March 23, 2026
Capitalism Is As Capitalism Does
Capitalism always favors the wealthy of its society and we shouldn't be surprised that this is the case.
4 min read
The title for this post is a play on the famous phrase from the Forrest Gump character - Stupid is as stupid does - (Winston Groom’s 1986 book Forrest Gump). This is a significant simplification of certain events after WWI as learned from Peter L. Bernstein’s book, The Power Of Gold: The History of an Obsession (January 1, 2000).
There is considerable talk these days about political activity and economic structure favoring the ultra-wealthy of United States. Many seem to portray this as a recent development due the power of the current billionaire class and technology titans. I submit that this is not a recent development, but rather a continuation of societies’ behavior since the days of old. The needs of the few (rich) outweigh the needs of the many (commoners).
All of this to say that this author believes that capitalism is the most flawed economic structure until you consider all the others. Just because we identify that it is flawed doesn’t mean we don’t continue to try and improve it. I’d rather live in a capitalist society.
We shouldn’t be surprised, nor should we waste our energy with shock, each time it occurs. We should expect this type of behavior and spend our time and energy in more fruitful ways rather than parading around expressing surprise and disgust that it occurs.
Post-War Economic Struggles and Class Divide
After World War I, Britain, France, and the U.S. faced severe economic challenges as international trade failed to recover as expected. Countries were anxious to return to the gold standard thinking the standard was the source of international harmony prior to WWI.
There’s no better example of this challenge in Britain than the crisis faced by the coal industry after Britain returned to the gold standard in 1925. Facing declining exports due to noncompetitive high prices, industry leaders demanded wage cuts from miners who had already made concessions in 1921-1922. The miners refused, prompting the government to intervene; not in labor’s favor. After the government came out in favor of wage cuts ‘to help the country’, owners began lockouts and unions retaliated by calling strikes. The unions unsuccessfully tried to gain support for a national general strike in spring 1926. By November 1926, starving miners capitulated to wage cuts. This outcome was arrived at because the government sided with wealthy industrialists over working people.
France faced similar post-war turmoil, needing to rebuild their industry, infrastructure and housing while veterans demanded social benefits in exchange for their service. As debates raged over whether to tax the wealthy (left) or cut spending (right), France’s rich moved their money abroad, “for safe keeping”, as the government sought emergency funding. To secure a J.P. Morgan loan in 1926, the French government slashed taxes on the wealthy while raising taxes on consumer goods, placing the burden squarely on average citizens. Reconstruction spending was slashed to meet creditor demands and no new spending programs were considered leaving ordinary people to shoulder both war’s aftermath and the financial crisis. In time, the French wealthy reshored their monies resulting in France returning to the gold standard.
The Pattern
Both nations revealed a consistent truth: when governments face economic pressure, they protect wealthy interests while sacrificing ordinary citizens. In these two situations, workers lost wages, consumers paid higher taxes, and reconstruction, meant to benefit all, was muted to appease the rich and international financiers. The wealthy faced little shared sacrifice; instead, they secured tax cuts and safe havens for their capital.
This post-war period demonstrated a template still followed today: in times of crisis, governments claim that necessity demands austerity for the many while preserving the privilege, and even bailing out the debts, for the few.