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The cure for toxic capitalism
Our toxic capitalism allows billionaires like Elon Musk to make 45 billion in one year.
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Nawaz Merchant - Tue, 27, Aug 2024
- 16:00 EDT
- 515
Representative Image / Pexels
Our political views are based on our ideas of morality. Do we care only about our pocketbooks? Or do we care that our neighbors are struggling?
In a recent conversation, I criticized our capitalist system for the outrageous influence of billionaires like Elon Musk. My friend protested, “So you would prefer communism? A dictator?” Mind you, my friend is a traditional republican who believes in conservative values. (We have not yet been able to have an honest discussion about Donald Trump’s aspirations to become a dictator as he’s openly claimed.)
Capitalism versus communism: Is that really the choice, though? If one is disenchanted with capitalism, does that make one a socialist? Instead, drawing on my Econ 201 class on macroeconomics and public goods, I said, “Remember the subprime mortgage bubble? Some markets need regulation. When competition is subverted, the free market needs more government oversight.”
But is that enough? Governmental policies like Trump’s development zones gave millions in tax breaks to billionaires, including Jared Kushner’s group. It puzzles me that this blatant conflict of interest has not drawn more attention. Isn’t nepotism the very definition of corruption? Why isn’t Trump facing charges of corruption for enacting laws that line his own family’s pockets?
No, the problem is bigger. To understand how, we need to understand Neoliberalism, “a political approach that favors free-market capitalism, deregulation, and reduction in government spending.” Like Reagan’s trickle-down economics, it’s become apparent that this path has failed. Over the last forty years, it has led to massive inequalities of income.
Senator Chris Murphy’s program of “pro-family, pro-community economic nationalism” is less focused on social welfare than an attempt to give regular people agency in the face of the supersized corporations he believes wield far too much influence today.’
Case in point is the subversion of the rental housing market though the use of a rental pricing app. The Justice Department just sued real estate software company RealPage Inc. for collusion, which is illegal based on antitrust laws. This illegal scheme, which cornered over 60 percent of the housing markets in some cities allows landlords to coordinate and hike rents. Competition between capitalist landlords in an unregulated market was supposed to keep rents down. Alas, it failed. Rent.com notes that the U.S. median monthly rent rose 26 percent in just 3 years.
“As of July 2024, rent prices were 33.4 percent higher than before the pandemic (2019).” When a market fails, it allows gross extortion of stakeholders. Regulation is needed to even the balance. However, die-hard republicans like my friend above see this as a move toward socialism, and therefore threatening.
When I point out the economic inequality that drives millions toward “strong man” solutions like Trump, my friend scoffs. “That’s why thousands are trying to get into the US, right? If it’s so bad here, why are people so desperate to migrate?”
Alas, the desperation of south American illegal immigrants does not validate our own system. These are people fleeing desperate poverty, violence, torture or slaughter. That their own societies are frightful does not make ours perfect!
Neo-liberalism is dead. Our toxic capitalism allows billionaires like Elon Musk to make 45 billion in one year. We need a return to a more rational taxation system that removes outrageous power from billionaires and demands that they pay their fair share. We need to enact broad societal investment so that all people, regardless of color or creed can fulfil their potential. Now, That's a great America, a fair United States of America of which we can justly be proud.
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