Capitalists beware: post-democracy America may not be a shining example of Hayekian liberalism
Dan Little has a post up at Understanding Society on what authoritarianism might look like in the United States. The whole thing is well worth reading, but here is one part:
This seems about right, though of course speculative, but I have doubts about the big business piece. Yes, some business interests will be close to the ruling party or strongman, and they may gain some degree of regulatory relief, but it would be a mistake for capitalists to think that they would thrive in an authoritarian system. Even authoritarian regimes worry about popular support, and capitalism is not deeply beloved by the masses. Just as the plutocratic wing of the Republican coalition has ceded power to socially conservative voters, business leaders in an authoritarian state would be vulnerable to the needs of the political elite. Capitalists and their businesses would be a source of revenue and jobs to buy public support, convenient scapegoats when things go sour, and a potential threat to the ruling oligarchs. Think about the uneasy position of capitalists in Russia and China.
Little’s post suggests that capitalists and perhaps indirectly capitalism will be strengthened in post-democracy America by regulatory retrenchment. The truth is that capitalists have it pretty good in America right now. I hope they don’t engage in Hayekian wishful thinking about the economic benefits of totalitarianism. The odds are that a nationalist authoritarian government would destroy our economic prospects as well as our democracy. It would be a huge mistake for business leaders to think that authoritarians would rescue them from Allende-type socialism and faithfully serve their interests ever after.
Unfortunately weakening of thought and speech and press has already preceded weakening of freedom of thought and speech and press, which at least means that that the tangible amount at risk from the loss of freedom is now less :<)
Isn’t it the common mistake that people make thinking they are on the inside when we see authoritarian structure start to rise and materialize?
I’m sure I’m not alone thinking that big business or business in general think they are sitting at the planning table for all that is happening. I know my experience locally has been my friends and acquaintances that are business owners (real honest to goodness small business) side republican because you know: Pro business.
The only true insider is the one at the head of the movement. Even they, if they are smart, have to watch out for the one coming after their position.
History shows that authoritarian structures rise out of the corrupt and incompetent regimes against which they are rebelling. Small business is always on the sidelines. OTOH, big business may stand on one side or the other, but if it was the wrong side then they are dead and dispossessed. Think czarist Russia, Weimar Germany (more incompetent that corrupt but still ethnic Germans suffered malnutrition that state elites did not), Qing China, and Batista’s Cuba. Our own George III was no saint, but somehow we made a dollar democratic republic (plutocracy) out of our revolution rather than autocracy.
OTOH, to set expectations for the US from the experiences of banana republics is to completely misunderstand the effects of scale and precedence and the dynamics of political power. Cuba was no banana republic, but rather a US satellite controlled by our own organized crime syndicates.
The US is a banana republic in part (large part, to much of a part) in that to much of it (it being all the factions currently living/thriving of sorts in the US) are acting out of selfishness (narcissism seems to be the word of the day) in an environment of promoted mistrust.
It’s not that small business is always on the outside. It is that they believe they are on the inside. Thus a group to be utilized by those in the current position to manipulate perception.
Said group of manipulators always potentially on the outs.
https://en.wikipedia.org/wiki/Banana_republic
In political science, the term banana republic describes a politically unstable country with an economy dependent upon the exportation of a limited-resource product, such as bananas or minerals. In 1904, the American author O. Henry coined the term to describe Honduras and neighbouring countries under economic exploitation by U.S. corporations, such as the United Fruit Company (now Chiquita Brands International).[1] Typically, a banana republic has a society of extremely stratified social classes, usually a large impoverished working class and a ruling class plutocracy, composed of the business, political, and military elites of that society.[2] The ruling class controls the primary sector of the economy by way of the exploitation of labor;[3] thus, the term banana republic is a pejorative descriptor for a servile oligarchy that abets and supports, for kickbacks, the exploitation of large-scale plantation agriculture, especially banana cultivation.[3]
A banana republic is a country with an economy of state capitalism, whereby the country is operated as a private commercial enterprise for the exclusive profit of the ruling class. Such exploitation is enabled by collusion between the state and favored economic monopolies, in which the profit, derived from the private exploitation of public lands, is private property, while the debts incurred thereby are the financial responsibility of the public treasury. Such an imbalanced economy remains limited by the uneven economic development of town and country and usually reduces the national currency into devalued banknotes (paper money), rendering the country ineligible for international development credit.[4]
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[Although I will admit several overlaps between the US and banana republics (e.g.,the country is operated as a private commercial enterprise for the exclusive profit of the ruling class) those similarities are a matter of degree where the degree is far more absolute in a banana republic than in our dollar democracy republican form. Moreover, the idea of a banana republic just does not square with being a (if not “the” any longer) global superpower. ]
Also, selfishness has been a norm throughout human history that always coexists with altruism in varying degrees among both historical periods and individuals. Narcissism is entirely something else, vanity as a mortal flaw and the lack of empathy as a personality disorder.
Small business owners rarely feel secure enough to fantasize that they are insiders to political power, although some midsize business owners appear to be that vain, but my guess is that is just their vanity speaking and not their true opinion.
They only have to feel inside enough to feel protected and that is what too many business owners believe as they support the Republican/right. They fail to see how they are actually not high enough up the money ladder to receive the benefits of the policy implemented by the party they support. But they are a voting block to be relied on.
I was not suggesting “absolute” regarding banana republic. I know what narcissism is. I know what selfishness is.
All my in-laws vote Republican because they were raised that way and they think that liberals are brain dead and crazy. They even voted for Trump, which was a bridge too far at least for my wife. My New Deal Democrat parents had tired of the Democratic Party by the time of LBJ because they had a much better idea what was needed to uplift low income families than he did. With Jack they had been hopeful and rather disappointed, but after that there was no other politician they thought highly of at all. Of course, FDR just became more of a saint with each new soul crushing election. OTOH, my wife’s parents were of the Silent Generation and never knew a Republican that they did not like. Both her family and mine understand little or nothing about history, economics, psychology, sociology, nor physical science. So, which family was more charitable and decent people? There was not much difference between them although her family was more above median income and mine was more median income or below. Both my dad and her dad were known as the kind of men that would give someone the shirt off their backs if they needed it.
OTOH, I also have met some gun crazy racist pigs that would not give anyone anything other than a hard time. Sure they always vote Republican and although there are enough of such people to scare the children at time, there are not enough of them to control election outcomes other than as any small voting block does at the margins.
Taxes drive small business owners crazy. It takes a lot of accounting to run a small business and most often there is too little income to want to pay an accountant to do it for them. Usually inventory is required to calculate income and there are payroll taxes for employees and sales taxes. Since there are a little over 30 million small businesses in the US, then that is a more than just a marginal voting block. Regulations also drive small business owners crazy. Small business owners are unlikely to marry any politician but they might kiss a Republican and probably would like to kill a Democrat or two.
BTW, I much prefer to use words as if I might know what they meant.
“So, which family was more charitable and decent people?” I don’t know. I was not under the impression that the discussion here was one of judgement.
My history is that I’m still in private practice. Me and 2 helpers since 1984. I also owned a flower shop/greenhouses for 20 years until 2/2019. Everything is Quicken and/or Quickbooks. The accountant only does the taxes. Own a bit of real estate and can/do fix or repair everything including all vehicle and power equipment.
I’ve served on nonprofit boards, local zoning board, local government committees, even ran for local office once. I’ve been involved with passing state legislation via testifying.
I like to think I’ve had a very broad life experience including a wonderful daughter with a lovely wife and a son.
Daniel
Thanks . . .