Both globally and within most nations, the patterns of consumption required to sustain existing social arrangements are inconsistent with the distribution of the fruits of production. Social and economic stability, therefore, depend upon redistribution for which there is no overt legal framework or political consensus. To square this circle, the financial and government sectors have evolved means of hiding redistribution in complex, continually improvised arrangements. Unsurprisingly, massive wealth distributions arranged in this way leave much to be desired, in terms of straight corruption (the financial and government sectors redistribute a lot of wealth to themselves), justice (e.g. wealth is redistributed to those who happen to speculate early in bubbles), and sustainability (the illusion of value behind the claims of those from whom wealth is taken may prove fragile, but “loss realizations” are socially disruptive if they are not carefully paced and allocated).My simplistic translation: the system is rigged and if it isn't fixed it will come crashing down. The only way a rapacious capitalist system can work is if the winners are forced to fork over some of their winnings so that those who are bankrupted can continue to play. This is the function of government: to let us all sit at the table. The fanatics of the right think it is fair and proper to let the foolish and unfortunate starve. Those on the left want to rob the rich and flatten society out into a dreary "sameness". The reality is that the path forward is between the extremes: you need to allow the rapacious to "win" to spur them on, but you have to harness them through taxes to ensure that the social organism doesn't collapse.
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Our choices are to overtly align the fruits of production with patterns of consumption, to continue to employ accounting fictions and magic to pretend away the contradictions, or to undergo some form of collapse.
Ideally the rich give back in an orgy of philanthropy at the end of the end of their life so that they can have the best of both worlds: an unfetter career of greed and empire building and then a deathbed conversion to charity where they give the chips back to let the game go on. Sadly, this won't work. So you need to treat the rich like the Tutsi treat their cattle, you bleed them a little to nourish the community but not enough to endanger their health. We are in a strange capitalistic dance in which the rich must be given loose reins, but not so loose that they run away on us. In the end we must realize we are all in the same social pot, so we have to find a way to keep redistributing the chips to let us all play the game. We will never have social equality (that would be dull and require an iron hand who wants that?). And we'll never have an aristocracy (giving the virtuous elite a free hand to demonstrate their virtuosity) since it is well known that power corrupts and absolute power corrupts absolutely. So a happy medium must be found. A dynamic but stable state. In short, an ideal state that we will never find but must dance around constantly redefining the social game to keep it within bounds.
That means we have to rein in the fanatics on left and right who don't understand the social dynamic. And we have to give up false hopes of a stable state and learn to live in a dynamic equilibrium that requires constant "jiggering" to make it work. The simplistic philosophies have to be abandoned for a mix of theory and pragmatism along with a dash of humility.
That's economic realism. That's the world we are condemned to live in. The sooner we understand and accept it, the sooner we can live a reasonably happy life. The longer it takes to get the various factions in society to accept this sad fact, the longer there will be needless suffering, cruelty, and injustice.
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