The American Prosperity Myth

This article from the Nation compares and contrasts the self-destructive nature of American capitalism with the more successful, socially oriented, and sustainable aspects of European capitalism:

Philosophically, culturally and practically, the social contract has been attacked head-on and undermined at every turn; its destruction has been one of the great objectives of the renaissance of American conservatism. As a result, its supports have been increasingly eroded. If there is to be what political philosopher John Rawls calls an infrastructure of justice--one insuring that everyone, despite any accident of birth, gets a chance to develop his or her talents, participate in the life of society, exercise liberties and enjoy basic living standards--then a system must be in place to maintain it. And that system is of necessity the state, with its ability to tax and spend. In this conception, the state is not a coercive interloper but a trustee of social fairness, providing the foundation for any society's long-term social health and wealth.

Yet since the mid-1970s taxation has been depicted by the right as a coercive intrusion upon individual liberty imposed by an oppressive government. Grants to poor students, for example, are seen as wasteful subsidies that undercut self-reliance and the robust qualities of independence that the early settlers possessed and upon which America was built. Yet America's social contract, hewn out of searing experiences like the Depression and bolstered by respect for the Constitution's claim that citizens should have equal opportunity, requires that the state act as its trustee--with the tax revenue to pay for it. To attack taxation as a moral evil and economic drag, and the state as oppressive and inefficient, is to knock away the key underpinnings of the social contract.

There is no need to recite details of the consequences: lower life expectancy than in Europe, vicious inequality and desperate lack of social mobility. Yes, it is true that the European social contract can produce perverse incentives, so that, say, excessively generous unemployment benefits in Germany undermine individuals' desire to look for and accept work. But the solution is to reform the excessive generosity, as German Chancellor Gerhard Schr?der is doing, rather than abandon the social contract altogether. The impact of America's approach on individual lives shows up in international surveys of happiness and sense of well-being, where Americans score so badly. An obsessive individualism in a society in which so many are harmed eats away at the capacity to empathize, and the very stuff of human association is undermined. A Hobbesian society, a war of all against all, is not an environment in which human beings can flower.

This is quite a good essay that goes a long way toward explaining why, even though many American capitalists are as evil as can be, I'm not quite ready to give up on capitalism: Europe shows us that the much ballyhooed economic system is not totally unredeemable.

Click here.

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