United States has always been a political economy, requiring government
regulation of its finance and money markets, and using government
stimulation of its labor force. “Free Market” enterprise is based
on the notion that open markets and the competition derived from
competing ideas for consumer patronage will create a market balance
(equilibrium) that will produce a stable economy and wide prosperity.
There is also a flawed theory that social conditions in the markets,
like poverty, homelessness, even economic subjugation and socio-political
discrimination caused by racism will self-correct in competitive
and robust economic environments.
think money solves everything when it is actually the cause of many
social and economic societal ills. Particularly as it relates to
the distribution and redistribution of income and wealth. Capitalism
is based on maximizing wealth without limit, and has few safeguards
as it relates to greed and class conflict (deflation of egalitarianism).
It’s hard to be a “society of equals” when one smaller segment has
all the wealth and the larger segment has no wealth at all. America
does a very poor job of wealth distribution. It is limited to those
who have, and those who don’t need to pull themselves up by their
“own bootstraps,” even if they don’t have shoestrings. Yet, when
major industry and major markets get in trouble, they look to the
government for stabilization.
conditions, and therein lies the problem. Capitalist don’t like
to be socialized (conditioned to share in a responsible way). When
President Obama was campaigning to become President, he suggested
that government look after “Main Street” instead of “Wall Street”
to help redistribute the wealth (and the pain). Quickly, capitalists
called him a “redistributor.” That was a nice way of calling him
a “socialist.” When the President conditioned the auto industry
bailout, after the gross abuses of bonuses and posh retreats by
the banks and securities companies that received economic stimulus
dollars, the critics said he was trying to “nationalize” the economy.
Another way of saying he’s introducing socialism. Most of us wasn’t
alive during the Depression, but this period in our lives has proven
to be a great lesson in why capitalists hate socialists. Wealth
redistribution is not their favorite topic.
ideological divide in the two party political system separates the
“wasteful spenders” from “responsible government.” The former seeks
to maintain a stable society by creating a social safety through
income redistribution. The latter seeks to keep government out of
the affairs of social problems and marginalizes wealth redistribution.
One promotes social responsibility, while the other promotes individual
would prefer to tax and pay as they spend (as we should), while
the other prefers not to tax, keep the wealth, spend anyway and
let future generations pay it back. The irony here is that one is
labeled as wasteful for engaging in social spending, while the other
is not labeled as spenders while clearly being wasteful. But what
does that mean in the context of a failed economy? One invests in
the labor force (retraining of people), while the other invests
in stabilizing the markets (recapitalizing industry). Both have
helped jumpstart the economy in the past. Both strategies assume
everybody will act in a responsible way. Neither strategy accounts
when the U.S. government invested in keeping Wall Street solvent,
the industry acted as capitalist do, use the money as a wealth buffer,
not a market stimulus. Bankers and money changers sought to “get
theirs” and rest of America, “be damned.”
the notion that the government is supposed to have a social safety
net for health care and for elders care is suddenly a foreign proposition.
But it is a strategy that worked for the nation when the markets
collapsed in 1929. The government took care of those who couldn’t
take care of themselves. Economist John Maynard Keynes, President
Franklin Roosevelt’s economic advisor, designed a strategy to use
government infrastructure development (building roads, highways,
bridges and government building) to put America back to work. Now,
it’s being called “nationalism” and “socialism” to suggest the government
put people back to work.
economy is in serious trouble if it thinks it’s not going to have
to close the wealth gap. Economic imbalance has been evidenced in
the huge foreclosure spike and the drop in consumer spending.
With credit shut down, the people “just don’t have it.” And with
people not spending, industry and Wall Street don’t have it either.
Think just behave like they do. Even with government money. With
industry laying off large sums of people, government action to save
capitalism is not unreasonable.
cannot continue to let capitalists do what they do, shun market
equilibrium caused by socio-economic disparities. Nor can we continue
to throw money at failed industry. Mandates on responsible economic
behavior is not nationalism. Investing in retraining the American
people is not socialism. What capitalists are finding out is they
can’t buy (or spend) their way out of everything. They can redistribute
money to the corporations all they want, but if the people have
no money to spend, the economy will continue to crash.
spending will bring the markets into balance, distribute money to
the masses and maintain the safety net, while opening the money
floodgates back into the economy. It’s not the only way, but it’s
the only way we trust. It’s one way that will be difficult for capitalists
to violate us. Call it whatever you want, but call it fair.
tough lesson for capitalists, but one they need to learn from.
BlackCommentator.com Columnist, Dr. Anthony Asadullah Samad, is a national columnist, managing
director of the Urban Issues Forum and author of Saving The Race: Empowerment Through Wisdom. His Website is AnthonySamad.com.
to contact Dr. Samad.