What would Adam Smith, the father of modern capitalism, think of capitalism in America today?
You see, it was Smith’s notion that despite natural greed, individuals in a free, capitalistic society would be led by “reason, principle, conscience” to act morally and compassionately. Capitalism would be the economic mechanism by which wage earners and the middle class would accumulate wealth. While certainly true historically in the United States, and much of the free world, that no longer seems to be the case here, especially since the Great Recession.
“Only upper income families have median wealth greater than prior to the Great Recession” – Pew Research Center, Nov. 1, 2017.
“The income share of the poorest half of Americans is declining while the richest have grabbed more. In Europe, it’s not happening.” – Vox.com, July 29, 2018.
“The US Congressional Research Service says the income share of the richest 1% of Americans reached 19.6% last year. It never rose above 10% in the first four decades after the Second Word War.” – The Telegraph, Feb. 5, 2019.
And, so what, you say?
“According to a new poll from Gallup, young Americans are souring on capitalism. Less than half, 45 percent, view capitalism positively,” CNBC reported last August. “Meanwhile, 51 percent of young people are positive about socialism.”
Perhaps you noticed the leftward swing in the mid-term elections last year. According to Axios.com, “The Democratic Party’s base is rallying around calls for massive social welfare programs like Medicare for All, a federal jobs guarantee and a Green New Deal — all of which would cost trillions of dollars and potentially bust the budget,” which they say “is not that big of a deal.”
This trend is not new. In 2011 BBC News Magazine published an article that declared, “As a side-effect of the financial crisis, more and more people are starting to think Karl Marx was right.”
To counter this trend, what have conservatives done? So far, they continue to promote rapacious capitalism, facilitate corporate greed, and provide fuel to energize the left.
In 1923, Sir John Skelton, penned a series of anti-socialism articles challenging fellow conservatives to step up and face the social and economic challenges facing his nation. He called this approach “constructive conservatism” and said that growing the wealth of wage-earners through fair wages and property ownership should be conservative’s top priority to thwart the appeal of socialism.
In today’s parlance that means big business should be hiring more people and increasing wages rather than funding stock buy-backs, expensive mergers, and escalating corporate salaries (now 270 times average wage earner salaries; up from 20 times in 1970.) Crumbs to the middle class from massive tax cuts for huge corporations and the wealthy and low-wage jobs with no benefits and no future won’t dent the rise of socialism.
So, who are the champions of constructive conservatism in America today?
Well, John Kasich may come closest. Quoting conservative Catholic philosopher Michael Novak, he said capitalism without compassion is “bankrupt,” but looks more to government intervention than moral business behavior.
An ironic call for “moral capitalism” to combat socialism comes from Rep. Joe Kennedy (yes, one of those Kennedys). “We have to do a better job addressing the economic needs of working class and middle class voters,” he told the Associated Press.
Some form of constructive conservatism will be needed to thwart the rise of socialism.
Crawford is a syndicate columnist from Meridian.
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