1989 Berlin Wall and End of Communism - 2009 Wall Street and end of Capitalism…?

In 1989, the wheel of history span fast and the Berlin Wall fell, thus transforming Europe and introducing Eastern Europe to the values of freedom and the alleged benefits of capitalism. At the time, politicians from all parties agreed and concluded that all dictatorships would soon crumble in the face of the great Democratic ideals. The American values of openness, economic liberalism, and democracy were on the verge of being adopted around the world in a one-size-fits-all package. Some parts of Europe were wary of the end of a bipolar world and the rise of a unipolar America. Hurbert Védrine, a former French foreign minister who worked for President François Mitterrand, seemed to foresee that “it’s the prologue of an opera with a cymbal crash, the prologue of 15 to 20 years of Western arrogance.” While Europe was considering the various alternatives for a Post- Cold War world, America was rejoicing in the obvious failure of communism. The new single-value unipolar power felt history supported what America had always believed, that capitalism is the best economic system. 20 years after the fall of the Berlin Wall, in the midst of a great economic crisis, some Americans still have an unshaken faith in capitalism believing it is the best system of all. The paradox begs the question: what exactly constitutes a failure? Americans, so quick to determine that communism failed, are very hesitant about the sweeping changes being made to their capitalistic economic system, even in the midst of the great 2009 crisis. The assertiveness of Americans about the virtues of capitalism has quickly tempered now that they face a potential “failure” of their own system. Is American-style capitalism, the one both parties agreed would prevail over all others, still considered the ideal economic system? Isn’t 2009 the celebration of its failure?

The ultimate goals of liberalism and communism are the same: to do what is best for the people. For this common purpose, two political ideologies assign different values to equality and to freedom, as both cannot be maximized together. The difference between the two political systems is the weight each one attributes to the conflicting values. Liberalism is a political economic system that maximizes individual liberty, political and economic, at all costs. It favors a limited government role in society and economic activity, emphasizing personal freedom over social equality. The final goal of the liberal ideology is to achieve a greater scope and promise of human activity and prosperity. Communism is a political economic system that maximizes economic and political equality as an end result at all costs. It emphasizes limited personal freedom and a strong state order to achieve social equality, rejecting the idea that personal freedom can lead to greater prosperity, as it will be monopolized by few. Interestingly, communists hold that in the inevitable struggle over economic resources, a small group will come to dominate the market and the state, using its wealth to control and exploit society as a whole. In the book Essentials of Comparative Politics, Patrick H. O’Neils describes the communist view of liberal democracy as “‘bourgeois democracy’ - of the rich, by the rich, and for the rich.”

Commemorating the 20th anniversary of the fall of the Berlin Wall, many wonder what caused the failure of communism. According to the Time Magazine, conservatives and liberals agreed that a main cause is “the utter hopelessness of communism as an economic system.” Both, however, are surprised to learn that the second most important cause was “the spirit of freedom in individual people.” The third main consensus cause is the Western policy of containment, a policy that limits the expansion and influence of a different ideology. The policy begs the question: if communism was bound to fail because of its inherent flaws in economic policies and individual freedom, why did Ronald Reagan need to escalate the military? Why did the United States need to increase its debt to fight a system that was doomed to fail anyway?

Failure is defined as nonperformance of what is requested or expected. As we commemorate the fall of a faulty system, let us take a moment to ponder - are the original values of capitalism, emphasizing a high degree of personal freedom over social equality, achieving what they were expected to? You may argue that failure is incorporated in the capitalist boom-and-bust system because the market will regain equilibrium in the long run. But as John M. Keynes said: “in the long run, we are all dead.” As the final goal of liberalism is to achieve a greater scope and promise of human activity and prosperity, let’s try to reflect on the success of these goals. Has the system succeeded? These questions are crucial today especially because of two main debates in the political arena. In the area of foreign affairs, when the United States is occupying several countries in order to promote ideas of democracy and capitalism, maybe we should consider the possibility that other countries attribute different values to freedom and equality. Maybe they have other ways of achieving greater prosperity, as the very concept of freedom, is culturally relative. The United States may need to take a step back and ask itself- are we so sure we are universally right? In the area of domestic affairs, as we debate government bailouts and follow the heath care debate, we may need to be reminded that we all have the same intentions - we want the good of the American public. Are we succeeding? Seeing the unemployment rate increase to 10.2%, New York Times columnist Bob Herbert points out that, “The perception now is that Wall Street is doing just fine while working people, whose taxes financed the bailouts, are walking the plank to economic oblivion.” Passing the financial district while celebrating the Yankees’ World Series championships, the crowd burst into a chant “Wall Street sucks! Wall Street sucks!” Is this where the prominent system of capitalism, leaning on the values of freedom and prosperity, has brought us? Freedom of what? Prosperity for whom?