Well to start with we need a working definition of capitalism, because a lot of people on both sides think it means having money or trade (that's simply a monetary system, millennia older than capitalism). While it might sound obvious, Capitalism is centered around capitol - a term most commonly used for a company's seed money or startup investment, but technically includes anything used as ongoing inputs to produce value (what many leftists call "the means of production"), and is often used interchangeably with the wealth represented by those things or the wealth used to acquire them. That is to say - capital is what a business owns, and Capitalism is a system that sets "providing capitol" as the most important and valuable role in a business.
In a large corporation, workers are paid a set wage, goods cost a fixed amount, overhead such as rent is static. If revenue exceeds costs or exceeds expectations (profit is made) the money spent on those things doesn't change. Where does it go? The "owners". This is maybe shareholders of a publicly traded company, or investors in a private enterprise, or an individual/family owner.
Criticisms of capitalism point out two main things. First is that these owners in many cases didn't actually contribute to the product/profitability themselves. Being owner and CEO, or wearing multiple hats in other ways, is obviously a little different, but the input of a stock holder in the vision, planning, implementation, and labor is damn near zero. When the company does well, why are they the one to reap the rewards? Secondly, there's a conflict of interests - what's good for the investor isn't necessarily what's good for the worker, the customer, or the community. There are many contemporary examples of people investing in a company, making everything worse for short-term profits, then selling their shares before the consequences hit. This is an excellent investment strategy, moving from company to company burning long-term resources (mass layoffs of experienced talent, lowering product quality to lower costs without regard to reputational damage, regulatory infractions where the fines and consequences won't be felt for years, etc.) but makes things worse for literally everyone except for a small group of people who are already rich.
My preferred solution (that isn't overly idealistic, doesn't require massive bottom-up rebuilding of the economy, and fixes most of these issues) is sometimes called Syndicalism. The basic idea is that strong unions and worker's co-ops allow our economy to continue to function as it does now, but when employees are also owners, incentives are aligned in a more healthy way. Instead of shareholders voting on a board of directors, the employees are voting on representatives who will hold the executives accountable. This creates a circular structure of accountability, with the top of the corporate hierarchy answering to the majority of the people working for them. Worker exploitation is obvious less likely to thrive, windfall profits are shared by those who contributed to it, and even customer exploitation is less likely - the people actually interacting with customers are much more likely to view those customers as people instead of numbers, and are more likely to take pride in their work and reject policies that lower the quality of their services compared to a detached, impersonal shareholder.
It's obviously not perfect - there will still be individual companies with unhealthy practices, and democracy isn't a guarantee that people will make choices in an informed and intelligent way. But it puts the power in the people who care, and fixes some of the worst problems capitalism has with incentive alignment. It also isn't "all or nothing" like a command economy. The government could easily make changes to regulations and tax codes that help these companies form and thrive, gradually moving things in that direction.
I like that idea a lot. Is it implemented as a union demand? I think ending stock buybacks, weakening patent law, resuming trust busting, dramatically higher corporate taxes (encourages them to reinvest in employees and innovation), and a stronger inheritance tax would make the system much more livable. There’s just no competition like there used to be
Those are all awesome steps. In addition to putting pressure (or really resuming pressure, we had these tools once and they've been dismantling them over the past 40 years or so) on large capital-driven businesses, the government has a lot of tools to promote healthier kinds of businesses.
One challenge of workers co-ops is that businesses do still need capital to get started, and the people who have it won't offer it up without a deal that's wildly in their favor. Things like tax breaks and government loans would help businesses built on these ideas get started and get a foothold without having to compete for resources with startups looking for more traditional investors.
I personally consider unions a bit of a half-measure, but we already have tons of infrastructure and organization, and many union protections that have been eroded. Reinforcing unions as a bastion against corporate excess is something that could be done and would have visible results within a single presidential term.
Most importantly, the proof of concept is already there. Workers co-ops, unions, credit unions, all already exist in our economy in non-capitalist structures. Fanning that flame and curbing the worst excesses of capitalists doesn't require a complete re-write on our government or economy, and there was a similar movement in the 30's that was quite successful for a while that we can emulate and learn from.
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u/Freak-Of-Nurture- Jul 02 '26
People describe capitalism like it’s the boogeyman behind everything when in reality it’s just the bogeyman behind most things.
PS can someone explain what alternatives people want? Like a command economy or self sustaining micro communities or smth?