From welfare state to cessionalism

Abstract

The author attempts to justify the thesis that Schumpeter’s theory on
the phenomena leading to its destruction works in the current version of
neoliberal capitalism. What Schumpeter was most concerned about, namely the
consequences of the deformation of the principles of freedom and the system
of private ownership let corporations grow extremely fast and made it possible
to eliminate ordinary entrepreneurs and their innovation. The process is taking
on such alarming proportion that former Schumpeter’s predictions of what
would happen in the future as a result of the growth of corporate capitalism are
already reflected in reality. In the author’s opinion, the neoliberal doctrine is
based on false premises among which Milton Friedman’s claim that stagflation
is always and everywhere a Keynesian phenomenon is of key importance.
Therefore, there is a need for creative destruction in the doctrinal sphere
aimed against neoliberalism and making it possible to introduce innovative
solutions that were wrongly eliminated. But it will not be enough to reintroduce
the rules of welfare state. Great success of the United States in the period of
their implementation originated from, besides the innovation in the political
system, other sources of extraordinary prosperity. These were huge profits
from seigniorage at the stage of the dollar progression. At present, it would
be desirable that the United States should restore full trust in the dollar as
a dominant world currency. Based on the arguments presented in the article,
there is a call for saving capitalism from a collapse with the use of a solution
consisting in the development of a new version of capitalism called cessionalism.