The Plutocratic System

Boiled down, U.S. politics under today’s mature capitalism are not about the welfare of the demos (i.e., the people) as envisioned in classical notions of democracy, but rather about which party can best deliver profitability to investors and corporations. There are continuing debates between those who simply want to slash labor costs, taxes, and regulations for the rich, and those who want to do some of that but also use some regulation and government spending to encourage higher wages and demand-driven growth. Both sides, however, accept that making the economy profitable for the owning class is the sine qua non of successful administration. Within these constraints, there are occasional important political fights and periodic bones to throw to the electorate. But, in times of economic stagnation, the bones get smaller and even disappear. What passes for genuine political debate often tends to be irrelevant gibberish and blatant manipulation on side issues, or inconsequential nitpicking on minutiae. The big stuff is off the table. The system is democratic in theory, plutocratic (rule by the rich) in content.

The hollowness of democracy in today’s capitalism is evident in the blatant corruption of governance at all levels in the United States, and the non-accountability of all the major players. The corruption we are discussing is not about politicians getting inordinately great seats at the World Series, but the degeneration of the system and the dominance of a culture of greed that is now pervasive and institutionalized, contaminating all aspects of life. The manner in which, during the current Great Recession, the dominant institutions and investors were able to coalesce and demand hundreds of billions, even trillions, of dollars in public money as a blank check to the largest banks—and then shamelessly disperse multimillion-dollar bonuses to individuals at the apex of those very same corporations now on the public dole—was a striking reminder of the limits of self-government in our political economy. When the Masters of the Universe, as those atop the economic system have been called, need money, when they need bail-outs, when they need the full power of the state, there is no time for debate or inquiry or deliberation. There is no time for the setting of conditions. There is only time to give them exactly what they want. Or else! Egged on by the news media, all responsible people fall in line or face ostracism. As for education and the social services that mark the good society, well, they have to wait in line and hope something is left after the capitalist master is fed. In stagnant times, it is a long wait.

Marx’s work provides searing insights on how to understand a society that, at the surface, appears to be one thing but, at its deeper productive foundations, is something else. Marx argued that a core contradiction built into capitalism was between its ever-increasing socialization and enhancement of productivity, and its ongoing system of private appropriation of profit. In other words, one of the great virtues of capitalism, in comparison to the relatively stagnant societies that preceded it, is that it is constantly revolutionizing society’s productive capacity and the social interconnections between people within production. But, at a certain point, private control over the economy comes into stark conflict with the vast productive capacities of social labor that have developed. These means of private control, the dominant class/property relations, become “so many fetters” on the further development of society, of human potential, of even the sustainability of human society. The fetters must therefore be “burst asunder,” to allow for new stages of human development.11

The Renewal of Socialism

It seems clear that this need for a “bursting asunder” is where the United States is now. Capitalism, viewed as a system of generalized commodity production motivated by the competitive pursuit of private gain without limits, and thus driven to the amassing of concentrated wealth, even at the expense of public welfare and environmental sustainability, is well past its productive era—during which it could make claims to some degree of rationality. We have reached “The End of Rational Capitalism.”12 It survives now on bubbles, bloated debt, military spending that borders on suicidal, and a deadening hypercommercialism.

When we state that capitalism is off-limits to critical review and analysis, what we really mean is that socialism, as the only rational successor to capitalism, is off-limits. If there is no credible alternative to capitalism, then there is no more reason to discuss transcending capitalism than there would be to debate the means of preventing lightning storms and earthquakes, as Steinbeck’s farmer observed. But in fact we are talking about relations and things made by human beings, and these can be changed, and have been changed enormously over the course of human history.

Since the dawn of class societies maybe five or six millennia ago, those in power have decried and demonized the ideas that threatened the status quo. Capitalism, as a specific form of class society, is no different. All prospective post-capitalist societies are denounced as so barbaric as to be beyond legitimate consideration.

