May 09, 2013

Is Capitalism Dying? - Forbes Big corporations now wield unprecedented political and economic power. A few have ridden the shift toward online commerce to superpower status. Many more have profited by replacing expensive US labor with cheaper overseas workers and software. The end result is that the inequality of wealth and income has grown dramatically not just among households but also across the divide separating large corporations from small businesses. Studies have shown that inequality saps growth. Combine an unequal playing field with political control over the institutions meant to level it and you get a stagnant, sclerotic economy that wastes potential and allows select politically connected participants to extract unjustified rents. And the thing is, we got here almost unnoticeably, by the natural accretion of small competitive advantages over time. So now we have the most powerful and cohesive organizations on Earth devoted to the pursuit of profit above all else and frequently at the expense of public interest. And their unprecedented wealth threatens to neuter democratic checks on their behavior. In theory, corporations are still responsible to their shareholders. In practice, they’re beholden to no one but boards of directors handpicked by senior managers. Free markets respond to supply and demand, and in the US the ready alternatives to domestic labor have placed it in an especially poor bargaining position relative to capital. It’s possible the trend will slow as outsourcing wanes. In 14th century Europe, the bubonic plague temporarily boosted wages and reduced agricultural rents. Barring a similar game-changer, it’s hard to...

Jodi Dean

Jodi Dean is a political theorist.

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