Toward the Democratization of Wealth

A Too Much review of
America Beyond Capitalism:
Reclaiming Our Wealth, Our Liberty, and Our Democracy
By Gar Alperovitz
John Wiley & Sons, 2005.

February 7, 2005

Late in January, at a Washington, D.C. news conference, the hottest new think tank in the nation's capital, the Center for American Progress, unveiled a major new tax reform plan.

The Center, an outfit led by refugees from the Clinton administration, proposed in this new plan a revamped tax system that would, among other steps, set 39.6 percent as the top tax rate on all income over $120,000 a year.

At the news conference that unveiled this new plan, Too Much asked why the Center had proposed 39.6 percent as the top rate. That 39.6 percent, the Center's top tax analyst responded, corresponds to the top tax rate in place during the Clinton years, so why not return “to a time when what we had worked very well.”

In fact, America's economy during the Clinton years worked “very well” only for the affluent. Indeed, America's economy hasn't worked “very well” for average Americans since the 1960s, a time when steep tax rates on high incomes were helping to keep America's income and wealth far more equally distributed than today.

Those steep tax rates on America's highest incomes have nose-dived over the past thirty years, and, over those same years, the concentration of America's wealth and income has become far more pronounced.

In the 1990s, the Clinton White House steadfastly refused to acknowledge this concentration as a problem. These days, those who cheer the Clinton years are, by and large, continuing that indifference to inequality.

“I am not," as candidate John Kerry announced last fall, “a redistributionist Democrat.”

But some voices are singing a different tune — and speaking directly to what long-time activist scholar Gar Alperovitz calls America's “real hunger for new thinking.”

That new thinking takes front and center in Alperovitz's engaging new book, America Beyond Capitalism: Reclaiming Our Wealth, Our Liberty, and Our Democracy.

The Clinton years, Alperovitz understands, saw no dramatic turnaround in the declining fortunes of average Americans. Any appraisal of today's United states, he notes, must begin with “the painful truth” that Americans have for decades been “becoming less equal, less free, and less the masters of their own fate.”

Typical American families, Alperovitz shows, have only been able to keep their heads above water by working vastly more hours of work. But most families have by now maxed out their available work hours.

We appear, observes Alperovitz, “to be reaching a limit of those who can add to family income.”

Without working more hours, how can we reverse our continuing downward economic slide? We as a nation need to be willing, writes Alperovitz, to stop and address “questions of how property is owned and controlled,” questions our current mainstream politics almost totally ignores.

In America Beyond Capitalism, Alperovitz reviews just how concentrated property ownership in America has become. He proposes, in response, a new “Pluralist Commonwealth” based on “the principle that ownership of the nation's wealth must ultmately be shifted, institutionally, to benefit the vast majority.”

What sort of institutional changes does author Alperovitz have in mind?

Several years ago, Alperovitz helped found the Democracy Collaborative at the University of Maryland, an institute that has been patiently cataloging innovative ideas for “democratizing” wealth, through everything from worker-owned firms to municipal initiatives that leverage city-owned land into income-producing businesses that can benefit city residents.

America Beyond Capitalism discusses the wide range of these initiatives already in the works all across the nation. But Alperovitz also emphasizes that this “host of alternative institutions,” to make a real difference in American life, needs to be closely linked to “an ever more sharply focused challenge to corporations and elite concentrations of income and wealth.”

Only the progressive taxation of elite income and wealth, America Beyond Capitalism argues, can free up the resources necessary to “to finance the broadened ownership of new investments” that Alperovitz sees as the key to better lives for average Americans in the twenty-first century.

“Over the long arc of the twenty-first century and beyond,” Alperovitz adds, “the flow of funds” from elite taxation could “help finance a reduction in the workweek” that would allow “greater amounts of free time,” in the process “bolstering both individual liberty and democratic participation.”

Higher tax rates on elite income and wealth could become politically feasible in the twenty-first century, Alperovitz contends cogently, since “far greater taxation of elites has been accepted policy for substantial periods of modern American history under both Democratic and Republican presidents.”

But little of the substantial change that Alperovitz quite rightfully sees as essential will take place unless Americans first come to reject the indifference to concentrated wealth and power that remains our conventional political wisdom.

“There is no way to achieve individual liberty in the modern era,” as Alperovitz sums up, “without individual economic security and greater amounts of free time.” And “neither of these, in turn, is possible without a change in the ownership of wealth and the income flows it permits.”

If you hunger for new thinking, in other words, bring your appetite to America Beyond Capitalism.

— Sam Pizzigati