America Beyond Capitalism book, by Gar AlperovitzI was giddy with hope back in November 2008 when Barack Obama won the presidential election. Like many, I believed that we stood at the edge of potentially enormous positive change, an opportunity that surely arises only once in a generation.

Today, a year later, I am more deeply concerned than ever. Not hopeless, but extremely worried. Obama’s election was the first, not the final, step, and though we are moving in the right direction under this new leadership, by every measure our progress looks like it’s going to fall far short of what is needed. The advances we’re making are incremental at a time when revolutionary change is needed.

Our political and economic structures and systems, governed by largely invisible but very real powers, will not change direction willingly. Our financial system is resisting all efforts to bring about meaningful structural reorganization. Recalcitrance from the energy industry means that global climate change may, at best, be delayed by only a generation. The recession is easing but countless Americans remain out of work, and far too many are still losing their homes to a rapacious banking sector. Meanwhile, our educational system is failing to deliver the talent required to lead us toward a sustainable future even as our population grows beyond levels the planet can sustain.

Strangely, in the face of a system that repeatedly produces unjust, inequitable and unsustainable results like these, we cling ever tighter to it believing that real alternatives do not exist.

Too many of us have hung back, hoping that Obama would be the catalyst that triggered massive change, but it’s now clear that his election is not enough. What his Administration and our progressive leaders in Congress need is a loud and sustained public mandate for bold new ideas. We, not they, are the people we’ve been waiting for.

Yet few of us are providing that vision for bold progressive change. The fundamental structural change we seek still seems to lie in territory that, for the most part, remains untouchable.

Still, there are voices speaking the words the world needs to hear. One belongs to political scientist Gar Alpervoitz. Alpervoitz has not hesitated to face up to the challenges before us. From the redistribution of wealth and rules governing property ownership to moving the boundaries between capitalist and socialist economics and creating a just and sustainable economy, he effortlessly outlines a bold and practical vision and places it in a powerful historical context.

In the introduction to America Beyond Capitalism Alpervoitz writes:

HOW DO WE DETECT when a society is in trouble–real trouble? What canary in the coal mine signals danger? The real signs of major trouble are to be found not only in huge deficits, unemployment, even terrorism. The time to pay close attention is when people begin to lose belief in things which once mattered profoundly––like the most important values which have given meaning to American history from the time of the Declaration of Independence: equality, liberty and democracy.

Systemic change, above all, involves questions of how property is owned and controlled–i.e., the locus of real power in most systems.

Beyond this, if equality, liberty, and meaningful democracy can truly no longer be sustained by the political and economic arrangements of the current system, this defines the beginning phases of what can only be called a systemic crisis––an era of history in which the political-economic system must slowly lose legitimacy because the realities it produces contradict the values it proclaims.

To grant the simple possibility that the present system, like others in history, might one day be transformed opens a certain perspective on possibilities both for the coming century and for its opening decades. The tendency of those who think about “systemic change” is commonly towards abstraction. Words like “revolution” appear often in traditional writing. It is striking that––again, just below the surface of most media concern–there has also been an extraordinary explosion of practical real world economic and political experimentation in the United States which ties in with (and points in the direction of) some of the main features of the new system-oriented ideas.

These are fairly “radical” ideas, and you’d never suspect them from someone with his resume. Alpervoitz is a Professor of Political Economy at the University of Maryland; a former Fellow at Kings College, Cambridge; a founding Fellow of the Institute of Politics at Harvard; a Fellow at the Institute for Policy Studies; and a Guest Scholar at the Brookings Institution. Unlike many academics, he comes from a political background and was a Legislative Director in both the U.S. House of Representatives and the U.S. Senate, and a Special Assistant concerned with United Nations issues in the Department of State.

Those are impressive credentials and they serve to make his ideas even more so. In a world of incremental thinking, Alpervoitz is all about systemic change. He’s also willing to risk the kind of name-calling that scares the hell out of his progressive brethren. Anyone who writes books and talks openly not only about income inequity but about income redistribution, is putting a bull’s-eye on his back. And Alpervoitz is fearless.