No one today would say that socialism is inevitable. The odds indeed may be heavily stacked against it. But we can say that it is necessary if our species is to have much of a future. The old socialist slogan “Socialism or Barbarism” made famous by Rosa Luxemburg, although meaningful in its time, may need now to be replaced with “Socialism or Exterminism.”13 Barbarism, it appears, is no longer the greatest danger. Science tells us that, with a continuation of “business as usual,” extermination of humans as well as innumerable other species is the most probable result—and in an extremely short historical period. The absurd thing is that we can’t seem to alter business as usual, even under these dire conditions. Why? Because business as usual is capitalism, which has made the world prey to its own self-expansion. As Steinbeck wrote in The Grapes of Wrath: “The bank—the monster has to have profits all the time. It can’t wait. It’ll die….When the monster stops growing, it dies. It can’t stay one size.”14 All of this suggests that socialism, which offers the possibility of a more egalitarian, democratic, sustainable, and collective response to our problems, is a necessity on both social and environmental grounds if we expect to have a chance at a rational future—or indeed any long-term future at all.

What is socialism? We cannot offer anything like a complete account here (the story of socialism is a long one and is still in the making), but it begins with the idea that society’s resources should be directed to serving the needs of people, not the profit dictates of the few. It is the socialization (democratization) of the economic sphere, and also the enlargement (de-privatization) of the political sphere. From that starting point, we are open-minded. There is a broad range of options, much to be debated, and enormous room for experimentation. There is a role for markets alongside democratic planning (for example, consumer markets), but not for a market society—that is, the Hayekian utopia of the self-regulating market, which becomes merely a disguise for the concentration of economic power and wealth.

The classical notion was that socialist movements would succeed, not in opposition to democracy, but as its champions. Among the contributions of the Soviet Union to our understanding of history is the confirmation of the fact that if socialism is not grounded in popular power, it in effect annihilates itself and capitalism is restored. Mere state ownership of key productive forces is not enough to create a socialist society; the people must exercise a sovereign rule over these productive forces and society as a whole, and the society must be organized to promote collective needs.15 Just as democracy is not an accomplished reality unless the vast majority of the people rule society, so socialism is not an accomplished reality unless the associated producers control the productive forms of society and use them rationally and sustainably in the collective interest. The two, in fact, require each other for their fulfillment.

With the failures and successes of some of the early socialist experiments in our rear-view mirrors, and the new socialism of the twenty-first century, pioneered above all in Latin America, in front of us, we believe that the classical notion of socialism has resumed its central role. This is a period of socialist renewal and revolutionary democracy. To us, it is encouraging to see the left victories across Latin America in the past decade. Their significance is made evident by the vitriol they have engendered in the mainstream and business press in the United States and Europe.

A key question thus arises: Has the moment for the renewal of U.S. socialism arrived?

Some of our friends would respond: “No. Socialism is permanently beyond our reach. The best we can hope for is the reform of capitalism along progressive lines.” They argue that capitalism can be made into a kinder and more rational system, increasingly in accord with the needs of humanity and the earth. Popular pressure, they say, can bring about enlightened government policies that will capture the benefits of capitalist economics and minimize the negative consequences. They make the case because they believe capitalism is so entrenched that it is impossible to do anything but seek reform—and they fear any hint of opposition to capitalism will marginalize them politically—or because they genuinely believe that capitalism can be tamed and made into a relatively benign and progressive society. The dream world from this perspective tends to be Scandinavian social democracy, in particular the Sweden of the Olof Palme era in the early and middle 1970s.

Sweden, during the decades of relative prosperity following the Second World War, was, in many ways, an enviable society. It enjoyed a degree of economic equality that has rarely been approached in a capitalist society, associated with high wages, superior social programs, and progressive taxation. It provided high-quality universal health care and free education up through university. The condition of women—described by Marx, after Fourier, as the measure of all human progress—was much better in Sweden, in that period, than in most capitalist societies.16

To be sure, the Swedish model, when it was “viable,” was heavily dependent on Sweden’s stature within the imperial global order. Sweden was clearly a beneficiary of the imperialism of the North and West, and not innocently so, given its substantial military budget and arms sales in these years. It is well to remember that social democracy has never been even a remote possibility for today’s peripheral capitalist countries. It was exclusively open to the club at the center of the world system, i.e., those countries that have continually benefitted from a system of international plunder.

