Social democracy means a bottom-up economy, with public spending directed at alleviating the burdens of the poor; public policy that drives greater social equality; and public investment in infrastructure that aids small businesses, including farming and small manufacturers.
The United States is moving left. That is the result of the realisation by left-of-centre intellectuals that the right-wing trickledown economy has driven social inequality and social division to such an extent that the very fabric of the country is falling apart. Anyone who believes the US is not in social trouble needs to wait a few years to see how bad things will get in that land of the Pure Capitalist.
Pure Capitalism is unsustainable in a volatile world where massive investment in the environment, government intervention in pandemic economies, and public policy that stops rising social inequality all are required to avoid an ominous threat to human existence.
Supply-side trickledown is tearing societies apart. The rise in nationalism, fascism, tribalism, racism, and social and political fragmentation, is the direct result of increasing social inequality driving public anger.
In the Virgin Islands, political elitism and social inequality have driven up crime and public anger, as was evident in the defeat of the former government. One reason for the success of the present political party is the belief that it is the party of the “small man.”
The solution to ensuring social and political calm is simple. Governments in western capitalist societies must invest in the poor, underprivileged and working classes, and bridge the social and wealth inequality gap. Failing this, continued social inequality threatens to become a time bomb.
US President Joe Biden is absolutely correct in stating that the economy of the trillion-dollar corporation and the super wealthy must give way to an economy of the working man and woman. Public investment in the social infrastructure is the best way to grow a sustainable economy that benefits the 90 percent.
A safe and secure society results from taxing the wealthy and investing that cash in quality education, accessible health care, and cutting-edge physical infrastructure that benefits the masses — thereby helping to ensure that no resident drops into poverty.
Economist John Maynard Keynes understood that the best way to drive economic growth was by putting cash into the pockets of the poor and working classes who spend that cash on necessities. Consumer spending by the working classes drives the multiplier effect. The exchange of money in the economy increases, driving greater economic growth.
Lifting the bottom of the social pyramid lifts the whole pyramid. On the other hand, when the top of the social pyramid controls economic and social power, it simply perpetuates the rule of the one percent, driving even greater social inequality.
Poverty is viewed as desirable for the existence of pure capitalism. Poverty ensures a cheap labour force for the one percent who can utilise low-cost labour to grow their wealth.
This system may be good for the one percent, but history has shown that the 90 percent remain burdened by social and economic stagnation, eventually leading to political instability.
Europe is home to a number of social democracies and countries with a high social democracy component: Among them are Denmark, Finland, Germany, Norway, Northern Ireland, Austria and France. The drive to create greater social equality in these countries has led to the highest quality-of-life indices anywhere on earth. Social democracy or democratic socialism leads to greater longevity, lower crime rates, and the highest standards of living and quality-of-life matrices.
If increasing social inequality is a ticking time bomb driving public anger and human suffering, then greater social equality promises “peace on earth.”
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