Capitalism is Antithetical to Democracy

Photograph by Nathaniel St. Clair

Sensurround sound in a two-inch wall
I was waiting for the communist call
I dared to ask for sunshine, and I got World War III
I’m looking over the wall, and they’re looking at me!

– John Lydon, Sex Pistols, 1977

Most Americans would likely be surprised to know that, according to a respected international poll taken in 2022, far more Chinese (83%) perceive China to be democratic than Americans (49%) perceive the US to be. And while culture war rationales were amongst the choices available to Americans to explain the difference, they chose ‘corruption’ (78%), ‘corporate control of the political system’ (72%), and the ‘power of Big Tech’ (66%) as the leading explanations for the dearth of democracy in the US.

This deference to economic explanations of political outcomes wouldn’t surprise many Marxists. But it should be a wake-up call for committed liberals. The accusation since 2016 that liberal democracy is at risk from ‘fascists’ misses that a plurality of Americans believe that corporate and oligarchic power have already compromised ‘our democracy.’ This isn’t to dispute claims of fascist intent. It is to state that many so accused are powerless, whereas corporate executives and oligarchs have the power to force corporate autocracy onto the US.

This problem of power has long been a blind spot for liberal theory. The will to act politically is necessary, but not sufficient, to affect political outcomes. Was economic power widely distributed, an argument could be made that the US is a Republic, a representative democracy. However, the US has spent the last five decades concentrating incomes, wealth, and with them power, in a remarkably small number of hands. An oligarchy isn’t a Republic.

The Supreme Court ruling(s) that money is political speech undermines democracy in quite specific ways. In liberal theory, each eligible citizen has an equal say in political outcomes through their vote. Step one in the process of political abstraction was the creation of a Republic versus direct democracy. ‘Representative democracy’ begs the question of whose interests are being represented? Step two is the power to augment one’s vote via wildly mal-distributed wealth. Even if it were justly distributed, why should economic power determine political outcomes?

Readers will note the frame of isolated and self-reliant individuals coming to their own conclusions about world events and acting accordingly here. But this has almost no descriptive power with respect to how political decisions are made in the US. Eligible voters do elect representatives, but those elected represent the interests of corporate executives and oligarchs, not the people. ‘Capitalism’ ties the political ambitions of the rich to the wellbeing of the rest of us in the national mythology. After all, why would politicians meet with workers when they can meet with the owners and bosses who are imagined to represent the interests of workers.

Regardless of whether or not anyone actually believes that bosses represent the interests of workers, this is a convenient fiction for politicians who meet with employers. These are their campaign contributors as well. And capitalist logic is quite malleable here. Joe Biden claimed a ‘greater good’ when he forbade railway workers from striking in the US, even as the declining power of organized labor has immiserated industrial workers here for five decades now. The point: Democrats and Republicans have both claimed the side of ‘the people.’

Irrespective of whether or not you believe that politicians represent the interests of the American people, a large plurality of Americans apparently doesn’t, hence the poll results linked to above. What would a ‘legitimate’ political response from the people look like?  Voters can in theory vote out politicians they deem corrupt. But how about when the entire system is failing? In what possible society that has wildly skewed income and wealth distribution might democracy be imagined to prevail? Hint: there is none.

In terms of theory, neoliberalism is ad hoc and opportunistic, versus the requirement of well-developed legal and social infrastructure to keep markets ‘free’ that is found in neoclassical economics. This presumptive belief in the power of ‘unfettered markets’ found amongst neoliberals is ideological, not analytical. For instance, supporters of the ACA (Affordable Care Act) claim that its ‘market mechanisms’ are ‘efficient.’ But this comes after the (globally inefficient) decision to keep the private insurance industry at the center of the American healthcare system.

In this way, capitalist economics is called ‘the queen of the social sciences’ because it pretends to address economic outcomes without accounting for earlier capitalist distribution. The feeding frenzy around the current American war against Russia illustrates that weapons makers create business for themselves by influencing foreign policy, and in so doing they make an outsized claim on Federal resources. In other words, power begets power. Existing wealth allows capitalists to crush economic competition, thereby ending capitalism as it exists in liberal theory.

