Russell Brand hates money. The British comedian and actor with a beard just shorter than Ted Kaczynski’s simply can’t stand the green stuff and he’s giving everyone the privilege of reading his thoughts on the subject in his new book “Revolution,” which you can find on Amazon.com for the sale price of $17.02.
More than money though, Brand despises the current “corrupt and conformist” socioeconomic “system” called capitalism. America receives the focus of much of his stream-of-consciousness rants because it’s, “…a country that, let’s face it, has really run with this whole capitalism thing…” In America, six people (of the Walmart fortune) have more wealth than 30 percent of the population. And that is crazy unfair!
He doesn’t explicitly define capitalism in the book, but we can gather from his writing that he thinks it’s a “socioeconomic system that creates a hugely wealthy elites at the cost of everyone else.” He writes, “Our system, capitalism, is designed to behave like this: It generated wealth for the wealthy and further impoverishes those with nothing. Asking it to behave differently is like asking a microwave to wash your car.”
I think we can all agree that a system that makes the wealthy more wealthy while also further impoverishing the poor would be a bad system. But is that what capitalism was designed to do, as he claims? More importantly, regardless of design, is that the result of capitalism?
First, it’s important to define our terms. According to dictionary.com, capitalism is
Basically, capitalism is where individuals or corporations control the economy (what’s known as the free market) and socialism is where the government controls the economy (controlled market).
So, does capitalism (the free market) lead to wealthier wealthy and poorer poor as Brand asserts?
The data definitely point to the former. The United States is a relatively free-market economy (it’s listed as #12 in the Fraser Institute Economic Freedom of the World Annual Report) and the wealthiest people in America have increased their income dramatically since 1989:
But have the poor become poorer? Not so much.
CBO data show that the bottom quintile is up 45 percent in real income since 1980. Now, it’s true that the increase is dwarfed by the gains by the wealthy, but it’s patently false to say that the poor have become poorer.
It’s even more spurious to claim that capitalism is to blame for this imaginary trend. The aforementioned Fraser study shows that there is no correlation between free-market economies and increased poverty. In fact, the poorest people in free-market countries tend to get a slightly bigger share of their pie than in non-free-market countries:
As you see in the above chart, the poorest 10 percent around the world take in about the same percentage of their countries’ income despite its economic freedom. But what the data do show is that the same small piece of the overall pie equates to a substantial amount more of real wealth in the economically free countries because they are wealthier on the whole:
Russell Brand rails the current system as corrupt and conformist and wants a system that is “fairer and sexier” but it’s clear when you look at the data that he’s promoting the exact opposite socioeconomic system he ostensibly supports. I don’t think you can find a socioeconomic system more corrupt and conformist than the least economically free countries (Venezuela, North Korea, and Zimbabwe), and is there anything less sexy than poverty? Freedom, on the other hand is sexy and fair. After all, is it fairer to allow everyone to keep what they earn or allow a certain class of people to bash people and take their stuff in order to distribute it to another class of people?
I’ll give Brand the benefit of doubt. I think he means well. But, as a brilliant person once said, the road to hell—and serfdom—is paved with good intentions. The data is clear: economic freedom leads to better lives for everyone involved.