Capitalism Within the American Stat

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At the end of World War II, the United States emerged as the dominant economic, political, and technological power of the world. Since then, the United States’ has sustained an almost unrivaled hegemon, and overseen the establishment of a new world political economic order centered around a democratic capitalist society. The postwar institutions it helped establish (the United Nations, IMF, and World Bank, amongst others) further entrenched a capitalist system into the global economy. A representative republic with strong democratic charisma and dominant free market economy, the American model was believed to be a polished system which fostered not only competition and innovation, but equal opportunity and social mobility. The combination of capitalism and democracy, as the United States had shown for over a century, was the model with which to bring unprecedented prosperity and freedom to the world.

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More recently though, this conventional thinking is beginning to unravel. While capitalism continues to flourish, democracy is struggling to keep up. China, boasting the 2nd largest GDP in the world, has seemingly balanced free market capitalism with an authoritarian state with no political freedom. There are many other economically successful nations, like Russia and Mexico, which are democracies in name only, hampered by the same problems that have troubled American democracy in recent years, allowing corporations and elites to undermine the government’s capacity to respond to citizens’ concerns. Capitalism too is beginning to show it isn’t a perfect system after all. Despite major increases in economic growth, the typical American family today has a lower net worth than the typical family did 20 years ago. The extra surplus value that was made during that time stayed in the top 1%; since 1978, wages for the average American worker have remained flat, while CEO pay has soared by 937%. There isn’t much of a debate anymore, America’s current economic system as it stands makes the rich richer while the rest of America remains stagnant or suffers to support the wealthy class. The problems inherent within the existing capitalist system have manifested themselves, and America has yet to do anything significant to combat them, begging to question the role the American government plays in propagating the existing system of capitalism. There is evidence to both support and refute the notion that the American state exists to support the current capitalist system.

Perhaps the most compelling evidence for the notion that the American state exists to support the existing capitalist system is the influence held by elite private individuals over public policy. Now more than ever before in America, there is an increasing link between money and the power it possesses within politics. Corporations and industry groups, labor unions, single-issue organizations and other forms of lobbyist spend billions of dollars each year to gain access to prominent decision-makers in government, all with the intent of influencing their thinking and decision-making

While there is nothing inherently wrong with lobbying, problems with lobbying appear when lobbyists use money to buy influence within the American state. In this regard, the wealthy wield an unfair advantage over the working class. In a study conducted by Professor Martin Gilens of Princeton University and Benjamin Page of Northwestern University, they found that “the preferences of the average American appear to have only a minuscule, near-zero, statically non-significant impact upon public policy”. In the current American system, the bottom 90% of income earners have virtually no say in government policy. However, Gilens and Page found that economic elites, corporations, and people who can afford lobbyists carry significant influence, because purchasing political power is legal and easy to do. The economic elite, which has the money and time to lobby, exploits the current system to ensure that lawmakers are essentially bought by donors and will both set agendas and vote in favor of specific legislation for their donors. Despite bipartisan support from constituents for campaign finance reform, Congress has yet to address the issues of donations and the impact they have on their legislative agenda. In this sense, the American legislature has been manipulated by the capitalist system in order for it to be exploited for the benefit of the economic elites.

Not only can money buy someone influence in America’s legislature, but it can also win influence in America’s executive. This has been done in the past and present through the use of independent foundations and think tanks; a fitting example of this comes from the Council on Foreign Relations. In 1924, the Rockefeller and Carnegie Foundations, with additional support from the Ford foundation later down the line, “began to formulate the idea of global cooperate governance” by creating the Council on Foreign Relations, which “today [is]the most powerful foreign policy pressure group in the world”. The Council on Foreign Relations brought together the heads of the leading steel, oil, and other major economic sectors together “to turn money into power” with no accountability or transparency. The wealth behind this independent foundation gave it abundant faculty to influence domestic and international policy to whatever would favor their respective industries and the broader capitalist agenda. Independent foundations like this one, while revolutionary at the time, by the 1950’s “began to work as quasi-extensions of the US government”, enabling leading economic elites with the ability to achieve substantial power and influence over the American state, influence which could be used to better support their own expansionist goals. Knowing these industries have a vested interest in preserving the existing system of capitalism in both the American state and the global economic system, they have and will continue to use their monetary leverage to garner influence within the government in order to preserve the existing capitalist state.

