This article is going viral: Why Socialism for the Rich, Capitalism for the Poor?

A small annoyance is how the word ‘socialism’ has come to mean so many things, usually depending on the underlying political or economic motives of whoever is using it, that it’s become hard to define. Socialism can mean:

1. Partial or total government ownership and influence of otherwise private firms

2. Worker ownership of the means of production

3. A system of government (social democracy) and or policy characterized by a very large social safety net (welfare state); significant presence of unions

4. Used interchangeably with ‘crony capitalism’ in which the government ‘picks and chooses winners and losers’, and or an economic system or policy that favors the wealthy and or large corporations

5. Wealth confiscation and or wealth caps; massive wealth redistribution

The article seems to be alluding to the forth definition.

This passage stood out:

Theirs is cutthroat hyper-capitalism—in which wages are shrinking, median household income continues to drop, workers are fired without warning, two-thirds are living paycheck to paycheck and employees are being classified as “independent contractors” without any labor protections at all.

Yes, as discussed before, for those who don’t have above-average IQs, your life may suck, if it doesn’t already. The past half century, but especially the past decade, has hit average and low-IQ people people the hardest, who find themselves stuck in the low-paying service sector or unemployed, the high-paying manufacturing jobs of earlier decades that were doable by people of all IQ levels, long gone.

The problem is a lack of stability. Manufacturing jobs provided generational stability for families and children, but with many those jobs gone, people have become more itinerant and atomistic. Construction and energy jobs, although they pay well, are very sensitive to both macro and micro economic conditions, making it hard for workers to settle down. Gig jobs don’t pay well, are demanding, and offer no benefits, unlike salaried jobs–but gig jobs create a lot of economic value–there is no waste, because workers, who are dependent on feedback and referrals, are fully accountable for their success or failure, whereas in corporate america, the cost of individual incompetence and sloth is shared by the entire firm (it’s like those group projects in school, where the smart kids do all the work but everyone gets equal credit).

It’s not so much that all jobs will vanish, but rather the quality of many jobs in terms of pay is declining, as part of the ‘hollowing out of the middle’.

But also, many businesses are struggling. By some estimates, this is this harshest environment ever for small business (except web 2.0 and stuff like that, which is immune). Employees are being squeezed but so too is small business, which is another component of capitalism. Multinationals are thriving because of an abundance of cheap capital (due to low interest rates), allowing them to expand and possibly crowd out smaller businesses. But there other factors for why small business is doing so badly: over the past quarter century, the cost of rent, land, insurance, and advertising has vastly exceeded inflation, but credit has become much more tight to all but the largest and safest of borrowers (the old joke being, to get credit you must first prove you don’t need it). This is part of America’s transition to a deterministic economy (similar to a planned economy) and society.

Related:

The Meritocracy We Don’t Understand