With all the late talk about median wages falling and the rich getting richer, it seems capitalism is becoming unfashionable again. Now I don't define capitalism by any economic or policy parameter. I define capitalism as the system that supports and gives status to business owners. When you see students demonstrating against "capitalism", they aren't arguing against private property. They won't share their precious iPhones, will they? They're cool about people owning stuff. What they don't want is status linked to the amount of property you own. I think this theory applies to the golden age of the labour movement a hundred years ago.
As a non billionaire with little interest in sleeping 4 hours a day and donating millions to sodomy activists to become one, I am naturally inclined to sympathise with the anticapitalists. Not only wages are going down, hours are going up, and the poor fuckers who can still find a job are caught in a rat race of who is able to outwork others and lick more ass while convincing themselves they love it. It's harsh.
So the push for higher taxes on rich people and higher median wages is understandable, if simplistic. But that's only one part of the picture. As easy as it is to blame everything on business, workers are a handful themselves. I have some experience at the owner side of business, and it is my impression that average people just don't want to work. They want a job, of course, somewhere to go every morning, meet people and get paid. But they don't want to focus on what work really means, i.e. making money according to a plan.
People are tribal, meaning that people are most comfortable belonging to groups of 20-100 people. The human brain spent millions of years living in tribes, and it has evolved to socialise in them. Of course tribes were made of kin, but in my experience people are still quite comfortable among non-kin, as long as the numbers are tribe-like. So when people find themselves in a tribal-ish environment, say an office, the tribal instincts start up. Which means that people start to think of the office as the place to socialise. They gossip, fool around, help each other, make up shit, fight over that shit, flirt, reject, status-whore. What they won't do is work, unless forced to.
The early industrial firms had total authority over their workers, so they could force them to work hard as much as they wanted. If you decide the amount and conditions of payment, all without any binding contract and with an army of miserable peasants waiting for the same job, it's very easy to force people to work. But people protested, and with help from dissenters from the elite, they formed unions.
Now what unions do is enforce the idea of the workplace as the social gathering of a tribe. Thing such as higher pay and shorter hours might come to be through labour competition, and there is evidence that unions weren't instrumental on that. What unions did enforce though was controlling who gets in and out. Deciding the membership of the tribe is the most important function of it. And unions were extremely zealous about it. Today in large swaths of Europe all employees have what amounts to life tenure. In Japan the once violent unions dismantled themselves after they achieved employee tenure.
Of course there's an economic rationale to job security for life. But people could equally push for deregulation of the job market so as to be able to change to better jobs. But most people don't want to change, even if they get more money. Most people want to stay in the same job for the rest of their life, and enjoy the tribal-ish social life it provides. Some business owners oblige to this sentiment, and they happily function as the head of the tribe, who cares about his employees. But that seldom works. What works is focused hard work and zero tolerance for bullshit. Which means that ceteris paribus a non-unionised business who can fire people at will and force them to work like slaves will always outperform a cozy company where people go to chat and feel good.
Most bosses are assholes because they have to be. They must break up the tribal mood of an office if the company is to make money. Still the myth of the patriarch-like company owner who cares about its employees like his own family and caters to its needs while simultaneously providing public goods with his business dies hard. Japan's business culture is pretty much based on this myth. It worked for a while, when the war generation, already acculturised into selflessness, went into business. But the kids these days have to be trained in-house, which means endless meetings, dinners, parties, company trips, all to install loyalty into the tribe. People are forced to work endless hours just to make them understand that the company is the tribe, which is above their wife and kids. All that lost time end up eating up most of their time and thus their productivity.
Europe has achieved some kind of balance, but many business owners aren't playing ball. If employees get tenure, they simply refuse to hire, which explains the huge unemployment rates everywhere south of France. The US though gives little heed to the tribal ideal of business. The American myth is the hard working man who builds a business and makes it work, making a lot of money in the process. He has no need to provide psychological comfort to his employees. That is a huge advantage, which explains much of American's economic power. Unions did a lot of harm back in the dark days of new deal fascism, but they are mostly dead now. While discrimination regulations are a huge burden, you still can fire non-black males at will, which keeps them productive, and they're the only ones that work anyway.
The lack of tribalism in American business culture made a vacuum in the market which is eagerly filled by thousands of churches, NGOs, internet forums and all those whacky political associations. American political culture sounds way more partisan (tribal) than most other countries, perhaps because it is.
If Automation does as advertised and keeps destroying most present business models, it's not only the danger of unemployment that we must care about. Even employed people will lose a semi-tribal environment in which they were comfortable, and someone else will have to fill this void.