Saving Capitalism

Robert B. Reich

"Under these circumstances, arguments based on the alleged superiority of the "free market," "free enterprise," "freedom of contract," "free trade," or even "free speech" warrant a degree of skepticism. The pertinent question is: Whose freedom?"

p. 13

"Those who claim to be on the side of freedom while ignoring the growing imbalance of economic and political power in America and other advanced economies are not in fact on the side of freedom. They are on the side of those with the power."

p. 15

"But the public interest is often understood as emerging from a consensus of the organized interests appearing before them. The larger and wealthier the organization, the better equipped its lawyers and its experts are to assert what's good for the public. Any official who once worked for such an organization, or who suspects he may work for one in the future, is prone to find such arguments especially persuasive.

 

Inside the mechanism of the "free market," the economic and political power of the new monopolies feed off and enlarge each other."

p. 34

"People are "worth" what they're paid in the market in the trivial sense that if the market rewards them a certain amount of money they must be. Some confuse this tautology for a moral claim that people deserve what they are paid. One of the most broadly held assumptions about the economy is that individuals are rewarded in direct proportion to their efforts and abilities--that our society is a meritocracy. But a moment's thought reveals many factors other than individual merit that play a role in determining earnings--financial inheritance, personal connections, discrimination in favor of or against someone because of how they look, luck, marriage, and, perhaps most significantly, the society one inhabits."

p. 91

"I am not accusing the wealthy of doing anything nefarious or intentionally harmful. There is no reason to suppose that top corporate executives, the successes of Wall Street, and other "high-worth" individuals have conspired to hijack the American economy for themselves. Each has merely behaved rationally in pursuit of his or her private interests. As their wealth has increased, so has their political power, and they have quite naturally used that power to enlarge and entrench their wealth. We can criticize them for being selfish and greedy, but they are no more selfish or greedy than are most other people. And some have been enormously generous with their wealth.

 

But when our system is viewed as whole--as a political economic arrangement for allocating rewards for the work people do--there is reason for concern. The meritocratic ideal with which our form of capitalism has been justified does not match the reality in which most of us live and work. The playing field is tilted toward those who have had the resources and power to tilt it in their direction. And as they gain steadily more resources and power, it tilts further."

p. 150

"The market is a human creation. It is based on rules that human beings devise. The central question is who shapes those rules and for what purpose. Over the last three decades, the rules have been shaped by large corporations, Wall Street, and very wealthy individuals in order to channel a large portion of the nation's total income and wealth to themselves."

p. 218

"The coming challenge is not to technology or to economics. It is a challenge to democracy. The critical debate for the future is not about the size of government; it is about whom government is for. The central choice is not between the "free market" and government; it is between a market organized for broadly based prosperity and one designed to deliver almost all the gains to a few at the top. The pertinent issue is not how much is to be taxed away from the wealthy and redistributed to those who are not; it is how to design the rules of the market so that the economy generates what most people would consider a fair distribution on its own, without necessitating large redistributions after the fact."

p. 219

© Kyuwon Lee, 2020.