Sweden under Palme was not a socialist society, in our terms, but rather a corporatist, social democratic one, in which the impossible of impossibles seemed to occur for a short time under fortuitous circumstances: the irreconcilables of capital and labor were apparently reconciled.

Self-described Marxist friends have told us that, if they could push a button and move the United States to where Sweden was in the early 1970s, they would gladly forgo any hopes of transcending capitalism and creating a genuinely socialist economy. This attitude points to something of practical importance: on many matters of contemporary political organizing in the United States, the efforts of the explicitly socialist left converge with those of Keynesian left-liberals and social democrats. Together, both sides work for increased social spending, environmental sanity, equitable taxation, increased regulation, reductions in militarism, open governance, full employment, civil liberties, and workers’ rights. It is all about reducing the power of capital and increasing the power of everyone else. This is the common ground that defines the broader left in the United States, and that makes the Swedish model of the Palme era seem so attractive to many.

But the main lesson to be learned from the Sweden of left-liberal and social democratic dreams is not that capitalism can be reformed and therefore need not be fundamentally challenged. Instead, the main lesson is that those progressives who aspire to radical social reforms can only hope to have sufficient leverage to win these reforms if the threat of socialism is looming on the horizon. In Sweden’s case: the Soviet Union across the Baltic. The left can expect to achieve most in every respect when the threat it represents is one to be taken seriously.

The current and pathetically weak state of the progressive forces in the United States points to the dangers of political demobilization. On issue after issue, progressives tend to garner a significant percentage of the American people’s support, yet they do not have anything remotely close to commensurate political influence. The recent debacle over health care, in which the Obama administration and its Congressional allies successfully played the left-wing and voting base of the Democratic Party for patsies and delivered on a gold platter a bill to the liking of the corporate sector, is the most recent evidence. Of course part of the liberal-left’s weakness in U.S. politics is due to the news media, unfavorable election laws, and a number of other factors with which progressives are all too familiar. But a more significant reason for that weakness is that nobody in power fears the liberal-left—and no one should. The liberal-left tends to trip over itself as it establishes its pro-market bona fides for decision makers. “Take us seriously, pretty please; we are not really radicals and certainly not socialists, we want to make your free market system work better, and don’t we have some jolly-good ideas,” they seem to say.

The only way to exact major reforms from those in power is to show them that we really mean it; to convey the message that if the real demands of the people, expressed in mass movements, are not met by the system (or are met only in very limited ways), then we as a body will make serious attempts to accomplish these ends by transcending the current system of power. Think of the great progressive reforms in modern U.S. history. The Wagner Act. Social Security. The Voting Rights Act. These came when those in power were petrified. They arose because of mass revolts from below, and because radicals recognized that it was the peculiar responsibility of the left to help mobilize the working class to fight for their own interests and their own needs—to take to the streets and fight power head on.

Consider why rulers in other nations, like France or Greece, tend to have greater difficulty implementing cutbacks in social programs during crises: Because, when they look out the window, they see a mass of people who would threaten the perpetuation of their system, if the vested interests were to engineer a class war from above in an attempt to turn back the clock. This makes the position of the capitalist class in such countries much more tenuous. The ability of the Swedish Social Democrats to win their tremendous reforms arose through the struggles of a working-class movement that was always populated with “extremist” elements open to expropriating private capital altogether.

From the birth of democracy in antiquity, it has been true that those with property will only concede fundamental rights to those without property when they fear for the very survival of their own privileges. “If there is no struggle,” as Frederick Douglass said in 1857, “there is no progress….Power concedes nothing without a demand. It never did and it never will….If we ever get free from the oppressions and wrongs heaped upon us, we must pay for their removal. We must do this by labor, by suffering, by sacrifice, and if needs be, by our lives and the lives of others.”17 People arrive at more radical, revolutionary positions through concrete struggle.

