Capitalism Hits Home: Capitalism, Socialism and Communism - Part 1

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This podcast will define those different class arrangements of Capitalism, Socialism and Communism and how they effect personal life. We will explore what they are and how do they differently effect personal life, particularly the lives of society's most vulnerable people, women and children.

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For more from Dr. Fraad, please visit her website at www.harrietfraad.com




Resnick & R Wolff. Class theory & History: Capitalism and Communism in the USSR.Routledge, 2003

Richard D Wolff. Understanding Socialism, Democracy at Work, 2019



Transcript has been edited for clarity.

Hello, this is Dr. Harriet Fraad on Capitalism Hits Home, an interpersonal update. This is a show about the intersection of capitalism, class, and our personal lives.

Today's podcast on Capitalism Hits Home is about what is class? What is a class revolution? What does it mean when we talk about feudalism, capitalism, state capitalism, socialism, and communism? These are words bandied about, but we don't really know what they mean, and we don't learn about these revolutions in school. So it's important to learn about them now. However, before I begin today's podcast, I want to tell you about some developments that have very important ramifications for our personal lives.

First, an update on Epstein, who I've covered in previous podcasts. That's particularly relevant because the way Epstein and his cohort of billionaires and powerful men treated young women affects everyone's personal life. Epstein's death has been declared a suicide, which is widely accepted even though there's ample evidence to make us question. There was a treasure trove of videos of powerful men raping young girls that Epstein provided. These videos were blackmail opportunities for Epstein to make money. A treasure trove of such videos was found when the FBI invaded the locks on Epstein's New York mansion, now worth about $100 million, opened the safe and found all these files. What has happened to these files incriminating billionaires and presidents? No one seems to know. How interesting. They seem to have disappeared, and there's radio silence on their contents. Similarly, the flight logs from the Lolita Express, on which Trump, and Clinton, and many powerful men flew in order to land on "slave island" and rape young women – who were drugged, and if they tried to escape, were forcibly brought back – those flight logs have similarly disappeared. How interesting.

In addition, there's interesting facts around Epstein's quote "suicide." Epstein was in the metropolitan prison system, which is controlled by Barr, Trump's – one of Trump's – most enthusiastic apologists. In that facility, it is mandated by law that there are cameras posted outside the cell of anyone who has attempted suicide, as Epstein did. Interestingly enough, both of those cameras outside Epstein's cell were broken. Another rule not to be broken is that when an inmate has tried to commit suicide, that inmate needs a fellow inmate in his cell at all times. Somehow the head warden, under the supervision of Barr, allowed Epstein's cellmate to be taken out of the cell. So he was alone. The marks on Epstein's neck, according to the autopsy of the government, indicated suicide. According to the autopsy of Epstein's lawyer, the broken hyoid bone – which all autopsies agree is usually associated with strangulation, not suicide – the marks on his neck were similar. The guards that were supposed to check on Epstein every half an hour – one was recruited from a different job for this job, which isn't her job. The other was on a second part, a second shift, and tired. How interesting is that? Those two guards are the only ones being prosecuted. How interesting. The head warden, who is responsible for this, under the supervision of Barr, has not been penalized. He was merely transferred, with the same, in the same position, with the same salary, to a different prison. These things are not being questioned. Across the United States, people refer to Epstein's suicide. How interesting. That's certainly questionable.

And so here again, in terms of capitalism hitting home, you have wealthy, powerful men who are allowed to regard women as sexual snacks, and rape them, and assault them – whether they're Alan Dershowitz, famous lawyer; or Prince Andrew, monarch's son; or Jes Staley, president of Barclays Bank; or any of the many others. No one is asking questions. If you don't – money talks in this society, and it seems to speak very loudly. And many voices here are silenced.

In addition, I want to call attention to two other developments which vastly affect personal life in America. One is that the recent mortality statistics show that Americans are dying younger than they used to. That's interesting, but what's more interesting is which Americans are dying younger. And this has been reported by The Economist magazine as well as a study by MIT. The bottom one percent – the one percent that earns the least – die, if they're men, on an average of 14 years earlier than the top one percent. The lowest percent of women die on the average of 10 years before the highest, or the middle, of American men and women. So you have mortality depending on income. Life itself is 10 to 14 years shorter if you don't have money than if you have quite a bit of money. That's certainly relevant when we look at how capitalism hits home: who's dead and who's allowed to live.

