American Capitalism Is Already Abysmal — Trump Is About to Make It a Lot Worse
Matt Yglesias wrote in September of last year that "we are currently living through the best of times." In a similar vein, Ezra Klein has argued that critics of the American economy, left and right, have a bad habit of exaggerating for political effect.
"Things are not really, really bad," he opined, chiding Donald Trump for his grim portrayal of a nation in decline.
"Donald Trump is a nasty embodiment of our decaying economic order."
The Voxxers were not entirely wrong; yes, it is true that the economy President Obama will shortly leave for President-elect Donald Trump is in better shape than the one he inherited from George W. Bush. Growth has been slow but steady; wages, for decades stagnant, appear to be trending upward, if only very slightly; financial institutions are not on the verge of total collapse.
But the relatively rosy numbers highlighted by Klein, Yglesias, and the Obama administration often serve to obscure more fundamental shifts in the way the economy works for most. According to a report published last year by the economists Lawrence Katz and Alan Krueger, the past decade has seen a startling move away from more traditional employment toward what have been termed "alternative work arrangements."
"The percentage of workers engaged in alternative work arrangements — defined as temporary help agency workers, on-call workers, contract workers, and independent contractors or freelancers — rose from 10.1 percent in February 2005 to 15.8 percent in late 2015," the report concludes.
This is a striking finding for several reasons. Most jarring, as Martin Hart-Landsberg, Professor Emeritus of Economics at Lewis and Clark College, observes, is the fact that "Employment in so-called traditional jobs is actually shrinking. The only types of jobs that have been growing in net terms are ones in which workers have little or no security and minimal social benefits."
In short, even as monthly job reports reveal steady hiring, the types of employment available are precarious, insecure, and low-paying.
There are also long-term trends that should be emphasized — trends that cannot be waved away with a dismissive "America is already great" or "everything is fine."
Even as the economy has continued to expand, "the bottom half of the income distribution in the United States has been completely shut off from economic growth since the 1970s," note the economists Thomas Piketty, Emmanuel Saez, and Gabriel Zucman in a recent report. "From 1980 to 2014, average national income per adult grew by 61 percent in the United States, yet the average pre-tax income of the bottom 50 percent of individual income earners stagnated at about $16,000 per adult after adjusting for inflation."
Almost all of the economic gains of the last several decades, the economists point out, have gone to the very top: "income skyrocketed at the top of the income distribution, rising 121 percent for the top 10 percent, 205 percent for the top 1 percent, and 636 percent for the top 0.001 percent."
These facts have implications that reverberate, that infect other elements of the social order, from public education to housing. "For many," summarizes Fredrik deBoer, "life isn't just not getting better. It's getting worse."
Particularly staggering are the racial disparities produced by an economy that is bent on rewarding the already wealthy at the expense of everyone else. “If current economic trends continue,” writes The Nation’s Joshua Holland, “the average black household will need 228 years to accumulate as much wealth as their white counterparts hold today. For the average Latino family, it will take 84 years.”
And as we've seen, these facts also have enormous political implications. Donald Trump ran a campaign that harnessed bigotry and xenophobia, but he also deployed a populist economic message, albeit one that was entirely phony. The problem, though, was that his Democratic opponent failed to offer a compelling alternative. Her response to the economic ills ravaging families and communities was not a rousing call for radical change, but a stale promise to tinker on the edges, leaving the staggering inequality that has become the norm largely intact.
"So long as Democrats stick with the mantra that everything is fine," wrote Nathan Robinson in July, "not only will they come across as smug, not only will what they are saying be false, but it's hard to see how they will win a presidential election."
Robinson's analysis has proved prescient: The Democrats have experienced loss after devastating loss, and now the most reactionary elements of the predatory corporate class are in control. They will seek, as they always do, to dismantle all restraints on corporate power while undercutting protections for workers and the environment.
Nor will insisting that everything is more or less okay, that we are more or less moving in the right direction economically, that everyone is more or less satisfied with the way things are going. That is simply not the case.
What is the case: In the wealthiest nation on the planet, food insecurity is on the rise and life expectancy is falling. The child poverty rate is over twenty percent. Wages have remained stagnant over the long-term, and the middle class has continued to wither.
Trump has already reneged on his promise to "drain the swamp," and he will renege on his promise to fight for workers, as well. Progressives must be prepared to respond with an alternative vision, one that emphasizes not just the excesses of capitalism and the inequities it inevitably produces, but its exploitative and predatory nature — laid bare by, for instance, the immensely lucrative role pharmaceutical companies have played in fueling the opioid epidemic, and big oil's drive to continue extracting fossil fuels, even as we hurtle toward climate catastrophe.
The German sociologist Wolfgang Streeck has argued that capitalism, due to its inherently fragile make-up, will likely collapse on its own. He has, as such, observed that alternatives are not a necessary element of capitalism's fall.
Alternatives are necessary, though, to pick up the pieces, to construct a more just and equitable society. For without organized, mobilized, and inclusive mass movements — "a multiracial working-class rebellion organized on the principles of solidarity and with anti-racism at its core" is how Keeanga-Yamahtta Taylor has put it — capitalism may indeed self-destruct, but something worse may arise in its place.
Donald Trump is a nasty embodiment of our decaying economic order. His victory, and the rise of far-right movements across the globe, gives weight to Sam Kriss's observation that "Fascism is what capitalism does when it's under threat."
Amidst the despair and confusion of the last several months, though, signs of hope have emerged. The water protectors at Standing Rock have given "the world a template for resistance"; workers striking for dignity, a living wage, and the right to organize, even in the face of hysterical corporate backlash, are demonstrating that victories can be won through mass action linked with concrete demands.
There will, of course, always be backlash; as John Kenneth Galbraith once observed, "even the most plausible of reforms" — a higher minimum wage, tougher regulation of Wall Street, the right of workers to unionize — will be dismissed by the political class and its business partners as "dangerously impractical." This is so for a reason: In the words of Corey Robin, demands of this kind "raise the specter of a more fundamental change in power."
Ensuring that this specter of democratic change from below — a specter that so thoroughly haunts entrenched power — becomes reality is the task of the left moving forward.
The immense difficulty of the task speaks to its importance. Precisely how the movements of the near and distant future will take shape is uncertain. Whether they must take shape if Trump and his allies are to be effectively resisted and defeated — that, surely, is beyond reasonable doubt. It is also clear that capitalism can't save us; it can't dig us out of the messes it has made.
"For too long, we have been told that capitalism must persist because capitalism means economic growth and rising quality of life," writes Fredrik deBoer. "This is a position that is hard to defend these days."
Some would say: Impossible. And as Martin Hart-Landsberg notes, "Only a rejuvenated labor movement, one able to build strong democratic unions and press for radically new economic policies will be able to reverse existing trends."