This is a long-term project that probably won’t be ready for 2008, but we need to keep working on it. The Right has become the party of capitalism, which by inference makes the Left the party of what? Communism? Socialism? Big government? Who wants to run on that?
But capitalism is just a technique for organizing production and consumption. It isn’t inherently Left or Right any more than assembly lines or double-entry bookkeeping or shopping malls are. Today, capitalism concentrates wealth in the hands of the few and distances both corporations and consumers from the destructive consequences of their decisions. But is that capitalism, or is it just right-wing capitalism? Could there be a left-wing capitalism that harnesses the efficiency of market forces to the values of liberal society?
William Greider says yes. He doesn’t have it all worked out yet either, but in The Soul of Capitalism he points a finger in the right direction. Without killing the goose that lays the golden eggs, we could encourage employee ownership, change the nature of corporate charters to make corporations more responsive to the public good, require (as Europe does) that manufacturers handle the disposal of their used-up products, create community investment funds that make capital available to good corporate citizens, and inject humanist values into the market system in many other ways. Greider still lacks an over-arching theory that pulls all this together, but his book is a welcome reminder that capitalism-as-we-see-it is not necessarily the last word in capitalism.
Another potential prophet of liberal capitalism is the South American economist Hernando de Soto. In The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else, de Soto stakes out a position between free-market fundamentalists (who claim that under-developed countries can become rich by setting capital free) and anti-globalists (who see only the potential for multinational corporations to rape and pillage the Third World). He writes:
It makes no sense continuing to call for open economies without facing the fact that economic reforms underway open the doors only for small and globalized elites and leave out most of humanity. At present, capitalist globalization is concerned with interconnecting only the elites that live inside the bell jars. To lift the bell jars and do away with property apartheid will require going beyond the existing borders of both economics and law.
I am not a die-hard capitalist. I do not view capitalism as a credo. Much more important to me are freedom, compassion for the poor, respect for the social contract, and equal opportunity. But for the moment, to achieve those goals, capitalism is the only game in town. It is the only system we know that provides us with the tools required to create massive surplus value.
The curious phrase property apartheid in the above quote is key to de Soto’s analysis. Capitalism doesn’t lift up the poor in the Third World, he claims, because they can’t get into the property-owning game. To fix this, he proposes liberalized rules for recognizing squatter’s rights, sweat equity, and the various other extralegal property conventions that exist on the fringes of society. His notion of “the people’s law” is quite radical: Property is a social convention that needs to come up from the people, not down from the government. Capitalism only starts to hum after the establishment of a property system with top-to-bottom legitimacy. (In the middle of all this economic and legal analysis is a wonderful bit of neglected history: How did the United States resolve all the conflicting claims of King’s grants, purchases from the Indians, and homesteading in order to create the orderly property system that we enjoy today?)
Finally, capitalism does not mean corporatism. (According to Mussolini, fascism does.) Due to a mistake the Supreme Court made in 1886 – damn those activist judges! – corporations were declared “persons” and given the protection of the Bill of Rights. That’s why it’s so hard to get them under control. The First Amendment protects their political contributions, for example, while their right to privacy limits how much data the government can force them to reveal. (God help us if they ever start testing the limits of their right to bear arms.) Sadly, it will take a constitutional amendment to undo this, and we should get right on it. See Thom Hartmann’s Unequal Protection for a summary of the issues (and even more fascinating neglected history).
Greider, de Soto, and Hartmann are not united behind any particular conclusions, but they share an attitude: Capitalism is not a given. Its workings were not established when God went back to work on the eighth day. If we look deeply into the roots of capitalism, we can understand it better than the conservatives do and find a way to make it our own.
Return to 10 Ideas for 2008 by Doug Muder