A popular myth has circulated in our society for quite some time.  The myth is that Capitalism and Democracy go hand-in-hand.  One is presumed to lead to the other in seamlessly promoting a free society.  If that ever was true, it is at least deeply in question today.

To focus, we must identify Capitalism as it actually is today as opposed to how it may be idealized by those who choose to perpetuate the myth.  The version presently alive and well is best described as globalized corporatism.  The influence of transnational corporations as the dominant economic actors both between and within national boundaries has grown to easily exceed the influence of the nations themselves – including the United States.  Global corporations call most of the shots – economically and politically.

The evolutionary process that has led to this state of the world is not our primary concern in this piece.  Rather, the important point is that we are all asked to, and in many ways forced to, operate within the accepted parameters of that system.  We continually hear that certain disaster awaits anyone in the economy or the broad culture in general who dares not accept globalization as a fact of life – nay, virtually an irresistible force of nature.

But how does this impact democracy?  What do corporatized institutions ask of us?  The answer is simply that we are needed as loyal consumers.  If the products and services are not willingly snapped up in meeting our material wants and needs, the dominant global business model fails and the world threatens to fall apart – ostensibly into a dark abyss of unemployment and depression.

Of course, the important operational fact is that a “corporation” is nothing more than a piece of paper.  The key role of the modern corporation is that it serves as the instrument of choice for control of all things political and economic for the world’s wealthiest and most powerful people.  It both causes and thrives on inequality, though corporations vigorously deny that as a conscious choice.  For continued public acceptance, corporations require that all of us see them as a positive and necessary element of our lives.  We end up tacitly embracing the dehumanizing inequality that, donning our socially conscious hats, we decry. 

The ascension of a normal business sector into a transnational globalized force over the last half-century or more is partly an outgrowth of slavish adherence to the familiar economic growth model and partly of gravitating toward a transnational environment beyond the legal and political control of any national system.  It has been a search for a laissez-faire environment where no rules not of your own making need apply.

Thus, the stark bottom line is that globalization means that the rich control the poor.  Such a world is realistically governable only by autocracy since democratic control of one’s own fate by the People becomes impossible in practice.  But the symbolism must remain in order to convince all of us we still are free, or the system threatens to fall apart.  The need is to create lobotomized consumerism as a virtual religion and convince people that freedom can best be defined as being able to walk into Walmart and buy anything we want. Any more expanded view of freedom suggests nervous rumblings of revolt.

The answer?  Must we conclude that Capitalism, at least in its current form, is absolutely incompatible with a truly democratic society?  Adam Smith offers an alternative, speaking from the roots of economic thinking.  His firmly established principle was that a business firm must meet the needs of the consumer, and must have no persuasive power over their wants and needs.  The consumer is king.  Globalization of the economy, indeed the culture, has created exactly the opposite world.  Producers, including multinational banking, control everything.

Combine this with Capitalism — the private ownership of the means of production — and the path to autocracy and fascism is unimpeded.  The inescapable conclusion is that our hope for a different future must rely on the vitality of the local economy.  Since locally-owned and operated businesses must rely on the will of the consumer, healthy private ownership (e.g., Adam Smith’s Capitalism) can thrive.  This is our call to action as citizens of Salem, with the potential payoff being a vision of the future compatible with our heritage of free markets and private ownership.

Finally, it would be naïve to assume that the path to a more locally controlled economy would be smooth.  Major corporations would, at some point, perceive a threat to their control and would take steps that, given their lock on political power at the national level, could be devastatingly effective.  In this same vein, regulatory and/or legislative cooperation from the “top-down” from the federal government would almost certainly be necessary to a successful “bottom-up” movement toward Localism.  This is difficult to imagine given the current nature of our politics.

The story is incomplete, and there is much more to say about these important issues and tactics that would support a different vision.  However, for now, we conclude:  Globalization destroys democracy, and Localism preserves it.