Introduction
The demand for articles and documentaries that seek to explain the current economic system has soared in recent years. Stagnating incomes and the rise of populism that always occur under such circumstances have become major discussion topics, as society is facing an existential choice while being extremely polarized. People who lead the country and voters who choose them are desperate in their desire to unite the nation by proposing certain tools meant to mitigate multiple crises, mainly by reshaping modern capitalism. The video and the articles analyzed in the paper allow for a comprehensive understanding of current issues, with the increasing income inequality that undermines the virtues of capitalism being the major challenge. I believe that capitalism provides people with the opportunity to choose a career and to perform tasks most efficiently. Moreover, innovators are always rewarded in this system, while competition enhances the quality of customer service. That is why I want to study the issue and am eager to find reasonable solutions.
Analysis and Discussion
The Netflix documentary follows Reich, the author of Saving Capitalism, on his book tour. One of the ideas that underpin the investigation is the assumption that capitalism is neutral. The system merely provides a framework that can be used by different people for the Common Good or their benefit. Capitalism is not meant to emphasize and praise the highly individualistic approach. It continues to provide benefits for society and the planet in general. Hearden (2019) notes that California’s timber industry’s efforts, for instance, utilize prescribed burning to reduce risks. Therefore, it is still the approach to capitalism that defines its core. Nevertheless, people who at some point managed to acquire wealth and received the financial tools to multiply their riches used the power that comes with the money for lobbying activities and various political contributions (Hess, 2019). This raises questions about the functioning of the democracy under such circumstances when people in charge are either lured by the chance to earn or feel the pressure to comply with the rich.
The documentary provides an estimate which illustrates the scale of the abovementioned activities. It is said that “corporate interests spend $34 on lobbying for every $1 spent by unions and all other public interest groups combined” (Kornbluth & Gilman, 2017). Such disproportionate distribution of power increasingly leads to multiple challenges that American society has to face. One of the most vivid examples of lobbying (concerning the prices for the goods) that continues to raise questions, especially during the COVID-19 pandemic, is drug prices. The US pharmaceutical industry regulatory system does not truly focus on drugs as a public utility, allowing companies to set any prices. Moreover, pharmaceutical companies have long been lobbying their interests and influencing the research results to justify the high prices by claiming that their scientific efforts are incredibly costly.
Moreover, multiple issues undermine the importance of labor in creating added value, which has always been a vital part of the perception of capitalism that helped create prosperous middle-class societies. Current US wealth inequality figures correspond to those of the late 19th century. It means that money has once again become the main tool that is needed to create extra wealth (apart from education). This phenomenon can also be explained by the accelerating automation process. Millions of jobs in the US are currently exposed to extinction, as robots and AI are becoming increasingly competitive and cost-efficient.
Globalization has led to a situation in which corporations enjoy an unprecedented level of freedom not only in terms of taxes but also in terms of the operations and the locations of their facilities. Since the 1980s, companies have been actively moving their plants to countries with low labor costs. It has affected the US industrial sector and millions of lives tremendously. One of the main factors which encouraged such an attitude was not merely economic. Despite the vivid popularity of Milton Friedman’s ideas and the obsession with quarterly earnings, the shift in the philosophy and the culture underlying business activities is also of major importance (Hess, 2019). Before the 1980s, almost all American businesses were focused on the necessity of social functions performed by them, which complemented the efforts of an emerging welfare state.
US companies were directly involved in the wellbeing of their employees, realizing that for most people, wages were not equal to the real social security network with multiple guarantees, paid leaves, and health insurance. Therefore, they were inclined to provide all of these to create a generally positive image and to stay competitive as employers. Nevertheless, such activities have been disrupted by the increased popularity of the highly individualistic Darwinist approach to human beings that emphasized the unlimited desire to consume and the rivalry between all economic actors.
One of the main factors underlying the unjust wealth distribution is the uniquely high gains investors generate by buying blue-chip companies’ stocks. In most cases, such corporations have been showing stable growth for at least several decades, which means that the wealthy have a relatively secure investment tool with two-digit returns. Several prominent suggestions seek to change the current situation. Probably, the most surprising is a proposal to provide every US citizen with “a modest $5,000 low-interest loan from the government and an account to invest in stock and bond index funds” (Ullmann, 2018). Moreover, the information about dark money from the sources was surprising, as it is extremely strange that voters do not have the chance to know who directly influences the political campaign’s success by pouring large amounts of money. There should be at least a clear distinction between the types of nonprofit organizations, allowing only some of them to receive anonymous donations.
The widening income gap currently leads to growing discontent across the nation. As a result, populism has become an extremely beneficial tool utilized by various politicians. For instance, the emphasis on the disparities in trade deals and multinational corporations’ ability to move production overseas has been instrumental in ensuring Trump’s victory in 2016. Nevertheless, some of the actions which Donald Trump introduced raise even more concerns about wealth inequality, such as tax breaks ad tax subsidies further accelerating wealth inequality alongside the abovementioned government lobbying. The video and the articles have also brought to life numerous issues that should be considered by all citizens, including robot taxation, introducing a universal basic income, and making higher education free.
Learning Outcomes
The video and the articles have a shared approach to the current capitalist system. All of the authors claim that the sense of injustice is in the air, which hinders the nation’s chances to unite in a common strive for the legendary vision of the American Dream. While working on this assignment, I have learned much about lobbying (especially in the pharmaceutical industry), universal basic income initiatives, and the way stock markets benefit the wealthy. Although all the issues are connected to wealth inequality, the video producer and the authors of the articles are confident that capitalism is destined to be the best option for society in general due to the freedom and effectiveness that it is associated with. Capitalism needs to be altered once again to correspond to the challenges of the 21st century.
References
Hearden, T. (2019). Studies show capitalism’s role in saving planet. Western FarmPress. Web.
Hess, E. D. (2019). Modernizing capitalism: Saving the American dream. Graziadio Business Review, 22(1). web.
Kornbluth, J., & Gilman, S. (2017). Saving capitalism [Film]. Netflix.
Ullmann, O. (2018). Saving capitalism.The International Economy, 32(4), 6−8. Web.
Appendix
competition policy
Regulations designed to promote competition and restrict monopoly practices.
culture
The complex whole that includes knowledge, belief, art, morals, law, custom, and other capabilities acquired by a person as a member of society.
democracy
Political system in which government is by the people, exercised either directly or through elected representatives.
globalization
Trend away from distinct national economic units and toward one huge global market.
individualism
An emphasis on the importance of guaranteeing individual freedom and self-expression.
location economies
Cost advantages from performing a value creation activity at the optimal location for that activity.
political system
System of government in a nation.
value creation
Performing activities that increase the value of goods or services to consumers.
values
Abstract ideas about what a society believes to be good, right, and desirable.