Free Markets, Free People

equality of outcome


Robert Reich’s attempt to redefine Capitalism

I’ve often said that what the left attempts to do is redefine words to blunt the impact (and fool the people) of what they’re trying to accomplish.

On the occasion of a Socialist winning France’s Presidential election, Robert Reich, of all people, is out to reassure the masses in America that Socialism is not the answer, Capitalism is.

However, upon closer reading, well it’s not the Capitalism we’d recognize.  Here are his opening paragraphs:

Francois Hollande’s victory doesn’t and shouldn’t mean a movement toward socialism in Europe or elsewhere. Socialism isn’t the answer to the basic problem haunting all rich nations.

The answer is to reform capitalism. The world’s productivity revolution is outpacing the political will of rich societies to fairly distribute its benefits. The result is widening inequality coupled with slow growth and stubbornly high unemployment.

Note the focus – ‘“fair” distribution of its benefits’.  Anyone – what about Capitalism calls for the “fair distribution of benefits.”

And if you change laws and require such a thing, can what you end up with be fairly called “Capitalism”?

Back to Reich.  He claims that workers are being replaced by “computers, software and the Internet (damn that Al Gore).  Consequently, jobs are at a premium and, well, that’s just not fair.  Besides (prepare for tired old song):

In the United States, almost all the gains from productivity growth have been going to the top 1 percent, and the percent of the working-age population with jobs is now lower than it’s been in more than thirty years (before the vast majority of women moved into paid work).

Inequality is also growing in Europe, along with chronic joblessness. Europe is finding it can no longer afford generous safety nets to catch everyone who has fallen out of the working economy.

And, apparently, the top 1% a) bury the money in cans in the back yard and b) don’t pay 37% of all income taxes collected (the top 5% pay 59%).  That’s just not sufficient anymore to keep the bottom 50%, who essentially pay no income taxes, in the lifestyle to which they’ve become accustomed.  And Reich thinks that’s wrong. However, and this is the whole point of his pitch, that’s not Socialism.Obama_Socialists_01_250px

Really?  A “fair distribution of benefits” so neatly defines Socialism, I’m not sure what’s left to say.  Except Reich wants us to somehow swallow the premise that it is also a principle part of Capitalism (it’s not) and we must reform Capitalism to conform to this newly discovered, er, inserted principle.

So what does Capitalism do?  Well, you’ve heard it said many times that the tide of Capitalism “lifts all boats”.  I.e. the “benefits” are distributed by a system that makes life better for all.  It does that by rewarding innovators, risk takers and entrepreneurs.  And those rewards can be very rich.  But:

Consumers in rich nations are reaping some of the benefits of the productivity revolution in the form of lower prices or more value for the money — consider the cost of color TVs, international phone calls, or cross-country flights compared to what they were before.

Indeed, we live better now than we did 30 years ago because of what?  The “benefits” of Capitalism as they’re traditionally defined.  Even Reich has to admit that.

However, that’s not good enough for the left.   Those not in the 1% are apparently “victims” and due much more simply because they exist.  And those who do take risks and succeed are those that owe the victims this “fairness” by giving up what they’ve earned.

You see the left’s forte is class warfare and that, frankly, is the cornerstone of Socialism.  Their traditional enemy is,  you guessed it, Capitalism and Capitalists. 

What Reich is offering is a new sort of a smoke and mirrors approach.  It’s hard to fight their traditional enemy on the basis of performance – we are a very rich nation and even our poor live better than most nation’s middle class.  So that won’t work.

Instead, it’s the politics of envy that has been employed and the siren song of “fairness” or “equality” as the required (not desired) outcome.  Oh, and that there is only one entity that can enforce either or both – government (mostly through punitive taxation).

That’s Reich’s pitch.  That’s the snake oil he’s trying to peddle.  Reassure everyone that he’s a big Capitalist (he’s not).  Pretend the problem with our system right now is it is unfair because Capitalism has gone wrong (it hasn’t).  But, with a few tweaks and reforms via government we can fix that (and end up just like Europe).

Of course we can certainly do all of that, can’t we?  And when we do, it will be called “Socialism”, won’t it?

~McQ

Twitter: @McQandO