The unwillingness, so common among U.S. progressives, to embrace a critique of capitalism, to take it to its radical conclusions, including the necessity of a serious class struggle, has another unfortunate political consequence. It opens the door to phony right-wing populist movements seizing the mantle of “radical” opposition to the status quo. With the economic system off-limits to criticism (even invisible in its main power dimensions), attention necessarily gravitates to government as the root of all evil. The state must therefore be the source of the peoples’ problems; and indeed, it seems very seldom to operate in their real interests. It is the state, after all, that imposes taxes that seem to provide ordinary people few benefits; runs deficits, the burden of which falls disproportionately on those who gain the least; and controls the military and police. In today’s Tea Party ideology, engineered principally by the right, capital is deemed natural, while the state is unnatural—imposed from without on those who would otherwise be free. The social crisis is then seen as a crisis of too much government, too much interference by state interests in the natural order of things. Capitalism is treated as an elemental force, like the wind and tides, or a mere byproduct of human nature. The reality of power in today’s society is hidden behind the mist generated by this false “naturalism.”

The underlying principle, therefore, is clear: progressives need a fundamental critique of capitalism and an open discussion about the possible advantages of socialism—even to attempt major reforms within capitalism. And when they begin that critique, we believe, most progressives and most Americans will come to the conclusion that C.B. Macpherson, in his The Life and Times of Liberal Democracy, reached some four decades ago: It is increasingly difficult to reconcile liberal democratic values (much less anything remotely resembling genuine democracy) with today’s monopoly-finance capital. Something has to go. And that is exactly why capitalism is off-limits to honest discussion, and why the constraints placed on public debate in our political culture prevent any real, permanent forward movement.18

We have not forgotten the basic realities of class. We know that most of those self-identified as part of the U.S. liberal-left are very privileged, relative to the larger working population. The liberal-left is heavily entrenched in the professional-managerial stratum, or the upper middle class. Many of them are employed by the state. Theirs is a class reality that ties them in innumerable ways to the system. They may want significant change, but most of the liberal-left is materially linked, in a way that the vast majority of the population is not, to the existing power structure. Nevertheless, there is no imaginable path toward socialism in the United States today, in which a considerable portion of those who currently constitute the “liberal-left” do not play an important role as key initiators and supporters of a general revolt in society.

The current state of U.S. politics might be described as one in which the right has gained more power by moving right. The left needs to gain more power by moving left. If this means increased political polarization, so be it.

Getting Serious

We were provoked to write this article because the possibilities in the United States for a genuine, free-wheeling discussion of capitalism’s defects, and the merits of socialism, are greater today than at any time in generations, and we must not let this historic moment pass. What is striking, and a cause for optimism, is the current degree of criticism of capitalism and the amount of support for socialism—in a media and political culture where criticism of the former and support for the latter have been all but forbidden. Back in 1987, a poll of the U.S. population indicated that 45 percent of the population believed that Marx’s famous words from the Critique of the Gotha Programme delimiting communism—“from each according to his ability, to each according to his needs”—were enshrined in the U.S. Constitution. This, of course, said more about the absolute ideals of most Americans, and what they thought they should expect, than about the U.S. Constitution itself.19

Two decades of neoliberalism, far from eradicating radical ideas, appear to have given them rebirth. A 2009 global survey, conducted by the BBC, found some 15 percent of Americans agreed with the statement that free market capitalism “is fatally flawed and a different economic system is needed.” Another 40 percent thought capitalism had problems that required regulation and reform. A mere 25 percent thought capitalism was doing a bang-up job and increased government regulation would be harmful.20 The remainder weren’t sure. A different 2009 survey found that only 53 percent of Americans thought capitalism superior to socialism. Among adults under the age of thirty, capitalism was preferred to socialism as the best system, by a slim 37 to 33 percent margin.21

We are in no position to determine the veracity of these poll numbers, though they arise from what are considered respectable sources. We also can only imagine what people think when they hear the term “socialism,” since it is either ignored or mangled in the mainstream culture. But we do know that people experience capitalism and corporate power every day in their lives, and these surveys demonstrate what we have seen repeatedly: People don’t like it very much, despite the endless exhortations about the genius of “choice” made possible by the “free market” around them. To many millions of Americans, if socialism is the nemesis of capitalism it must by definition be a damn sight better.

To his credit, filmmaker Michael Moore was the first to tap into this sentiment with his 2009 film, Capitalism: A Love Story. He toured the nation, explaining that capitalism had failed and needed to be replaced. Words like these had never been uttered on commercial news media, unless they were part of some denunciation of the speaker.

