Democracy Is The Only Economics That Works

I am reading about how we got out of the Great Depression, and I think there was a clear sense of adversarial relationship between wealth, corporate power and democracy that we don't see today, but which I believe defines what is happening to us. For example I am currently
reading FDR's 2nd inaugural address. I know this address comes four years into The New Deal, but I think it reflects what I have read from when the New Deal began as well.

"In fact, in these last four years, we have made the exercise of all power more democratic; for we have begun to bring private autocratic powers into their proper subordination to the public's government. The legend that they were invincible above and beyond the processes of a democracy has been shattered. They have been challenged and beaten.

Our progress out of the depression is obvious. But that is not all that you and I mean by the new order of things. Our pledge was not merely to do a patchwork job with second-hand materials. By using the new materials of social justice we have undertaken to erect on the old foundations a more enduring structure for the better use of future generations.

In that purpose we have been helped by achievements of mind and spirit. Old truths have been relearned; untruths have been unlearned. We have always known that heedless self-interest was bad morals; we know now that it is bad economics. Out of the collapse of a prosperity whose builders boasted their practicality has come the conviction that in the long run economic morality pays. We are beginning to wipe out the line that divides the practical from the ideal; and in so doing we are fashioning an instrument of unimagined power for the establishment of a morally better world.

This new understanding undermines the old admiration of worldly success as such. We are beginning to abandon our tolerance of the abuse of power by those who betray for profit the elementary decencies of life."

I think this strongly shows that FDR's believed that the depression was caused by wealth flowing to the top (as today) and would be corrected by asserting that We, the People must take back control of our common resources.

In other words, real democracy -- We, the People controlling and making decisions about our common resources, instead of corporations and the wealthy -- is the only form of government and economics that can work for all of us.

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Comments

[Pdubya]

07:39 PM on 12/08/2008

Sir: I will remind you that we had a "democratic" vote for the bailout. The majority ruled. Was it representative? No. We live in a republic. And I do believe you have the formula backwards: Only a true free market can foster a representative democracy...whether it be a repubic or not. And no, we have not had a free market, but a managed market.....started by Wilson and ensured by FDR. It went full tilt with the Bretton Woods breakdown. A good read on the subject is: The Creature from Jekyll Island.

[Rule Of Law]

04:10 PM on 12/08/2008

FDR's words here explain precisely why he is so feared and reviled by the Republican Party and Neo-Cons who in the name of the "Free Market" are really seeking the total destruction of the Middle Class and the power we wield!

[JesseChanley]

11:47 AM on 12/08/2008

Excellent! Thank you for reminding us of FDR's perspective and for championing economic democracy. Our economy would be both fairer and more stable if we reduced inequality, by 1) linking the top salaries in companies to those at the bottom (e.g., 4:1 ratio), 2) providing all workers with a fair ownership share, and 3) providing a fair return to investors but not shares of ownership.

[Samalabear]

10:14 PM on 12/08/2008

It would indeed be nice to see CEOs making that ratio. I believe some of them are making 800 times that of the lowest paid worker.