Senator Warren Is Demonstrating How to Make Capitalism Work

As I mentioned last week, I’m finally following through on my plan to re-watch all six seasons of David Simon’s ground-breaking television series The Wire. The show is often billed as a story about the failed war on drugs as it plays out between drug kingpins and law enforcement in Baltimore. But season two demonstrated Simon’s incredible prescience in telling the story of working class men in the city’s port. To understand the bigger picture of the point Simon was making, he said this during a speech he made at Loyola University in 2007.

We are in the postindustrial age. We do not need as many of us as we once did. We don’t need us to generate capital, to secure wealth. We are in a transitive period where human beings have lost some of their value. Now, whether or not we can figure out a way to validate the humanity of the individual, I have great doubts…

I didn’t start out as a cynic, but at every given moment where this country has had a choice – its governments, institutions, corporations, its social framework – to exalt the value of individuals over the value of the shared price, we have chosen raw unencumbered capitalism. Capitalism has become our god. You are not looking at a marxist up here, but you are looking at somebody who doesn’t believe that capitalism can work absent a social framework that accepts that it is relatively easy to marginalize more and more people in this economy. Capitalism has to be attended to. And that has to be a conscious calculation on the part of society, if that is going to succeed. Everywhere we have created an alternate America of haves and have-nots. At some point, either more of us are going to find our conscience or we’re not…

The Wire is certainly an angry show. It’s about the idea that we are worth less. And that is an unreasonable thing to contemplate for all of us. It is unacceptable. And none of us wants to be part of a world that is going to do that to human beings. If we don’t exert on behalf of human dignity at the expense of profit and capitalism and greed, which are inevitabilities, and if we can’t modulate them in some way that is a framework for an intelligent society, we are doomed. It is going to happen sooner than we think. I don’t know what form it will take. But I know that every year America is going to be a more brutish and cynical and divided place.

In other words, whether it’s the corner boys selling dope or dock workers that are being replaced by technology and gentrification, the root of the problem is that in a post-industrial age, we’re all worth less and, for our democracy to survive, capitalism must be attended to. Do you see what I mean about Simon’s prescience? Eleven years later, the conversation he said was necessary for our survival is starting to take place among Democrats as we hear discussions about regulated capitalism vs. socialism.

I thought of Simon’s analysis when I read Franklin Foer’s interview with Sen. Elizabeth Warren. You’ll want to read the whole thing, but here’s a taste:

Foer: I’ve heard your latest proposals described as an attempt to save capitalism, which implies that it’s in pretty dire straits. How dire do you think the state of American capitalism is?

Warren:  I worry both for capitalism and for democracy. People across this country once believed that folks who work hard and play by the rules have a chance to be able to build real security and that their kids will do better than they did. Today, that dream runs into a very hard reality that this is now a world that works better and better for a smaller and smaller number of people. That’s a problem for capitalism and for democracy at the same time.

Foer: There’s so much talk right now on the left about socialism, which seems somewhat misguided given everything you say capitalism has to recommend itself.

Warren:  I love the competition that comes with a market that has decent rules. I love the structure that encourages anyone with a good idea to try their hand in business.

Warren’s embrace of capitalism with “decent rules” has some pundits pontificating about the possibility of significant daylight between herself and Bernie Sanders, who calls himself a “democratic socialist.” But who is surprised that Sen. Warren wants to regulate capitalism rather than embrace socialism? I’d remind them that she is the same one who came up with the idea of a government program to protect consumers from the financial services industry.

While it didn’t receive as much attention as her more recent Accountable Capitalism Act, Warren also proposed a bill that health care policy guru Charles Gaba called “ACA 2.0.” It would improve on Obamacare by tightening regulations on insurance companies and increasing subsidies for Americans to buy health insurance.

I would suggest that, when it comes to the policy proposals Sen. Warren is cranking out these days, she is playing to the same strength that led her to create the Consumer Financial Protection Bureau. Given her background, she has a good head for the kind of legislation that is necessary to reign in the “raw unencumbered capitalism” Simon warned us about. If she continues to play the role of pragmatist that she did to get the CFPB included in the Dodd-Frank Wall Street Reform bill, she’ll be leading the Democratic Party exactly where it needs to go.

Nancy LeTourneau

Nancy LeTourneau is a contributing writer for the Washington Monthly.