Saving Capitalism and Democracy

The other part of what I hope the film does is inspire people to go out and talk to people they disagree with. You choose your tribe and essentially only learn what your tribe is saying or believing. But most Republicans and conservatives I come across are not nearly that extreme.

I spend a lot of time in so-called red states. Just last month I was in Western Kentucky and I accept almost any invitation from a public university in a red state to come and give a talk. Many Republicans I run into and many conservatives voted for Trump despite his bigotry. But very few of the people I have met who voted for Trump were happy to vote for Trump. I am sure there are some people who still to this day are fanatically behind him. I was reading through Twitter trying to get a sense of how people were responding to the film. Better start hiding stacks in the wall now.

We have shots of my students and classes, but also many of the people who the viewers met through the film who are coming together and giving voice to their concerns.

That to me is a very hopeful message. The scene where you were speaking with your students was the most moving part of the film for me. But at the time I thought I was pushing as hard as I could, as hard as I dared. It was difficult for me. Many people have had the experience in their organizations or among their peers of not being able to get people to see what you consider to be the truth and respond appropriately. I was in the cabinet of a President who had, I think, the right values and instincts, and for two years the Democrats had control over both houses of Congress.

But I felt deeply frustrated by my inability to get him and congressional leaders to take the kind of action I felt they needed to, given the gravity of the problem—the problem being of course that wages were stagnating and had been for years, that inequality was growing, and that inequality was undermining our democracy. It was a tough slog. At the time, I thought I risked being marginalized. And I had two young boys who I was seeing very little of and who I missed terribly.

I did the best I could. In retrospect, you always wonder if you could have done more. I might have been able to. I think he is not just the worst president in my lifetime, but I think he poses a grave danger to this country, to our cohesion and our place in the world.

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I want them to see the connections between economics and politics. I want the wealthy and privileged in America to understand that they have got to accept, if not actually advocate for, fundamental changes that will get big money out of politics and restore our democracy. Trump is just the latest manifestation. We are at a crisis point in our political-economic system. Career Connections Berkeley Network Webinars.

Upgrade your Grad Pack to Life Membership. They don't have the resources to control the product of their own labor and sell it to obtain other necessities.

Thus, economic systems have two spheres: Reich offers many insights into how capitalism distributes wealth under the rules of the "free market. In a chapter about contracts, for example, Reich explains the bogus "consent" given by Apple users when they click "I Accept" and sign away privacy rights in order to use the iCloud. But there is no similar chapter in Saving Capitalism about how the workers who make Apple products--like blue- and white-collar workers for other companies the world over--have little choice about accepting unfair pay and working conditions, and none at all about what is done with the product of their work.

The "free market" has determined that they'll find the basically same raw deal everywhere else--and a worse one if they're unemployed. This lack of choice for the working majority is necessary for the functioning of capitalism--which is why it can never be reformed into a system that works "for the many. Just as human societies have decided the terms of private property regarding cooking recipes and year drug patents, it's also possible for society to decide that the companies that produce and distribute wealth shouldn't be privately owned at all, but should instead be collectively run by their workers.

This is the heart of socialism: Not just that wealth should be fairly distributed, but also that those who create it should have democratic control--to start with, over what they do and how they do it. Workers' control is vital to socialism not just because it's a nice idea, but because workers are the only force with the potential power to bring about socialism. But the question, of course, is how human beings can go about deciding on workers' control versus capitalist control. But in fact, it was the power of unions and strikes and civil rights organizations and mass protest that pressured those leaders into the creating programs like Social Security, Medicare and the other major reforms of the 20th century that they are now credited with establishing.

Reich supports unions and grassroots organizations not as potentially revolutionary forces, but instead as what he calls a "counterveiling power"--to balance out the self-serving interests of corporations and the 1 Percent. But the people who bravely organized the strikes and sit-ins didn't risk everything and sacrifice so much because they wanted their children to have to fight the same battles as an eternal counterweight to the greed and ambition of an undeserving ruling class. Ultimately, they wanted to win a more just society for good--and many explicitly viewed that society as socialism.

At different points in the last years, their efforts exploded into strikes and protests involving tens of millions, creating genuinely revolutionary moments when workers' control of production and democratic control over the distribution of wealth became real possibilities.

Because this type of socialism is fundamentally at odds with capitalism, these revolutions had to spread--or be defeated. Most were rolled back quickly. The most famous revolution of all, in Russia in , saw millions of workers take power and create a new form of government, based on workers' councils, for a few years. But that revolution, too, was overturned, isolated by foreign invasion and destroyed by a new hierarchy led by Joseph Stalin. There have been no workers' revolutions in recent decades, and even many of the reforms won in the past have been reversed as the 1 Percent has grown even more powerful and working-class organization weaker.

In this setting, it's easy to conclude that socialism based on workers' control is unrealistic--and that it's better to focus on the reforms to make capitalism for livable for the many. But we should recognize that in many ways, it's Reich and Sanders who have an unrealistic vision of bringing back the past. Their vision of reforming capitalism is based on the model of the U. Those few decades that are the model for Saving Capitalism are a stark exception to the overall tendency of capitalism--which, as Thomas Piketty showed in his bestselling book Capital in the 21st Century , has in all other times led to wealth becoming more concentrated in fewer hands.

Looking back to a period when the U. That, in turn, is leading to more and more ruthless international competition and global migration of workers. Socialists don't draw a line between reform and revolution and stand only on one side of that line. We can embrace social reforms and are part of struggles to achieve them.

