Whither American Democracy: FDR-style reform, revolution or slide into populist dictatorship?

Three people, Jeff Bezos, Bill Gates and Warren Buffet, together own $248.5 billion which is as much wealth as 56% of Americans. This level of inequality is unsustainable and I often wonder when the American political system will implode. In other countries, other political parties would have arisen long ago to replace the Republicans and Democrats, but the rules of the US political system make it virtually impossible for an effective third party to come to the fore.

At this point, it is increasingly pointless to call the Republican Party a political party in the traditional sense. A party is supposed to represent the interests of a significant block of voters, but the Republican Party increasingly only represents a tiny percentage of Americans when it comes to economic issues. The new tax bill is a shameless give-away to rich donors, while raising taxes on households making under $75,000 or less over the next decade, raising the national deficit by $1.45 trillion, and taking away the health care of 13 million Americans. Basically it raises taxes by $4.5 trillion over the next decade on the lower and middle classes, in order to give $6 trillion in tax cuts to the wealthy, of which 62% of those tax cuts go to the top 1%. One analysis found that 71.6% of Americans would be worse off, while 5% would benefit from the bill. This is basically a tax bill which says let’s rob from society in general to give to those who already have too much.

The establishment wing of the Democratic Party isn’t much better when it comes to promoting wealth inequality. Obama’s promotion of the TPP was a shameless give-away to transnational corporations and Obama made 96% of George W. Bush’s tax cuts permanent. Bill Clinton’s deregulation of Wall Street in the late 1990s was basically bribery by the big banks. Clinton also planned to make a “grand bargain” with the Republicans to gut Social Security, but it got derailed by his dalliances with Monica Lewinsky. Obama was similarly disposed to ink a $4 trillion dollar “grand bargain” with the Republicans in 2011, but ideologues in the Republican Party didn’t think it went far enough in gutting the US social safety net. Looking at Hillary Clinton’s list of cabinet picks if she had been elected, her administration would also have governed in favor of the rich, although not as brazenly as Trump has done.

If the system doesn’t allow for a political readjustment that will carry out wealth redistribution like FDR’s administration did in the 1930s, then revolution will become inevitable. Barak Obama had the opportunity be the next FDR, but he decided to thread the needle between the interests of his wealthy donors and the public interest, which gave us half measures like that American Care Act that did little to address the fundamental problem.

The real question at this point is whether the US political system will block the next FDR. Looking at the underhanded tactics of the establishment wing of Democratic Party in the last election, it is a real question whether the Democratic Party is willing to allow another FDR to come to the fore. FDR succeeded because he was able to bring the trade unionists, the farmers (including Southern cotton farmers), the socialists and traditional establishment of Democratic Party together in a grand coalition that voted to raise taxes, provide jobs and create Social Security and unemployment insurance. A less-recognized aspect of FDR’s success was due to the fact that he managed to convince a portion of the elites that they had to accept higher taxes if they wanted to maintain social order. For the last 4 decades, the economic elite have relentlessly pursued an agenda of cutting their taxes and denying their own responsibility to larger society. A small proportion of today’s billionaires, however, are starting to realize the ultimate folly of an economic policy that destroys the consumptive power of the masses. Some of the new tech billionaires like Bill Gates, Elon Musk, Mark Zuckerberg and Sam Altman recognize the basic problem and now openly discuss the idea of a universal basic income. The UBI is hardly an ideal solution, but it at least acknowledges that new technology promises to automate 47% of today’s jobs over the next two decades, and people will revolt if their basic needs aren’t met.

Most political systems around the world are unprepared for the kinds of stresses that wealth inequality, climate change, resource scarcity, artificial intelligence and automation will bring, but the US political system is particularly vulnerable. The US Constitution did not anticipate many of the fundamental problems that would arise and it is a miracle that it has managed to survive so long through a series of court opinions and amendments that update it. There is little hope of reform coming through the amendment process of the US Constitution, since it is virtually impossible to get two-thirds of Congress and three-quarters of states to agree on anything in a political system has become increasingly sclerotic, polarized and gridlocked in recent decades due to gerrymandering, the influence of money in politics, the deregulation of the media and the rise of information silos, etc.

At this point, another global economic crash is becoming increasingly likely due to neoliberal deregulation and the increasing fragility of a globalized economy based on financial speculation and dependence on over-specialized global supply chains where there is no redundancy. The Chinese probably won’t be able to save the global economy like they did in 2008-9 through massive public spending, since they are now as deeply in debt as all the other major economies. Likewise, there is growing risk of a climatic disaster. If the US experiences a warm, dry summer like Russia in 2010 that helped usher in the Arab Spring, then there will be global grain shortages. Imagine what will happen if the price of corn quadruples, which in turn effects the price of sugar, beef, chicken and half the products on the supermarket shelf which contain some corn derivative.

Will the next economic crash or ecological crisis cause a revolution in the US? If there is no political reform like FDR’s administration, it might, but I don’t currently see a widespread ideological movement that will be able to direct public frustration into revolution. Americans might be angry at the system, but it isn’t like France in the 1780s or Russia in 1917 where most people think that the current system has to go and there are organized groups offering a vision of a new system to replace it.

What is far more likely in my opinion is that blocked reform will lead to more and more obstructionism, until the rise of a populist dictator starts to take over the effective reins of the government, while maintaining the form and symbolism of American democracy. Most people will accept it, because the strongman will redistribute wealth and bring order compared to a gridlocked political system which was incapable of supplying people’s basic needs. In fact, de facto dictatorship is likely to be sold under the guise of propping up and saving the system.

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