Along this pathway, neoliberalism ties to European fascism of the twentieth century through the abandonment of rules-based economic relations in favor of serving the will of corporate executives and oligarchs. This is the very definition of autocracy. And while this is a very old criticism of capitalist power relations, it needs to be revisited given the virtual control that capital, broadly considered, now has over the governments of the West. Given five decades of planned deindustrialization, what can the US make except weapons?

In this way, the classical liberal problems of ‘freedom’ and ‘liberty’ depend on separate and distinct analyses lest capitalism be understood to undermine democracy. Simply put, why would rule by Northrup Grumman and Goldman Sachs constitute a state of freedom? How is having the CEOs of munitions makers meet secretly with leading politicians prior to the launch of a war that they will benefit from ‘good for democracy?’ The answer, ‘planning,’ requires the suspension of disbelief that those paying to get politicians elected don’t control them.

The response from officialdom regarding rising popular discontent has been to censor and otherwise shut down dissident voices using the ruse of Right-wing ‘disinformation.’ In fact, every Left-wing journalist I know of has complained about their work being censored through its reach being limited, yours truly included. This isn’t a case of ‘fascists’ acting to control political outcomes unless you consider the integrated corporate-state to be fascist. Here is my explanation of the relationship between liberalism and fascism. The tie comes through the economic power of capital.

The Twitter Files, the review of the three-letter agency’s gaming of Twitter to affect political outcomes inside the US and out, has been treated by those friendly to the effort as a legitimate response to the Right-wing politics of the age. If so, why not advertise the roles of the CIA, FBI, and NSA in not just censoring constitutionally protected speech, but also for using state propaganda to craft political outcomes. If what they are doing has the consent of the American people, why hide it?  Lest this come as a shock, the CIA and FBI are promoting their own, not ‘American,’ interests.

By inserting Federal agencies between the American people and ‘freedom,’ these agencies have been turned into the ‘enemy of open societies’ that overseas critics have long accused them of being. Not only is legitimate and constitutionally protected dissent being suppressed, but an ‘official’ version of correct belief, as has been determined by agents of the Federal government, is being put forward in its place. That this ‘correct belief’ matches the rhetoric of the urban bourgeois who constitute the PMC (Professional-Managerial Class) suggests a connection.

During the Cold War, the Federal government of the US turned itself into a lite version of what American liberals imagined Soviet ‘totalitarianism’ to be. At the time, the Soviet model of economic development was working and the commitment to democracy inside the US had been placed behind national security concerns by American leaders. In the current epoch, China’s economic success is likely imagined in official circles to be a product of state control over information flow. Magical thinking can be influential when it can’t be countered.

As Xi Jinping and Vladimir Putin certainly know— and Joe Biden almost certainly doesn’t, China has been engaged in an export-led growth strategy that featured state investment through captive banks in the ‘private’ economy of China. Cleverly, the Chinese copied what worked about Western economic development without being dragged down the rabbit hole of capitalist ideology. Does this make China capitalist? Thankfully, no. As I wrote here a decade ago, the relative economic success of China should have ended capitalism as it is understood, forever.

Re: Twitter, one group of people, let’s call them representatives of Federal government agencies, knew that Twitter was being ‘managed’ to affect their desired political outcomes. Another group, let’s call them employees of Twitter, saw little to gain from crossing these Federal agencies. And Twitter received payment from said government agencies for facilitating their political subterfuge. The only people unaware of the subterfuge were Twitter users and the journalists who regularly use Twitter to locate straw persons for their reporting.

As regards censorship, the rich in the West have long had the capacity to amplify or repress political views through both Gramscian hegemony and control of the media. The liberal conception of ‘free speech’ as a right has always been blind to the de facto power to censor held by capital. Had the doyen of the Washington Post not allowed Bob Woodward and Carl Bernstein to report on the Watergate break-in and its aftermath, it likely wouldn’t have been reported on. How ‘free’ is the free press when media owners get to determine what gets reported and what doesn’t?

Here again, concentrated economic power determines political outcomes, in contrast to liberal theory that posits that voters decide. The flip side of ‘preventing Right-wing disinformation’ is that even more nefarious actors have been given the power to ‘manage’ public discourse for their own benefit. What’s more, ‘disinformation’ ties political outcomes to internet chatter rather than to the schemes and wants of corporate executives and oligarchs. While some Americans have been convinced that the American war against Russia is legitimate, what plausible outcome makes it a good idea? Hint: there is none.