We can make use of the ideas and analysis put forward by people like Sanders and Reich. Pursuant Republicans have not even appropriated sufficient money to enforce the shards of the act that remain.

The Glass-Steagall Act has to be resurrected. There has to be a limit on the size of big banks. The current big banks have to be broken up using anti-trust laws, as we broke up the oil cartels in the early years of the 20th century. We also need to get money out of politics. But how are these changes going to come about while the very wealthy can so effectively control and manipulate the political process? I could go on, but you get my drift. Get the weekly Five Books newsletter. None of this is possible without an upsurge in the public at large — a movement that may have already begun with the so-called Occupiers , but a movement that rescues our democracy and takes back our economy.

Much the same challenge exists in Europe and Japan and elsewhere around the world, where systems profess to combine capitalism and democracy. Massive inequality is incompatible with robust democracy. The richest people in America have more wealth than the bottom million Americans put together. Is there a single theme that ties them together? All five books are about the structure of the economy and how that structure affects and is affected by the social life of a society.

They are all economic books in one sense, but they are also political and sociological books in another. Before that, in the 19th century, it was called political economy — no one assumed you could separate politics from economics. Then before that in the 18th century it was called moral philosophy. Adam Smith called himself a moral philosopher.

He took the greatest pride not in his Wealth of Nations but in his Theory of Moral Sentiments , which is all about the ways in which people felt connected to one another in the same society. It sounds very familiar, but Croly is writing in the early 20th century. It was written in and it had an electrifying effect on America and in the formation of modern American capitalism.

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Herbert Croly was the first to understand that modern capitalism required a government that was robustly democratic, but was large enough and strong enough to counterbalance the forces of large corporations. In a sense, he married the national vision of [Founding Father and first US Secretary of the Treasury] Alexander Hamilton to the commitment of [Founding Father and principal author of the Declaration of Independence ] Thomas Jefferson toward average people, rather than the wealthy and the privileged.

You touch on the debate between Hamilton and Jefferson, with Croly really siding with Hamilton and his belief in the need for a strong national government. In fact, government is seen as a threat to individual freedom even by people who might benefit from a more interventionist approach to the economy. Yes, and some of these people seem to believe that a smaller government will give them more freedom.

Saving Capitalism

But they overlook the overwhelming power of big corporations and Wall Street. The only way they are going to have more freedom is if government, as Croly envisioned, counterbalances the enormous power of the large corporations and Wall Street. But in order to do so, government has to be more responsive to average people.

This, of course, gets us back to the points I was making a moment ago. We have got to have a democracy that is not corrupted by great wealth and power. Otherwise the government simply becomes another vehicle for the wealthy to entrench their privileged position. There are similarities between the US today and with what was happening in the early 20th century.

Back then there was a clear response to the failings of capitalism, and reforms such as anti-trust laws and labour protection legislation were instigated. Modern American capitalism has been tested several times over the last century. At least twice, reformers have preserved capitalism by responding to its excesses. The first was during the progressive era, the first decade and a half of the 20th century before World War I.

It was not just at the federal level but, perhaps even more strikingly, at the level of state government where you had the beginnings of the reforms that found their full flowering in the s. Yes, anti-trust laws were designed to break up the big monopolies and oligopolies that essentially ran much of the American economy at the end of the 19th century. There were laws to improve the functioning of democracy, to get money out of politics, to reduce the power of the political bosses. The Federal Reserve Board was created in an attempt to provide some orderly and predictable means of maintaining economic policy and avoid the patterns of booms and busts that had marred the era of monopoly capitalism.

Income tax was instituted.

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Labour protections, at the state level in particular, were introduced — a five-day working week, time-and-a-half for overtime, health and safety measures. The list was quite long. Croly was not entirely responsible obviously, but his book came at a time when there was great optimism about the capacity of our democratic process to control the excesses of capitalism and to make capitalism work for the people.

The second era [of reform] was obviously the s when, after the Great Crash of , [President] Franklin D Roosevelt enacted everything from the minimum wage to social security, unemployment insurance, the hour working week nationally and also the requirement that employers bargain with unions in good faith, thereby laying the foundations for very strong labour unions in the United States. Much of what the progressives accomplished, and what the New Deal accomplished 25 years later, had to do with changing both the economic and social structure of the country — widening the circle of prosperity, enabling far greater numbers of Americans to participate in the economy and to gain advantages as the economy grew, and at the same time strengthen democracy.

We are now at another crisis. But in many ways The New Industrial State is more interesting because here again we have an economist who reaches beyond the narrow scope of economics and sees economics and social life in a broader frame. Galbraith was looking at what had happened to the large corporation. The New Industrial State was more of an explanation than a call to arms. The United States, and by inference all nations practising democratic capitalism, had to be careful to make sure that we understood what the technostructure was doing and why it was doing it and how it was trying to influence all of us.

Galbraith understood 20th century consumerism probably better than anyone. Just as Thorstein Veblen understood where consumerism was going at the end of the 19th century, Galbraith really saw the future with regards to consumerism in the last decades of the 20th century. Wall Street is definitely not risk averse or shy of maximising profits, is it? Galbraith in some senses explained and even celebrated a system of corporate power that was soon to shift to Wall Street. Galbraith sees the victory of a system of democratic capitalism by contrast to the alternatives in the world at that time — communism, fascism, dictatorship and mass poverty.

But at the same time he was concerned about the technostructure.