THE BLOG
01/22/2013 01:04 pm ET Updated Mar 24, 2013

There Is Something Wrong With Capitalism: Martin Luther King and the 'S' Word

In December, Reuters released the first of a special series detailing the growing chasm of income inequality in the United States. The series is appropriately titled "The Unequal State of America: How Uncle Sam Widens the Income Divide."

The report found that the difference between the top 5 percent of households in the nation's capitol is now 54-to-1. (Only 20 years ago it was an infinitesimal 39-to-1.) Further, the report illustrated Washington D.C.'s culture of crony capitalism and particularly the exponentially widening trough for private companies to make obscene amounts of money from public contracts in the defense sphere.

Income inequality isn't a new issue. But what I found particularly jarring about the Reuters study -- published in the midst of President Obama and House Speaker Boehner's fight over which programs for the poor, sick and elderly they would cut and whose taxes they would raise to support the growing insatiable monstrosity that is the military industrial complex -- was the fact that no one seems to see the elephant in the room.

This is capitalism.

As we honor Rev. Dr. Martin Luther King, Jr. it's important that we honor who the man really was and not who he's been mythologized to be. Dr. King was a fearsome and voracious critic of American economic policy and were he alive today I have to imagine that even at age 84 he would be more active than ever.

King died on April 4, 1968, preparing to lead a Poor People's March on Washington that he hoped would close down the U.S. Capitol building.

"To his family, King was murdered because he was no longer the King of the March on Washington, simply asking for the whites only signs to come down," wrote Verne E. Smith and Jon Meacham in an article for Newsweek. "He had grown radical: the King of 1968 was trying to build an interracial coalition to end the war in Vietnam and force major economic reforms."

King in his later years had turned his attention from the African-American civil rights struggle to the economic struggles of all Americans who were not getting a fair shake in this the land of opportunity.

He realized in the months leading up to his death that civil rights were empty without human rights that included economic rights. For people too poor to eat at a restaurant or afford a decent home, anti-discrimination laws were hollow and meaningless.

King understood that the issues the nation's poor faced were largely a result of the economic systems in place.

"There is something wrong with capitalism," he said in a 1967 speech.

In that speech, called "Where Do We Go From Here," King described, in great detail, just what was wrong with capitalism:

There are forty million poor people here, and one day we must ask the question, 'Why are there forty million poor people in America?' And when you begin to ask that question, you are raising a question about the economic system, about a broader distribution of wealth. When you ask that question, you begin to question the capitalistic economy. And I'm simply saying that more and more, we've got to begin to ask questions about the whole society...And you see, my friends, when you deal with this you begin to ask the question, 'Who owns the oil?' You begin to ask the question, 'Who owns the iron ore?' You begin to ask the question, 'Why is it that people have to pay water bills in a world that's two-thirds water?' These are words that must be said.

On a number of other occasions King called for radical changes in the structure of American society and a redistribution of wealth and power in the United States.

Albert Einstein, in his essay, "Why Socialism" argued:

Man is, at one and the same time, a solitary being and a social being. As a solitary being, he attempts to protect his own existence and that of those who are closest to him, to satisfy his personal desires, and to develop his innate abilities. As a social being, he seeks to gain the recognition and affection of his fellow human beings, to share in their pleasures, to comfort them in their sorrows, and to improve their conditions of life. Only the existence of these varied, frequently conflicting, strivings accounts for the special character of a man, and their specific combination determines the extent to which an individual can achieve an inner equilibrium and can contribute to the well-being of society.

Unlike Einstein, King was not a socialist, because he came to a very simple understanding about the philosophies of socialism -- they don't work. Socialism necessarily leads to communism and communism ignores the inherent realities of who we are as human beings.

In the exact same speech in which he damned capitalism, King rightly distanced himself from socialism:

Now, don't think you have me in a bind today. I'm not talking about communism. What I'm talking about is far beyond communism...I read 'Communist Manifesto' and 'Das Kapital' a long time ago, and I saw that maybe Marx didn't follow Hegel enough. He took his dialectics, but he left out his idealism and his spiritualism. And he went over to a German philosopher by the name of Feuerbach, and took his materialism and made it into a system that he called 'dialectical materialism.' I have to reject that.

What I'm saying to you this morning is communism forgets that life is individual. Capitalism forgets that life is social. And the kingdom of brotherhood is found neither in the thesis of communism nor the antithesis of capitalism, but in a higher synthesis. It is found in a higher synthesis that combines the truths of both. Now, when I say questioning the whole society, it means ultimately coming to see that the problem of racism, the problem of economic exploitation, and the problem of war are all tied together. These are the triple evils that are interrelated.

What Dr. King was saying is that communism and socialism are not the answer because both philosophies ignore a part of our humanity that's as important as anything else about us. We are social beings who care about each other, but we also have a need to improve ourselves and a need to serve ourselves and those closest to us. We have a need to compete and while that need can often get the best of us, it can also bring out the best in us.

"Only market capitalism solves the two major problems that face any economy - how to provide an incentive to innovate and how to solve the problem of decentralized information," said Prof. Gary Wolfman of Hillsdale College. "The reason there is so much innovation in a market system compared to socialism or other forms of central planning is that profit provides the incentive for innovators to take the risk needed to come up with new products."

Wolfman goes on to point out, "Over the last 100 years capitalism has reduced poverty more and increased life expectancy more than in the 100,000 years prior."

But capitalism doesn't work for the same reason Communism and socialism don't work -- capitalism ignores the fact that life is social. Perhaps more importantly than the existential crisis it creates is the economic crisis it inures.

As I've pointed out before, today 400 individuals have as much wealth as an entire half of America. One percent of people own 40 percent of the wealth and are taking in more of the nation's income than at any time in history since the 1920s. Eighty percent of this country's citizens have only 7 percent of its wealth.

There is certainly something wrong with capitalism and we shouldn't be afraid to say that.
Let's continue the work that King didn't get to finish. Let's not forget the radical economic changes he called for and strive for the more perfect synthesis he sought.

I urge you to honor Dr. King by opening your mind to possibilities beyond what is safe and familiar. Honor not just the principles of freedom and equality he stood for, but for the idea that a better future for all people was possible.

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