I started thinking about this after seeing the staggering statistic yet again: 51% of millennials don’t support capitalism. Forty-two percent do. I am a millennial, and I am part of that 42%—I think.
To be honest, I haven’t really thought about it lately, which is my way of warning you that this may take a while. I came of political mind as a teenage socialist, and upon learning about socialist regimes and philosophies as a political science major at UMass, I decided that I simply wasn’t wired that way (I’m probably one of like, five people who has gone to college in Massachusetts and come out more conservative). My grandfather was a first generation American who grew up in poverty, fought in World War II, then returned home to start his own business and became a millionaire. It’s difficult to deny the American dream when you grow up around proof that it exists.
But what does the American dream mean anymore? What does capitalism mean?
I am sick and tired of ideology. It’s all that our political debates have become, and it’s exhausting. When you register to vote, you declare your team, and then we all watch CNN like it’s ESPN, and now ESPN is trying to become more like CNN, and everyone’s screaming at each other and I’m standing somewhere in the middle losing my damn mind. Ideology is literally killing us, and the truly morbid part is that it’s an inescapable part of our tribalism.
The story of humanity is a tug-of-war between modernity and our nomadic past. Getting separated from the herd was virtually a death sentence once upon a time, so we clung to those in our tribe. Now, we have developed technology to the point where you can live an entire productive life without ever seeing another human in real life. The problem is that our instincts have not caught up to our intelligence, and we are trapped in the past by a cage of modern comforts. Our technology convinces us that we’re smarter than we are, and tribalism is ideology now.
Part of why tribalism is so effective is that it’s an alluring substitute for putting in the work it takes to form a coherent opinion. You don’t need to think about how you really feel about abortion, because you’re pro-gun ownership. You don’t have to consider your true feelings about drone strikes, because at least George W. Bush isn’t directing them. It’s easier to toss a blanket ideology on to a set of tribal signals than to take the time to know what you don’t know, and our reptile brain rewards power and group dominance—which renders self-reflection useless when the herd is designed to present a unified front.
Let’s face it, a lot of why America is like this is because the majority of us don’t put in the work it takes to be a citizen. We can’t name our elected officials. We don’t know any justices on the Supreme Court, and we know virtually nothing about the constitution that we claim to revere. Thanks to this lack of knowledge about how America works, we convince ourselves that it is all unfixable. Then apathy sets in, and the wealthy assume control of our democratic institutions even more than they already have. We lament that the American government is forever in the pocket of big business—that we’re up against the greatest resources in the world—and we decide nothing can be done.
Some of this is certainly true. Whatever era you look at in history, oligarchs have always ruled. Despite all our ideological squabbles, the long view of mankind proves that powerful humans will figure out how to hack any political or economic system that you put in front of them. That’s a sobering thought, but we still have more power than we believe we do. Here are some inescapable figures that I want to point out.
2008 voting rate (our best turnout since 1968): 58.2%
2016 top tax rate: 39.6%
1960 voting rate: 62.8%
1964 voting rate: 61.4%
1968 voting rate: 60.7%
1964 top tax rate: 77%
If 100 percent of us showed up to vote for every election, the rich would have a much looser grip on our economy. Some of this is on us. Our apathy creates a vacuum that the rich and powerful are more than happy to step in and exploit.
American Capitalism Is, First and Foremost, A Lie
The “capitalism” that we “enjoy” today is not the same kind of “capitalism” from the post-WWII era. Therefore, simply declaring myself to be a “capitalist” isn't very descriptive. I have little use for ideological markers, and if I had it my way, we'd ban political parties altogether in this country (something that George Washington warned us about), and I would make candidates list three bills on the ballot that they plan to enact while in office.
So often, ideology describes what we want to be (like our army of uninformed people who simply say that they're fiscally conservative and socially liberal because that's the exact middle of what this country rewards as acceptable political thought), while the policies that you support tell the story of who you really are. For example, twenty percent of moderate Republicans want single-payer health care, and I want to take a moment to speak to any of them who happen to be reading right now. The rest of you can scroll to the next paragraph.
Folks, I've got bad news: you're not Republicans anymore. Like it or not, single-payer health care is an inherently socialist policy (technically you can employ it without going full-socialist, but that's a debate for another day), and you're absolutely right to support it. It's the best model we have to manage the most complex policy in government, and government should be involved in guaranteeing its citizens' health care. Good for you, but also, come on: look at the madness around you.
