Democratic Capitalism: An Oxymoron?

Old Mole Variety Hour: The Well-read Red
August 4, 2008

Democratic Capitalism: an Oxymoron

Good morning, comrades.  The website  of The International Endowment for Democracy has a page of quotations which I am drawing on for this commentary.

For most of human history, we have been ruled by kings and oligarchies.  Quite recently—less than 400 years ago—people began to resist the rule of others in a systematic way.  They demanded to rule themselves.  But democracy came about slowly.  Only the privileged few were in a position to write the new rules and form the new governments. In this country, those were the owners of plantations, slaves and import-export businesses.   While they did not want to be ruled by the King of England, they certainly did not want the people whose lives and labor they exploited and controlled to be meddling with property rights.  That is,  they really didn’t want democracy—the rule of the people.   And this attitude lasted a long time.  As late as 1932, a US Army Training Manual had this definition of “democracy”:

a government of the masses. Authority derived through mass meeting or any other form of direct expression. Results in mobocracy. Attitude toward property is communistic… negating property rights. Attitude toward law is that the will of a majority shall regulate, whether it is based upon deliberation or governed by passion, prejudices or impulse, without restraint or regard to consequences. Result is demagoguism, license, agitation, discontent, anarchy.

The fear that the rights of property were not safe under democracy was, and still  is, a realistic one.  But democracy could not be denied to the people entirely.  So those at the apex of the pyramid of wealth and power enshrined in law and politics narrowed the meaning of democracy: they defined it as the right of the people, not to rule, but to elect their rulers every few years.   This system, as we have all come to find out lately, does not prevent the government from conducting wars we don’t want to fight, giving huge tax breaks to the wealthiest people, ignoring our needs for better schools, national health care, a safe and secure credit system, and so on and on.   What we are taught to call a democratic form of government is hardly a “government of the people, by the people, and for the people” even though we all learn to parrot that phrase from Lincoln’s  Gettysburg Address.

The disproportionate power of big money brings out something that’s been obvious for a long time: that democracy is not really compatible with concentrated wealth and with the power of that wealth to determine what is and is not in the so-called “national interest.  In the 18th Century, William Godwin wrote,

Democracy restores to man a consciousness of his value, teaches him by the removal of authority and oppression to listen to the dictates of reason, gives him confidence to treat all other men as his fellow human beings, and induces him to regard them no longer as enemies against whom to be upon his guard, but as brethren whom it becomes him to assist.

Godwin is obviously not thinking of  a system of occasional elections conducted by slogans and image-making, but of a world in which we all have to think out together how we shall live—whether to build a bridge, and if so where, or whether we should respond to an external threat with war or with negotiation.  And if we are to treat each others as fellow human beings who need our assistance, then surely we would not leave the conditions of our lives –our access to jobs or to health care—up to the workings of a market controlled by big businesses. 

Another English writer, Sidney Webb wrote:

The inevitable outcome of Democracy is the control by the people themselves, not only of their own political organization, but … also of the main instruments of wealth production; the gradual substitution of organized cooperation for the anarchy of the competitive struggle… The economic side of the democratic ideal is, in fact, socialism itself.

Whoa!   Socialism?  How did that get into the act?  But socialism is nothing but economic democracy—which doesn’t just mean we vote with our dollars in the market, but that we work out together, based on our needs and enjoyments, what we shall produce and how we shall produce it—again rather than letting that be dictated by corporations whose goal is to line the pockets of their shareholders. 

In our world, all the resources by which we live (the land, the machinery, the jobs) are privately owned and controlled by their owners for  their private profit.  That’s capitalism.  And that iis anti-democratic.  This is made very clear by Noam Chomsky:

Capitalism is a system in which the central institutions of society are, in principle, under autocratic control. Thus, a corporation or an industry is, if we were to think of it in political terms, fascist, that is, it has tight control at the top and strict obedience has to be established at every level... Just as I'm opposed to political fascism, I am opposed to economic fascism. I think that until the major institutions of society are under the popular control of participants and communities, it's pointless to talk about democracy.

It is not pointless, though, to talk of democracy as something we aspire to.  What is important to understand is that the pursuit of democracy, taking control of the conditions of our lives, inevitably conflicts with the private ownership of  productive property, and with the ideology that supports it.  The road to a real and effective democratic society is forever blocked if we assume at the outset that our economic life will always be managed by the owners of great wealth.    We can work for and achieve important democratic gains today and tomorrow and next year, but in the end, there’s no such thing as democratic capitalism. 

I’m Clayton Morgareidge with the Well-read Red.

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