by Do we want to be an economy or society? For me, you can view the economy camp as a modern values worldview based on competition with winners and losers; a society is a postmodern worldview concerned with the well-being of the collective. I once heard Reich say this in a radio or tv interview and I’ve been a fan ever since.
So I looked over his works for a candidate that I felt would best fit with our After Capitalism theme. I settled on the 2010 book Aftershock: The Next Economy and America’s Future
. The book, of course, deals with the aftermath of the financial crisis of 2008, but it also explores what might follow. Getting right to it: “the problem isn’t slow growth, it’s that all the money went to the top.”
He’s not a fan of unfettered (is “fettered” ever used). He notes that reliance on the free market essentially left the middle class unprotected from the effects of global competition and automation. Nor was anything done after the Great Recession on this.
He is prescient in this 2010 book on the implications of failing to address inequality: “failure to address causes [of inequality] will result in political backlash against trade, immigration, foreign investment, high business, Wall Street, and government itself.” Seem familiar?
And here we get to the lack of demand issue that we are seeing: “the problem isn’t too little saving, but too little demand; workers can’t afford the products they are making.” Check!
In a nutshell, from 1947-1975; wages and productivity grew; since 1975, just productivity, which he blames large on privatizing and de-regulating. He has lots of data and stories on how “the game” is increasingly rigged in favor of the rich, which will continue to exacerbate the inequality issue.
Interestingly, however, he suggests “we need a next stage of capitalism,” which should include remedies such as:
- reverse income tax; money added to paycheck through earned income tax credit
- carbon tax
- higher marginal tax rates on wealth and income from capital gains treated as income
- re-employment rather than unemployment; wage insurances; severance tax on those laying off people
- school vouchers
- college loans linked to earnings; free public university tuition w/10% of earnings paid back for 10 years
- medicare for all
- increase in public goods: transport, parks, recreation
- money out of politics
Personally, I don’t think another wrinkle, tweak, or even reinvention of capitalism is enough. I believe it’s transforming to a new system, not fixing the existing. At the same time, I would imagine that a lot of these remedies would fit with transformation. – Andy Hines
Andy, as I’ve read more and more sociology, I’ve come to the conclusion that the biggest problem with capitalism — besides unfounded and largely untested assumptions about the nature of human beings — is its disconnection from the social reasons we engage in economies in the first place. We don’t just produce goods and services because we need goods and services from others or because we want to enrich ourselves. We produce, exchange, distribute and control goods and services through a network of social relationships and do so for social reasons. I think that if it is to be successful, the next economy — whatever it turns out to be — must do a better job of reconnecting economic activities to the social realities they serve.
indeed! It’s like we’ve lost our focus, and the means have become the ends, and forgot what the original ends were.