Humans haven't really figured out healthcare yet, aside from discovering that the theoretical model of an insurance company can be a good way to manage risk. Insurance is not really a complex idea at its most fundamental level, and these companies are basically just giant pools of money moving around. That's essentially what government is too—except it's a supersized pool of money. As Costco has demonstrated to a staggering degree, buying in bulk can save you a ton of cash, so having one big pile of all our money paying for all of our health care seems like the most fair and sensible option. Something must change, as there is no moral argument on behalf of the current model—it forces poor, sick people to choose between bankruptcy and/or death.
This is an issue where I have moved left in recent years. I used to think that the problem was that the healthcare market was not free, and I believe(d?) that if the government busted these monopolistic and oligopolistic markets, that competition would bring prices down. Compared to the current cartoonishly evil model, that still is true—but that's an astoundingly low bar to clear, and a rich country owes its citizens more. Single-payer is superior to the free market, because we shouldn't squeeze profits out of sick people. Even though I theoretically believe in capitalism, I don't believe that it should exist everywhere. There are some essential parts of life that the government should guarantee its citizens, because why else does government exist? And don't tell me that there isn't room in the budget for it.
There's also something to be said of a country where over 3.5 million people go homeless (including 1.35 million children), but well over 14 million homes remain empty year-round. It's grotesque, and the fact that 3 out of 4 empty homes are owned by investors is proof that we value money more than human lives in this country. A lot of my inclinations to right the wrongs perpetrated by American capitalism feel socialist in nature, but there's also a part of me who thinks that a lot of what we call “socialism” is just liberal democracy (which encompasses the Republican Party too—well, not this batch of loony tunes, but at least in theory)—and a significant chunk of millennials who call themselves socialist are not actually socialists, and this staggering figure is just proof of how far right our national discussion has moved. America has always been hyper-friendly to big business, but over the last four decades, we have bent over backwards to acquiesce to our economic overlords in a manner not seen since the Gilded Age of the late 19th and early 20th centuries.
Much of the disagreement between socialism and liberal democracy is just over how much to take from the rich to redistribute to the rest of the populace. When we speak in holy undertones about the advancements from the French and American revolutions, the guiding principles are based on Robin Hood—not the Robber Barons. I think that a large part of our current problem stems from the 1990s, when we fundamentally redefined capitalism.
Yay We Win! No Rules No More!
I was born in 1986, and I remember the 1990s as one big victory lap. Every baby boomer described the 1960s as their great victory which ended ancient history, and the next few decades were simply a buildup to the infallible Era of Clinton. Wealth creation became the big new thing in the 1980s, and my father was a stockbroker throughout this entire period. One of my best friends and several other acquaintances also work in investment management, and I can promise you that the cartoonish portrayals of this industry are just that. The vast majority of financial services is simply people trying to do right by their clients.
However, the recap of 2008 proves those cartoons to be true once you take them up the private elevator to the C suites at all the largest firms on Earth. Rolling Stone's Matt Taibbi put it aptly, that “the illuminati were amateurs” compared to our current financial puppet masters (this $500+ TRILLION DOLLAR GLOBAL FINANCIAL FRAUD was a big story for like, a week). The subsequent reporting on the collapse of 2008 revealed that our financial sector is structured in such a way that a handful of executives can easily manipulate their employees into unknowingly pursuing investments which will hurt their clients, while benefiting those at the very top of the economic food chain.
The Era of Clinton was defined by handing America's economic keys over to these vampire squids—a nickname Taibbi bestowed unto Goldman Sachs—and the Era of Obama is partially defined by its failure to punish ANY of the criminals of the crisis fomented in the Era of Clinton. This is the story of modern liberalism, and the fight that you are witnessing on the left is the beginning of the changing of the guard.
Prior to the 1980s, investment banking was viewed as the province of nerds. After Ronald Reagan and Gordon Gecko helped popularize Wall Street, Clinton decided to go all-in on the markets. The economy was booming unlike any other point in modern history, but this is precisely where America took a wrong turn. In the 1980s, short-term profit seeking supplanted long-term investing as the law of the land. In the 1960s, people held on to stocks for an average of eight years. Now the average time is anywhere between four and eight months. Wall Street is mostly run by robots now, as roughly half of all equity movement is high-frequency trading, and only 10% of all trades are simply good old-fashioned stock picking.
