Imagine you work in a restaurant. Your manager sets the schedule and assigns various cleanup tasks at the end of the day. But he repeatedly gives his friends the most lucrative shifts, the easiest chores, and the weekends and holidays free. So you and your other co-workers decide to speak up. You’d prefer a system of equal rotation. Surprisingly, however, when you voice your concerns, you’re met with a barrage of accusations that you are anti-business, envious of others, and that this is class warfare. If you wanted to be manager, you should’ve gone to school. Capitalism, you are told, is better than socialism and you are lucky to live in the land of the free.
This odd situation is similar to one we often face today. Our economic discourse tends to suffers from non sequiturs. Two common ones stem from confusing the “level of analysis” in a conversation and mistaking arguments about policies with ones about people.
Capitalism and socialism are two possible grand organizing principles that used to compete for our loyalties. Few engage in debates about them today, however. At this level of analysis, the so-called socialist economies of Europe are just like ours. They’re capitalist-mixed economies that simply have a stronger safety net than we do. In the most “socialist” of the bunch — Sweden — Ikea is privately owned. It was founded by former farm boy Ingvar Kamprad, who is now one of the richest men in the world.
Within capitalism, however, there are myriad intermediate structures, policies, rules and procedures that govern and shape economic interactions. We have classical economic theories and Keynesian ones. We have supply-side economics and middle-out. We have particular tax rates, industry regulations, government programs, and eligibility rules, and we change them all the time. To criticize some of these intermediate structures or policies, however, is not to attack “capitalism.” To build a case for change at this level is not to undermine business as a meaningful, worthwhile and socially beneficial activity any more than to suggest a change in the household distribution of chores is to attack the institution of the family. In fact, it may serve to strengthen it.
We were capitalist, for example, when the highest marginal tax rate was 91 percent (under Eisenhower); when it was 77 percent (Nixon), and 35 to 39.6 percent (Obama). Eisenhower was no commie and neither is Obama. We were capitalist before Glass-Steagall, during Glass-Steagall, and after its repeal.
When one highlights a possible inconsistency, or perhaps some injustices, in this intermediate realm and encounters rejoinders about the superiority of capitalism over socialism or the benefits that business brings, it’s baffling. The latter were never called into doubt by the former. One is clueless as to where the conversation got derailed and how to fix the track and go forward. I mean, if you ask a bookseller the price of a book and he answers that it’s snowing in Boston, what do you say next?
The same is true when one points out the ways in which structures and policies disadvantage some groups, like the poor. Notice that such statements say nothing about the poor or rich as people. Instead they say something about the system. Yet typical responses to such statements focus on the people. They often deride the poor and defend the rich (who were not being attacked in the first place).
These responses further confuse the issue by reifying “the poor” (and sometimes also “the rich”), treating them as one thing — as lazy and vice-ridden, for example. “The poor,” however, is a category that includes a lot of people — the disabled, veterans, elderly couples, working two-parent families and single-headed households, immigrants, children and more. It includes lazy people and hard-working people; vice-ridden and not. (And it should come as no surprise that the middle-class and the wealthy are equally diverse.)
When unrelated arguments are read into conversations, or a diverse group is defined in terms of its worst representatives, we end up talking past one another. It would be great if we could listen to one another and benefit from our different perspectives rather than assuming that “this” really means “that” and the defense of some really means an attack on others.