Previously, many economists and scholars claimed capitalism as the end of history and capitalism as a historical achievement we cannot imagine transcending. In today’s world, statistically, the top 225 individuals now possess wealth equal to the combined incomes of the bottom 47 percent of the world’s population. In the United States, the capital of capitalism, the upper 1 percent of the population owns more wealth than the bottom 95 percent. This incredible inequality is the result of capitalism. About this inequality, the most respectable academics and policymakers once believed that capitalism would even out these inequalities over time, but no one believes that anymore.Capitalism is fundamentally the right that people be rewarded for their contribution to the common good, which is awesome, but in practice, entrepreneurship, economic risk, stock market and other “investment games” are unfair since the people who already own capital (already rich) have a way better advantage than the poorer people. Capitalism is technically good, but not ethically, for capitalistic profit is unfair: goods are made from human labor and non-human nature only but in capitalism, goods are made from human labor, non-human nature and capital thus the capitalistic profit but capitalists make no contribution to production yet get the biggest section of the profit.
A very interesting example used to illustrate the inequality in incomes due to capitalism is the march of the dwarves and a few giants. Basically, the height of people is represented by their income (example set in the USA). In the example, I am six feet tall because I make $55,000 per year, the average income. The parade is one hour long. For the first 5 minutes, the marchers are 1 foot tall ($9,200). 3o minutes into the parade the marchers reach 4.5 feet ($40,000). It will not be till the 38th minute for the marchers to get to my height and 54 minutes for their height to double ($110,000). The fun stuff begin the last minute. 36 seconds to go, the marcher’s height is 33 feet ($300,000) and then 30 seconds to go the salary of the president appears, as he walks 44 feet tall. In the last few seconds, people walk at the heights of a ten-story building, one mile, two miles and 16x higher than Mt. Everest (Bill Gates). The people 2 miles tall make $5o,ooo per hour.Capitalism has six fundamental defects: massive inequality, demoralizing unemployment, unnecessary overwork, excruciating poverty (nationally and globally), lack of a real democracy and systematic and sustained environmental degradation. The justifications have moved from non-comparative to comparative, thus the main justification for capitalism is that There Is No Alternative (TINA). But is there?
There is of course communism but I do not believe it is superior to capitalist; it is just as flawed as capitalism. However, few nations have created hybrid economic policies that seem to be as technically successful as capitalism and with less inequality and more ethical. However, I do not have enough information about those policies to decide to follow them yet. However, to accept and follow a new economic policy, it should be both economically viable and ethically superior to capitalism and concrete enough for us to foresee how it would likely function in practice, when animated by the finite, imperfect human beings that we are.
On a sad note I must point out that pro-capitalists in order to keep the concept of capitalism’s superiority in the peoples’ minds, are changing what one believes is ethical. In the United States, movements such as Objectivism and Libertarianism where selfishness is the moral ideal are becoming more and more popular within the student and younger generation. So what I believe is ethical might not be considered ethical by others.
Statistics from: David Schweickart, After Capitalism (Lanham, MD.: Rowman & Littlefield Publishers, INC., 2002)
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