Back to Capitalism 101

“Pew Research Center survey: roughly the same number of eighteen-to-twenty-nine year old Americans have positive views of socialism as of capitalism. In a survey conducted in early December last year, 49 percent had a positive view of socialism, while 47 percent had a positive view of capitalism. Similarly, only 43 percent had a negative view of socialism, compared with 47 percent who had a negative view of capitalism.

The approval figure for socialism is even larger than the results of polling from May 2010, where 43 percent of eighteen-to-twenty-nine year olds registered positive feeling for socialism. (This put it in a dead heat with capitalism).”

First, let me point out that capitalism is an economic form and socialism is a political philosophy.  They are not mutually exclusive.

Even so, why do these young people feel the way they do? Well let’s see, I may have some information that will help us to understand better: First, over the last thirty years, the income of the top 1 percent increased 250 percent. During that same period, the wage-earner’s take home pay, when adjusted for inflation, has remained essentially the same.  I doubt that these facts make capitalism look good to young people.

Some years back it became popular in the business world to institute what was called an “employment-at-will” employment agreement. Here’s what Wikipedia had to say about it, “At-will employment is a doctrine of American law that defines an employment relationship in which either party can break the relationship with no liability, provided there was no express contract for a definite term governing the employment relationship and that the employer does not belong to a collective bargaining group (i.e., has not recognized a union). I’m sure this law garners a whole lot of love for capitalism and loyalty from employees.

Well there’s always the “union” protection clause. Except that unionizing has become very difficult for today’s workers. Read these new findings from Dr. Kate Bronfenbrenner. “They provide a comprehensive, independent analysis of employer behavior in union representation elections supervised by the National Labor Relations Board (NLRB). Her research identifies the range and incidence of legal and illegal coercive tactics used by employers NLRB elections and the ineffectiveness of current labor law to protect and enforce workers’ rights during the process.”  I doubt that this fact is going to endear young folks to capitalism.

Here’s another aspect of capitalism that cannot be explained to their satisfaction. From an article by Lynn Parramore on the website: AlterNet.org, “Big business apologists like to tell us that the U.S. corporate tax rate of 35 percent is too high, and makes companies less “competitive” with foreign firms. Yet we all know that corporations hire legions of wily accountants to find loopholes that often bring their tax rate down to next to nothing.

In 2008, Goldman Sachs paid a laughable 1.1 percent of its income in taxes. That same year, it earned a profit of $2.3 billion and received an $800 billion bailout, courtesy of you and me. Let’s savor that irony for a moment, as we recall that the bailout is not all we paid for Goldman Sachs to operate its rapacious business, which, as the cynical editors of Bloomberg recently reminded us, apparently has no obligation to serve humanity. We pay for its employees to be educated. We pay for the infrastructure required to facilitate its business. We pay a gargantuan sum in “defense spending” which essentially funnels our tax dollars into protections and path-smoothing that allows Goldman Sachs to operate in, and to penetrate, foreign markets.”

What’s not to love? That is if you are the recipient of the goodies that capitalism can and does provide to fewer and fewer people every year. No, I’m not advocating socialism as an economic form. Capitalism is still the best economic form. But it’s broken and needs to be fixed.

Robert DeFilippis