Discussion of looting has defined the discourse of protest and rebellion for the last week as thousands of businesses have sustained unprecedented demolition. The response to this destruction has been vehement. The National Guard has been deployed across the country in an effort to quell righteous rage and destruction unleashed on a white supremacist police state. The attempted suppression of protesters in an effort to protect private property is, of course, not surprising given this country’s obsession with economic prosperity.
The free market dominates every facet of human creativity. Scientists strive diligently over the course of their professional lives to discover cures for disease and uncover the miracles of the natural world but are beholden to private grants that provide funding for their research. Artists yearn to erect transformative art that reveals the truth of our world, but often have to settle for less in a bid to not obstruct sale potential. A similar plight faces writers and economists. All actions are filtered through the lens of economic conduct and output.
This is the byproduct of neoliberalism — an enterprise to preserve private property, a free market, free trade, and a cartoonish definition of individual liberty. The main tenets of neoliberalism are not necessarily confined to any particular political ideology. This is evidenced by the expansion of neoliberalist policies under Ronald Reagan and Margaret Thatcher, as well as Bill Clinton and Tony Blair. Under both conservative and liberal governments, there has been a systematic effort to reverse the regulatory systems built during the Great Depression and in the aftermath of WWII. As a consequence, the role of government is consumed by an almost singular focus: maintaining the integrity of money and the construction of a military, defense force, law enforcement, and judicial system that secure private property.
Under neoliberalism, we have seen the emergence of two parallel economies. On one hand, there is the speculative financial economy, which operates primarily in the stock market and through banking systems. On the other is the real economy, one that produces goods and services through labor and capital. Over the course of several decades, the financial economy has turned practices meant to manage risk into increasingly volatile gambling tools. Simultaneously, the stability once promised to those in the real economy has rapidly disappeared as gig workers and independent contractors find themselves in roles with shrinking wages and little to no benefits. This has culminated in a vast and widening wealth gap.
The solution to this conundrum is ambitious, yet far reaching in its implications and reach: collective economics. Collective economics is generally defined by robust government regulation of national and international finance, nationalization of fundamental industries (e.g., mass transit and healthcare), and the immediate promulgation of a progressive tax code that ensures an equitable redistribution of wealth. It is not enough to regulate the market economy, nor is it sufficient to counterbalance inequalities generated in the market by resorting to compensatory redistribution through tax and transfer.
The government can and must, on a large scale, do the work of venture capital by investing money directly in communities. This calls for experimentation in the ways we invest money, mimicking the market, but where the source of capital is a governmentally controlled pension system (like the Social Security system). Making the Social Security System the core of a U.S. sovereign wealth fund is only one option. It would also be possible, as other countries do, to vest the responsibility for managing a sovereign wealth fund in the Treasury or in specially created investment supervisory bodies (e.g., for infrastructure, technology development, etc.).
Mass government reinvestment can occur in two ways: direct cash deposits, and mass investment in public sector initiatives that reward restorative initiatives. These funds would specifically target disenfranchised communities such as those on native reservations and other similarly situated distressed regions. The Investing in Opportunity Act, a recently proposed piece of legislation, originally introduced by Cory Booker, Tim Scott, Pat Tiberi, and Ron Kind, incentivizes the private sector to invest in distressed communities. It recognizes that the one in six Americans living in distressed communities need immediate and direct support. However, rather than mandate mass government re-investment, it seeks to rely on the very institutions that continue to ravage communities of equity.
The ethic of collective economics is furthered by current Universal Basic Income legislation and recent attempts by Senators Bernie Sanders, Ed Markey, and Kamala Harris to expand direct cash subsidies. It goes further, of course, by demanding a robust distribution of wealth in the hands of people and communities. By doing so, it entrenches social welfare and collective action into the heart of American economic power.
The irony here is that the wealthiest Americans operating in the financial economy are already acting as a collective economic behemoth, absorbing outrageous wealth, not simply from economic activity, but from overt and insidious political influence. In the wake of the coronavirus pandemic, the federal government has spent a total of $500 billion to sustain corporations,. Under the guise of COVID-19 relief, the administration has rolled back environmental protections and continued its crusade to de-regulate the market. While our institutions are displaced by economic market valuations, private corporations are surviving off the avails of socialism. Small businesses and public services are growing gaunt and ghostly, with their future prospects of survival looking increasingly improbable. Public institutions tasked with the critical work of educating young people, housing the needy, and sustaining social and civic life must escape from the chokehold of privatization and center instead on the pragmatic and moral approaches that build decision-making power through democratic socialism and government-funded social services.
The global coronavirus pandemic is exploiting an underlying epidemic of scarcity and greed. A scarcity of resources, then, is not the problem. Our world can be different. There is no scarcity problem in the US, or in the world as a whole; there is a violently destructive mis-allocation problem. There is simply a vacuum of collective ambition — and this must radically change to realize the promise of a fairer and more just society.