A third development which really affects how capitalism hits home is the new figure that now couples live together more frequently than they marry. We already know that the mass of 18- to 35-year-olds don't marry, and that the latest development among married couples is married couples without children. But in the latest studies of cohabitation, the reasons people give for not marrying – which certainly affects their personal lives – are that they don't have the security to plan for the future, and they certainly don't have the financial security to plan for children. Before the 1970s, people loved one another, got together, decided to marry, to raise children, counted on the fact that they'd always get a job and make a living. Now that's no longer the case. Both people have to work, and if both people are working and we have scant or no paid maternity leaves and paternity leaves, then what are people going to do? Day care, on average – which isn't the finest day care, but decent day care – costs about the same cost as a community-college tuition: about $10,000 a year. Not that many couples can afford that. And already 85 percent of America's kids are in substandard day care, crowded in front of televisions in wet diapers. So this is not a tenable future. So that people live together, but they don't marry because they don't have the security.

Now I want to launch into the topic for today. What is class? What is feudalism? capitalism? state capitalism? socialism? communism? What do these words really mean? Well, they all affect personal life because personal life is very different in these different systems. And we have to understand that no system that's human is pure. There's always variety, as there always is amongst us.

So, for example, the New Deal was in many ways in the United States a socialist period in the United States, although it was never declared that way. Taxes were levied on the highest incomes. The taxes were 98.6 percent on the highest incomes. But now, the highest-income people don't pay their taxes. They get good tax lawyers, and put their money offshore. Romney bragged that he paid 13 percent on his taxes – more than his employees, of course. Trump brags that he paid no taxes at all, and also that he's very rich. But that was a socialistic period in the United States, where the top incomes were taxed heavily in order to finance Social Security, Medicare, unemployment insurance in a depression. And the reason that was agreed to is the capitalist system had broken down. And capitalists at the top agreed with their wealthy capitalist president, Delano Roosevelt, that in order for the capitalist system to continue, they better be taxed to pay for these programs. Because at the time, the communist and socialist parties organized hundreds of thousands of marchers in the streets of New York and other cities. And the farms, had to do something about farmers, because the Iowa militias were killing judges that condemned family farms. And there were pitched battles in the streets. And so the people at the top felt threatened enough to be taxed. Now, they obviously don't.

So there's always a mix of some kind, according to the circumstances. And we have to understand that a system is called feudal, or capitalist, or socialist, or state capitalist, or communist because of the dominant system. Now what system is this? In order to define class we can ask three basic questions: Who produces the goods and services in a society? Who gets to receive the fruits of those goods and services – the profits? And who gets to decide where to distribute those goods and services? So you can look, let's say, at a big company we all know about which is – well, I hope this is all over the country; I think it is – which is McDonald's. The workers who produce the burgers, and the people who produce the frozen burgers they use, and the frozen french fries, are given a salary. They're employees, because capitalism is a system of employers and employees. They create the profits that McDonald's appropriates. And then the board of directors, representing the owners of McDonald's, decides what to do with those profits: whether to mechanize further and therefore be able to lay off people, whether to expand their menu, whether to expand their stores – whatever it is they want to do. The people who do the work don't have a say. They may go on strike, as many are for $15 an hour, but they're still – so they have an impact, but the basic decisions are made by the employers, the board of directors of McDonald's, in the capitalist system.

In feudalism, serfs produce the wealth of the society. Serfs created the agricultural produce and gave a certain portion to themselves so that they could reproduce and survive – not an elegant portion but a portion – and the rest was appropriated by the lord of the manor to use for whatever he decided: whether it was to expand his lands by invading a neighbor, whether it was inviting more courtiers to live at the palace, or whatever. And that system was justified by the Catholic Church's ideology that determined that the serfs were required by God himself to work for the lord who appropriated their wealth. Parenthetically and interestingly, the church itself was a huge feudal lord, owning many feudal estates. That was feudalism.

