What’s wrong with capitalism?

18 August 2021
Hersha Kadkol

Amazon founder Jeff Bezos, Virgin Group founder Richard Branson and Tesla CEO Elon Musk illustrate everything that is wrong with capitalism. Just when you thought that the three billionaires could not be more out of touch with humankind, they decided to remove themselves from the planet entirely, spending at least US$21.8 billion of their personal wealth on space flight projects.

Bezos jetted off for eleven minutes in a rocket that, fittingly, looked like a giant dick. Fortune magazine reports that he spent at least $5.5 billion on his space company, Blue Origin, which nevertheless is a drop in the ocean compared to his overall fortune of nearly $200 billion.

Branson spent at least $1 billion of his wealth on Virgin Galactic. This came after Virgin companies received hundreds of millions in bailout funds from the UK and Australian governments to cover losses due to the pandemic. And Musk, a cult hero of libertarians, has an eye-watering $15.3 billion holding in SpaceX, which aims to launch rockets to the moon and to Mars.

The three space billionaires have a combined net worth approaching $400 billion. Their new-style conspicuous consumption comes at a time when more than 800 million people around the world go to bed hungry every night. What could their collective wealth be used for instead of ego-driven joy flights?

According to the Ceres2030 project—a partnership of researchers from Cornell University, the International Food Policy Research Institute and the International Institute for Sustainable Development—governments need to spend $33 billion a year to eradicate global hunger by 2030. Bezos, Branson and Musk could do it themselves and still be left with tens of billions to spare.

The cost of vaccinating the world against COVID-19 is posed as a barrier to dealing with the worst pandemic humanity has experienced since the Spanish flu. Yet the estimated $66 billion price tag is little more than three times as much as the three billionaires spent on their hobby projects.

If the wealth of just these three could address such problems, we could do so much more with the wealth of all the world’s super-rich people. According to Forbes magazine, the combined wealth of the world’s 2,755 billionaires is a whopping US$13 trillion. Add to that the wealth of the multi-millionaires with more money than they could reasonably spend in a lifetime.

The $73 trillion it would take to fund a global renewable energy transition to 2050, according to a 2019 report published by Stanford University, is small potatoes compared to the wealth the global elite will accrue in the coming decades.

But the problem goes much deeper than their own accumulated funds. Billionaires are undeniably greedy, but that alone can’t explain how they have been able to accumulate so much individual wealth.

Bezos, Musk and all the world’s super-rich argue that their riches are a just reward for investing wisely and innovating. But their wealth isn’t just about income. They belong to a select group in society that collectively controls the vast bulk of productive resources.

They own the agricultural land and claims to the minerals taken out of the ground. They own the vehicles and ports required to transport goods and the vast warehouses to store them. They own the oil refineries and the steel furnaces. They own the telecommunications infrastructure and office buildings. These economic resources sustain our society. They are required to produce food and electricity, phones, fridges and paper.

The wealthy decide what gets produced, how things get produced, who participates in the production process and where the products go. This minority group is the capitalist class. They are a separate social class not only because of their accumulated wealth, but because of this economic control.

For this reason, redistributing much of the money wealth—by introducing much higher taxes, for example—while desirable, would not get to the heart of the problem. If you took most of Jeff Bezos’ personal fortune tomorrow, he would still control Amazon and would just re-accumulate his riches over time.

How do they turn their investments into more and more money? By putting millions of people to work without working themselves. In the case of Bezos’ Amazon, 1.3 million people globally, to be exact. Those workers have no say over the direction of the company or over what the massive logistics network is used for. On his return from orbit, Bezos himself pointed out that all the money for his space flight came from the labour of workers. “I want to thank every Amazon employee and every Amazon customer because you guys paid for all this”, he said.

The infamous conditions and inflexibility of Amazon warehouse work make exploitation there explicit. But even workers who are much better paid and in better jobs make more money for their boss than the boss gives back to them in wages. Capitalists and workers are not equal in the economy, because one controls all the economic resources and the other owns little more than their ability to work.

This exploitation is at the heart of the system. Under capitalist control, the resources of our society are mobilised to produce for the markets to generate profits for the owners of businesses, rather than to fulfil human needs. In this framework, the people with the greatest needs are usually those with the least access to the goods available.

Hunger and malnutrition exist even in wealthy countries because, to gain access to a necessity like food, you must be able to pay for it. The only way for people to pay is for a capitalist to offer them a job. But capitalists will provide jobs only if they think they can make a profit. And even when they hire people, they hold wages down to generate those profits. So while the Food and Agriculture Organization of the UN forecasts record high cereal production this year, people in poorer countries like Yemen, Sudan and Lebanon are being priced out of staples by rapid cost rises and a decline in incomes. Even in the US, more than 10 percent of households are deemed “food insecure” by the Department of Agriculture.

Take another necessity. In the current pandemic, instead of halting the viral spread by making vaccines freely available around the world, pharmaceutical companies’ COVID-19 vaccines have been competitively developed and patented so that money can be made from their production. Instead of society collectively directing the mass production of vaccines, the rollout has been hostage to supply chain blockages, pharmaceutical companies refusing to share their vaccine recipes and the richest countries purchasing more than they need.

So we have the grotesque spectacle of Pfizer CEO Albert Boula making $21 million last year—a 17 percent increase—while millions now are dying because they can’t get access to the vaccine.

And because capitalist investment is calculated only to make profits, it often produces waste and destruction. There is no better example than fossil fuels. These are embedded in the current economic set-up. The dire predictions of climate and environmental scientists are increasingly acknowledged yet have not been allowed to inform a transition to a green economy because it would cost too many capitalists their existing investments.

To solve the problem of climate change, the capitalist class would need to put aside the desire to make profit, and instead spend trillions reshaping the economy in the interests of human society. That’s like asking a pride of lions to go vegetarian. Which member of the capitalist class would begin this process of transition? To do so would be to give up their own social status. Maybe one or two might. But their position would just be taken by someone else.

The capitalist class is therefore up to its eyeballs in greenhouse gas pollution. Musk’s electric car company Tesla is no exception: in the first quarter of 2021, selling $518 million worth of carbon credits to dirty companies was the only reason the enterprise turned a profit. And it doesn’t matter that Bezos describes the Earth as precious and worth saving while he’s hovering above it—here on the ground, his class is to blame for the planet’s degradation.

Capitalism doesn’t cause only economic problems. A system of class exploitation also creates and perpetuates social oppression to sustain itself. When so few own and control so much wealth, while so many struggle with so few resources, those at the top have to keep the rest of the population divided, fighting among ourselves. And they use a tremendous amount of violence to keep oppressed groups subjugated. Today, capitalists everywhere rake in extra money by paying different sections of the workforce different rates, and convincing one group that the other is to blame for poverty. Social divisions along lines of nationality, race, gender and sexuality, enforced by oppression, break up the solidarity of the exploited against the bosses who rule over us.

Bezos, Branson and Musk are just the tip of the iceberg: at every turn, the control of the world’s resources by a small minority of people is the main barrier to creating a society run in the interests of all people on the planet. With every passing year, the competitive drive for profit produces more and more disastrous effects. Whole sections of the world’s population are condemned to poverty, while everywhere the oppressed endure discrimination and suffering. That’s what’s wrong with capitalism.

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