The super-wealthy and the role of the state

Aug 17, 2019 Features / Columnists, Freddie Kissoon

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Untold millions in this world that include brilliant minds frown on socialist economics. They think the capitalist system is a preferred direction. But which model of capitalist economics? It certainly cannot be the type of capitalist economy the United States gave the world.
If any country has a capitalist system that has not produced national good for the totality of its citizens, it is the US.
The French academic, Thomas Picketty’s 2013 text, “Capital in the Twentieth-First Century” is an extraordinary piece of scholarship. It is one of the best non-fiction books the past 25 years. It is a brilliant dissertation on the pitfalls of capitalism in the United States and to a lesser extent, Europe.
One recalls that at the beginning of the nineties when world communism collapsed and the USSR disappeared from the face of the map, American scholar, Francis Fukuyama, produced a breath-taking study that the western world hailed as one of the best scholarly works ever written.
In “The End of History and the Last Man,” Fukuyama did an ironic job of Marx’s dialectics. Whereas Marx saw the end of history in the advent of communism, Fukuyama interpreted the disintegration of the USSR and the end of the Cold War as the dialectical conclusion of class struggle in the triumph of capitalist liberalism.
Fukuyama’s scholarship was greeted with prestigious awards but the not so easily converted were deeply discomfited with his enthusiasm.
Did history come to an end with capitalism? Was capitalism the answer all the time? But if history ends with the success of capitalism then how do you account for the vices, venalities, inequalities, exploitations of capitalism?
Fukuyama’s book came out in 1992 and 21 years after Piketty demolished the central tenets of Fukuyama. Fukuyama gives interviews in which he has come to reject the essential argument of his famous book.
On reading Piketty, it becomes easy to see that Fukuyama had a dream, woke up and penned an unrealistic vision of something too bizarre to be real. The trouble with capitalism from the 20th century onwards is that it adopted the American version and embraced it as the true form of capitalist economics. It is not.
American capitalism is seriously and deeply flawed. Space would not provide for my layman’s adumbration or to offer quotes from Piketty’s extraordinary treatise. Important to note is the impressive layout of statistics by Piketty to prove his point that 21st century capitalism is not working.
This is where other versions of capitalism should be discussed and socialist economics should be put on the table. The Scandinavian countries including Finland have capitalist systems. But the structure of Scandinavian capitalism incorporates many features of socialist perspectives.
The working people of Scandinavia don’t care about how many yachts and jets the wealthy have. That is their right to have wealth. They don’t care about the flaunting of ostentatious lifestyles once they are comfortable with their income and the facilities their countries offer them.
We can give literally hundreds of examples where capitalist Scandinavia incorporates many socialist features but a few should be mentioned.
They have free university education which Germany has adopted. Working parents have state-sponsored day-care facilities. The heath delivery system is excellent. A working class man is sick, he goes to a Swedish hospital and he gets medical treatment that is on par with what the rich man pays a private hospital to receive.
Piketty argues that society’s wealth should be taxed so there can be a fair share of society’s wealth. This is where Guyana is a miserable example. Guyana’s leadership needs to read Piketty.
Before 2014, declaration for property tax started at assets worth $7 million. Yet for the past forty years, property tax has not contributed even two percent of total taxes collected each year.
Rewind the clock before 2014. If you had to pay property tax on assets from $7 million up then when one looks at the stupendous wealth of hundreds of rich individuals and families in Guyana, property tax should have brought in a handsome sum to the Treasury.
The trouble with capitalist America (as Piketty so brilliantly depicted) is that the national wealth is not being shared at all. On the contrary it is being hogged (Piketty’s statistical outlay is phenomenal). Here is where America’s presidential election comes in.
Both Bernie Sanders and Elizabeth Warren are arguing for greater access of the lower and middle classes to America’s wealth. I hope one of the two becomes the US President. It should not matter how many private jet John Jones owns. The role of the state is to see he and he alone does not hog the nation’s wealth.

 

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