject line.

 

 

 

 

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