Read Part II, Part III, Part IV Part I: Structural Problems of Extreme Inequality The great challenge of our time is not a clash of civilizations, as many advocated since Samuel Huntington published The Clash of Civilizations. Nor is the world most important challenge the revival of the Cold War in the form of a renewed US-Russia confrontation or in the forms of the evils of unconventional war that the US calls “terrorism”, a generic term governments use to label any opponent terrorist. These issues are manufactured and symptomatic of capitalist countries engaged in an intense world competition for markets and raw materials. This is not very different from the world power structure during the Age of New Imperialism, 1870-1914. The great challenge of our time is social and geographic inequality that threatens not only the system of capitalism creating inequality, but the democratic political regime under which capitalism has thrived in the last one hundred years. 1. Is capitalism in deep crisis because of the deepening gap between the very rich and the rest of the population, or this how the system works and society has always been organized as a social pyramid? If capitalism is creating extreme inequality what does this entail for democracy that rests on a strong middle class and all institutions on which bourgeois society his built? Does the fact 1% of the richest people will own more wealth than the other 90% of the world’s population in 2016, and that 80% of the people on earth own just 5.5% of the wealth mean anything, or is it just numbers?Reformist critics argue that the declining middle class throughout the Western World in the last four decades is symptomatic of an ailing economic system that must be addressed through the political process. If this is not done, then democracy itself will give way to a more authoritarian political system. On the left side of the political spectrum, critics argue that the crisis of capitalism has already given way to a form of authoritarianism with a thin veil of democracy for mass consumption. Capitalism has shown definite signs of decline and it will ultimately fall. This will take a long time, just as Rome was in decline from the death of Marcus Aurelius to the sacking of Rome in the 5th century. Capitalism’s decline from within will come because it is serving an increasingly smaller segment of the population to the detriment of many losing faith in its promise. This means that it will take down with it all institutions, including the warped democratic political system as it will be evolving toward some authoritarian form, a contradiction in itself. Scholars, journalists, politicians, business people and a segment of the public know that the world is experiencing a crisis of inequality. Despite the phenomenal Gross World Product (GWP) growth rising from $27 trillion in 1990 to $75 trillion in 2014, owing largely to the integration China and former Communist countries into the capitalist economy, income inequality actually grew during this period because capital remained concentrated in the hands of the top 10 percent. The inequality crisis is not just in Egypt, Nigeria, Kazakhstan and other developing nations under authoritarian corrupt regime, but in the US and Western democratic societies that go through the motions of promising equality but deliver downward social mobility for the college graduates. With few notable exceptions, among them Norway, many of the Western democracies deliver economic and social policies not much different from authoritarian countries that make no pretenses about a pluralistic society. This is not only in European Union countries undergoing austerity, but in the US as the world’s leading capitalist country where inequality is very evident. Although the US is an open society under a pluralistic system, it has been experiencing a crisis in its democratic institutions that has been going down the road of a quasi-police state ever since 9/11, considering there are glaring violations of the Constitution regarding civil rights, and of international law regarding human rights. Things are not very different for the rest of the Western World where the rights of workers are disappearing and middle class is shrinking, while poverty is rising amid massive capital concentration. This is all justified in the name of markets that governments today equate with the “national interest”, thus redefining the social contract as understood by European thinkers of the Enlightenment as well as Thomas Jefferson and James Madison. The contradiction of democracy’s promise for equality and the downward socioeconomic mobility and rising income gap between the rich and the poor has been the subject of serious studies that ignore the populist propaganda in the media. However, such studies are hardly influential among mainstream politicians loyal to the new “market-centered” concept of the social contract that whatever is good for the rich is good for the nation – reminiscent of the 1920s thinking in America. (See Vicki L. Birchfield, Income Inequality in Capitalist Democracies: The Interplay of Values and Institutions; John Skinner, Capitalism, Socialism, Social Plutocracy: An American Crisis) On the surface, the capitalist world economy certainly appears sound because of the fact that most people believe they have a stake in it. If they have no stake in it, they have hope for themselves and their children. Just below the surface there are very serious problems owing to a complex web of problems, most of them stemming from a political economy rooted in injustice and the source of oppression and exploitation that instead of lessening it is worsening based not just on income gaps between the rich and the “rest of society”, but on the quality of life in general for the “rest of society”. This does not mean that capitalism is coming to an end any time soon. Nevertheless, it manifests signs of structural weaknesses that will eventually undermine both capitalism and democracy from within. In other words, the real enemy that will bring down the social order is not “terrorism” or another enemy nation like Russia, but the decadent system. Jon V Kofas is a novelist. Read Part II, Part III, Part IV Source URL |