In his most recent book, Unjust Deserts, written with Lew Daly, he challenges the very notion of who should rightfully own the wealth that an increasingly small group of individuals claim as their own.

Alpervoitz finds that humanity’s “stock of knowledge” now plays a central role in economic growth and is largely responsible for the real income gains that separated the twentieth century from all that came before it. He declares this “stock of knowledge” a social inheritance that should not be the exclusive province of a select group of individuals. Created by many generations of people, and nurtured by governments, institutions, and cultures, it was not produced nor should it belong to a tiny group of uber-capitalists who have leveraged it into fantastic amounts of money.

Yet even as our economic growth has become highly socialized by the impacts of expanding knowledge, the fruits of that knowledge—the well-being generated by knowledge-based growth—flows increasingly to the top. A new aristocracy is reaping huge unearned gains from our collective intellectual wealth. Unjust Deserts, says Barbara Ehrenreich, “reveals the untold story of wealth creation in our time,” and, as Bill Moyers writes, “opens an extraordinary new vista on the moral bankruptcy of our second Gilded Age.”

Unjust Deserts also challenges the notion that real estate and natural resources should exclusively benefit the individuals who were lucky enough or smart enough to write a check to purchase those assets.

Take a small potato field in East Hampton, Long Island purchased by a speculator from Manhattan in 1954, the year I was born. Back then, those 10 acres along a deserted stretch of beach were worth less than $100,000. Today the same land is valued at over $20 million, 200 times its original value. What did the lawyer do to increase the value of his investment? Absolutely nothing.

Instead, it was the Town of East Hampton that built and kept in repair the road that provides access to the beach. It was the community that put in a sewer line and constructed a school 3 miles away. It was the Long Island Power Company that provided access to electricity, and it was hundreds of other landowners who built houses nearby that supported local merchants, fostered a local economy, and led to even more people building more houses, all of which worked in concert to continually raise the value of that potato field.

So to whom does its appreciation of $19,900,000 really belong?

Gar and Daly write, “Warren Buffett, one of the wealthiest men in the nation, is worth over $60 billion. Does he “deserve” all this money? Why? Did he work so much harder than everyone else? Did he create something so extraordinary that no one else could have created it? Ask Buffett himself, and he will tell you that he thinks that ‘society is responsible for a very significant percentage of what I’ve earned.’ But if this is true, doesn’t society deserve a very significant share of what he has received?”

Drawing upon the writings of countless economists from the 19th and 20th century (the footnotes of this book list more authors than I have read in my lifetime!) Alpervoitz and Daily make a compelling case that not only has the wealth that’s been created been distributed unfairly, but that capitalism itself was never intended to work in the “winner take all” way that it practices today.

In America Beyond Capitalism, Alpervoitz accompanies his stimulating critique of modern capitalism with a hopeful articulation of new possibilities and a road map to redesigning our broken system. The book tackles 10 myths about capitalism:

Myth #1: Leaving aside Iraq, Afghanistan, Health Care and Global Climate Change, America is basically on the right track.

Reality: The fundamental values we treasure most—equality, democracy, and liberty—are in free-fall. In 1981, the ten most highly paid CEOs averaged $3.5 million a year. By 2000 it was $154 million–an increase of 4,300 percent. In the 1960s, roughly two out of three Americans regularly told pollsters they believed government was run “for the benefit of all.” Fully 75% of those surveyed now feel that government is run for the benefit of special interests.

Myth #2: Progressives have run out of good ideas.

Reality: While old left solutions may not be working, activists all over the nation are succeeding with new solutions to old problems. These solutions, detailed in America Beyond Capitalism, are oriented toward helping the vast majority of Americans reach their goals: great schools, quality medical care, nice parks, short commutes, good jobs, and a pleasant downtown to spend their money in.

