On February 9, The George Washington Forum brought to campus Professor Michael Munger from Duke University. Professor Munger presented a talk entitled "Is Capitalism Sustainable in a Democracy?” The question could, of course, be posed the other way around, “Is Democracy Sustainable within Capitalism?” Munger addressed the problems each of these systems face in terms of sustainability. Each of these, for different reasons, are susceptible to corruption through the concentration of wealth and power.
In the case of capitalism, the problem is when accumulated capital is used for profit without productivity. Examples of this use of capital abound. Munger cited the use of capital to influence political processes to suppress competition in the marketplace. With reduced competition, prices can rise and investors and managers benefit. Workers may benefit some, but the benefit of their wage increases is counteracted by price rises. Capitalists don’t mind some inflation because they have the resources to be able to pay higher prices for goods and services. Many workers and those on fixed incomes don’t.
Capitalism fails when too much wealth and power is in the hands of those who can control the system and wealth and power are abused. When capital is used for increased productivity, which benefits a wide spectrum of society, markets work and capitalism seems sustainable. Even that, however, is problematic in that economic growth cannot persist forever on a finite planet.
It can be said that capitalism failed in the early 20th century, leading to the depression and an ultimate bailout by government. The scenario was repeated in 2008, and again in the fall of 2019, although the 2019 bailout is not so well known because the failure was limited to the banking system and the bailout was not publicized in the media.
Munger alleged that the problem of democracy is that voters can make bad choices just like rulers can; an allegation that rings true. He suggested that it is the universities which hold the promise of fixing this problem. I hope universities can help, but that is an elitist solution, which will certainly not be enough.
He was asked if voters could make better choices if open primaries and ranked-choice voting were instituted. He agreed they could, but went on simply to point out how difficult that will be to implement, since both of the major political parties, want to keep their duopoly control over the elections process. But California did go to open primaries despite opposition from both parties and greatly improved the performance of their legislature. Alaska has now gone to ranked-choice voting. Maine is moving in that direction too. Ranked-choice voting is done in local elections in New York City and several other local jurisdictions.
I hope young people will not accept Munger’s simple passive acceptance of the present dominant voting system. It can be changed. Capitalism might be sustainable with autocracy, under an enlightened dictator, but democracy may be a surer bet to save some degree of the free market, plus preservation of an appropriate degree of liberty. For democracy to be sustainable elections have to work. The way it works now is that voters are often forced into selecting between two options, neither of which address fundamental issues about sustainability. Options exist. Change can happen.
John N. Howell, Ph.D., Associate Professor Emeritus of Physiology, Ohio University.
