Capitalism and Functioning Democracy Are at Odds
The fundamental debate is whether the right to increases in capital and property supersedes the right to equality, i.e. the right to equal access to labor and life. If the two rights are considered absolute they cannot coexist; one destroys the other (per “What is Property” by French anarchist Joseph-Pierre Proudhon).
If the right to collect capital at the expense of the wellbeing of others is deemed fundamental, then some form of capitalism is the answer. However, if the right to equality, meaning the right to labor and life, is fundamental, then we have to come up with alternatives, and these alternatives need to strengthen the ability of people to govern their own affairs collectively and individually.
The ability to govern one’s affairs also implies that control over resources and the means of productions needs to be shared among people. The attack on property rights that is implicit in this argument is not an attack on the people’s rights to own a house, or a car, or enough land to provide for themselves. It is an attack on the rights of a private entity to exclusively own natural resources (mines, water, land) and means of production (factories and shops) at the expense of all other people who depend on those resources for existence.
For the democratic process to be meaningful, those who are affected by a decision should participate in the decision-making. Democracy and inequality are mutually exclusive. This has been argued by Aristotle, who surmised that in a functioning democracy the dispossessed masses will use the democratic process to redistribute wealth and resources more equally, something that recently happened in Bolivia.
So in a situation with rampant inequality the choices are to decrease inequality, or to restrict democracy (see Noam Chomsky’s Understanding Power). That was well understood by our “Founding Fathers,” who chose the latter. They instituted different tools into the system to keep the “less desirable element” (landless peasants, workers, women, slaves, Native Americans, etc.) out of most of the decision making, while keeping moneyed individuals fairly equal and protected from the mob and from each other (see The American Political Tradition and the Men Who Made It by Richard Hofstadter or An Economic Interpretation of the Constitution of the United States by Charles Beard).
These principles have been taken and perverted to an extent that even the “Founding Fathers” would find repulsive. The Fourteenth Amendment should protect the equal rights of freed slaves, but of the cases citing this amendment that were brought to the Supreme Court in the years 1890–1910, 19 had to do with the rights of African-Americans and 288 had to do with corporate rights (People’s History of the United States by Howard Zinn). That hints at what group is more capable of protecting its rights, the “haves” or the “have not’s.”
Due to present and profound inequality, the ability of most people to influence the country’s politics is virtually nonexistent, pressing a button every four years notwithstanding. On the other hand, corporations, with their limitless cash and influence, can buy and bully the government into passing legislation that is opposed by the majority of people.
To illustrate the point, the current health care fiasco makes a nice case study. According to a 2005 study by BusinessWeek, 67 percent of the population favors a “single-payer,” aka Medicare-for-All, not-for-profit healthcare system that covers everyone (BusinessWeek, May 15, 2005). That is two-thirds of the population. Yet, in our “democratic” system, “single-payer” is not even discussed in Congress. The reason is obvious: It cuts deeply into the profits of insurance and drug companies, and since profits, in the true spirit of capitalism, are more important than people, the “single-payer” legislation (HR.676) is ignored and dismissed. Instead, after a lot of fighting to beat back any chance of a reasonable and meaningful reform, we get a bill with a very weak “public option,” which is likely to be stripped down further in the Senate, a shameful anti-choice amendment. This will likely be coupled with many gifts to the drug industry, such as ensuring certain drugs will never be generic.
A study by IMS Health estimated that the new healthcare bill will bring the drug industry an increase in sales by $137 billion over the next four years (“Democracy Now!” November 12, 2009). Guess who will have to pay that extra $137 billion? A pretty good deal for Big Pharma, but this bill was not cheap for the insurance and drug companies. They paid Senator Max Baucus (D-Mont.), the guy in charge of drafting the legislation, at least $3.5 million. In the first quarter of 2009, Pfizer alone spent $6 million on “lobbying,” although bribing is a better word for it (Z Magazine, October 2008). The Washington Post reports that the drug industry was spending $1.4 million per day on lobbying for the current legislation (Z Magazine, October 2008). Insurance companies also hit the mother lode: individuals and families will be forced to buy private insurance, or pay penalties.
There is nothing efficient in this process. It is wasteful and inefficient in terms of providing healthcare, but it does what it is there to do: secure profits for corporations. What capital wants, capital gets; forget about what millions of Americans actually want or need. “Privatize profit, socialize cost and risk” has always been the corporate motto. The examples are limitless. Just to point to one more, as of November 2009, 58 percent of people are against the war in Afghanistan, yet the government is considering an escalation.
Under the current system, particularly when talking about corporations, people are not in control of what they produce; the corporate board of directors is. Let us take another recent example that illustrates who runs the show. In 2005, residents of a neighborhood of New London, CT were forcefully evicted from their homes after years of legal battles over the concept of “Eminent Domain” (“Democracy Now!” Nov. 13, 2009). The homes were condemned to make space for a private development project, with part of the idea being to make the area more likable to the pharmaceutical giant Pfizer. The development was supposed to bring thousands of jobs. Recently Pfizer announced that it will shut down its research facility in New London and move to another town. Now the lots where people lived and children played are vacant and overgrown.
The first point is that the lives and well-being of people were sacrificed to cater to a big corporation; nothing new there. The second and more important point is that people who may be affected by a corporation have no say in what the corporation does. If a corporation wants to shut down a plant because it is not profitable to operate, or wants to shift production abroad because it is cheaper, the people in the community and the workers have no control over these decisions although their livelihoods may depend on it. Very democratic, isn’t it?
That efficient production is only possible under the conditions of profit-making, competition, and market discipline is a myth. Let us look at a historic example. During the Spanish Civil War, areas of the country (mostly near Barcelona) became under workers’ control and industry and agriculture were socialized/collectivized. Production was shifted towards what was needed, not what was profitable. What were the results? Workers put in extra effort and production in certain areas of industry increased by 10-fold (Objectivity and Liberal Scholarship by Noam Chomsky), new industries, such as optical and chemical, were developed (The Anarchist Collectives: Workers’ Self-Management in the Spanish Revolution, 1936–1939 by Sam Dolgoff), and agricultural production increased by 50 percent to 75 percent (Anarchism by Daniel Guerin).
No one has the right to dictate to people how to live their lives. That is as true for totalitarian regimes as it is true for private, corporate tyrannies! Only people can collectively decide on how to organize their existence and economy. This is the meaning of democracy, and if we are to have democracy not just in form but in substance, people across all classes need to become much more involved in how the country is run. The abolition of child labor, the institution of an 8-hour working day, Social Security, the Civil Rights Act, etc. were not gifts from the government. These achievements were won by disadvantaged people refusing to be passive bystanders, and by working and bleeding together to win the rights that they deemed fair. So there are examples before us. The question is: Will we follow them?
Alexi Goranov is a postdoc at the David H. Koch Institute for Integrative Cancer Research.