After the Nov 3 election in the United States, Matt Galloway, of CBC The Current, talks to former U.S. ambassador to Canada, Bruce Heyman, about what this uncertain outcome might mean for U.S.-Canada relations.
Ambassador Heyman connects the response to Donald Trump to the need of people enduring the consequences of greater wealth inequality to grasp at a possible solution from the “non-politician” candidate.1Bruce Livesey of CBC Ideas investigates how capitalism is destroying democracy.
'Authoritarian capitalism is where the U.S. is heading,' says Timothy Snyder, Yale historian, Levin professor of history, and author of On Tyranny and The Road to Unfreedom.
Is capitalism destroying democracy and fostering the rise of authoritarian regimes around the globe? With the election of right-wing populist governments and leaders in Hungary, Poland, the United Kingdom, Brazil, Turkey, India, Italy and the United States, the prospect that the answer is "yes" is gaining credence.
"Authoritarian capitalism is what China has under the aegis of the Communist party; authoritarian capitalism is what Russia has with no particular ideological content," asserts Timothy Snyder. "And authoritarian capitalism is where the United States is heading… I think it is much more closely connected to a certain kind of capitalism — a capitalism which says: it's okay for there to be radical inequality."2But long before Trump's ascendancy, corporations and the ultra-wealthy had been using their resources to undermine American democracy. In 2010, the U.S. Supreme Court opened the door for unlimited corporate money to enter the political system through a ruling called Citizens United.
"It cannot be overstated what a deleterious effect on American political discourse the Citizens United decision has had," explains Andrea Bernstein, a New York-based investigative journalist and author of American Oligarchs: The Kushners, the Trumps, and the Marriage of Money and Power. "After Citizens United… it became possible for money to just flood into the system."2Indeed, President Barack Obama commented on the dangers of the ruling:
"There aren't a lot of functioning democracies around the world that work this way. Where you basically have millionaires and billionaires bankrolling whomever they want and however they want and in some cases undisclosed. And what it means is ordinary Americans are shut out of the process."2Thomas Piketty’s argument, as explained by Justin Fox for the Harvard Business Review is that capital (which by Piketty’s definition is pretty much the same thing as wealth) has tended over time to grow faster than the overall economy.
Income from capital is invariably much less evenly distributed than labor income.
Piketty’s main worry seems to be that growing wealth in Europe will bring a return to 19th century circumstances in which most affluent people get that way through inheritance… But the basic message from Piketty’s data, that the ravages of the World Wars and the high taxes that followed put a big damper on wealth and inheritance that has now been lifted, seems irrefutable… he does offer evidence for his contention that the bigger the fortune, the faster it will grow in the future: the performance of university endowments in the U.S., where the largest endowments have earned dramatically higher percentage returns than the rest.3Piketty proposes a progressive global wealth tax — at one point he suggests that it could start at 0.1% a year for small nest eggs and rise to 2% for fortunes of above 5 billion euros ($6.9 billion) — as the best response to the current dynamics of inequality. No longer will one be able to simply assert that rising inequality is a necessary byproduct of prosperity, or that capital deserves protected status because it brings growth. From now on, those who say such things may be expected to provide evidence that they’re actually true. Perhaps Trump popularity is a symptom of increasing wealth inequality in the United States that has encouraged “authoritarian capitalism” and increasing the desperation of the working class with a society where their income decreases.
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