Ask them how well capitalism was doing in 1929.
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To the extent that capitalism’s problems – inequality, instability (cycles/crises), etc. – stem in part from its production relationships, reforms focused exclusively on regulating or supplanting markets will not succeed in solving them. For example, Keynesian monetary policies (focused on raising or lowering the quantity of money in circulation and, correspondingly, interest rates) do not touch the employer-employee relationship, however much their variations redistribute wealth, regulate markets, or displace markets in favor of state-administered investment decisions. Likewise, Keynesian fiscal policies (raising or lowering taxes and government spending) do not address the employer-employee relationship.
Keynesian policies also never ended the cyclical instability of capitalism. The New Deal and European social democracy left capitalism in place in both state and private units (enterprises) of production notwithstanding their massive reform agendas and programs. They thereby left capitalist employers facing the incentives and receiving the resources (profits) to evade, weaken and eventually dissolve most of those programs.
It is far better not to distribute wealth unequally in the first place than to re-distribute it after to undo the inequality. For example, FDR proposed in 1944 that the government establish a maximum income alongside a minimum wage; that is one among the various ways inequality could be limited and thereby redistribution avoided. Efforts to redistribute encounter evasions, oppositions, and failures that compound the effects of unequal distribution itself. Social peace and cohesion are the victims of redistribution sooner or later. Reforming markets while leaving the relations/organization of capitalist production unchanged is like redistribution. Just as redistribution schemes fail to solve the problems rooted in distribution, market-focused reforms fail to solve the problems rooted in production.
Since 2008, capitalism has showed us all yet again its deep and unsolved problems of cyclical instability, deepening inequality and the injustices they both entail. Their persistence mirrors that of the capitalist organization of production. To successfully confront and solve the problems of economic cycles, income and wealth inequality, and so on, we need to go beyond the capitalist employer-employee system of production. The democratization of enterprises – transitioning from employer-employee hierarchies to worker cooperatives – is a key way available here and now to realize the change we need.
Worker coops democratically decide the distribution of income (wages, bonuses, benefits, profit shares, etc.) among their members. No small group of owners and the boards of directors they choose would, as in capitalist corporations, make such decisions. Thus, for example, it would be far less likely that a few individuals in a worker coop would earn millions while most others could not afford to send children to college. A democratic worker coop decision on the distribution of enterprise income would be far less unequal than what typifies capitalist enterprises. A socialism for the 21st century could and should include the transition from a capitalist to a worker-coop-based economic system as central to its commitments to less inequality and less social conflict over redistribution.
Capitalism Is Not the “Market System”
Strangely all the Socialist ideas that the racist KKK, Progressive Marxist Socialists and FDR came up with the New Deal to bring America out of the Depression did not work. What did bring the U.S. out of the Great Depression was World War II. The slogan was "A Chicken In Every Pot And A Car In The Garage". What's the slogan for the "Green New Deal"?
#37 – If FDR's New Deal Didn't End the Depression, Then It ...
https://fee.org/articles/37-if-fdrs-new-deal-
didnt-end-the...
In April 1939, almost ten years after the crisis began, more than one in five Americans still
could not find work. On the surface, World War II seems to mark the end of the Great
Depression. During the war more than 12 million Americans were sent into the military, and a similar number toiled in defense-related jobs.
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The Great Depression and World War II, 1929-1945 | Gilder ...
https://www.gilderlehrman.org/history-now/great-depression-and...
And between 1929 and 1945 the Great Depression and World War II utterly redefined the role of government in American society and catapulted the United States from an isolated, peripheral state into the world’s hegemonic superpower.
Everything he posted is dead on accurate. Why do people ignore this?
And in fact, it wasn't even world war 2 that ended the depression. There is only one economic measure that suggests the depression ended at world war 2, and that is the unemployment rate.
But the unemployment rate declining, was largely due to the US drafting everyone into the military. Unemployed people went into the military, or employed people were drafted, and had to be replaced by unemployed people. The real number of jobs, in the private sector really didn't increase much. What increased was the number of people in the military.
If we simply made it a prison sentence to be unemployed, and put all the unemployed into labor gangs, would you conclude that dramatically lower unemployment was due to economic growth? NO, of course not. That would be ridiculous. But that is exactly what happened in WW2.
And by any economic measure, the standard of living declined during world war 2. Rationing of meat, and eggs, and automobiles. Everything was reduced. In what economic growth situation, does everyone become worse off?
In reality, the real end of the depression was in the late 40s, when tariffs on trade were removed, regulations were reduced, and taxes were cut.
A lot of people fail to remember that in 1945, when the war was over, and all the men started returning home, tons of problems came up. Unemployment went up, there was a housing crisis, and shortages of food.
So all the problems that existed before the war, returned after the war. It was the repeal of the taxes, and the regulations, and tariffs, that resulted in all those problems going away.
