On July 16, 2021, the editorial board of The Washington Post declared, ''Democratic capitalism, for all its shortcomings, remains the greatest engine of widely-shared prosperity the world has ever known.''
Behold the most astounding event since the USSR lowered the hammer and sickle and dissolved itself.
Add in the Post’s declaration that ''The pursuit of individual wealth is not only natural; it is laudable, as a reward for risk-taking, innovation, artistic creativity and efficient production, whose benefits spill over to society as a whole. Throughout history, societies that arbitrarily confiscated property failed while those that lawfully protected it flourished.''
Pursuit of wealth laudable?
Pinch me, I must be dreaming.
I scooped The Washington Post on this in my Newsmax column A Spooky Halloween Tale of Democratic Capitalism almost nine months ago! I wrote:
In the past year we've heard a great deal about "Democratic Socialists" thanks to Sen. Bernie Sanders and Rep. Alexandria Ocasio-Cortez. Now, both Halloween and Election Day are approaching. A night and a day devoted to the kooky and the spooky ...
Come closer, children. Let me tell you a spooky story for this spooky season.
Once upon a time, within living memory of the very elderly, like me, actual Democratic Capitalists roamed the land, unashamed! Democratic Capitalists were considered "normal."
They may return! Insert ominous organ spike here!
As I revealed in Chapter Two of my latest book, The Ten Commandments of Capitalism, the most radical Reagan tax-rate cuts, cutting the top rate from 70% to 28%, were initiated and led by Democrats. …
Spookier! Democratic Capitalism didn't end there.
President Clinton signed into law a whopping cut in the capital gains tax rate from 28% to 20%. Clinton reformed welfare, cut tariffs, kept inflation in check and restrained federal spending growth so well that, compared to his successors, he resembled that icon of capitalism, that skinflint, Scrooge McDuck. …
Scared yet? No? Well.
Even spookier! Democratic Capitalism didn't begin there.
JFK promised and LBJ enacted cutting the top rate from 91% to 70%. President Jimmy Carter, although hopeless on inflation and taxes, was wonderfully pro-capitalism in cutting onerous bureaucratic red tape.
Where’s my Pulitzer, dude?
I look forward to the Post’s promised series on capitalism, starting with its legitimately identifying the yawning gap between the net worth of workers and investors as a pernicious threat to capitalism’s legitimacy.
Yet the Post’s editorial board begins its inquest by pointing to globalization and deregulation. Odd oversight. The real perp was Richard Nixon.
The beginning of the end of equitable prosperity began in earnest on August 15, 1971, with the ''Nixon Shock.'' Nixon’s tariff and wage-price controls are long gone, his ''temporary'' suspension of the Bretton Woods international monetary system persists. Consider the correlation between that and economic inequity.
As I wrote a few years ago, ''... Stan Sorscher, ... published a frighteningly important blog at The Huffington Post ... headlined ''Inequality — ''X'' Marks the Spot — Dig Here.'' ... Sorscher nailed the moment if not the cause.
What spot does X mark? The Bureau of Labor Statistics data presents a dramatic breakdown, from 1971-1973, between major sector productivity, which continued its robust ascent, and the real wages of goods-producing workers, which flatlines. These factors are not identical to the relative net worth of investors and workers yet are reasonable proxies.
Merely coincidental to the breakdown of the post-war international monetary order? Unlikely. The breakdown from fixed to floating exchange rates and, with it, the rise of creeping inequity between capital and labor, was inevitable due to the infirmities of the gold-exchange standard as pointed out at the time by Triffin and Rueff.
Those flaws were exacerbated, not rectified, by Nixon to our great cost.
To restore equitability, we first must unwind Nixon’s monetary sin.
How could we have missed this? As John Maynard Keynes wrote in his 1919 classic "The Economic Consequences of the Peace":
''Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.''
What to do? Hello Post owner Jeff Bezos!
You are that one man in a million!
Bezos? You don’t meddle with the Post’s editorial policy. Yet surely the shade of Kay Graham will cheer you on for finally exorcising the specter of Richard Nixon still haunting America. Please tutor the Post’s editorial board on monetary policy.
After, let’s grab a beer and talk about The Washington Post providing reparations to the democratic-capitalist running dogs so long denigrated by the Post, the better to rev up the greatest engine of widely-shared prosperity the world has ever known, democratic capitalism.
Ralph Benko, co-author of "The Capitalist Manifesto" and chairman and co-founder of "The Capitalist League," is the founder of The Prosperity Caucus and is an original Kemp-era member of the Supply-Side revolution that propelled the Dow from 814 to its current heights and world GDP from $11T to $88T. Read Ralph Benko's reports — More Here.
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