Anyone who tells you that the 2016 Democratic Party platform was the “most progressive” in American history is LYING (or MISINFORMED). Consider the 1940 Democratic Party platform, which says: “We have attacked the kind of banking which treated America as a colonial empire to exploit; the kind of securities business which regarded the Stock Exchange as a private gambling club for wagering other people’s money; the kind of public utility holding companies which used consumers’ and investors’ money to suborn a free press, bludgeon legislatures and political conventions, and control elections against the interest of their customers and their security holders. We have attacked the kind of business which levied tribute on all the rest of American business by the extortionate methods of monopoly.”
Back to the arguments for capitalism. The two parts of the pro-capitalist story we’re going to debunk now are as follows:
(1) Society is the aggregation of all private citizens and private firms.
(2) The boom and bust of the market, the shifts that drive businesses out and result in periodic crises which destabilize entire societies, is simply part of the process of “creative destruction” that capitalism requires.
In response to (1), society is more than just private firms and private individuals. Our government and public agencies are a key part of what makes civilization possible, and political participation is an important part of what makes us human. Treating the public sphere as secondary or unimportant is a strange and unjustified capitalist prejudice. The private wouldn’t be able to exist without the public. The word “individual” used to mean “unable to be divided (from the whole).” Individuals need the public realm just as much as they need the private realm of family, friendship, and love to fully realize themselves.
In response to (2), and following up on the post where I listed just some of the many market failures of capitalism, the boom-and-bust cycle is (1) incredibly wasteful and pointless, and (2) extremely costly. People pour their time, energy, money, and passion into businesses which end up getting shoved out of the market by big-box corporate leviathans with far more resources. Workers at small businesses are thrown into unemployment, small business owners are impoverished, and culture is lost when everything is homogenized, as happens when capitalist markets move towards their oligopoly/monopoly phase.
Human beings actively create economic and political systems. To create a system which then escapes your own control seems to me the height of folly. To treat the market as a god issuing decrees from on high is simply absurd. Yet this is what capitalism does when it turns “the business cycle” into a timeless “truth,” severs the link between the real/productive economy and the financial/monetary economy, and accepts that “animal spirits” will wreck the economy every now and again. We throw away millions of tons of food a year even as millions of children suffer from malnutrition and die of hunger. People languishing for want of food, clothing, and shelter in the midst of plenty and overproduction is the absurd condition capitalism creates. We are capable of creating a system that achieves a permanent steady state without periodically plunging itself into devastating and prolonged crises.
The 2008 financial crisis is estimated to have cost the US economy over $22 trillion. As any good capitalist would do to determine economic viability, let’s do a partial cost-benefit analysis of capitalism. Add up the cost of all the recessions and depressions over the course of capitalist history. Now, add to this the opportunity cost of the inefficient allocation of social resources in the form of people working unnecessary jobs, unnecessary competition between nearly identical private firms, advertising spending, overhead costs for corporations, the production and conspicuous consumption of luxury items, etc.
Leave out costs related to market failures: the moral, environmental, and health-related/psychological costs and costs associated with economic underdevelopment due to poverty, homelessness, the lack of adequate early childhood care, educational inequality, racism, sexism, heightened levels of anxiety and stress, the under-regulation or non-regulation of important products, and all the other ills that plague capitalist societies. Even if you ignore these many costs (and environmental costs alone are enormous and possibly unmeasurable) and stick simply to the costs associated with inefficiencies of capitalist economic structures, I find it really, really hard to imagine how capitalism doesn’t end up in the red. On the positive side of the ledger, “innovation” just doesn’t cut it, especially when most capitalists only “innovate” products that benefit the small fraction of the population with enough disposable income to buy them.