Because Americans are modern Israelites—lost in the desert, and bowing to the golden calf at Mount Sinai—greed became good, and when this mindset met the market, everything changed. Amazon losing money on research and development for years may be good for long-term profits (and in a time before robots were able to take our jobs, it was also good for their workforce's job security), but it's bad for short-term investors, and these types soon supplanted the Warren Buffett's of the world as D.C.'s preferred investment class. Wall Street rode the Internet Revolution into record profits, and Bill Clinton embodied the rest of the baby boomers' “we've got this all figured out” mantra, busting down the firewall between FDIC insured banks and investment banks—which meant that banks could now gamble with your savings. And they did.
The financial crisis of 2008 was so vast that it's impossible to point to any one person who caused it, but Bill Clinton going all in on pure free market capitalism and eliminating two of the four planks of Glass-Steagall (the first law that we enacted after the Great Depression to fix the same errors we would come to repeat) would rank pretty close to number one in my book. Ronald Reagan and George H.W. Bush took the chains off Wall Street, Clinton opened the floodgates, then George W. Bush handed out free money to anyone lending to people with a pulse and a desire to buy a house, and Wall Street spent the early 21st century getting high off the housing bubble. When the bubble popped, and stole about half of middle class wealth with it (including my father's), Wall Street got bailed out, and we didn't. This is the legacy of Bill Clinton, and until Clinton partisans understand that liberals—even capitalist(?) liberals like me—don't believe that the Clintons are very liberal, these fights on the left will continue into infinity.
Am I a Socialist?
So does opposing Clintonian capitalism (read: neoliberalism, read: diet conservatism) and supporting single-payer health care make me a socialist? I have other views that I would definitely call socialist. I don't believe that billionaires should exist in a world where people go hungry. We absolutely should seize these empty houses from the investors and solve our homelessness crisis overnight (roughly 40,000 veterans are homeless, almost 10 times the number of soldiers who died in Iraq). My grandfather made millions in his life, and it was enough to help send both me and my sister to private school and college. We should incentivize people to want to make more money than they'll ever need, but that doesn't mean that we should actually let them have it.
Believing wholeheartedly in the almighty power of supply and demand also doesn't disqualify me from being a socialist. Bernie Sanders' Democratic Socialism explicitly allows for a free market—just far more regulated than Hillary Clinton's free market. If you look at a lot of our problems in this country, they stem from regulation. America is somehow simultaneously under- and over-regulated. Small businesses spend about $83,000 per year dealing with regulations, while big business is given every break imaginable.
Our tax code and its disciples are literal proof that another justice system exists for those with armies of lawyers and accountants. That shouldn't happen in any political or economic system, and ironically, in America's hyper-capitalist new age of robber barons, our oligarchs have privatized their gains and socialized their losses in an oligopolistic model that looks theoretically socialist—for them. America is so royally screwed up that defending the “free market” against socialism can lead you to defend socialist principles.
Seven years ago, I tried to start my own business and was unsuccessful. Looking back, I can highlight clear mistakes made by me which helped lead to our demise. My Darwinian nature helped me get through the anguish of my failure—as I accepted that I earned it—and I believe that this reveals my affinity for capitalism. I'm completely fine with Apple making gajillions of dollars by being the first company to produce smart phones. They should be rewarded for providing a product that those of us on the demand side of the equation didn't even know that we needed, yet could not live without. However, they shouldn't be rewarded for building it with slave labor, and then taking those profits and filing a bunch of patents to keep products out of the market that they'll never build. That's not capitalism.
It's growthism. As to the sickness plaguing America, economist Umair Haque put it best in Harvard Business Review:
It seems to be a toxic admixture of capitalism for the poor, who are ruthlessly whittled down, in brutal Darwinian contests; and socialism for the rich, for whom there appears to be no limit to bailouts, subsidies, and privileges. It's a lethal cocktail of cronyism for the powerful; and endless struggle for the powerless. It's neither fish nor fowl; but a chimera.
When I compared us to the Israelites worshipping a false god earlier, that wasn't a literary device—I mean that literally. The Dollar truly is Almighty, and all we care about is growing the pie—paying little mind to where that growth goes (we talk about the 1% a lot, but it's the .01% where the figures are truly grotesque, the eight richest people in the world have as much wealth as the bottom half).
Capitalism is all about relying on the power of supply and demand to efficiently sort resources (meaning: people wanting stuff and others being smart enough to build the stuff that others want—also known as creating tangible economic value), but American capitalism does not focus on that crucial aspect of capitalism. It is empirically true that resources are not sorted efficiently here, and we don't really care. All of our biggest companies already are sitting on mountains of cash that they don't know what to do with, and they're using the Republican Party to obtain even more massive tax cuts in this new tax bill.