In addition, one can look no further than the leaders of American government to find evidence that the American government exists to support the existing capitalist system. In both political parties, there is a bipartisan consensus that the capitalist system continues to be the right way forward. While they may disagree on the extent of the free market, “the economic aim of both major US political parties is, in the end, the same: to protect and reinforce the capitalist system”. With the rise of socialist agendas spearheaded by Bernie Sanders and Alexandria Ocasio-Cortez’s within the Democratic party, moderate Democrats have had to reaffirm their commitment to a capitalist America, with Elizabeth Warren going so far as to say she is “a Capitalist to [her] bones”. On the Republican side, Donald Trump is a textbook example of a politician with a conflict of interest. With a net worth of allegedly $3.1 billion dollars, Donald Trump has refused to disclose his tax returns to the American public. It still remains relatively unclear whether he has given up total control of his private businesses while in office, or whether he is acting in the name of the people or for his own self-interests. In 2017, this was demonstrated when Donald Trump helped Congress pass new tax policy in which personal exemptions were eliminated altogether and the corporate tax rate was reduced from 35% to 21%, supporting wealthy business owners more than the average American. Donald Trump’s shameless dedication to his business interests follows Rousseau’s argument concerning inequalities, with “wealth [being] the last to which they are ultimately reduced, because… it readily serves to buy all the rest”. When elites, like Trump, are given to opportunity to make policy on behalf of the government, they almost always will use that power to better their own self-interests, perpetuating any inequalities found within the existing capitalist system. Despite this evidence, it can be argued concurrently that the continued stability of public opinion regarding the capitalist system within the American state is what has propagated it, rather than its existence itself. In this argument, the state is not an instrument of class rule but rather serves to maintain the public interests’. The America legislature has always followed majority rule, and the majority has always had the right to act to reform and reshape government policy when they see fit. When a terrorist attack occurred on September 11th, there was swift action to invade Afghanistan because it was the people’s will to do so. While it was previously discussed that there is an inequality of monetary distribution in favor of the elite, and therefore a chance for power and influence to accumulate in the wealthy, “there is no legal monopoly of power in the hands of the economically dominant class,” and the average citizen under the U.S. Constitution has the same guaranteed rights and ability to influence government policy through voting as members of the wealthy class.

Suffice to say, this argument runs that the American state does not exist to support the capitalist system, but rather that this system exists because it is supported by a majority of people. Up until recently, Americans have overwhelmingly supported the American capitalist system. A decade ago, “80 percent of Americans agreed with the statement that a free market economy is the best system”. However, that consensus in recent years has severely taking a hit. Today, support for capitalism amongst Americans is around 60 percent, lower than in China. One recent poll found that only 42 percent of millennials supported capitalism, while in another poll, a majority of millennials said they would rather live in a socialist country than a capitalist one. This shift in tone can be explained in part as a response to the latest problems that have plagued capitalist societies. Economic recession and lack of recovery in certain geographic areas of the country, rising student debt, and other damaging economic consequences have driven working class voters out to the polls voting against the capitalist state. As the youngest voting generation continues to gain more political power, they continue to demonstrate a desire to see socialist policies implemented within American government, a staggering course of events within American political discourse. More and more, the American public is starting to recognize the need for certain sectors of our society (education, health care, renewable energy solutions, etc.) to be relegated by the government instead of privatized under a capitalist system. While these policies would hinder the capitalist system in certain sectors, with certain industries like education becoming less commodified and therefore less profitable, it still marks a transition in American thought where there is more trust in governmental oversight than in private intervention, no part understood as a backlash against the current capitalist state.

This trend has also garnered traction in the executive as well. In 2016, Bernie Sanders ran for president on a political platform that many thought should’ve ruined his political chances; as a democratic socialist, he disavowed America’s longtime capitalist consensus and proudly wrapped himself in the labels of socialism which many considered political poisons at the time, but worked for him as he pulled in a significant percentage of the votes in the Democratic primary. Despite the fact that the 2016 election did not result in a presidential victory for Sanders, the support he received from grassroots movements spearheaded by young Americans signals a change in the overall satisfaction of younger people with the current state of affairs and their desire to see it changed. Although the state at this point still serves to serve a majority that wishes to keep the existing capitalist system, the powers of representatives and lawmakers is derived from the authority of the people they represent, rendering themselves and the political system vulnerable to change, so long as there exists a rising level of dissatisfaction among the population as more progressive generations come to take part in the political system.

Throughout American history, the United States has prided itself on representing the political and economic desires of its citizens. However, an overpowering tradition of capitalism has rooted itself within not only the American political system but in the international system, a tradition which is difficult to undo and reform. There exists an overwhelming body of evidence that the American state helps propagate the existing capitalist regime. However, there is hope that new public support for socialist policies will help elevate some of the struggles placed on the working class by the existing capitalist system. Furthermore, the American state, despites its clear favoritism for capitalism, exists not to simply support a capitalist state, but exists to support its citizens, regardless of their class or wealth.

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Capitalism within the American Stat. (2021, Mar 20). Retrieved December 3, 2022 , from
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