So if we ask these questions: who produces the goods and services, who appropriates the profit from them, and who makes the decisions about what they're used for, we can see what kind of a class society we have. I talked a little bit about feudalism, in which the lord of the manor appropriated and distributed the wealth created by his serfs, and that system was destroyed through history and also through the yearnings of the mass of people for something else besides a life of serfdom. They rebelled; they yearned for better lives. The slogan in the French Revolution, which was characteristic of the capitalist revolution that followed feudalism, was "liberté, égalité, fraternité." Liberty, equality among people, and brotherhood among people. And because it was a capitalist revolution, the society was divided between employers and employees. The employees worked to create the wealth of the employer, who appropriated that wealth and decided how to spend the profits.

Workers have no control in a capitalist system. They don't have control over what they're producing, whether they get fired or not (unless they have a strong union), what they produce, whether they get new machinery, whether they get laid off because things are automated. They don't have control of that, and the employer has control over that. They get a salary, a wage as employees, and the employer or his board of directors makes the decisions. Socialism grew out of the feeling, and the reality, that capitalism didn't bring liberty because of financial enslavement or financial poverty. It didn't bring equality, because capitalist societies are noted for their inequality. The United States now, which has the fewest socialistic measures, has the greatest inequality of all the 30 developed countries in the world. Even though in 1970 we were the most equal, now we're the least equal. And so socialism is becoming more interesting with the democratic-socialist alliances and people like Bernie Sanders and Ocasio-Cortez.

State capitalism is more typical of what happened in the Soviet Union and its satellite nations. In state capitalism, bureaucrats decide what's produced, how it's produced, and how it's appropriated and distributed. That's also a capitalism of employers and employees, and the bureaucrats decide how to distribute the goods, how to distribute the money – not the people who produce the wealth.

Communism is a rare system enacted in the world. In the world today, it's practiced in a community called Mondragon, which is a city of about 110,000 people, all working in collectives, communes, cooperatives. No person in that cooperative, or representing that in their governing body, is allowed to make more than six times what the average worker makes. Imagine what the CEOs would do if they couldn't make more than six times what the average workers in their corporation make – like the McDonald's Corporation, or at Amazon, where Jeff Bezos has $150 billion and is about the richest man in the world. What would happen to him if he could only get six times more than the poor pay that his workers get?

At any rate, in Mondragon, the way things are organized is that every cooperative makes decisions cooperatively. Everybody has to participate; participation is mandatory. And they elect representatives to a larger body that makes the bigger decisions for the wider collective. When I was visiting Mondragon, I went to see their biggest co-op, the Fagor Industrial, which makes household appliances: refrigerators, stoves, dishwashers. Every two hours a buzzer went off. And when I asked what that was about, they said that the workers in this cooperative decided that any more than two hours at a given production job was bad for the person on the job. And so they switched to a different job.

They had big decisions they had to make because Mondragon is in Spain, and during the recession there were fewer people buying second homes, fewer household appliances were bought, and their orders were down. And in this cooperative they had to decide what to do about it: whether some people would be fired and they would save money that way, or they would each get less money and work five days a week, or they'd get less money and work fewer days a week. They all decided together to get less money but work only four days a week. But that was a joint decision of how to distribute the income that came in. And it was a decision made by the workers, who then appoint people, elect people, to the council that decides what to do overall: how to invest in, whether to invest in, the universities (they have two universities there), in technological innovation centers, in health care, and other things. So that's really a communist society.

And we have to look and see what our goals are. If their goals are, if our goals are, equality between people so no one has economic power over anyone else, in addition to equality of power we need to look – because we want a society that's fair and equal among people, that no one has economic or social power over anyone else – we can look at societies and different class societies in terms of whether there's equality, whether they create kindness between people, whether they create the well-being of most people. So we have to look at each class system and decide from a personal, kind of homey, point of view which creates the greatest relationships of equality, and kindness, and well-being. We have to evaluate the societies by looking at the way people are treated in them – especially those who have the least economic and political power, who are children, and women, and often ethnic or racial minorities.

Some class revolutions and the changes they made are things we will study. They're all changes that, sadly enough, we don't learn about in school.

Thank you for listening. This episode has been brought to you by Democracy at Work. Please support our work. Visit our website at democracyatwork.info.

Transcript by Marilou Baughman
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