This excerpt from Chapter One of “America Beyond Capitalism” is Part Five of our continuing exclusive series of installments from Gar Alperovitz’s visionary book, first published in 2005, whose time has come. Donate to Truthout and receive a free copy.
We often forget that it was once simply assumed the United States would move inevitably in the direction of ever greater equality. A 1963 American Economic Review article observed that “most recent studies” of U.S. economic history take for granted that “since the end of the depression the nation’s wealth has been redistributed and prosperity has been extended to the vast majority.” A respected group of researchers declared, “The United States has arrived at the point where poverty could be abolished easily and simply by a stroke of the pen.” The title of an important book by the liberal economist John Kenneth Galbraith proclaimed the “Affluent Society.”
Such assumptions now appear strange, indeed, unreal. Statistical studies show growing, not diminishing, inequality. Writers like Galbraith have been forced to a radical reassessment: “Alas, I am not nearly as optimistic now as then…. [T]hose who dismiss the pro-affluent movement of these past years as a temporary departure from some socially concerned norm are quite wrong.”
Compensation of the ten most highly paid CEOs averaged $3.5 million a year in 1981. By 1988 it had jumped to $19.3 million. By 2000 it was $154 million—an increase over this period of 4,300 percent.
In 1948 Nobel laureate Paul Samuelson had attempted to illustrate the extent of inequality in his popular economics textbook with the following example: “If we made … an income pyramid out of a child’s play blocks with each layer portraying $1,000 of income, the peak would be far higher than the Eiffel Tower, but almost all of us would be within a yard of the ground.”
By the closing years of the century, Samuelson found that the Eiffel Tower no longer adequately expressed the orders of magnitude involved. He replaced it with Mount Everest.
Another troubled economist, Lester Thurow, wrote, “No country not experiencing a revolution or a military defeat with a subsequent occupation has probably ever had as rapid or as widespread an increase in inequality as has occurred in the United States in the past two decades.”
Consider an even deeper problem: “As American democratic institutions begin their third century,” political scientist Robert Putnam observes, “a sense is abroad in the land that our national experiment in self-government is faltering.” Quite fundamental forces have also undermined the experience of democracy for millions of Americans—and again what is striking and profoundly worrisome is the trend.
In the 1960s roughly two out of three regularly told pollsters they believed government was run “for the benefit of all.” Asked in 1999, “Would you say the government is pretty much run by a few big interests looking out for themselves, or that it is run for the benefit of all the people,” a mere 19 percent said that it is run for all. Fully 75 percent now felt that government was run for the benefit of special interests.
Voting—one bottom-line test of democracy—also declined dramatically. In the 1960 presidential election more than three out of five of those eligible voted; only slightly more than half did so in 2000. Less than 40 percent now bother to participate in congressional elections (understandably, since partisan redistricting has made almost 400 of the 435 seats in the House of Representatives all but impossible to contest!).
An angry Republican senator, John McCain, describes the American political system as “an elaborate influence-peddling scheme in which both parties conspire to stay in office by selling the country to the highest bidder.”
Another obvious source of the “democratic deficit” is the enormous power of giant corporations. Careful academics, like the former president of the American Political Science Association, Charles Lindblom, put the point this way: “It is the large enterprises that pose obstructions to political democracy. Through their spending and relations with government officials they exercise much more power than do citizens…. [This is] a mammoth violation of the political equality deemed necessary for genuine rather than spurious democracy.”
Another political scientist, Carl Boggs, is less restrained: “[T]he largest corporations are able to dominate virtually every phase of economic, political, and cultural life; they set the agenda for nearly every dimension of public policy.”
Democracy’s steady decline, theorist Michael Sandel laments, is ultimately evidenced in “a widespread sense that we are caught in the grip of impersonal structures of power that defy our understanding and control.”
Finally, consider the matter of liberty.
At the most obvious level, the war on terrorism has brought extraordinary threats to traditional American liberties. Georgetown University law professor David Cole writes: “Secrecy has become the order of the day. Criminal proceedings are governed by gag orders—themselves secret—preventing defendants or their lawyers from saying anything to the public about their predicament…. The Patriot Act authorizes never-disclosed wiretaps and secret searches in criminal investigations without probable cause of a crime, the bedrock constitutional predicate for any search.”
Nor is this the worry only of liberals. An angry conservative, William Safire, charges, “Intimidated by terrorists and inflamed by a passion for rough justice, we are letting George W. Bush get away with the replacement of the American rule of law with military kangaroo courts.” Safire goes on, “These used to be the Great Unwatched, free people conducting their private lives; now they are under close surveillance by hundreds of hidden cameras…. This is not some alarmist Orwellian scenario; it is here, now, financed by $20 billion last year and $15 billion more this year of federal money appropriated out of sheer fear.”
Fear of crime also has fueled what the African American columnist, the late Carl Rowan, termed a “wild zeal” to guarantee personal safety and the willingness of many judges to countenance a “retreat from our historic protection of civil liberties and privacy rights.” In 2002 one in eight black men age twenty to thirty-four was in prison or jail.
For serious conservatives, liberty inherently requires small government, but here the underlying structural trends are also daunting. Not only is government big, but even when Republicans have been elected there is little evidence that its basic scale can be significantly altered. Indeed, government increased as a share of the economy during each of the first years of the George W. Bush presidency—from 18.6 percent in fiscal year 2001 to an estimated 20.2 percent in fiscal year 2004. “For those who cherish individual liberty and a free society,” political economist Robert Higgs observes, “the prospect is deeply disheartening.”18
Liberty in traditional conservative thought also depends on maintaining the underlying institutions of free-market capitalism—above all the independence, culture, and energy of the entrepreneur. The entrepreneur once did play a central role in the system—but this was more than a hundred years ago. Today roughly 90 percent of working Americans are employees—a very different kind of individual.
A society can continue for a very substantial period along a path characterized by ever greater divergence between the core values and ideals that give it legitimacy and the institutions and practices that create and constitute the everyday realities its citizens experience. Plausibly, a society could continue indefinitely on such a course—though clearly, cynicism and apathy would result, and at some point increasingly serious demands for change most likely would be heard.
It would be surprising, however, if some of its most serious thinkers did not attempt to reassess the relationship between traditional theories and values, on the one hand, and politics, strategies, and underlying institutions, on the other.
Indeed, a steadily developing rethinking is now evident among individuals and groups on all sides of the traditional political divide—left, right, and center.
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