Randall Collins, University of Pennsylvania

Sixty years ago, C. Wright Mills assembled a collective portrait of the elite that governs the United States. Domhoff and many follow-ups have shown that major positions in the U.S. government are almost entirely held by a small elite drawn from Wall Street financiers, big corporate businesses, upper-class universities, and the military/industrial complex—no matter what party is in office. Nothing in the 2016 election changes that pattern. It is typical that Clinton, Trump, and their enterprises operate from the same neighborhoods in Manhattan and now-trendy Brooklyn. Is Trump a major shift in any respect? His campaign was more forthright about the big structural problem that confronts non-elite America, but he has the diagnosis wrong in singling out off-shoring production as the chief culprit.

The real problem is the future survival of capitalism as it now destroys its own customers. Capitalism depends ultimately on having an income-earning population who can buy its products. Displacement of workers by machinery is the formula for the self-destruction of capitalism. In the 19th century, it was expected this would happen because mechanization would virtually eliminate the manual labor force. This did not happen, because of the rise of a middle class of administrative and communicative labor. But now computerization and the electronic media are eliminating the middle class. This is happening much faster than the mechanization of factory work. It took 150 years to eliminate most of the working class, while we are on a pace to eliminate most middle-class work within 50 years from the takeoff of information technology in the 1990s.

The Survival of Capitalism?

There are five main arguments why capitalism will survive. None of them is convincing.

Escape number one is Schumpeterian creative destruction: destruction of jobs by new technology will always be balanced by the creation of new jobs. But this is only an empirical generalization from the period of factory mechanization; it has no theoretical causality, and it appears empirically wrong for the period of electronic elimination of labor. Moreover, the pace of eliminating middle-class work will increase in the future, since artificial intelligence mimicking the higher thinking of human beings is still in an early phase. Even the upper reaches of the capitalist class will be subject to replacement by computers. We can already glimpse the formation of a tiny class of computerized companies fighting to monopolize the production and distribution of virtually everything, such as the struggles between Apple, Alphabet [Google], and Amazon.

Escape number two is globalization: crisis may hit some parts of the world, but other regions will develop. Nevertheless, although the crisis of capitalism will be uneven, the mechanism is universal, and the entire world will ultimately be engulfed by it.

Escape number three: the growth of financial markets will provide income or at least credit for everyone, even as the drive for profits eliminates jobs. But financial markets are intrinsically unstable, and will only add volatility to structural crisis as financialization grows bigger and more complex.

Escape number four: the Keynesian welfare state solution. This depends on political will, and it will no doubt be attempted again. But capitalist financial markets undermine such attempts to save capitalism via the state. We shall see how much Keynesianism will be possible as the structural crisis worsens.

Escape number five: the hidden Keynesian mechanism of expanding educational credentials, which undergo inflation, so that half a century from now schools will be almost life-long. They will resemble Chinese mandarins studying for the Imperial examinations into their old age, but now including the entire population. Current struggles over the cost of mass higher education suggest the instability of this solution.

In a future full of robots, the question is: who will own the robots? People may have personal robots but they won’t be able to afford them if their own jobs are taken by capitalist-owned robots. At the rate we are going, I would predict the collapse of capitalism will happen in the 2040s or 2050s, an estimate the coincides with that of world-system theory.

Will the transition to a post-capitalist economy be peaceful or violent? When the number of voters displaced from the work force reaches 70 percent or so, they could vote to take economic power from the dwindling number of automation-controlling capitalists. A socialist regime would not be the end of history. It would not eliminate politics. It could enhance democracy. It may also happen, decades or centuries later, that the drawbacks of socialism would bring voters to return to some form of capitalism; and this in turn would go through its own self-destructing tendencies, causing an oscillation between socialist and capitalist systems far into the future.

The ecological crisis of global warming will also intensify during our current century. Michael Mann has argued that ecological crisis is so hard to stop because it is driven by profit-seeking capitalism and consumerism. If so, the timing of the two crises may be auspicious. The full brunt of ecological crisis is predicted for around the year 2100. If the crisis of work displacement brings the end of capitalism by 2050, there will be time for a regime that is people-oriented rather than profit-oriented to solve global warming.

References

Domhoff, G. William. 1967. Who Rules America? Englewood Cliffs NJ: Prentice-Hall.

Domhoff, G. William. 2007. “Fifty Years of Power Structure Research.” Michigan Sociological Review 21: 1-54.

Mills, C.Wright. 1956. The Power Elite. New York: Oxford University Press.

Wallerstein, Immanuel, Randall Collins, Michael Mann, Georgi Derluguian, and Craig Calhoun. 2013. Does Capitalism Have a Future? New York: Oxford University Press.