Capitalism against Capitalism

Michel Albert, author of Capitalisme contre Capitalisme, compares the neo-American model of a capitalistic market economy with the Rhenish capitalism of Germany's social market economy. The neo-American model is based on the ideas of Hayek and Friedman, and the latter, according to Albert, is founded on principles of publicly organized social security. Albert asserts that this model is more equitable, efficient, and less violent.

To the general public (and certainly most Americans), however, the neo-American model appears more attractive and dynamic.  Part of this attractiveness, he asserts, is an illusion because, as Albert (in 1991) argues:

The largest banks know, however, that they are literally 'too big to fail' and can count on a helping hand from government if the worst comes to the worst. America's political leaders would step in to prevent the crash of a major financial institution on the grounds that it could set off a lethal chain reaction culminating in widespread disaster. ... Thus, in yet another intriguing but ominous irony of history, 10 years of ultra-liberalism have resulted in a US financial system whose future may only be assured with the help of federal government handouts. [Michel Albert. Capitalism Against Capitalism. London: Whurr, 1993.  p. 61]

Alberts ideas for a "better" capitalism include finance controlled more by banks than stock exchanges, closer relationships between between banks and companies, more balance between shareholders and managers, more partnerships between employers and unions, more loyal employees, more educated employees, a dual education system (more apprenticeships coupled with classroom learning), more regulation, and greater societal emphasis on equality and solidarity.  Perhaps Washington should, at least, consider some of these alternatives.

Mandarins and their Protections

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Union members who work for the government now outnumber privately employed union members in the United States, according to the Bureau of Labor Statistics. Overall union membership is now 15.3 million; 51.5 percent of these members are government workers. As of December 2009, the U.S. non-farming private workforce had 108.4 million workers; the government had 22.47 million. Thus, 35.1 percent of government workers are unioned, and 7 percent of private sector workers belong to unions.

Public employee unions primarily act in their member's interests (rather than in (or in addition to) the interest of the optimization of the government entity) and drive up the scope, cost, and size of government. Whereas private unionized industries are subject to the corrective forces of the market, government is a permanent, protected monopoly with the coercive ability to increase revenue through taxation.

The Supreme Court's recent ruling allowing unlimited funding of elections by unions should help maintain a course toward soldifying the power of these mandarins of American government.

See, also, http://reason.com/archives/2010/01/12/class-war .