Lewis Corey

The Decline of American Capitalism


PART SIX
Concentration of Income and Wealth


Introductory


THE unequal distribution of income and wealth renders absurd all capitalist society’s pretensions to democracy and equality. It sticks like a bone in the throat. And it threatens to choke capitalism, for the unequal distribution arises out of and aggravates all the maladjustments and disturbances of capitalist production.

Although the concentration of income and wealth has become constantly greater, many capitalist apologists have always insisted that it was breaking down. This was one of the major claims of the pre-1929 “new capitalism.” The logic of the illogical assumption that the “policy” of increasingly higher wages was accepted by the employers led the prophets of the “new capitalism” to insist:

That, in the words of President Calvin Coolidge, “the results of prosperity are going more and more into the homes of the land and less into the enrichment of the few.” [1]

That, consequently, the distribution of income and wealth was becoming more equal, more democratic; the indubitable proof of which, according to the apologists, being the “enormous” increase of “mass” participation in stock ownership.

Now, in the cold gray dawn of the morning after, it is said that if the distribution of the proceeds of industry had been less unequal there would have been no cyclical crisis and depression. This was also said by the prophets of the new “new capitalism” of Niraism. Thus Rexford Guy Tugwell declared that “imperious necessity” compels a “more even” and “just” distribution of wealth and income among “the people as a whole,” otherwise “our whole economic structure falls into idleness and ruin.” And Harold L. Ickes, Roosevelt Secretary of the Interior, said:

”A bloodless revolution has occurred, turning out from the seats of power the representatives of wealth and privilege ... I believe that we are at the dawn of a new era when the average man and woman and child in the United States will have an opportunity for a happier and richer life. And it is just and desirable that this should be so. After all, we are not in this world to work like galley slaves for long hours at toilsome tasks, in order to accumulate in the hands of 2% of the population 80% of the wealth of the country.” [2]

Thus Niraism created its ballyhoo. And “practical” economists manufacture theory to make the deception appear rational. But the history of capitalism is full of promises to “equalize” income and wealth, while their concentration was becoming steadily greater. And the promises burst into new life precisely at the moment when, under the conditions of capitalist decline, the income of the workers must decrease while the concentration of wealth and income becomes relatively greater.

Notes

1. New York Times, May 21, 1927.

2. New York Times, February 9, 1934.

 


Last updated on 4.9.2007