How Capitalism’s Dogged Defenders and Propagandists Shield It From Criticism

Yves here. Even though I am running Richard Wolff’s piece, I do not accept his premise that capitalism is ever and always bad. Capitalism in Japan, where entrepreneurs are revered for creating employment, not for getting rich, performed well until the US forced rapid deregulation on its banks to make the world safer for American investment bankers. Even in Japan’s bust, large companies further narrowed the already-not-large by Western standard gap between entry-level and executive pay to preserve employment levels, the opposite of what you see here. Similarly, the Nordic model also delivered high levels of social services and low levels of inequality until neoliberals had increasing success in eroding it.

What Wolff miss is that democracy and democratically-organized organizations don’t scale well, as anyone who participated in Occupy Wall Street and participated in “stack” can tell you. Mondragon is the world’s largest worker cooperative. But it’s actually 257 companies, so the average company size is under 300 employees. Many lines of enterprise have economies of scale or scope. That means smaller entities, unless they have managed to create a defensible niche, will be at a big disadvantage. Scale in turn virtually necessitates hierarchy. Even Mongradon has had to relent on its “maximum wage” rules and has widened the gap between minimum and maximum pay.

As we explained long-form in ECONNED, the reversion to a more tooth-and-claw form of capitalism is the direct result of a concerted and well-funded effort, codified in the Powell Memo of 1971, to move the values of the US to the right. One of

Keep reading this article on Naked Capitalism (Yves Smith) - Blog.

Leave a Reply