‘It’s Not Socialism, It’s Democratic Capitalism’

by on July 16, 2015 · 6 comments

in American Empire, Economy, Politics

Bernie SandersBy Jeeni Criscenzo

In a recent interview about the groundswell of popularity for Bernie Sanders, Richard Wolff, author of “Democracy at Work, a Cure for Capitalism,” opined that we are seeing a new form of socialism that doesn’t give the power to the government, but rather focuses on –

“changing the way we organize enterprises, so they stop being top-down, hierarchical, where the board of directors makes all the decisions, and we move to this idea which is now catching on: cooperation, workers owning and operating collectively and democratically their economy and their enterprise.”

Instead of looking at this as a new kind of socialism, I like to think of it as a new kind of capitalism—democratic capitalism, where workers are actually free.

For all the talk about how lucky we are to be free in America, the reality is that anyone working for an enterprise that is not their own, is not free. There is no democracy in an employer/employee relationship. And where there is no democracy, there is seldom fairness or justice. One person, (owner, CEO, supervisor) has all the power and you had no voice in appointing them. The worker/employee must do as they are told or lose their job.

Losing your job is disastrous for the worker and everyone who depends on his/her income. Without wages from employment, the worker is deprived of even the basic necessities. If they don’t replace their job quickly, they will also lose their credit rating. Young adults who were sold the myth that they must go into massive debt (that cannot be forgiven with bankruptcy) for an education to qualify for a “good” job are particularly vulnerable to having that ding on their credit. They start their careers as indentured servants.

The motivation to keep a job, no matter how unfulfilling, is intense. Many people will endure a lifetime working at a job they hate rather than face the possibility of being unemployed, even temporarily. That bestows near totalitarian power on those in a position to fire or layoff workers, whether that is a supervisor, bean-counter, or owner(s) of the business.

Under our capitalist system, workers voluntarily relinquish their Constitutional rights, in exchange for job security. While some workers have risked financial ruin, imprisonment, beatings and even death, to reclaim some of those rights by forming unions, most persist, day after day, convinced that doing good on the job is the way to achieve the American Dream. They believe that those who are wealthy have acquired that wealth through hard work and they want to be one of those wealthy people someday.

In the popular novel, The Shadow of the Wind, Fermín, a savvy, street-smart character, observes that, “The most efficient way of rendering the poor harmless is to teach them to want to imitate the rich.” Reminds me of a young man I was telling about Dennis Kucinich during the presidential primaries in 2004. “The other candidates only care about the rich. Why would you vote for them?” I explained. “Because I intend to be rich someday,” he responded.

I’ll bet that kid isn’t rich today. The Wealth Club is getting more and more exclusive every day. And the politicians who could always count on workers voting against their own best interest because they thought they have a chance of joining the Wealth Club, are clearing the path for a populist like Bernie Sanders.

Take for instance this recent quote from Republican presidential candidate, Jeb Bush:

My aspiration for the country and I believe we can achieve it, is 4% growth as far as the eye can see. Which means we have to be a lot more productive, workforce participation has to rise from its all-time modern lows. It means that people need to work longer hours and, through their productivity, gain more income for their families.

While some claim that Bush’s quote shows that he’s out of touch with the American worker, in fact he just doesn’t give a damn. “Growing the Economy” (code for growing their wealth), is all that matters. In reality, according to a report by the Economic Policy Institute, American worker productivity (defined as the output of goods and services per hours worked) grew by about 74 percent between 1973 and 2013, but compensation for workers grew at only 9 percent during the same time period! Look what working longer hours got us!

American worker productivity … grew by about 74 percent between 1973 and 2013, but compensation for workers grew at only 9 percent during the same time period!

Referring to this in an interview in The Atlantic, Feb. 2015, economist and senior-associate dean for research at Harvard Business School, Jan W. Rivkin, explained:

From the end of WWII until the 1970s productivity in the U.S. and median wages grew in lockstep. But from the late 1970s until today we’ve seen a divergence, with productivity growing faster than wages. The divergence indicates that companies and the people who own and run them are doing much better than the people who work at the companies.

