Nothing wrong with capitalism, the capitalists are the problem

In March 1964, a group including Linus Pauling, Gunnar Myrdal, Tom Hayden, Ben B. Seligmanm and computer pioneer Louis Fein sent a letter to President Lyndon Johnson covering their report on “The Triple Revolution.” The letter began: “We enclose a memorandum... prepared out of a feeling of foreboding about the nation's future. The men and women whose names are signed to it think that neither Americans nor their leaders are aware of the magnitude and acceleration of the changes going on around them. These changes, economic, military, and social, comprise The Triple Revolution. We believe that these changes will compel, in the very near future and whether we like it or not, public measures that move radically beyond any steps now proposed or contemplated.” They were right about the changes but underestimated our ability to drift towards the iceberg most would not see until much later.

The three revolutions were in cybernation, weaponry and human rights. The nuclear and other new weapon systems threatened peace. The African American struggle for equal rights in the US was part of the rising demand around the globe for full human rights. But the report focused on the affects of the cybernation revolution (their term). The combination of the computer and automation was issuing in a new mode of production as different from the industrial as that was from the agricultural. It would result in “almost unlimited productive capacity which requires progressively less human labor.” Yet the current economic model awarded access to this production, to the wealth it created, unequally to those with capital and those who earned their keep through labor. The cybernation of production would mean increasingly less of good paying industrial jobs. The US was experiencing this process first but it would spread throughout the world we dominated.

The report argued that having access to the collectively produced wealth of society could not any longer be tied to labor. Maintaining and improving individual wellbeing across society – through making maximum use of the potential of automated production – would have to transition from depending on good paying jobs. Income would have to be separated from work. This would require some form of guaranteed individual income and vast investment in public goods. Left to itself, the market would not move in this direction, it would require government action.

As it turned out, capital figured out a way to exploit the new cybernetic economy by shifting production to automation (and now AI) and to areas of cheap labor. Some developing countries – like China – followed suit using their cheap labor to industrialize. This form of globalization produced cheaper goods and did lift many from poverty, worldwide. But it mostly benefited capital rather than labor.

The Western democracies did little to ensure the political sustainability of free trade globalism. This would have required providing those reduced to un- and under-employment or low-paying service sector jobs with the decent income and public goods (including improved education, free healthcare and jobs created through spending on updating infrastructure) that we could have begun 60 years ago. The Western European democracies did a bit better than the US with their social welfare programs but still found themselves in this 21st Century facing the political drift to the right fueled by those left out of the wealth creation.

In the US, we got Trump and his MAGA movement. This virulent form of the anti-globalism reaction has plunged the world into Trump’s tariff war on the very foundations of the world capitalist order.

Nothing wrong with capitalism, indeed there seems to be no good alternative to markets coordinating supply and demand. Free trade to maximize market functioning is part of this (with some measures perhaps needed to ensure fair trade). The World Trade Organization could expand its trade liberalization agenda to include mandates to improve local living standards alongside fair labor standards. Rather than make war on the system of rule-based trade that we have benefited from, the US government would encourage foreign investment in our productive sector as part of a rational approach to whatever re-industrialization makes sense. (This could include China.)

The monopoly capitalists at the top of our cybernetic economy are the problem. They need to be taxed at levels considerably greater than their workers. Their ability to wield political power through money needs to be ended. Government must be empowered to ensure that everyone benefits from market functioning even if this means a form of guaranteed minimum individual income. The Democrats need to do more than wait for Trump to fail. Railing against the billionaires must be accompanied by explaining the need for change and advocating the policies laid out in that report to Johnson.

So what if Trumps wins?

If Donald Trump wins the presidency on November 5, it will be the third time this century that a Republican has won with a minority of the vote. This owes to the anti-democratic elements of our 18th Century Constitution (the Electoral College, Senate and Supreme Court). The Republican Party is a minority party riding on every advantage our outdated system gives it. They win – with help from the Russians and arrogant tech lords like Musk – by converting Trump’s clownish authoritarianism into the false consciousness of whites who feel threatened by the increasing diversity of America despite being themselves among the richest 4% of the global population.

What would Trump’s victory mean? One can consider the U.S. domestic implications and the impact on the world in general.

Domestically, Trump will seek political vengeance while using the justice system to avoid prison. (Avoiding prison is his main reason for running.) His cohort of Project-2025ers will seek to undermine the administrative state while using state power to favor those capitalists that see government as hindrance. Together they will probably throw our economy, politics, courts, health & education systems, social safety nets and society in general, into turmoil. Their efforts to govern through authoritarianism and populism – the essence of MAGA – will test our democratic institutions and wreck havoc.

But we are not Weimar Germany. Our institutions will hold, although any Trump effort to use the military for domestic actions – such as dealing with “illegal migration” – could lead to a real crisis. It may well be that in the midterm elections of 2026, the upheaval would be enough to lead to a Democratic resurgence. (It will be interesting to watch a Vice President Vance. He could call the policy shots from the background. As an opportunist par excellence, he may be sensitive to the popular reaction to the various outrages pushed by the P-2025ers and tack accordingly.)

A Trump regime’s impact on the world stage is another matter. He will favor isolationism, economic nationalism, unilateralism, pro-Russian approaches in Ukraine and Eastern Europe, disengagement from the Mideast and who knows what with North Korea. This will fundamentally weaken the global position of the U.S. But let’s consider this from the 35,000 foot level.

The U.S. has held center stage in the world since the end of World War II. The various political and economic institutions of the global order – including the UN, IMF, World Bank, NATO etc – were ours by design. We established the contours of the Cold War that divided the world into good guys and bad guys and led to many distortions of the domestic affairs of other countries. After the fall of the USSR, we found other ways to define bad actors by choosing – often unwisely – which regional states to offer favored status and protection. As we began to lose our industrial advantage – with other economies coming online – globalism became our religion and we used the available levers to impose austerity and free trade everywhere we could.

We Americans have always been pretty self-centered, focused on our own navels. We governed the world – to the extent we did – for our own purposes, assuming that what was good for America was good for everyone. Trump’s obsession on making America “great again” is simply a dysfunctional flavor of this.

Our record as the predominant global hegemon has been mixed, to say the least. The world today can be legitimately described as a mess, with violent conflicts of various kinds and sources, terrorism, mass migration, political polarization, continued poverty and inequality, nuclear proliferation, the emerging technological singularity, and widespread and worsening climate disruptions. The U.S. did not cause any of these – at least not by ourselves – but they all happened on our watch. Meanwhile, the world has increasingly begun to just ignore us. (Watch China, India and the other BRICS cozy up to Putin despite his assault on world order.) Our inability to anything about the Mideast has not surprised anyone but ourselves. Maybe it’s better that we do withdraw somewhat from world affairs and let folks get on with finding their own way? If Trump wins in November, however messy it will be, maybe it’ll be what the world needs?  Like a heart attack that scares you into changing your bad habits? 

(Maybe we Americans will finally upgrade our Constitution.)