Capitalism, as an economic, political, and social system based on private ownership, directed to the greatest possible profits for particular individuals and corporations, is, in our day, entirely absurd. It has no rational or orderly relationship to human life or to the future of humanity. Socialism, as its heir apparent, stands for the chance that still exists to create a just, egalitarian, and sustainable world directed at human needs, in which the people themselves are sovereign—once the fetters of private profit are burst asunder.

Is this possible? Who knows? What we do know is that, as long as we breathe air, we have no real choice but to rebel, because under capitalism humanity has no future.

Notes

1.      ↩ See http://merriam-webster.com/netdict/absurd; http://merriam-webster.com/netdict/capitalism; http://dictionary.cambridge.org/dictionary/british/capitalism. Entry for capitalism is based on a combination of Merriam Webster Online and Cambridge Advanced Learner’s Dictionary, using the latter for the actual definition.

2.      ↩ Fredric Jameson, “The Future of the City,” New Left Review 21, second series (May-June 2003), 76.

3.      ↩ John Steinbeck, The Grapes of Wrath (London: Penguin Books, 2006), 38-39.

4.      ↩ On the opacity of the market see especially Bertell Ollman, “Market Mystification in Capitalist and Socialist Market Societies,” in Ollman, ed., Market Socialism: The Debate Among Socialists (New York: Routledge, 1998), 81-121.

5.      ↩ Arthur B. Kennickell, “Ponds and Streams: Wealth and Income in the U.S., 1989 to 2007,” Federal Reserve Board Working Paper 2009-23, 53, 63.

6.      ↩ John Bellamy Foster, Hannah Holleman, and Robert W. McChesney, “The U.S. Imperial Triangle and Military Spending,” Monthly Review 50, no. 5 (October 2008), 1-19.

7.      ↩ Annie Leonard, The Story of Stuff (New York: The Free Press, 2010), 151; http://happyplanetindex.org.

8.      ↩ John Kenneth Galbraith, The Affluent Society (Boston: Houghton Mifflin, 1958).

9.      ↩ “Warren Buffett Sees Strong Rail System as Key to U.S. Growth,” USA Today, March 5, 2010.

10.    ↩ Paul Goodman, Growing Up Absurd (New York: Random House, 1960), 17.

11.    ↩ Karl Marx and Friedrich Engels, The Communist Manifesto (New York: Monthly Review Press, 1964), 10-11.

12.    ↩ John Bellamy Foster, “The End of Rational Capitalism,” Monthly Review 54, no. 10 (March 2005), 1-13.

13.    ↩ Rosa Luxemburg, The Rosa Luxemburg Reader (New York: Monthly Review Press, 2004), 350. On exterminism, see E.P. Thompson, Beyond the Cold War (New York: Pantheon, 1982), 41-80; Rudolf Bahro, Avoiding Social and Ecological Disaster (Bath: Gateway Books, 1994), 19; John Bellamy Foster, The Ecological Revolution (New York: Monthly Review Press, 2009), 27-28.

14.    ↩ Steinbeck, The Grapes of Wrath, 32.

15.    ↩ See Michael Lebowitz, The Socialist Alternative (New York: Monthly Review Press, 2010 [forthcoming]).

16.    ↩ Karl Marx, Early Writings (London: Penguin, 1974), 347.

17.    ↩ Frederick Douglass, Life and Writings, vol. 2. (New York: International Publishers, 1950), 437.

18.    ↩ C. B. Macpherson, The Life and Times of Liberal Democracy (New York: Oxford, 1977).

19.    ↩ Poll on Constitution, Boston Globe Magazine, September 13, 1987; Jules Lobel, “Introduction,” in Jules Lobel, ed., A Less than Perfect Union (New York: Monthly Review Press, 1988), 3.

20.    ↩ James Robbins, “Free Market Flawed, Says Survey,” BBC News, November 9, 2009, http://news.bbc.co.uk/2/hi/8347409.stm.

21.    ↩ “New Poll: Socialism is Gaining Popularity in America,” Cleveland Leader, April 9, 2009, http://www.clevelandleader.com/node/9655.