Obviously, for an increasingly large number of Americans, capitalism isn’t working out as planned. Not only are we working harder than ever, the wages being paid are seldom enough to cover the basics. The shrinking middle class is finding itself on the losing end of an economic model that sees them as a dispensable column in a spreadsheet:

To increase profits, select U.S. Workers and click DELETE.

Back in the time of the American Civil War, the Hazard Circular, a document penned by the bankers, was quoted as saying that slavery was not an economical source of labor because slavery “carries with it the care of the laborers, while … capital shall control labor by controlling wages.” In many respects, especially now as good paying jobs become scarce, those fortunate enough to be employed are as controlled as slaves – but they still have to buy their own bed and board.

Is it possible to do what you love and still be personally responsible? Is it possible for everyone to work at what they love and still have a prosperous community?

Given our conditioning, we think of work as something we have to do, whether we like it or not. But consider the innovation and creativity that will never be manifested because of all the people with brilliant ideas and talent who must spend their lives working at something that gives them no personal gratification.

Let’s not stop with what Bernie Sanders is proposing—let’s start there. Let’s ask amazing questions: Is it possible to do what you love and still be personally responsible? Is it possible for everyone to work at what they love and still have a prosperous community? What if we started from the assumption that almost everyone needs to feel that they are contributing and that people derive great satisfaction from doing so?

In our current system, a worker’s labor is for the benefit of shareholders or owners, who want only one thing—greater productivity at lower costs. In Democratic Capitalism, everyone is a stakeholder in the fruits of their labor. There is no necessity to show growth every quarter, nor the need to cajole customers to purchase unnecessary products that are harmful to our health and environment. Production is engaged in for the purpose of providing what is necessary, using processes that result in the lowest possible carbon footprint rather than the lowest cost.

This is not socialism! No one is asking the government for anything. In fact, since our government has become so entrenched with the military/industrial/financial oligarchy, it is important to organize with as little government intervention as possible.

Neither is this communism, because the individual is actually valued more here than in our current system. Each individual is essentially their own boss, contracting their time, talent, experience, ideas and labor. Some people will want to negotiate long-term contracts, which differs from having a job because the individual retains control over the deal. And since democratic capitalism provides many livelihood options, the individual is in a stronger bargaining position.

I know—it’s pie in the sky… so let’s get cookin’!

The above is from a new columnist at San Diego Free Press.


{ 6 comments… read them below or add one }

Bearded OBcean July 16, 2015 at 12:15 pm

I guess two questions.

How does the author conclude that we are working harder than ever? Didn’t past generations work pretty hard too?

Also, based upon this idea of ‘democratic capitalism’ how would businesses ever get off the ground?


Frank Gormlie July 16, 2015 at 2:14 pm



RB July 17, 2015 at 6:16 am

Most of the disconnect comes from defining productivity as output per hours worked.
If you define productivity as output from all input costs much of the disconnect disappears. Most of output gains or increased productivity has come from technology advancements and investments not increased labor efforts.

One computer has replaced my need for an accountant, travel agent, financial consultant, librarian, bank teller, mall store worker, and most other labor. My productivity comes from investment in technology not investments in labor.


Rufus July 17, 2015 at 7:37 am

The ultimate democratic-capitalism is working for yourself!!


Blaine H. Mogil July 21, 2015 at 2:53 pm

I have to point out a most serious flaw in your article. Describing Richard Wolff’s proposed remedy for our boom and bust economic system as democratic capitalism is a fundamentally incorrect use of this terminology. These two economic systems, Wolff’s WSDEs and our current system of democratic capitalism, are diametrically opposed concepts and using one to describe the other will generate grand confusion on the topic for your readers. In fact this is a seriously flummoxing conflation of Wolff’s proposed WSDEs and our current democratic capitalistic economic structure. Most certainly Wolff is proposing “Democracy at Work” in the book of this same title. However, democratic capitalism most accurately describes our current free-market private capital system, which is precisely what Wolff stands in opposition to as a vanguard. Please clarify this in order to avoid causing further confusion on this important issue.


tj July 28, 2015 at 11:12 pm

Bernie doesn’t mind the term “socialism” (Sweden) – unfortunately, most Americans & the 1%er controlled mainstream media confuse it (often intentionally) with communism (Russia/China).


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