Sam Ben-Meir
Global Research
11 October 2017
It never
ceases to surprise me how merely the suggestion that our current global
capitalistic system is not the best humanity can do for itself, is so
often met with virulent hostility. One would think that when we are
still recovering from the economic crisis of 2007-2008 (and many
economists see an even worse crisis on the horizon), when inequality has
been steadily rising since the neoliberal turn of the early 1980s, when
real wages have remained virtually stagnant, and the list goes on – one
would think that perhaps we would keep an open mind regarding
alternatives; instead of buying the tired old argument that anything
else must either lead to totalitarianism, or be incurably utopian.
Capitalism has always been about movement, and our era of
deregulated globalization has only further augmented the hyper-mobility
of capital. As a consequence, this has produced a virtually endless
supply of cheap labor – trade liberalization has seen jobs flee the
country and compelled developing countries to deregulate and turn a
blind eye to labor standards so as to maintain a competitive advantage.
Trump’s promises to keep jobs at home have been mostly empty rhetoric.
The growing
concentration of wealth among a tiny few has been helped along by a tax
code that has shifted the burden off the very rich and onto the middle
class. And now the Republicans want to cut taxes on the rich yet
further: the wealthy will pay only thirty-five percent on their income
taxes – down from thirty-nine point five percent. In addition, Trump’s
proposal gives the rich a substantial tax break by eliminating the
estate tax, which will only further exacerbate economic inequality.
How is this defensible? The main argument one hears is that
fallacy that Republican leaders have continued to foist upon the
American public since President Reagan: that high taxes on the top income bracket is bad for growth; that slashing taxes will spur the economy.
This is not
historically accurate – in fact, it is a bald-faced lie. The period in
which America enjoyed unprecedented growth, during the fifties and
sixties and until the late seventies, the tax rate never fell below
seventy percent. America’s growth during that time was four to five
percent. Then in 1981, Reagan’s Economic Recovery Tax Act (ERTA) cut the
marginal tax rate twenty-five percent across-the-board, with the top
marginal tax rate falling from seventy to fifty percent. In 1987, Reagan
lowered the top tax rate from fifty to thirty-eight point five percent,
where it has hovered since. The average rate of growth since the 1970s
has been two percent. Indeed, there is no indication that Trump’s
“trickle-down” tax plan will engender any significant growth.
What we have
seen is that under neoliberalism there has been a redistribution and
concentration of wealth in the hands of the very rich few. Real wages
have remained stagnant while economic disparity has increased since the
mid- to late-1970s when “the uppermost tier’s income share began rising
dramatically.” A 2015 report by the Economic Policy Institute states
that between 1979 and 2013, “the hourly wages of middle-wage workers …
were stagnant… The wages of low wage workers fared even worse, falling 5
percent from 1979 to 2013.” As Warren Buffet acknowledged,
“There’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning.”
Last year, I used the October 13 birthday of Great Britain’s late Prime Minister Margaret Thatcher
as an occasion to observe how her vision of laissez-faire capitalism
still holds ideological sway in our globalized landscape. Her famous
claim that ‘There is no alternative’ to capitalism needs to be abandoned
once and for all. At the very least, we need to begin to consider
alternatives to the kind of capitalism we have.
A good place to start is with extending democratic
practices to new social spaces currently occupied by hierarchical and
bureaucratic organizations, including the urban setting as well as the
workplace. The fact is that there is an alternative to the way firms are
run on the capitalist model. That alternative is worker self-management
and it has seen remarkable success.
Look, for
example, at the Mondragon Corporation centered in the Basque region of
Spain. Mondragon has a thoroughly democratic structure of governance
with a General Assembly that meets annually, as well as a supervisory
council that appoints management, a social council with jurisdiction
concerning matters to do with workers’ well-being, and a watchdog
council that monitors and gathers information for the general assembly. A
federation of supportive cooperative firms, Mondragon has now over a
dozen education centers including a polytechnical university. In 2015,
Mondragon generated revenues in excess of twelve billion euros, and
employed over 74.000 people.
To claim that we have no choice but to accept the global
capitalist status quo is simply no longer plausible. This is not to say
that worker self-directed firms will be idyllic, that they will all
succeed, or that they will not face a myriad of unforeseen challenges.
However, they have shown themselves to be successful, even while
operating in highly competitive environments. If companies are
self-directed and workers themselves participate in the decision making
process regarding, for example, the location of production, it becomes
far more unlikely that we will see plant closures, outsourcing, job
exports, and so on.
Such firms will
embrace democratic processes in which goals can be internally defined:
where there is equality of voting power, and workers themselves make
decisions about production and distribution. Furthermore, in the process
of nurturing participatory attitudes, we not only facilitate and
reinforce self-management within the firm (or neighborhood, school,
etc.): we are also educating and empowering individuals to seek
self-determination and democratic participation in the political arena.
The same
fundamental commitments that urge us to promote political democracy
should compel us to promote economic democracy as well, a society in
which enterprises are collectively governed by all those actively
contributing to the process of production. Indeed, economic democracy is
essential to the legitimacy of a fully democratic society – which is to
say that democratic legitimacy must be grounded in the social realm, as
much as the political.
Sam Ben-Meir is a professor of philosophy and world religions at Mercy College in New York City.
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