I believe that we should heavily tax the rich and corporations making tons of money, but with the understanding that capital can very easily vacate our borders, so we have to be creative about it—if we simply just raise taxes while providing no tangible benefit to the super rich to keep their money here, they'll just move it somewhere else in the world, and now we get 0% of it. They've got us by the balls, folks. We can't get everything we want here.
The problem with our economy is that it creates very little actual economic value for anyone outside the investor class. Working “for yourself” driving for Uber sounds nice in theory, but not when you don't have health insurance. The 10 most common jobs in America are:
1. Retail Salesperson (mean hourly wage of $12.20)
2. Cashier ($9.82)
3. Serving Worker ($9.08)
4. Office Clerk ($14.42)
5. Registered Nurse ($33.13)
6. Waiter and Waitress ($10.04)
7. Customer Service Representative ($16.04)
8. Laborer ($12.83)
9. Secretaries and Administrative Assistants ($16.35)
10. Janitors and Cleaners ($12.09)
The fact is that most people work in fields which are intrinsic to our lives, but they're not high-paying jobs, and many don't provide health care. Much of the value generation has been shipped overseas or automated, and we are in a long-term cycle where more good jobs are being destroyed than created. This trend is accelerating, and pure free market capitalism has absolutely no plan for a future where robots eliminate millions from the workforce.
I accept the fact that government must step in to make guarantees that the free market can't, but as bad as everything is, this is still the best time ever to be alive, and part of that is thanks to capitalism. Supply and demand really is a powerful force, and when given room to run while protecting the market from monopolistic tendencies, it can and has created decentralized economies where people can carve out a life for themselves on their own. However, a harsh truth of our time is that it's a really really really really really really stupid time to be alive, and that is also due to giving in to the laws of supply and demand—especially in democratically and economically vital industries like journalism.
Sorry folks—I know that a lot of Paste politics readers are here thanks to our socialist tendencies, but I just can't get to the finish line here. Ultimately, my new obsession with blockchain technology and cryptocurrency proves my free market principles, and as much as I want government there every step of the way overlooking the free market, I still theoretically believe that the market can lead the charge into the future. I cannot defend capitalism as a widely beneficial system in the American context, because there is almost no evidence to suggest that we are the first generation of humans to buck the trend of making the same mistakes as those before us. The issue for those of us who defend capitalism-in-theory is that humans make capitalism unreliable in practice.
Ultimately, I will defend capitalism-in-theory because I believe that it is inextricably linked to Darwinism. Capitalism has lifted an entire global generation out of poverty—albeit at the expense of Western middle classes (providing further proof to my assertion that the central problem is that government has not done enough to fill in the gaps that the market misses). If government efficiently regulates the free market (which has never happened in human history), I really believe that capitalism can work.
Now, I admit that my premise could very easily be flawed, and that my expectations for what humans can be is unrealistic, and it is simply not possible for a government to effectively regulate a free market. I also acknowledge that I have downplayed the predatory nature of capitalism throughout my theoretical defense here. I asked my Facebook friends for their thoughts on the capitalism vs. socialism debate, and one thoughtful response rebutted my Darwinian assertion before I ever advanced it.
The basic concept of capitalism is based on playing off the human concept of greed. Greed is based in the desire for survival. In cases where you have no hope whatsoever of fulfilling that basic survival need in a meaningful way, capitalism will hold no interest to you. The larger the divide between the haves and the have nots and the larger a group the latter is, the less attractive capitalism looks, as it doesn’t benefit the have nots.
One thing is for certain: this iteration of capitalism—the only one that actually matters—has utterly failed to generate shared prosperity. This isn’t up for debate. We repeated the exact same mistakes of the Great Depression, had a Great Recession, and did not fix those same underlying problems. We are definitely headed towards another massive crash, and this is the nature of capitalism: you can’t have a boom without a bust to leap from, and you can’t have a bust without a boom to fall from, and etc. That bust isn’t just spoken about in economic terms, but in human ones—like this former rich kid learned in 2008. So, even though I cannot get on board with socialism in a theoretical battle against capitalism, if my choices are either socialism or American capitalism (growthism), give me socialism every time.
Jacob Weindling is a staff writer for Paste politics. Follow him on Twitter at @Jakeweindling.