Wanted: Equitable capitalism, profitable socialism
Socialism – real, no-private-ownership, state-controlled, egalitarian socialism – has been off the political agenda in most states, including Communist China, for decades. The mixture of gross inefficiency and varying degrees of repressive savagery that most such systems showed seems to have inoculated the world against socialism and confined support for it to the arts and sociology faculties of Western universities. But what was booted triumphantly out the front door of history may be knocking quietly on the back door of the present. The reason is inequality.
Pointing out inequality is a political attraction these days, and as good a dramatization of that as any is in the comparison between what Tony Blair, Britain’s Labour Prime Minister, said about it in 2001, on the eve of his second election, and what Conservative leader David Cameron said about it in a speech in 2009, soon before the 2010 election that made him Prime Minister. Blair, questioned about rising inequality, responded that while he was concerned with poverty and its alleviation, he didn’t lose sleep about the rich being rich. “It’s not”, he said, invoking Britain’s most popular sports figure, “a burning ambition for me to make sure that David Beckham earns less money.”
Cameron, referring to the recently published The Spirit Level by Richard Wilkinson and Kate Pickett – a detailed argument that inequality is bad for everyone, even the rich – said the book showed that “among the richest countries, it’s the more unequal ones that do worse according to almost every quality-of-life indicator.” That left and right should so switch places marks the shift that has taken place in the past decade, from living in societies where the tide of growth lifted all boats to one where most fear they’ll soon be sinking (assuming they already aren’t).
The political discourse in the United States has long held that getting rich is glorious, on the assumption that everybody has an equal chance of doing it. But that hasn’t been the case for some time, a fact that would seem to make Mitt Romney vulnerable. He is very rich, though he has skillfully in distanced himself from the Romney who remarked at a (leaked) private meeting that 47 percent of his fellow Americans wouldn’t vote for him because they paid no taxes. He even managed a joke about it at the Alfred E. Smith memorial dinner last week, saying it was relaxing to wear the most formal dress, the kind of thing that “Ann and I wear around the house.” Obama, also jocular but rather sharper, said, “Earlier today I went shopping at some stores in Midtown. I understand Governor Romney went shopping for some stores in Midtown.”
Beneath the wit, there’s an anxiety in the Romney camp that his wealth is a disadvantage. Likewise, there’s an evident calculation in the Obama camp that while the political culture in the United States still precludes an all-out attack on the rich, a constant reminder of presidential modesty does no harm. (“Modesty” is relative: The Obama family holds assets in in the $2.6 million to $8.3 million range, versus Romney’s $190 million to $250 million.)
Socialism is routinely accused of being the product of envy, and there’s something to that. Russian, Chinese, Cuban and other revolutionaries mobilized workers, peasants and intellectuals by pointing to the luxury in which the wealthy few lived. After the revolutions, “rich peasants” were slaughtered and repressed even as many of the really rich managed to escape – hence the large number of Russian counts and countesses in early 20th century Paris.
But then, capitalism is routinely accused by its enemies of being based on greed, and there’s something to that, too. Few would choose to put in the long, stress-filled hours that working in the financial sector, or founding a company, demand unless they believed it would make them rich – and envied for being so.
The excesses of the 1920s and earlier were deemed by most to be immoral and passé. But recently, as Paul Krugman observed a decade ago, we entered a “new gilded age,” from which the middle disappeared. The trends have only deepened since then. In South Africa, where inequality is among the highest, white plutocrats have now been joined by “a fabulously rich black elite.” In Russia, 96 billionaires control 18.6 percent of the wealth, while 48 of their Indian comrades control 10.9 percent – though the latter country is on the lower slopes of inequality, about the same as the United Kingdom and Germany. Sweden – of course – registers among the lowest, though there, as almost everywhere, inequality grows.
The situation is grossly unfair, but it’s not necessarily simple to solve. The protesters at the various Occupy movements, spreading out from Wall Street last year, proclaimed that “we are the 99 percent.” But as the political scientist David Runciman points out, “the implication of the slogan … is that we have all been duped … (and) now that we know about it we can stop it. But how?”
How is the question. Socialism’s central justification is in its name: It is concerned with the social. Its moral force is that it implicitly asks the question: What are you doing for society that entitles you to more of its resources? From that question flows a myriad of considerations, such as: Why should the soldier whose country puts him in harm’s way earn one-hundredth that of a financier, whose job is to increase wealth? How do we weigh the relative rewards due to the entrepreneur, who takes risks and creates jobs, against the worker who goes through the sewers every day among the rats to ensure the effluent flows out and we don’t go back to pre-19th century levels of disease? “The market” has decided such things. The growth of inequality – and in many societies the corruption bolted to it – now questions its wisdom.
Socialism’s central flaw has been its inefficiency – and in the hands of the revolutionaries and their descendants, its murderous application. Social democracy, by contrast, has been pacific and mildly redistributionist. But it hasn’t had the strength to withstand the gale of globalized inequality blowing through our societies. We’re lacking an alternative.
Yet out of the continuing and maybe deepening crises of the Western economies there may come some political force that seeks to address the social at least as much as the individual. It is already straining to emerge and gain traction. Making it compatible with the freedom we have enjoyed will be the trick.
PHOTO: A protestor marches through the streets as others hold a banner during a demonstration ahead of the NATO meeting in Chicago May 18, 2012. REUTERS/Jim Young