Rethinking American Capitalism

SUBHEAD: A moral argument Obama will have to use. By Thad Williamson on 20 March 2009 in Tikkun Magazine [Editor's Note: This is a excerpt from the beginning and ending of this article. Click on link above for full article.] Barack Obama ascends to the presidency in the midst of the most severe crisis American capitalism has faced since the Great Depression. Resolving that crisis will almost certainly require dramatic public action on a scale not seen since the 1930s. But dramatic action that fails to address the fundamental structural issues driving the crisis-and in particular the generation-long trend toward rapidly growing inequality-is unlikely to be successful.
image above: Still from 1938 film "Robin Hood" starring Errol Flynn from Hence, the time is ripe to reconsider the institutional structure and moral assumptions of American capitalism, from the bottom up. While Obama's advisers are likely to exercise better judgment than the free market ideologues who have run the show in recent years, progressives should not count on people like Larry Summers and Timothy Geithner, establishment figures with deep ties to the corporate establishment, to address the deeper questions. They may have the technical expertise to contain the fire and calm the markets down, but they are not going to push for a fundamentally new set of economic priorities. Already the $819 billion stimulus package the administration aimed to push through Congress in its first month has been criticized for relying too much on tax cuts and lacking an overarching vision for its public investment components. Other liberal economists believe that the scale of the stimulus package, while huge, is still inadequate to the task at hand. In the meantime, questions about whether (or when) the federal government will pursue nationalization of banks grow louder with every passing week. And still others question whether Obama's goal must be not simply ramping up the economic growth machine again but moving toward a different kind of economy, an economy that places human needs, respect for community, and ecological sustainability ahead of GDP growth. Obama's Inaugural Address showed that the president understands the need to move toward new barometers for measuring economic health. Obama flatly stated that we must judge the economy not on its size but on the extent to which it delivers opportunity to all. Obama has also moved to make "green jobs" and energy efficiency a centerpiece of his recovery plan. Calling for a bold change of direction and actually taking meaningful steps in that direction are two different things, of course. It's up to progressive social movements to take advantage of the historic opportunity the Obama administration represents by pushing for a fundamentally new set of economic priorities. But if spiritual progressives and our allies are to become a credible, forceful voice, we will need to pay close attention to the hard-headed realities of how our existing system works (and fails to work), and to directly challenge dominant ideologies justifying the status quo. Fortunately, three important new books-Joel Magnuson's Mindful Economics; Douglas Hicks and Mark Valeri's edited collection, Global Neighbors; and Gar Alperovitz and Lew Daly's Unjust Deserts-have arrived on the scene to help show the way. Together these books provide a well-timed critique of the fundamentals of our economic system, in each case connecting the critiques explicitly to ethical and in some cases theological conceptions of what makes for a good human life and what makes for a just society. These books each do what religion does at its best: they break through the dominant economic discourses and provide an alternative way of viewing social reality. They then describe measures for improving our economic system that would help much more than corporate bailouts. To Get Good Government, Voters MUST Understand Economics-So Read This Book Much discussion of economic policy is wrapped-arguably quite deliberately-in a shroud of mystery. When former Treasury Secretary Henry Paulson forcefully demanded that Congress approve a $750 billion bailout this past September, the strongest argument offered was "because we say so." Few members of Congress, let alone ordinary citizens, were equipped to understand in any level of detail either the causes of the financial crisis or the nature of the institutions involved in the crisis and subsequent bailout. There is no hope of holding political elites (be they Republican or Democrat) accountable on economic policy if ordinary citizens do not understand the nature of the institutions governing American capitalism... ...If it turns out that little of what the wealthy control now is attributable to individual effort, how can large fortunes such as that accumulated by Bill Gates be justified? Alperovitz and Daly argue that they can't. To be sure, there is a pragmatic case for continuing to permit patents and for providing other incentives to stimulate further research and creative activity. But we must reject the idea that the person who happens to add the last increment of value to a vast, collective creation produced over many generations is thereby entitled to the whole. If we were to take seriously the reality that our affluence is primarily the result of the accumulated knowledge and capital of the past and not our personal efforts, we would be forced to reject the assumption that the highly unequal distribution of wealth we witness both nationally and globally are in any way the byproduct of just economic arrangements. (Importantly, recognizing this point does not require abandoning the moral intuition that there should be some connection between economic reward and effort.) Those who claim a disproportionate, lion's share of economic wealth are not simply claiming their just deserts; rather, they are usurping the common inheritance of humanity, while excluding the vast majority of the national and world populations from a fair share of that inheritance. Alperovitz and Daly thus (like Magnuson) call for a fundamental rethinking of how wealth is distributed, and for developing new forms of ownership that are democratic and that "spread the wealth around," as Barack Obama has put it. Alperovitz and Daly's argumentation and practical proposals offer progressives a chance, after a generation of playing defense, to again assume the initiative in challenging the grotesque distribution of wealth and resources and explaining why, not as a matter of charity or expedience but of moral desert, wealth should indeed be spread around. A Moral Argument Obama Will Have to Use Note also that the logic of the tight constraints facing Obama as he assumes the presidency will almost certainly force Obama in this direction: if the resources needed to carry out health care reform and other expensive proposals are to be garnered, the natural place to start is with the incomes and estates of the super-rich. But Obama will not be able to tap that vast well of resources too often so long as he appeals only to pragmatic arguments to explain why. At some point, he must exercise the same kind of leadership he carried out with respect to America's racial divide during the primary campaign, and explain to the American people that the vast fortunes accumulated by America's wealthiest are not the product so much of their holder's individual virtues but of the supportive environment provided by the United States and by the long accumulation of human knowledge that undergirds our current wealth. There is no reason, Obama might argue, why continued expansion of our technological capacities should have the effect of hardening economic inequalities, rather than being harnessed toward the common good and (as called for in his Inaugural Address) the extension of "the reach of our prosperity" to "every willing heart." The very rich will not like it, and the right wing will predictably cry "socialism." But a President Obama willing to withstand the criticism and make the case would not only bolster his prospects for getting the resources needed to fund his programs; it would also help alter our public understanding of wealth and how it is created, steering us away from the myth that individuals create wealth simply through their individual efforts and toward recognition of the central role of community, extending across both time and space, in making prosperity possible.

No comments :

Post a Comment