Chase CEO Dimon Illuminates Capitalism’s Sickness While Trying to Critique Socialism

Last updated on April 8th, 2019 at 01:03 pm

To perhaps an unprecedented degree in the United States, we are witnessing an increasingly serious debate playing out about the relative merits of capitalism and socialism.

This development is healthy, allowing the opportunity to assess the effectiveness of the way we organize our economy to meet human need through honest comparison with the ways other nations do, as we search for the best solutions and possibilities for serving people’s needs.

Despite the general consensus that during the Red Scare days Senator Joe McCarthy was in fact conducting an extremist witch hunt, an anti-communism ideology has abided in American culture, disarming our ability to engage in clear-eyed reflection of other possibilities for organizing our economy, healthcare system, and more. Once anyone said, “Well that’s socialism” or “that’s communism,” the conversation ended.

Bernie Sanders’ 2016 campaign, regardless of its shortcomings, catapulted “socialism” into the nation’s political vocabulary, eroding in some measure its pejorative presumptions, arguably sparking more curiosity than castigation. The juggernaut intellect Alexandria Ocasio-Cortez has furthered the term’s currency, endowing it with a vibrancy, substance, and maybe even a sustainability, although it still holds the status of being a shiny new object in political conversation, its history notwithstanding.

One sign of socialism’s currency, that it demands reckoning, is the fact that J.P. Morgan Chase CEO Jamie Dimon felt compelled even to address socialism in a recent letter to shareholders. One doesn’t take on opponents one doesn’t view as a serious threat to one’s standing and interests; one ignores them.
Dimon’s discussion also signals the extent to which “socialism” really is a shiny new object largely misunderstood in U.S. politics and culture.

It’s not even clear Dimon really understands capitalism, as his comments to shareholders, ironically, read more like an indictment of the U.S.’s current capitalist order.

Let’s look at this letter, released with the bank’s 2018 annual report. Dimon writes:

“When governments control companies, economic assets (companies, lenders and so on) over time are used to further political interests – leading to inefficient companies and markets, enormous favoritism and corruption.”

“Socialism inevitably produces stagnation, corruption and often worse – such as authoritarian government officials who often have an increasing ability to interfere with both the economy and individual lives – which they frequently do to maintain power. This would be as much a disaster for our country as it has been in the other places it’s been tried.”

Did you catch the irony? Substitute “capitalism” for “socialism” in this passage, and it would make more sense, particularly in our current context, to which Dimon seems rather oblivious.

If you didn’t catch the irony, let me explain some sad facts of our political economy that should clarify it.

Nevermind our President is being sued for violating the Constitution’s emoluments clause and has been blatant in exploiting the Presidency to enrich himself, vacationing at his own resorts at taxpayer expense, gaining favoritism for his and his family’s businesses with foreign governments, and more. The Saudis and their lobbyists book rooms in Trump hotels by the hundreds.

Last March, Newsweek reported on the strange — and quietly orchestrated — move by the White House, endorsed by Jared Kushner, to support a blockade of Qatar organized by Saudi Arabia and the United Arab Emirates. This support came a month after reports that Qatar had rejected solicitations from Jared Kushner’s father for financing to bail them out of a heavily indebted property. Speculation ran high that this otherwise puzzling foreign relations decision was an exacting of revenge on the part of the Kushner family.
And Dimon thinks socialism breeds corruption and favoritism?

Trump and his shenanigans aside, though, let’s look at a few other examples, from the thousands from which we could pick, of the way capitalism breeds corruption, fosters behavior hostile to the public good, and interferes with individual lives in damaging ways.

Here’s a few:

*A recent lawsuit filed by the state of Massachusetts against Purdue Pharma details how the company, in marketing its product OxyContin, self-servingly and knowingly urged over-prescription of the drug and abetted the opioid crisis that has taken and damaged tens of thousands of lives. Among other information contained in company communications, documents reveal the company knew of the problems of addiction and the dangers of their drug and, instead of pursuing a course of action to curtail the problem, developed a PR campaign to blame the addicts rather than threaten their profits.

*Remember that horror of U.S. capitalism called the Great Recession caused largely by banks creating and trading toxic mortgage loans, often fraudulently, leading to the destruction of millions of Americans’ wealth, causing massive unemployment, triggering a foreclosure crisis, and more? And remember that capitalist history cyclically experiences such crises? Certainly capitalism has its moments far worse than stagnation, and I hope the rampant corruption here is clear.

*And remember Wells Fargo defrauding its customers, opening accounts in their names without their knowledge?

*And, to inject a little variety, let’s shift to how the criminal justice system functions within capitalism. Remember the Pennsylvania judge who enriched himself by sentencing juvenile offenders to serve time in a private prison? Or our carceral state with private prisons that benefit not from reductions in crime and rehabilitating prisoners but expanding crime and warehousing criminals?

*How about for-profit universities (including Trump’s) that have swindled students out of exorbitant tuition payments and left them no with degree?

This kind of greed infecting our system, which does not promote democracy or the public good but rather a kind of authoritarianism and a private interest hostile to others, is a value capitalism cultivates–and set of behaviors applauded and awarded..

The system Dimon describes as socialism, is in fact capitalism, our nation’s capitalism.

Meanwhile, as I’ve written about in these pages, nations like Finland and Denmark rank higher for happiness, health, and education, and people like Nikki Haley and Dimon, swimming in private wealth, continue to denounce them.

Wonder why?

I guess the authoritarianism, corruption, economic crises and instability, and favoritism and cronyism we experience in U.S. capitalism are somehow preferable.

Tim Libretti is a professor of U.S. literature and culture at a state university in Chicago. A long-time progressive voice, he has published many academic and journalistic articles on culture, class, race, gender, and politics, for which he has received awards from the Working Class Studies Association, the International Labor Communications Association, the National Federation of Press Women, and the Illinois Woman's Press Association.

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