Capitalism and Democracy are Mutually Exclusive
By: William Hawes
Tags: Economics, Finance, Capitalism, Democracy, Politics

This short Q+A was originally published at Balkans Post: http://balkanspost.com/article/876/capitalism-and-democracy-are-mutually-exclusive

BP: How would you describe the effects of a highly capitalist economic system, namely that of the United States, on the livelihood of ordinary people living in that country?

William Hawes: Well, the median individual income in the U.S. is about thirty-one thousand dollars a year. That number is high compared to most people around the world, relatively speaking. The problem in the U.S. is the high cost of living for everything — rent, food, health care, etc., which eats away at any chance for savings, investing, and retirement. Rent or mortgage payments can eat up a third or even half of wages or salary depending upon where you live, because real estate is so expensive.

Ordinary workers and citizens feel demoralized, taken for granted, and powerless. People have checked out from public life and it’s understandable why: there is little community or social safety net here. There are failing schools and crumbling infrastructure in nearly every large city and rural poverty remains endemic. People feel and sense that things are going from bad to worse, but for the most part try to ignore or escape from even talking about key issues, and when they do it’s distorted, mediated, and filtered through media narratives or the spectacle of U.S. elections. It’s painful and depressing to witness. The combination of all these effects have created one of the most lonely, homogenous, conformist, authoritarian, and boring societies in all of history, in my opinion.

In terms of distribution of wealth and resources, capitalism creates a system of artificial scarcity where goods and services are withheld from the population unless one can pay for them. Therefore citizens become dependent on a system where they must work or go homeless and starve.

BP: What’s your take on inequality, injustice and corporate power in capitalist countries? How do these problems affect a society?

William Hawes: These features are all part of capitalist economies. Their antecedents are visible in previous systems like feudalism and ancient empires: there have been strict divisions of labor, caste systems and hierarchies, and monopolistic power for thousands of years. What used to be the commons, like public land for growing food or grazing livestock, or communal forests for hunting and gathering, has been stolen and then privatized by the ruling classes, who then use private property law to enforce the theft of land and resources. The difference in contemporary times is that globalization has spread the myth across the world that free markets can always deliver basic goods and services better than every other model.

The effects cannot be overstated, really. When you have master-servant relationships over generations splitting the population into a ruling class and working class, what ends up happening is the ruling class becomes numb and indifferent to the fate of those below them. A sense of superiority appears and then appeals to race, nation, caste, or tribe/clan are used to enforce inequality, cloaked in patriotic propaganda. On the other hand, the working classes become too poor, disorganized, sick, or disabled, or disillusioned enduring the drudgery of their lives to organize and fight back regularly; although as we know through history non-violent direct action as well as violent revolt and revolution by the oppressed are most often the key drivers towards making society more equitable.

Another difference with capitalism compared to older systems is that it has managed to create large middle classes, who have managed to create greater systems of production, a reduction in the most severe poverty in some cases, and a semblance of political democracy. However, there is no economic democracy in our society, simply capitalist business owners who make all the decisions in the workplace, and their puppet politicians whose interests are diametrically opposed to those of working people.

Unfortunately, the middle classes in the U.S., who fundamentally are workers and do not own the means of production, identify to varying degrees with the ruling classes due to authoritarian, hierarchical divisions of labor and class — as well as materialist and consumerist trends in our society. This happens over generations: economic and political elites use gaslighting and jingoistic propaganda to indoctrinate their citizens and claim that other nations and minorities are the enemy. Over time, 6,000 years of civilization really but intensified in late capitalism, this creates a sort of collective Stockholm syndrome effect; with most people not having any more say than medieval serfs and peasants, yet who still view their ruling class overlords as heroes and saviors: those wonderful and benevolent “job creators”. The ruling classes shatter hopes and dreams, diminish expectations, get the working classes to do their bidding, all the while harping that capitalistic “liberal democracy” is the best system ever constructed.

BP: What are the links between capitalism and global warming? Is it correct to say that capitalism is the main factor behind such phenomenon?

William Hawes: Capitalism relies on endless growth to continue. To maintain growth and profits, corporations rely on the cheapest forms of energy — for most of the past 200 years, fossil fuels — to run their factories, transport goods, heat and light their warehouses and office buildings, etc.

Capitalism claims all the gains of corporate enterprises — profits — for those who own businesses, while dumping the risks and costs onto the public and the environment. Ever since the Industrial Revolution got underway, capitalist firms sold energy in the form of coal, gas, and oil, and reaped all the profit. Meanwhile, the impact of strip mining, oil spills, fracking, polluted air and waterways, and increase in carbon dioxide, are left for the public to deal with. Sometimes the corporations pay piddling fines or implement meager plans to restore damaged habitat, but it never can repay the true costs, because there is no way to account for the health of an ecosystem in monetary value. The pseudoscience we call economics confirms this: they claim it just and wise that a private corporation can take all the gains, while the costs of doing business — pollution, atmospheric warming, etc. — are “externalities” that cannot be accounted for in their models.

Other mechanisms fossil fuel corporations use are to bribe, lobby, infiltrate, and coerce the state to subsidize their businesses, offer tax breaks, loosen regulations, block legislation and judicial oversight, and break up or if necessary murder opposing activist groups.