Myth #3: Income redistribution, though unpopular, is the way to increase equality.

Reality: The real issue is wealth inequality. Almost half of all the financial wealth in the United States is held by 1% of the population. In a meritocratic society, redistributing income is hard to defend as fair because we like to think everyone has a chance to become a successful entrepreneur. However, the role played by entrepreneurs in the American economy is rapidly declining, and a shockingly tiny percentage of Americans have taken control of our resources, ownership which they rarely earned with the sweat of their own brow.

Myth #4: If we don’t like capitalism, our only other choice is socialism.

Reality: Capitalism and socialism are academic ideas that have never existed in their purest forms anywhere. A more useful way to think of it is that we currently have a haphazard, corporate-run system, but it could just as easily be a democratic, community-run system.  Citizens can play a role in which stores open up nearby, what incentives new factories get to move into the community, what kinds of new housing developments get built, and much much more without limiting innovation or profits. There are thousands of employee-owned firms, neighborhood corporations, municipal enterprises, and state investment strategies exploding at the grass roots level all over the nation.

Myth #5:  We need to get there through incremental changes.

Reality: We need to take a step back and make major changes to the system. We have to alter the way we think about the size of our politics, the size of our bank accounts, and the size of our dreams.  Many of the most successful new ideas discussed in America Beyond Capitalism involve changing things one small step at time, but turning the many existing innovative pilot programs into a brighter future for all Americans will require wholesale changes in the way we think about things.

Myth #6:  Major changes are impossible to make.

Reality:  Major changes will come, whether we plan for them or not. The history of America is the history of tremendous change. Declaring independence, Reconstruction, and the New Deal are just some of the large-scale changes we’ve engineered. In hindsight, these upheavals seem cyclical and inevitable. All signs point to another one on the horizon. America is getting more partisan, more concerned, more tired, and more serious about changing the system at its roots. That change will come, and progressives have a chance to define what it will look like.

Myth #7:  Global problems need global solutions.

Reality:  Many causes with global support could actually be handled within the U.S. at a regional scale. While the energy behind global demonstrations is laudable, there’s much to be gained by thinking about many issues the same way most Americans think about themselves: as Southerners, New Englanders, Midwesterners, etc. Though such regional thinking rarely achieves political critical mass, many of the issues related to specific industries or specific environmental issues, for example, are concentrated a single region of the country. This makes them too small to gain momentum as national issues, but too large for a single state to handle. Regional thinking offers a way out of this common conundrum.

Myth #8: National problems need national solutions.

Reality: When progressives concentrate on local politics, they achieve national results. Long ago, the left ceded the desire to define local politics to the right. Yet from promoting democracy and defending local retailers against Wal-Mart to reducing crime and poverty, America Beyond Capitalism presents abundant evidence that citizens have a better chance of changing minds and changing the world when they start in their own backyards.

Myth #9: Our free market system is getting the job done.

Reality: Our economic system isn’t all that free, and it’s sure not getting the job done. With the exception of a few naïve libertarians, Americans are happy to have regulations on accounting standards, food safety, toxic chemicals, and other issues. The largest corporations also benefit from government involvement in their industries, involvement which these corporations have, in fact, strongly encouraged in the form of generous subsidies, favorable trade laws, and other goodies that their armies of lobbyists have put into place. The result is a free market that’s hardly free and not even close to working for most people. The hourly wages of the bottom 60% of workers (otherwise known as the rest of us) hasn’t risen as fast as inflation. The result is that the “real income” each person earns, hour by hour, was actually lower in 1995 than it was in 1973.

Myth #10: The Democrats are the party of organized labor and the civil rights movement.

Reality: The Democrats are now really the party of the family and the community. With unions and manufacturing in decline, and the slow but steady success of civil rights initiatives, most Democrats are uniting behind the same purpose: to better the lives of their families, their neighbors, and their friends. Since the Republicans have become the party of the corporation and the church, no one else is working to help ordinary people achieve their goals.

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