This past week, the US House of Representatives, led by the Democrats, passed a mostly partisan measure to raise the US minimum wage to $15 per hour. The poor economic results that will follow from such a disastrous move aside, the bill represents what socialists often get so wrong. They tend to point their fingers at the wrong class.
Socialists tend to assume that the reason for unfairness in the world is that an upper class of business owners and leaders control all so that money and resources are purposefully distributed unequally, targeting people in the lower classes as working animals to supply the upper class with wealth while they toil. They believe that businesses and greedy corporate institutions hold them down, refusing to give out anything but scraps to the very people who work to make their profits possible. It is thought that wealth is created by ownership of production, and therefore, all workers should seize the means of production.
While there is certainly something to be said for the idea that corporate interests hold far too much sway over the world’s governments, it would be erroneous to toss capitalism aside by pointing to “the 1%” and blaming them for the world’s ills. While some in the upper class might be complicit in creating unfairness in markets, it is the ruling class that is more directly responsible.
It is a grave mistake to take the most powerful class that already controls too much and place in their hands the means to control most aspects of the economy, and by extension, many other things as well. If wealth disparity and power are the concerns, then why ignore the most significant disparity: That of the ruling class over the rest of us. While many in the ruling class are themselves extremely wealthy, they also maintain control of enormous amounts of capital, thus more wealth than the rest of us can ever imagine.
This year, the US government will have control over nearly $5 trillion in spending. By contrast, Amazon, the largest company in the world by market evaluation (worth almost $1 trillion) spent approximately $222 billion in all of 2018. Walmart, a more expense-heavy business, spent nearly $438 billion over the same period. How would one consider the wealth of the US government? If one wanted to purchase such power entirely, what would it be worth? $20 trillion perhaps, $30 trillion? Maybe more. It would take several of the world’s largest businesses to equal the wealth of the US government, not to mention the combined wealth of all the world’s governments. The wealth of the ruling class is indeed very vast, and the disparity between it and common citizens is enormously wide.
Large businesses do, indeed, take advantage of the wealth and power of government to obtain favorable rules and regulations, as well as to obtain some of that wealth through corporate welfare. But to attack the problem purely by institutionalizing government ownership of business, only makes the wealthiest class more wealthy and increases that wide disparity to terrifying levels. Take away the ability for government to provide favorable rules and regulations, and then they have nothing to offer businesses.
Socialism begins with the idea that wealth is concentrated in the hands of those who operate the means of production under a capitalist system, but the assumption ignores the even wealthier class that manipulates the poor and their circumstances to hold them down (under a crony capitalist system). Socialism grants the ruling class greater wealth, and the ruling class absorbs it rather than distributing it.
There is no worse means of wealth distribution than government. Fair distribution of wealth doesn’t come from the workers owning the means of production, it comes from the people owning the government and eliminating the massive power it has over them. If you want to point a finger at where the problem of wealth distribution lies, then point it toward the wealthiest class: The ruling class, your government.
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