A great article from Faisal Islam, Channel 4 News’s economics editor, about how capitalism, in the strict sense, is in the process of reaping rewards rather than on the verge of collapse.
If you look at capitalism through the lens of Marx, then it’s pretty clear that right now, capital has never been so ascendant over labour. Capital is capturing the returns to growth, and labour is losing them.
The best example of this is the absolute refusal of Britain’s workers to ask for pay rises. The inflationary price-wage spiral has completely failed to fire. The bargaining power of British workers has never been so weak. It’s not just about low levels of unionisation, it seems that the British worker now internalises the idea that their job can be done more cheaply in China, or by an eager foreign worker.
Obviously, this isn’t an argument that capitalism is not failing as a delivery mechanism of general improvements in living standards. I’d still argue that it’s the best idea we’ve come up with so far.