What Comes After Late-Stage Capitalism Fails?
When They Stop Extracting The Value Of Our Work To Send To Billionaires and Other Shareholders
This is the question that stays with me, because I agree that there are signs capitalism is failing. Realities like following feel especially relevant:
The top 10% of the richest people own nearly 70% of the world’s wealth (60-80% depending on the source), and the top 1% own nearly half of that wealth1.
The bottom 50% of U.S. residents own less than 4% of all U.S. wealth2.
The current administration proposes a tax bill in which 1.1 trillion in tax cuts will go to those that make over 500k a year, while 1.1 trillion in cuts are slated for Medicaid, while 13 million people will lose their health care coverage.
These are highly unsustainable and undesirable situations.
Yet, they are part of why many of us still need to work a 40-hour workweek (or more) as “standard” despite a growing body of research that suggests 30 hours (or 4 day work weeks) would be optimal for both people and net productivity.
When we work for a company (and I’ve done this for a majority of my career), the “value” of our work is not paid at 100%. If it were, the company would not earn a profit. Part of the way colonial capitalism works is that organizations and shareholders own the means of production, and workers are paid a certain amount for labor.
When I worked in the investment/trust industry (circa 1998-2002) I started to understand this. Employees generate “shareholder value” and this is what gets paid out to those holding stocks. Though fewer companies pay dividends stock appreciation drives much growth of wealth.
When I first learned this, I moved my money from a large bank (different from the one where I worked) to a credit union. Why was it fair that shareholders likely indifferent state skimmed off the “good stuff” and distributed it to non-employees and non-customers?
It made zero sense to me. But this is financialized capitalism.
Most of my remaining retirement funds are invested in mutual funds. So in one sense, I guess I’ve become the shareholder. (I’m aware of how I nearly mistyped to “slaveholder” and how this is tied into the history of capitalism also - ugh.)
Good for me?
Maybe.
About 16 years ago, when I found work as a full-time employee for a large medical device company, I started making “real” money. Each time I got a raise, instead of spending that money, I upped my 401(k) contribution by that percentage. I did what all the finance magazines told me to do. Fortunately I enjoyed the work I was doing.
I also felt relieved to have made it through the “Great Recession” of 2008. Newly post-divorce, my realtor negotiated a short sale for my townhome. I couldn’t find full-time work to keep up payments without going further into debt.
I then understood that “investments” like homes don’t have actual value. Everything is valued only at the amount that someone is willing (and able) to pay for it at that moment in time.
Ouch. I had drunk the Kool-Aid. I believed “housing values always increase” as many realtors explained. Yeah. They do tend to increase. Over decades, and in the “right” neighborhoods. But for a shorter-term horizon (like 3-7 years) that I had been able to consider when buying, not necessarily.
Eventually, after a few years of job insecurity, I parlayed “temp to hire” work into a medical device company. I worked 2 years as a contractor, with no vacation or benefits. When I finally got a “full time” offer, I felt like I’d won the lottery.
Even though I’d been moderate about temping hours (typically only billing 37.5 hours/weekly) I never shut my brain off fully when I wasn’t at work. I didn’t bill for the time I wasn’t sitting in the seat. Though on my commutes and over lunch, I always thought about work.
My brain (diagnosed with ADHD over 20 years ago) doesn’t have the most reliable off switch… However, given that sometimes I was daydreaming or not fully attentive 100% of the time while sitting in front of the screen, billing for less felt appropriate, and in integrity. (I’ve since learned my standards were way too high, but I digress.)
This less-than-full-time billing almost cost me the full time job offer. My boss (who usually showed up ~45 minutes after I arrived, and left ~45 minutes before me) told me she wasn’t sure I was ready for a full time role. She noted that I never entered 40 hours according to my timesheet. It was only later that I understood I was actually underestimating my true contributions.
It wasn’t about time. It was about value.
Valuable skills I had that I’d honed before arriving at the job: spreadsheets, data analysis, the ability to think critically. Four years of liberal arts education where I had to present my ideas, and wrestle with tricky subjects. A masters degree focused on organizational development and management. A decade of working within different types of industries and teams, understanding the subtle dynamics in meetings. My gifts for diplomatic cross-cultural communication, etc.
Okay, now I sound like I’m bragging. 😸
The point though: it wasn’t about the hours. Yet, I was stuck in a system that counted those hours as though they meant something about my commitment.
My salary was an amount that felt large to me. Later, when I understood how profitable our products were, it became clear that the “marginal” value of my labor was being shipped off to the shareholders. Having a company stock ownership plan fooled me into thinking I was participating in collecting wealth.
I was a shareholder now. I had a nominal stake in the system. This is one way they get to you.
I know I’m complicit in this structure of capitalism. I bought into it. For a while it seemed to “work” for me. But when I wake up to the fact that half of the population owns less than 4% of the overall wealth, I feel sick. Of course, I know it’s not all up to me. I’m not the cause of the inequality.
However, I do feel compelled to consider what alternatives exist in a system that seems determined to keep hollowing out small towns, and rewarding billionaires. A couple of months ago I learned the concept of a “kleptocracy3” which rang a bell in my mind.
Oh!
That’s where we live now, isn’t it?
It doesn’t even seem to faze people that the U.S. president accepted an airplane from a foreign government4. Influence is being bought, and we don’t even blink anymore.
***
My fear brain goes to revolution as a next step. History doesn’t have a lot of positive things to say about increasing wealth gaps, or a nation so armed with guns. How we tiptoe around authoritarian leaders to avoid upsetting anyone.
I wonder about socialism. Is that even possible in a world that has poisoned by the capitalist insistence that we can’t have nice things in a world where billionaires are asked to pay their fare share5?
It does seem like the concept is gaining traction. Perhaps the popularity of Bernie Sanders indicates that more fair distribution is not impossible. The Boomers, steeped in the “red scare” and other anti-communist rhetoric may not believe it. The GenXers (myself included) are skeptical of every system, so this is probably why the label feels cringey.
How do you see it, dear reader?
Can we paint a picture together of what it might look like to keep more of the value of the work we do?
I realize a lot of people dismiss the Scandinavian countries6 that promote more equality in their systems as outliers. However, it’s worth trying to consider what we might gain in a system where nobody needs to go bankrupt for an unexpected medical issue.
I can’t answer the question I raised in the title. But I sure hope our imaginations don’t fail us in this hour of need, alongside what seems like unfettered greed.
See Wealth Inequality per Wikipedia for more information.
Charted: U.S. Wealth Held by the Bottom 50% (1989- 2024) - Information from Visual Capitalist based on Federal Reserve Data.
Trump Accepts Qatar Plane (source: NPR).
Warren Buffet on Billionaires Underpaying Taxes from Investopedia.
Countries ranked on Income Equality - U.S. News & World Report