The Unhappy Marriage of Capitalism and Conservatism

Barry Ritholtz's 10 New Year’s Eve Reads points to The Unhappy Marriage of Capitalism and Conservatism by Nancy Folbre who writes that:

The economic interests of capitalists (defined as those who earn most of their income from capital) are beginning to diverge significantly from the interests of social conservatives (defined as those who prefer traditional gender relations and oppose government efforts to promote racial and ethnic equality).

As recounted by Folbre, this has always been the case during the history of Capitalism. The social conservatives have always sought to defend their existing privileges gained through an earlier stage of Capitalism against those who have gained from economic changes. The political struggle has always been about the alignment of political power with economic reality.

Folbre lists three (3) areas where the conflict between conservatism and Capitalism has occurred:

1. One of the most beneficial consequences of a pattern of capitalist development shaped by political democracy was a growing demand for human capital that helped members of previously disempowered groups compete effectively for economic success and political leadership.
2. …the polarization of income itself reflects the evolution of a partly denationalized form of capitalism in which our largest companies create more jobs in other countries than at home and minimize their tax payments in overseas tax shelters.
3. …the role that the powerful banking sector played in the recession highlighted growing divisions within the business community.

I think Folbre misses the point that Capitalism is a dynamic system as opposed to slavery or Feudalism. By its very nature, Capitalism is always seeking new ways to make profits. Any Capitalist who becomes a conservative dooms themself.

It is this dynamic of Capitalism that has confounded Communists who followed the dictum that revolutions tend to occur when the political superstructure does not match the economic reality. The Communists had expected the revolutions to overthrow Capitalism, not sustain it as in the following crises:

• The growth in political power of the union movement through the rise of the Labour Parties in the late 19th and early 20th centuries;
• The extension of suffrage, in stages, to:
• All white men
• All white women
• All adults
• The creation of the welfare state as seen in 'A Conservative Case for the Welfare State'
• The Civil Right's Movement
• The Land Right's Movement
• The Women's Movement

All of these covulsions have been absorbed into the Capitalist system. The danger for the Capitalist system is when it is no longer willing to absorb these changes. Such changes that need to be absorbed are:

• Gay Marriage
• Refugee Rights
• Climate Change
• Third World Debt