Capitalism in the United States, as it is right now, is dangerously flawed. Our politicians and policies prioritize corporations, special interests and top income earners over regular American workers and those most impacted by the COVID-19 pandemic. This crisis, in particular, has laid bare the vast chasm between socioeconomic classes that have developed over the past decade. It’s exposed the failure of our nation to address our citizens’ most basic needs that numerous countries around the world seem able to do – but it doesn’t have to be this way. We can, and must, redesign capitalism to level the playing field and offer genuine opportunity and support to anyone who works for it.
In the last few months, most of the life-saving benefits of the CARES Act, Congress’ landmark COVID stimulus package passed in March, have expired. The absence of critical measures like boosted unemployment benefits and eviction moratoriums have left millions without the lifeline they relied on throughout most of the pandemic, along with the worst quarter of GDP growth in decades, and an unemployment rate of 10.2% (30 million Americans). Thanks to the failures of our federal government, many are questioning capitalism’s purpose as more and more Americans are left to fend for themselves during a deadly pandemic.
Given the bleak outlook of our economy at this current state, it’s no shock that younger Americans, in particular, are questioning the system they’re inheriting. In 2019, the medium net worth for Americans under 35 was 40% lower than it was in 2014 and previous years. Over the same period, the net worth of Americans over 65 rose by 9%.That inverse effect shows that our vast levels of inequality have closed off any opportunity for economic advancement for younger Americans. If you’re born in the wrong zip code, to the wrong parents, or in the wrong state, your chances of owning a home or attending college – much less reaching the Forbes 400 – are slim.
The founder of Forbes Magazine once wrote that “the purpose of capitalism is to increase happiness for all.” There’s truth to that, but to say “for all” seems like quite a stretch in such an unequal economy that offers little support to those struggling on the margins. Basic survival today can be extremely painful for many. Clearly, something needs to be fixed if capitalism is going to survive.
If we actually want to fix the flaws and create a more equitable system for all, there’s a couple concrete steps we need to take immediately. First, we need to increase the minimum wage to $15 an hour so working folks can put food on the table for their kids and make the rent. Second, we need to get rid of the 2017 GOP tax cuts that gave trillions of our country’s wealth to billionaires and massive corporations, who further exploit the system through loopholes and by-the-letter rules to avoid paying their fair share. Finally, we need to go a step further by adding new marginal rates and wealth taxes on high-net worth folks like myself to ensure that we are tackling inequality at the source.
Saving capitalism is actually that simple: tax the rich and give workers a raise.
This formula has worked wonders in Western Europe, where they’ve created a system of humane capitalism that doesn’t put the bottom line of corporations above all else. And yes, they are capitalist, not socialist, as much as some of my conservative friends would like to paint them as such.. They have free markets and resources are distributed in order to maximize profits, but strong regulations and progressive taxation create a system with a robust safety net and government programs that treats their citizens with dignity. Is that so hard to imagine in the richest country in the history of the world?
I want to live in a country where people don’t go bankrupt from medical bills, where the wealthy fund robust public programs with their taxes, and where people are able to live comfortably and with dignity while working at the minimum wage. Loud pundits on the right might try to label me anti-American or a socialist for holding these beliefs, but I’m not. I’m a capitalist who knows that the current status quo is not working for most Americans. We can reform capitalism to create an economy for all that lifts every American up, rather than a select few. The American dream shouldn’t depend on the flip of the coin.