Power Struggles in Capitalist Democracies and the Fate of American Labor Unions
To some, "capitalistic democracy" conjures up the picture of a utopia where the free market is accompanied by individual liberty and social justice. To others, however, the term is more like a paradox—despite tremendous economic power, the advanced industrial nations are not immune from the evils of socio-political inequality as well as economical disparity. Amongst the capitalist democracies of the world, it is an established and well-known fact that when compared with the advanced industrial countries in Europe, the United States has the worst condition of economical-political inequality and social injustice. Its government is the least progressive, and its social inequalities the most deplorable. To explain the condition in the U.S. today, both the universality of capitalistic democracies and the peculiarities the American system employs—as well as this system's political and historical development—must be examined and explored.
As Joshua Cohen and Joel Rogers articulated in On Democracy, a capitalist democracy is one that "if [it] is not just capitalism, still less is it just democracy" (Cohen 50). Indeed, despite the apparent political equality in a system that nowadays guarantees universal suffrage, the dominate socio-political structure in the United States and most western European countries does not allow—neither by intention nor in practice—free and equal competition between the capital and labor. Cohen and Rogers theorize that at the heart of this disparity lies what they call "the demand constraint" and "the resource constraint". In summation, the demand constraint states that because of the fact that the entire capitalistic economy is intrinsically dependent on the investment and satisfaction of the capitalist class, the state and the labor class cannot and will not make all the necessary demands to the rich; and the resource constraint is that labor's collective actions suffers from lack of resource and a magnified free rider problem that oftentimes render them ineffective.
The demand constraints limits what the labor class and the state can demand from the capitalist class because it essentially controls the economy through capital investment. As a result, "the satisfaction of the interest of capitalists is a necessary condition for the satisfaction of all other interests within the system." (Cohen 298). There exists an inherent imbalance of power in a capitalist democracy because its stability and growth depends primarily on the economic well being of the capitalist class. This group holds the power of choosing what, where, and how to invest their resources. Moreover, "corporations control a host of decisions unless and until the government specifically intervenes". (Clowson et al, 161) The labor class is dependent on them for employment and income, and the state also relies on them both directly and indirectly—directly through income tax...