The statue of the “fearless girl” facing the bronze bull statue near Wall Street in New York, USA on March 9, 2017. The “fearless girl” was placed there by an investment firm for draw attention to the lack of gender diversity in business management and the fact that they are paid less than men. (Xinhua / Wang Ying)
Many of the problems that have arisen since the turn of the 21st century are ultimately the result of American-style capitalism – especially social divisions within the United States itself.
This raises a difficult and contemporary question: Can capitalism be sustained?
Since the 2008 financial crisis, American and Western intellectual elites have deepened their reconceptualization of capitalism, especially American-style capitalism.
For example, Capitalism in the Twenty-First Century by French economist Thomas Piketty, published in 2014, is a masterpiece. Piketty has studied economic data for over 200 years, and the results confirm that the increase in wealth has grown more than the GDP, which means that money generates more money than people work hard to earn. If a state cannot seriously control the flow of capital through distribution, society will undoubtedly become increasingly unequal.
Piketty is a reformist thinker who advocates increasing the equity of social distribution by dramatically increasing taxes for the rich.
Other researchers argue that only a fundamental transformation of the capitalist system can end this growing divide between the rich and the poor.
Swedish researcher Martin Hägglund, a rising theoretical star in recent years, represents this point of view. He argues that capitalism is motivated precisely by its “harmful wealth inequality” and that redistribution is not the real solution.
This means that small reforms cannot save capitalism, and the capitalist system cannot be the solution as long as the wealth generated by capitalism is the root of the problem.
Similar discussions have emerged in recent years. But recent discussions of capitalism have had a widespread impact on America’s young, well-educated generations – millennials and millennials – who understand these theories and studies according to their struggles. These include being burdened with large student loans, not earning enough to pay rent, not being able to find more suitable employment, and not finding more suitable employment opportunities.
In this social context, some American politicians began to refocus on the “middle path” of democratic socialism represented by Sweden. They are looking for a way to transform American capitalism and attract more support from the voters.
In the United States, the neoliberal paradigm established by the Reagan administration is coming to an end. From quantitative easing under former President Barack Obama to trade disputes under former President Donald Trump, there has been plenty of crucial real-world evidence reminding people that the United States is deviating from the basics of the government. neoliberalism – such as laissez-faire and Freedom Trade. The competition between the three great economic agendas of the contemporary American political establishment, Trump populism and Sanders’ democratic socialism, has brought the American capitalist model to a crossroads.
The next step for the United States, whether it raises taxes on the rich, big corporations, and Wall Street, or chooses to break down monopolies and bring more multinationals home to pay taxes, is to curb the momentum of “paternalistic” capitalism. But what will be the result?
Of course, the system will have to evolve for the benefit of the middle and lower classes in general. It will have to improve inequalities in income, health care, race, education, etc. This will promote a series of systemic reforms.
Historically speaking, the American model of capitalist development has evolved through change and adjustment. And every major crisis has sparked significant change.
The accumulation of distributional imbalances has led to the breakdown of political collaboration between social classes. The problem of unequal distribution is getting worse and dividing all of society after the financial crisis.
The difficulty is that it is impossible to overcome the differences without serious reforms. And it is difficult to promote reform without bridging the differences.
The future of capitalism will be determined by how far the “de-Americanization” of the United States goes.
The author is editor-in-chief of the People’s Daily and currently a senior researcher at the Chongyang Institute for Financial Studies at Renmin University of China. [email protected] Follow him on Twitter @dinggangchina