Though the polls predicted his victory, Zohran Mamdani’s July 1 domination of the Democratic primary for the nomination for mayor of New York City still stunned some observers. Mamdani, a state assembly member, ran as a Democratic Socialist.
Any hint of a candidate’s socialist tendencies usually precedes a political obituary.
In 1930, in Individualism Old and New, John Dewey made an observation that still defines most people’s concept of socialism:
“The myth is still current that socialism desires to use political means in order to divide wealth equally among all individuals, and that it is consequently opposed to the development of trusts, mergers and consolidated business in general.”
[That myth persists – and will likely lead to deliberate misreadings of what follows.]
Dewey was accused of being a Marxist or a communist so many times that he felt the need to publish “Philosophy vs. Marxism: Why I am not a Communist” in the April 1938 issue of the second incarnation of The Freeman.
“He [Marx] had no conception, moreover, of the capacity of expanding industry to develop new inventions so as to develop new wants, new forms of wealth, new occupations; nor did he imagine that the intellectual ability of the employing class would be equal to seeing the need for sustaining consuming power by high wages in order to keep up production and its profits.”
[I read The Communist Manifesto in my introductory philosophy course. It took my professor, who professed to being “a true conservative” despite his liberal leanings, about two minutes to point out Marx’s fallacies. But such incoherence comes naturally to followers of Hegel.]
Dewey credits “the employing class” with the “intellectual ability” to see the benefit of increasing wages so that workers could keep buying products.
That was once the case. What we might call naïve capitalism raised all boats on the tides of prosperity following World War II. The American Dream became a reality for our middle class. Manufacturing jobs to supply consumer needs and wants spawned auxiliary industries to keep them operating.
Then came the corporate raiders, who bought companies to sell off their parts; traitorous American companies who moved their operations toward cheaper, foreign labor and Reaganomics. One result was the Rust Belt. Another was the growing wage discrepancy between workers and bosses.
In April, Claudio Fernandez Araoz and Greg Nagel of Fortune reported:
“Back in 1965, CEOs earned 21 times more than the average worker; by 2023, this ratio had escalated to 290 times. The situation is even worse for 100 out of the S&P 500 corporations, where in 2022 this ratio was 603 times. As a result, real [inflation-adjusted] CEO compensation in large firms increased by 878% from 1978 to 2022, while real worker compensation rose by 4.5% during this period.”
On Aug. 18, the Institute for Policy Studies issued a report revealing that, at the 100 Standard & Poor’s 500 companies with the lowest median wagers, CEOs were being paid 632 times more than their workers. In 2023, the gap was 560-1.
The Creed of Greed infected American corporations and moneychangers. The transition from textbook [naïve] capitalism to today’s rogue, rabid capitalism took place as “making money” replaced “making things” as a guiding principle.
MBAs showed corporate leaders how to make money without making widgets as if short term profits that destroyed the industry was Darwinian natural selection. Darwin described how species evolved through time. He was not endorsing a blue-printed justification to subjugate others for the dominance of one group.
In The Crisis in the Triumph of Capitalism, Catalonian historian Josep Fontana details how moneyed interests have been abetted in establishing wage inequality by “parliamentary democracies based on constitutions that guarantee the rights and freedoms of all citizens, but where the elected governments take care, above all, of favoring the economic interests of large corporations and of the richest.”
How does that happen? How do our representatives lose their way?
The prime example is billionaire Elon Musk, who spent $288 million last year to buy a presidency and Congress to do his economic bidding. On July 31, he donated another $5 million to super PACs for House and Senate Republicans and $5 million to MAGA, Inc, the super PAC of President Donald Trump.
Musk can well afford that. The next day. Tesla voted him a $29 billion pay package – pretty fair compensation for the guy who oversaw Tesla’s shares drop 20.21% from the first of the year. On Aug. 6, the Memphis Commercial Appeal logged the drop from $379.28 per share on Jan. 1 to $302.63 on Aug. 1.
It is hard to imagine what the richest man in the world would receive if Tesla were increasing in value.
Fontana called representatives who rubber-stamp economic inequality “tolerant accomplices” for “enriching a small group at the expense of majority and that engenders with this an increasingly uneven society.”
In a 2017 meeting of the Pontifical Academy of Social Sciences, Pope Francis expressed similar sentiments, pointing out, “inequality and exploitation are not inevitable, nor are they an historic constant. They are not inevitable because they depend not only on different individual forms of behavior, but also the economic rules that a society decides to adopt. We can think of energy production, the job market, the banking system, welfare, the tax system, the schools sector. According to how these sectors are planned, there are different consequences on the way in which income and wealth are distributed among those who have participated in their production.”
And a more equitable economics – equinomics, if you will – is also good business.
In their Fortune article, Fernandez Araoz and Nagel reported:
“Strikingly, before 1970, large firms’ real value grew at its highest rate of 6.1% per year, yet their CEO pay growth was 0.1% per year. In stark contrast, after 1970 the growth in large firms’ real value declined to 5.2% per year, while their real CEO pay increased by 4.6% per year [921% total through 2022].”
Back in 1930 – five years after President Calvin Coolidge told a roomful of newsmen, “the chief business of the American people is business” – Dewey assessed his present and looked toward the future:
“In a society so rapidly becoming corporate, there is need of associated thought to take account of the realities of the situation and to frame policies in the social interest. Only then can organized action in behalf of the social interest be made a reality. We are in for some kind of socialism, call it by whatever name we please, and no matter what it will be called when it is realized. Economic determinism is now a fact, not a theory. But there is a difference – and a choice between a blind, chaotic and unplanned determinism, issuing from business conducted for pecuniary profit, and the determination of a socially planned and ordered development. It is the difference and the choice between a socialism that is public and one that is capitalistic.”
Capitalistic corporate socialists are in control now. But they are a different, more selfish breed than their predecessors. New York City voters have said such a condition is not irreversible.