Absolutely, capitalism is to blame and it is the key factor. That is why capitalist elites distance themselves at every chance — they live in gated communities amongst their own kind, employ private security, mercenary armies — in general they live in separate spheres of existence compared to us commoners. Why? Because they know they are responsible for creating and/or inflaming all these interconnected crises.

BP: Is capitalism in contrast with democracy?

William Hawes: Yes, capitalism and democracy are mutually exclusive. Ask yourself, in large corporations, do workers get to vote or have a say in who, what, when, where, how, and why products are made the way they are? Or are the decisions handed down by the ownership and a small cast of executives and managers? Capitalism fundamentally alienates and exploits workers and treats them as interchangeable disposable objects.

In the U.S. we have an oligarchy. In other societies with high inequality the same problems appear, oligarchs fight and win concessions from governments and deregulation, privatizations, and harsh austerity measures are implemented on the poor, with tax breaks and loopholes for the rich. So all over the globe economies are teetering on the brink, and authoritarian, demagogic faux-populism in on the rise: the best examples being Trump, Orban, Duterte, Bolsonaro, Erdogan, and Modi.

Capitalist societies privilege the rights of private property above all else. The limited political rights and relatively decent wages Westerners enjoy are akin to the carrot; but when workers start agitating for economic rights and racial and gender equality, those in power are quick to bring out the stick. Capitalism is inherently authoritarian.

To give a quick foreign policy example, every excuse capitalist powers use to harm others is a projection of their own malevolence. For instance, in Iraq in 2003 Saddam was accused of having WMDs. Well, the U.S. used WMDs in Iraq — bombs, missiles, white phosphorus, and depleted uranium. In Afghanistan the Taliban was accused of harboring terrorists. The U.S. is the world’s greatest threat to peace and harbors, employs, arms, and uses terrorists and black operations in the majority of the world’s nations. There are somewhere between 800–1000 (the true number is classified) U.S. bases outside its territory in over 130 nations.

One of the most frustrating things about living in the U.S. is how the two-party system has duped nearly everyone — class is never addressed as the fundamental issue. Liberals blame conservatives for everything gone wrong, and conservatives blame liberals and cast them as “radical socialists”. It has been extremely difficult to expand the bounds of discourse to show that the real problem is capitalism. Both sides agree that we “live in a democracy” but that’s just not the case. Americans have this strange idea that only a totalitarian dictatorship can be undemocratic, the fact that we’re allowed to choose our jobs and go shopping makes this a “free country.”

The fact is we do live in a dictatorship: a dictatorship of money. Americans still view the concepts of authoritarianism and dictatorship through the lens of Cold War propaganda: any nation that has a centrally-planned economy and a Politburo is “undemocratic”, but the U.S. with “free markets” and “fair elections” is a liberal democratic country. The fact is we have a rotating cast of plutocrats, military and intelligence leaders, and politicians who all serve the Almighty Dollar. That rotating cast provides the illusion of democracy — because no one group remains in charge, no one assumes responsibility for the system — and the simulacrum of a “free society” endures. So, because no one group is permanently at the helm, there is little recognition of the scale of the problem and the source: capitalism. The president cannot fundamentally control or be held responsible for the economy (they can tinker with taxes, tariffs, interest rates, but only to limited degrees), corporate elites cannot outright control the three branches of government (they do so covertly through donating, lobbying, and bribery), and the military cannot dominate either (unlike with coups and juntas in other parts of the world), so the public becomes indoctrinated that there actually are checks and balances and diverse interest groups which govern America. Eventually, the public becomes fatigued at finding the true source of the problem (industrial-based capitalism) and resorts to two-party bickering, as well as nationalistic and racist propaganda to assuage its anxieties.

All this being said, there are reasons to be positive — working class Westerners are awakening and mobilizing and the taboo against taking socialism seriously has been broken in the U.S. and Europe. Anti-capitalist critiques are becoming more widely accepted, and the political rights we still enjoy in the West along with a relatively uncensored digital media provide the possibilities for Leftist mass movements and organization to gain serious momentum very soon.

BP: How has U.S. imperial meddling impacted the targeted countries and the whole world?

William Hawes: Well, this is one of those questions where I hope a new generation of activists and scholars can help answer because there are so many areas here ripe for investigation. To start, readers may want to check out some of the most popular and accessible North American authors on this subject: Noam Chomsky, Michael Parenti, William Blum, Michel Chossudovsky, Naomi Klein, and John Perkins.

The U.S. has always been an empire from its foundation. Post-WWII the U.S. of course became the world’s hegemonic power and used its military, economic, and political powers to expand its influence to every corner of the world. As the global power with unparalleled reach and nearly inexhaustible resources, the U.S. used its many forms of leverage to coerce, bribe, and steal as well as to manage and interfere in the affairs of other nations.

Like ancient empires, today the U.S. extracts tribute from its vassals in various forms: fossil fuels, debt payments, mineral resources, using foreign banks to purchase our debt and prop up our currency, etc. The impacts have just been tragic and devastating: consider all the dead and wounded from our imperial wars, all those driven from their homes, all of the slave labor and inhumane working conditions that span the globe to serve Western multinational corporations. Western capitalists and our military empire are also responsible for untold environmental devastation which inevitably has caused many world health crises involving rising rates of cancer, diabetes, and various chronic illnesses; U.S. imperialism has made the world a poorer, sicker, and more dangerous place.