Woe is Capitalism

In a heartfelt op-ed to the Wall Street Journal, poor beleaguered and oppressed venture capitalist Tom Perkins lamented the rising “war” on the 1% and astutely likened the backlash against the über-rich to the Kristallnacht during which Nazi street thugs terrorized Jews and destroyed their livelihoods in a grim warning of the coming Holocaust.

Very apt comparison, Mr. Perkins. Really, bravo.

Perkins’ cluelessness is not an isolated phenomenon, though. One need only flip the dial over to the house that Ailes built to hear similar propaganda trying to forestall the country’s growing awareness of the widening income inequality that has quietly characterized the hidden story of capitalism in the West over the last generation.

Ironically, it’s comments like Perkins’ that seem to cry out for some sort of uprising, but of course, to a privileged, entitled member of America’s new feudal class, any sort of protest must be exactly like the final solution. (Again, sir, your logic is unassailable! Thank you for helping us see the light.)

An understanding of history that extends beyond caricaturistic notions of WWII, of course, offers us other analogies with which to view this widening gulf between the rich and poor in this country. I have often quoted the old Chinese saying from The Good Earth in my observations about this issue: “When the rich are too rich… and the poor are too poor, there are ways.” Indeed, during the twilight of the Gilded Age–the last time in American history when the gulf between the wealthy and the rest of us got nearly this wide–there was popular discontent that led to systemic changes, trust busting, and labor movements.

America avoided communist revolution in the twentieth century by righting its course and adjusting legal, fiscal, monetary, and tax policy to restore a healthy balance to the economy.

That’s what need to happen now, too.

Yet so far, surprisingly it hasn’t. Robert Reich, who has become something of a herald of this inevitable social upheaval, remarked on this lack of outcry recently and cited three likely causes. His explanations–student disengagement (partly because of debt to this corrupt and broken system), worker anxiety, and cynicism toward government really don’t do one lick of work to explain why there is no simmering revolution, why the people are not in the streets.

Model billionaire Bill Gates, though, may have accidentally struck on the answer. In recent interviews, Gates has noted that statistically, the world is looking pretty good these days.

Based on the numbers, Gates concludes we have poverty–true, horrible, desperate poverty–on the ropes. He believes we can eradicate it this century.

A bold claim that many might dismiss as rosy-colored foolish optimism, but there are some numbers to back him up. In terms of hunger and meeting basic material needs, most of the world’s poor are doing better than in the past.

Global Capitalism–boogeyman of the Left–has kinda worked.

Kinda.

Gates says he is less concerned with income inequality than with sweeping away destitution and preventing devastating disease. And if all of the 85 people who controlled a third of the world’s wealth were acting like Bill Gates, then I too might not be terribly concerned with inequality. And indeed, this may be why ultimately there is no massive movement taking to the streets:  people aren’t going hungry. They’re in debt up to their eyeballs, but they’re not worried about their kids starving to death. (But go ahead, Tea Party wankers, destroy welfare, social security, medicaid, and all the other parts of the safety net; see how that works out for you.)

But when there are guys like Tom Perkins in the world, then I think we still have a live issue.

Capitalism has brought greater material prosperity to the poor of the world, but it also continues to be an engine of exploitation–both of the natural world and of human capital–that operates at the expense of human empathy and long term sustainability.

Many argue that we should abandon the model, that capitalism itself has failed or will shortly fail completely. And indeed, in its current form that privileges capital above all the other factors of production, I too would say that big-C Capitalism as we see it operating on the global stage today must go.

That kind of Capitalism.

But markets are still pretty effective ideas and they can do a lot for us in crafting a better world. We need a balance between all these guys–the Reichses warning us about the consequences, the Gateses keeping us focused on the essential progress being made, and yes, even the greedy sons of bitches like Perkinses to keep driving markets forward–to promote the sort of economy we need for the rest of the twenty-first century.