Growing inequality threatens our most basic democratic principles.
Pete Buttigieg, who’s shown an impressive knack for putting matters well in these early days of the 2020 presidential race, nailed it recently when Chuck Todd of NBC asked him about capitalism. Of course I’m a capitalist, he said; America “is a capitalist society.”
But, he continued: “It’s got to be democratic capitalism.”
Mr. Buttigieg said that when capitalism becomes unrestrained by democratic checks and impulses, that’s no longer the kind of capitalism that once produced broad prosperity in this country. “If you want to see what happens when you have capitalism without democracy, you can see it very clearly in Russia,” he said. “It turns into crony capitalism, and that turns into oligarchy.”
Aside from enabling Mr. Buttigieg, the South Bend, Ind., mayor, to swat away a question that has bedeviled some others, his rhetoric reminds us of a crucial point: There is, or should be, a democratic element to capitalism — and an economic element to how we define democracy.
After all, oligarchy does have an economic element to it; in fact, it is explicitly economic. Oligarchy is the rule of the few, and these few have been understood since Aristotle’s time to be men of wealth, property, nobility, what have you.
Democracy can’t flourish in a context of grotesque concentration of wealth. This idea is neither new nor radical nor alien. It is old, mainstream and as American as Thomas Jefferson.
I invoke Jefferson for a reason. Everyone knows how he was occupying his time in the summer of 1776; he was writing the Declaration of Independence. But what was he up to that fall? He was a member of the Virginia House of Delegates, and he was taking the lead in writing and sponsoring legislation to abolish the commonwealth’s laws upholding “entail” (which kept large estates within families across generations) and primogeniture.
Mere coincidence that he moved so quickly from writing the founding document of democracy to writing a bill abolishing inheritance laws brought over from England? Hardly. He believed, as the founders did generally, that excess inherited wealth was fundamentally incompatible with democracy.
They were most concerned with inherited wealth, as was the Scottish economist Adam Smith, whom conservatives invoke constantly today but who would in fact be appalled by the propagandistic phrase “death tax” — in their time, inherited wealth was the oppressive economic problem.
So, yes, democracy and the kind of economic inequality we’ve seen in this country in recent decades don’t mix. Some will rejoin that many nations even more unequal than ours are still democracies — South Africa, Brazil, India. But are those the models to which the United States of America should aspire?
A number of scholars have made these arguments in recent years, notably Ganesh Sitaraman in his book “The Crisis of the Middle-Class Constitution.” All that work has been vitally important. But now that some politicians are saying it, we can finally have the broad national conversation we’ve desperately needed for years.
Bernie Sanders has proposed an inheritance tax that the founders would love, and Elizabeth Warren has proposed a wealth tax of which they’d surely approve. But you don’t have to be a supporter of either of those candidates or their plans to get behind the general idea that great concentration of wealth is undemocratic.
Policies built around this idea will not turn America into the Soviet Union or, in the au courant formulation, Venezuela. They will make it the nation the founders intended. And this, as Mr. Buttigieg’s words suggest, is how Democratic candidates should answer the socialism question (with the apparent exception of the socialist Mr. Sanders). No, I’m a capitalist. And that’s why I want capitalism to change.