American capitalism has served as an inspiring notion of what Americans can achieve, but the allure of our style of laissez-faire capitalism has lost some of its spark. In recent years, we have seen rampant income inequality on the rise, coupled with increased economic insecurity that has been especially prominent during the pandemic. The rising insecurity has empowered populist leaders like President Donald Trump. We need solutions.
Some of what I propose may make me sound like a “radical socialist” or to others “Bernie Sanders lite,” but I implore you to hear out my reasoning. I assure you I’m an ardent capitalist who merely wants to see our system provide everyone with the opportunity to prosper.
To maintain the type of competitiveness that makes America a vibrant country, we must combat rampant wealth inequality. Moreover, we ought to promote a public health insurance option to encourage job mobility and to support similar initiatives like increased small business grants, access to college education and federal works programs. In doing so, we can seek to rebalance the status quo in a way that could transform our nation while preserving it’s uniquely capitalist core.
One of the most pressing problems that garners our attention as we revamp capitalism is wealth inequality, which has become increasingly prevalent over the past few decades. The 50 wealthiest Americans hold close to the same amount of wealth as the poorest 165 million Americans. Meanwhile, the lowest-paid Americans have seen their wage growth stagnate over the last 40 years, with their purchasing power relatively low compared to richer Americans. To counter that, instead of imposing a set statewide minimum wage, we should tie it to the relative inflation rate and cost of living in each city, which should then be updated every year.
The government should consider expanding college grants or, at the very least, the prospect of debt-free education to encourage attendance amongst low-income individuals, which benefits society as a whole. We also need to implement reeducation programs to combat a lack of skills and job displacement due to globalization — such as now evident throughout the Rust Belt as jobs go to areas with lower wages and lax labor laws.
From there, we should boost the idea of a federal works program, like the Works Progress Administration (WPA) that from 1935 to 1943 created 8.5 million jobs and focused on public works projects like schools, airports, electricity infrastructure and recreational spaces, as well as on major works such as the Hoover Dam and Golden Gate Bridge. The WPA could help us create job opportunities for the unemployed and those with lower educational attainment. This would not only create good-paying jobs for individuals in dire need, but it would serve as a way to reinvent our infrastructure, facilitate the green economy and motivate artistic displays.
Additionally, we ought to promote raising the corporate tax rate back up to at least 28% while also closing loopholes that allow corporations like Amazon and Netflix to pay $0 in federal taxes. On top of that, we should consider taxing the wealthy at higher rates, either through increased marginal tax rates or simply higher overall tax rates with guidelines to prevent offshore wealth accumulation; these are proposals that some wealthy Americans already endorse. With these proposals, the government could generate additional revenue to enact ambitious proposals and invigorate an economy that works for the many, not only the few.
Another idea would be to create a public option for health insurance, which would bring down rates on private insurance, while still deriving decent care and expanded access. In doing so, low- and middle-income workers will have greater job mobility relative to the current system, where their health insurance is tied to their jobs. As a result of getting quality care and health insurance, these families can become more productive members of our society. It’s not rocket science to know that the more healthy your most vulnerable and largest populations are, the better the country as a whole is going to be.
I would be remiss not to address the fact that those harmed the most by capitalism tend to disproportionately be Black, Indigenous and people of color and low-income families, who have either been exploited or have lacked the resources they need for success. I will not excuse actions by past Americans who have exploited these communities because they are rightfully condemnable. These groups have gone neglected, written off as welfare cheats or been told they are the problems of society. Predatory behavior toward people in these communities has been encouraged by preventing them from new home loans through redlining and banks trapping them in debt. Due to prevalent public skepticism, this is all coupled with the willful neglect by the government to invest in impoverished areas. Such transgressions are reprehensible and must be rectified.
Many will say that American capitalism is broken and beyond repair — I don’t think it is. Undoubtedly, America has prospered under a capitalist system, inspiring invention and affluence. American capitalism has been stifled by both a lack of real economic gains and investment amongst the lower and middle classes, mainly due to inaction by Congress to curb the growing wealth divide or provide real opportunities to those who need them most.
As Americans, we should recognize significant disparities between the richest and poorest in our nation and provide greater equality of opportunity. By providing an equal opportunity to succeed in life, we exemplify the basic tenets of what the American Dream is said to be about — the ability to successfully pursue our wildest ideas. If we do nothing to mitigate those differences, we will undoubtedly suffer future populist grandstanders, who monopolize on exploiting our base human fears of others.
Demetrios Mammas (23C) is from Atlanta.