Capitalism has been good to me; Biden will make sure to keep it that way

Guest Writer

When I was ten years old, I studied stock market price fluctuations to devise a “system” for day trading. As the editor of my college newspaper,  I revived an anemic student publication with an aggressive advertising/profit-making plan.

I then chartered flights to Europe for my fellow college students charging less than half the price of the major airlines. During graduate school in the early 1970’s, when real estate prices were in free fall, I bought my first residential building on the Upper West Side in New York with $15,000 and a large mortgage. I eventually sold that brownstone for $4.5 million. I went on to buy ten other historic buildings, renovated them, rented out apartments, and sold condos. I massively invested in stocks during the 2009 downturn and tripled my money. I founded an internet travel agency, with sales of $30 million annually. I am now developing an internet startup. Capitalism has been good to me.

But it is precisely because I believe in capitalism, (and want it preserved and thriving), that I can easily support the pragmatic reforms of Joe Biden.

Inevitably, Donald Trump and the Republicans automatically label the policies of any Democratic candidate as “Socialist.” They hope this is especially effective in Florida, where so many Cubans suffered under Castro’s socialist revolution.

The word has been toxic in American politics since the turn of the last century.

Ironically, real Socialists strongly denounce the progressive policies of Biden/Harris as a faux attempt to buy off the coming revolution, just as during the crisis of the 1930’s, when Socialists and Communists actively opposed Franklin D. Roosevelt’s New Deal social welfare programs — social security and a massive jobs program — that ultimately preserved our free markets of today.

Today, our capitalist system is under its greatest stress since the 1930’s. There have been seismic economic changes — exponential technological advancements, and globalization have produced unfathomable riches for a miniscule elite. But this new wealth has not “trickled down” and has resulted in gross inequality for the many: a dangerous time bomb that has broken the social pact of universal progress, upward mobility and growing prosperity for all, which endured from the period from 1933 to1979.

This latest reengineering of America is not working for the majority.

The ecosystem is out of balance. Upward mobility for the lower and middle class has stalled in the last 30 years.  Median wages have been stagnant during those same years. Middle class wages will no longer support home buying, or a college education or decent healthcare. Life expectancy in the US is declining, and our healthcare system ranks 37th in the world.

This great inequality is not anyone’s fault. Inequality has increased under democratic Presidents, Clinton and Obama, and under republican presidents, Bush and Trump.

Businessmen and politicians are just doing what they have always done. It’s just that rules and the game changed rapidly — an elite got very rich, very quickly, and the middle class found itself in a sharp decline: increasingly ignored, irrelevant, and forgotten.

No political or economic system can survive for very long that does not improve the wealth and health of its ordinary citizens. Disgruntled Americans voted left for change in 2008 (Obama) and then did a 180-degree turn, and moved right for change in 2016 (Trump). Both times, middle class Americans were bitterly disappointed with the little that they got: more politics of platitudes, while inequality mushroomed.

These are the themes which Donald Trump seized upon in the 2016 election. He saw rage and resentment rampant in the white working class of middle America. He positioned himself as the outsider who would not go by the rules, who would drain the swamp of lobbyists and special interest groups.

Recent mass protests and strikes testify to the unhappiness of a disgruntled middle class. More young Americans prefer socialism to capitalism, according to a recent Gallup poll.

To Europeans, American understanding of socialism is absurd.

Denmark, Sweden, Norway, the United Kingdom, Germany, France are profoundly capitalist  democracies and the progressive policies they adopted, were not enacted to replace the capitalist market system, but to prevent the middle classes from turning against capitalism altogether.

So true capitalists and Wall Street should embrace the mild reforms of Biden, as a quick and simple way of buying off an explosive venting, and solidifying long-term support from the majority for free markets.

This is what Otto Von Bismarck did in 1883. With the German economy in free fall, Bismarck adopted a masterful plan for universal health care, and a form of social security to counter the threatening demands of a growing Socialist party.  His tactic was simple — beat the Marxists at their own game. After his reforms, the German economy prospered for decades.

Socialism has been a dirty word in America since the 1920s. But the “socialism” or progressivism of Biden is a pragmatic belief that the government should provide a slightly broader range of basic, public services — health care and education — for free or at a significant discount.

These are not such radical ideas.The government already provides many services to the public in the form of roads, firemen, policemen, the courts, and the legal system. Equal access to education and health care are the ultimate great levelers in all societies.

Moderate tempering of the excesses of unfettered capitalism is not new. It has happened in regular cycles in American history and has created — for the majority — the American dream, a widely shared prosperity.

At the turn of the last century (1870–1890) during a similar period of transformation — from agricultural to industrial — the excesses  of the Gilded Age, and the growing economic inequality, gave rise to populist anarchist, and socialist  insurgencies.

Republican President Teddy Roosevelt realized that tinkering continually with capitalism is the best way to preserve it.  Roosevelt came up with the “Square Deal” to break up the monopolistic trusts and create decent living conditions for millions of new factory workers. He also proposed a ban on corporate political contributions, an income tax and an inheritance tax.

Likewise, during the Great Depression of the 1930s — a period of maximum crisis and economic misery —  Franklin D Roosevelt funded millions of government jobs, and numerous social programs, by raising the income tax to 75 percent on the highest incomes. Roosevelt, called a traitor to his capitalist class, defended his actions as a pragmatic response to the widespread wretchedness and hardship of the times. “Reform to Preserve” is the slogan he borrowed from the English.

If we continue as we have been, the relentless self-reinforcing arc of unfettered capitalism, globalization, transformative technologies will inevitably produce excess wealth and prolong downward mobility for the majority.

Democracy and free market capitalism cannot survive such inequality. Capitalists should support a more equal society, not because they want to, or its the right thing to do, but because, in its own self interest, it’s the best way to preserve and promote democracy and free markets.

Every dominant civilization believes in the hubris  — that it is the last and best stage of human development — and that it will endure forever. This is a fantasy. Advanced societies collapse with bewildering speed: the Mongols,  the Greeks, the Romans, the Chinese, the Mayans, the Incas, the Spanish, the English and the Soviet Communists.

Our democratic, free market system, lasting a mere 300 years, is a blip in human history, an anomaly. It will not survive if it does not deliver the goods to the majority of people. Most people don’t really care all that much about the niceties of political ideology — they care about what’s in it for them. They want their fair share.

The “Occupy Wall Street” protestors of a few years ago and the middle class blue collar workers, who delivered Trump the presidency, are strikingly similar. Both groups feel they are getting shafted.

Strongman populism all too often replaces democracies and free markets in times of disequilibrium. Authoritarian rulers justify their contempt for liberal niceties by claiming they represent the people against corrupt and out-of-touch economic and political elites, when fairness about who gets what, breaks down.

So free market capitalists — myself included! — who want the system to survive, should endorse a touch of democratic socialism and greater equality — the inclusive bargain — as a cheap price to keep this great system going and in balance.

Trump, the rebel outsider who was essentially promising to bring back equality, completely failed, didn’t live up to his promises and fell under the influence of the Washington swamp dwellers.

It now appears that Trump, after his horrific handling of the pandemic,  is “a dead man walking,” with a small chance of pulling a rabbit out of this hat. But the eventual cost of such a victory may be the death knell for free market capitalism and democracy as we know it.

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