If social democracy ran the way liberals say it does, I wouldn’t see a reason not to adopt it. We’d have no inequality, where everyone could be paid the same and live in a gigantic mansion. People could stop having to worry about big medical bills or those god-awful student loans, obviously, the government takes care of that. With big legislative packages like the Green New Deal, global warming would be gone in an instant. And, of course, more free stuff!
Except, 100 times out of 100, that isn’t how it’s going to play out.
The goal of social democracy isn’t to change capitalism, rather it is to improve it. And this is a problem. The ills of our society come from the fundamental exploitative relationship between the owners and workers that exist under all types of capitalism. It’s idealism to think that we’re able to bypass the flaws of the system without replacing it.
Most prominently, poverty is required for any capitalist system to function. Nobody would willingly work for a low wage and create profits for their boss if they weren’t poor to begin with.
Any capitalist culture will produce and rely upon a distinct class structure. Karl Marx’s philosophy of social science proves the upper class needs a large lower class in order to maintain power in a capitalist society. An uneducated member of the lower class has no opportunities available to them except for a job at the local Burger King or Wal-Mart. Because of the initial minimum-wage salary, the subject also must shop at Wal-Mart in order to maintain a bearable lifestyle.[1]
Under a capitalist system, the economy would go into crisis if low-paying businesses such as Burger King didn’t have enough people poor enough to work for them. Fewer workers would mean fewer burgers. Abiding by the principles of supply and demand, fewer burgers mean more expensive burgers. And who likes more expensive burgers?
Certainly not the vast majority of the population, who now have lost a significant portion of their income due to rising prices. We also shouldn’t forget that the fast food industry is but one example in which a decline in poverty disrupts the economy. It would likely raise prices for all corporations that underpay their workers, from clothing to cars to construction to commerce. In the end, all this reduction in poverty could to it does is recreate more poverty. If we stick with capitalism, there really isn’t a way out.
Social-democrats could try their hardest to eliminate poverty, but because of the artificial need for it under capitalism, it won’t get them anywhere. One of their talking points is to raise the minimum wage to $15. It has been highlighted that this policy while appearing to be bold, won’t make that much of a difference. Even now, 80% (source) of Americans are making more than that. And poverty is a far greater problem than for just the bottom fifth of the U.S. population.
In fact, a $15 minimum wage could only harm workers, if it were enacted in a first-world nation. Since it’s in their fundamental class interest to do whatever is most profitable, capitalists would certainly react to any policy that would threaten their exploitation. In this case, they would likely move jobs overseas. This would create massive unemployment at home, especially among the already poor workers. For the newly unemployed, this would cause even more poverty which even the most expansive government programs couldn’t address. For the rest of us, a decline this large in purchasing power could lead to another crisis. See a trend? Any policy meant to address the ills of capitalism usually backfires on the working masses whether it be more poverty or a full-blown recession.
But … you tell me … Scandinavia!!!
One can’t talk about social democracy without referencing these “paradises”. However, the workings of capitalism are no stranger to these countries. In these countries, economic inequality is higher than it is in the rest of Europe. While some of it may be attributed to the poor people needing less money to live, it shows that no amount of big government can change the machinations of capitalism.
Even with all of the welfare programs, poverty still exists. Take this example from a Stockholm slum.
The settlement appeared to be much bigger than we expected. It seemed almost like there were several villages/camps, some containing not more than two, and the biggest with about ten houses.
The largest of these camps seemed much more organized than the smaller ones. There was less garbage laying in and around the camp and the residents had obtained electricity by opening street lighting. By digging out the cables from the earth and leading them to their huts they are able to use the electricity in their homes.
The worst part of walking around and looking at the horrible condition these people live in was seeing the toys of the children. The idea that these children would grow up this way, living outside of society, seemed horrible. For them, life as a slum dweller is all they know, which will make it much harder for them to adapt to lives within mainstream society later in life.
Again, capitalism can’t work without poverty. Since big corporations still exist in these countries, they need to create artificial poverty and inequality for profits to remain stable. Capitalists here figure that they better ensure that the majority of the population stays too poor to quit their jobs but not poor enough to organize and become a real threat to the system. In the past few decades, their plans have mostly worked.
While they aren’t necessarily doing a very good job, I must admit that Scandinavian countries do have a higher standard of living than other capitalist countries, such as Brazil or India. But this isn’t because the former has a more “equitable” system than the latter. It’s because the former exploits the latter.
Norway, for example, dropped 600 bombs on Libya[3] back in 2011 when Qadaffi was overthrown.
Like its ally and partner the United States, it’s likely that this action was motivated by “the black stuff”. Equinor, one of their largest oil companies, even admitted to this.
Equinor has been present in Libya for more than 27 years with onshore exploration and oil production activities. More recently, our engagement in lifting and marketing Libyan crude oil has become a growing part of our business activities.[4]
We know that the nation is only rich because of two things, oil, and integration into the world imperialist system. Without countries like Libya to drill in, the scope of the Norweigan oil industry would be significantly lessened. And that wouldn’t be good for the state either, since Equinor pays $2.2 billion in tax annually, nearly 10% of the state’s entire budget. Nearly all of the largest businesses in the nation have operations that extend far beyond their borders. Norsk Hydro, for example, proudly runs mines on all seven continents. In 2018, they were called out for breaking environmental law in a plant in Brazil. Profits from this style of expansionism fuel the spending of the Norweigan welfare state.
This doesn’t just apply to Norway; all of these countries are home to international imperialist monopolies such as Volvo, H&M, Lego, or Nokia. As they reap the natural resources and labor of the semi-colonies of the global south, the government can take a chunk of it to spend on their own people. That’s why Scandinavian countries are dependent on the success of neoliberal globalization and the suffering that comes with it to be as wealthy as they are.
In conclusion, social democracy is a system built on imperialism that still doesn’t achieve much for the working masses. It’s impossible to bypass the flaws of capitalism whether through innovation, better wages, or government programs. As the system is killing both our people and our planet, it mustn’t be improved, but outright replaced.
Footnotes
[1] IVAN LOVEGREN: Capitalism creates, oppresses lower class
[2] Almost 80 percent of U.S. workers now earn at least $15 an hour, a ‘major shift from pre-pandemic norms’
Maoism For The Masses 
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