‘Freedom’ was  understood to be a challenging concept before its cartoon version was recovered during the last large scale American slaughter in Iraq. The Freudian concept of hiddenness in the human psyche— the subconscious, is central to the psychology used in American state propaganda to control the population. Hidden desires are the wedge used to induce people to buy things they don’t need and can’t afford, be it ‘a brand-new Chevrolet’ or cynical misdirection regarding a war that weapons makers want to launch.

Of consequence here is that ‘Left’ and ‘Right’ refer to differing political frames presumed to explain power by referencing ideology, whereas the ‘management’ of the US by a permanent bureaucracy that supports a more-or-less permanent oligarchy describes actual political economy. The impermanence of electoral outcomes rests atop an active, permanent, state. Whether this is a ‘deep state,’ or just well-placed political opportunists, means little relative to its capacity to undermine so-called democracy.

In history, before he was appointed to the Supreme Court, Clarence Thomas was hired by the Reagan administration to throw tens of thousands of class-action lawsuits into the trash without review. On the one hand, Thomas was a political actor placed in a position of authority inside the Federal government to undermine the will of Congress (which makes laws). On the other hand, he was placed there by representatives of powerful constituencies to affect political outcomes for them. Who benefited? Hint: it wasn’t the people who had their lawsuits alleging discrimination thrown in the trash. It was capital that benefited.

In liberal theory, citizens are able to change the form and function of the state through elections. In reality, the permanent state now determines the contours of elections. Leading the way, Democrats re-invented the ‘smoke-filled room’ whereby party insiders decide the roster of candidates away from the rank-and-file. In the US, this contest for power has already been won. Capital always and everywhere gets its way. As ‘the Squad’ demonstrates on a daily basis, electing ‘progressives’ does nothing to alter the distribution of power.

This is to make the point that the political contest in the US is between power and not-power, not between Democrats and Republicans. The ‘architecture’ of this relationship is that voters elect political leaders who, once elected, work with their donors to do the donors’ bidding, not that of the voters. While there are differences between the parties, capital pulls the strings of both. This makes the current fantasy that Republicans will lead a revolution to restore democracy delusional. Should they regain power, they will go ‘full Biden,’ meaning doing the bidding of power.

Missing from most liberal accounts is that the US is an empire. Large, powerful, US-based corporations have been put forward to act as the avant-garde of American state power abroad. This geopolitical role is generally portrayed as event based inside the US. For instance, in order to invade Iraq in 2003, the CIA invented the pretext of WMDs (the ‘event’), even though Iraq’s ‘missing’ WMDs had been supplied to it by the US, and no new WMDs were found. Through state-capitalist dependencies, the Federal government needed ‘private’ contractors to arm the military, rebuild Iraq, and to exploit Iraq’s oil and gas bounty.

The tally so far is that capital controls political power inside the US, empire represents the reach of US-backed capital internationally, and the American electoral system exists to promote the illusion that politics exists separate and distinct from the power of capital to determine political outcomes inside the US. The American people intuitively understand this, as well as the power of capital to crush ‘democracy,’ as evidenced by the poll results linked above (first paragraph). The primary impediment to democracy is capital.

The Marxist response has long been that liberalism is the ethos of capitalism written as a theory of ‘the world.’ Liberalism lacks descriptive power because it emerges from logical deduction, from first principles regarding theories of what it means to be human. There is no society without economic relations. But liberalism posits ‘freedom’ as an absence of coercive state power, excluding economic power as a factor. But as the Twitter Files revealed, the corporate-state has no intention of leaving political outcomes to ‘the people.’

The Marxist solution, the elimination of income and wealth disparities through full social participation for all, fits the liberal democratic ideal while placing economic relations at the center of conceptions of freedom and democracy. ‘Democracy,’ where the bosses and politicians decide and the results are presented to us, isn’t working for most of the planet. But the problem isn’t with democracy. Until you can tell your boss, landlord, banker, etc. to stick it where the sun doesn’t shine without fear of economic retribution, you aren’t free.

Socialism is democratic. In fact, it is the only plausible route to democracy.

Rob Urie is an artist and political economist. His book Zen Economics is published by CounterPunch Books.