Why Do We Feel Things Aren't as They Should Be Under Capitalism?
The Inevitable Logic of Neoliberal Capitalism
We live in a time marked by widespread unease. Globally, multiple interconnected crises paint a landscape of uncertainty and frustration. This perception is not irrational: it reflects objective realities impacting every aspect of contemporary life.
The ecological crisis is accelerating. In 2023, the world saw record temperatures, and extreme weather events quadrupled compared to 1980 levels. Global warming has already reached 1.2°C above pre-industrial levels, moving us closer to the 1.5°C threshold after which irreversible changes are expected, such as the collapse of key ecosystems and massive agricultural productivity losses (IPCC, 2023).
Political corruption erodes trust in democracies: 85% of the world’s population lives in countries where corruption is considered serious or very serious, directly undermining the legitimacy of public institutions (Transparency International, 2024).
Personal and state debt is reaching historic highs. In 1980, global debt represented 110% of world GDP; by 2024, it reached 315 trillion dollars, equivalent to 336% of GDP. In just four decades, global debt has tripled relative to the size of the economy (Institute of International Finance, 2024).
Job insecurity is widespread: 60% of workers have informal or unstable jobs. Additionally, the expansion of digital platforms has fragmented career paths, fueling markets of temporary, low-paid jobs without benefits, as seen in delivery, ride-sharing, courier services, and remote assistance (ILO, 2023).
Economic crises are recurrent: since 1990, the world has gone through more than 140 banking, currency, or sovereign debt crises, particularly affecting Latin America, Africa, Southeast Asia, and Eastern Europe (IMF, 2023).
Access to adequate housing has deteriorated dramatically. In major cities, the price of property went from about four times an average worker’s annual income in the 1980s to now, on average, over ten times, with many global cities seeing ratios as high as twenty times. Meanwhile, real wages have barely risen and the cost of living has steadily increased, widening the access gap. Whereas an average worker could once aspire to buy a home after saving for 7 to 10 years, today it would take 20, 30, or even more years, amid greater job insecurity and widespread indebtedness (OECD, 2023).
Food insecurity currently affects nearly 2.4 billion people, concentrated in Sub-Saharan Africa, South Asia, and parts of Latin America, worsened by the concentration of agricultural control in a handful of global corporations (FAO, 2023).
Mental health faces a global crisis: currently, one in eight people suffers from disorders such as depression, anxiety, or chronic stress. According to the WHO’s 2023 Mental Health Atlas, this phenomenon mainly results from job insecurity, economic uncertainty, the prolonged impact of the COVID-19 pandemic, and constant pressure in a hyperconnected digital world.
Finally, extreme inequality is stark: the world’s richest 1% holds nearly half of global wealth, while the poorest 50% share just 2% (Oxfam, 2022; World Inequality Report, 2022).
Each of these phenomena confirms that the promise of progress, stability, and well-being that shaped the 20th-century imagination no longer holds. Today, we witness clear evidence of a deep and structural deterioration of conditions that once seemed to guarantee widespread prosperity.
The Welfare State: A Historical Parenthesis
This model of progress and stability, now unraveling, found its most concrete form in the Welfare State, which emerged in the mid-20th century in leading industrialized countries, especially in Western Europe and the United States. It was the most ambitious attempt to guarantee, through state action, universal access to basic rights such as education, health, pensions, and decent work.
To achieve this, states implemented progressive tax policies, taxing large fortunes and assets at rates above 70% for much of the postwar period, especially in countries like the United States. They also extended social security systems, provided universal public services, and fostered economic growth based on full employment. Private capital was regulated through strong financial controls, while expanded labor rights supported a redistribution of wealth that, though limited, ensured unprecedented levels of social stability.
However, far from being an ethical transformation of capitalism, the Welfare State was born as a pragmatic response to two challenges: containing the social tensions of the Great Depression and postwar era, and offering an alternative to the advance of Soviet communism. Guaranteeing public education, health, pensions, and labor rights stabilized economies and neutralized the revolutionary appeal of Moscow.
Thus, the Welfare State did not represent a structural transformation of capitalism, but rather a historical parenthesis, sustained by exceptional economic growth and the pressure of ideological competition from communism. During this period, capitalism temporarily accepted limits to its tendency toward concentration, but never abandoned its essence of accumulation and profit maximization.
The collapse of the Soviet Union in 1991 dismantled the framework supporting this balance. Without the need for ideological legitimacy contests, the incentives to maintain robust redistributive policies also disappeared. This marked the beginning of a restoration of capitalism in its purest and most deregulated form: neoliberalism.
This doctrine, already gaining ground since the late 1970s, consolidated as the new dominant paradigm: supremacy of the market as social regulator, drastic reduction of the state, massive privatizations, financial and trade liberalization, and an individualization of risk resulting from the gradual elimination of labor, social, and economic protections previously ensured by the state.
Since then, these policies have been systematically applied: privatization of public companies, financial deregulation, labor flexibilization, indiscriminate opening of economies, and tax reductions for large fortunes.
In this new context, the concentration of wealth and dismantling of social protection systems were not errors or deviations, but the logical consequence of freeing capitalism from the temporary restraints that had been imposed in the 20th century. The deeply unequal distribution of resources is not an anomaly but the natural result of a system that, once unbounded, returns to its historical dynamic of accumulation and power concentration.
In this scenario, references to the Welfare State that shaped the 20th century remain present as a political tool. The ideal of equity and social protection is invoked as a symbolic opposition to neoliberal advance, but objectively, it rarely translates into effective policies. Thus, the Welfare State persists more as a rhetorical horizon than as a viable project within the contemporary global structure.
Why Are Things Exactly as They Are Supposed to Be?
Today, political discourse no longer seems aimed at reversing wealth concentration but rather appears to legitimize new forms of centralizing the social surplus in the hands of privileged minorities. The classic opposition between “state” and “market” dissolves into a dynamic where two types of power groups—some internal and others external to nation-states—through different strategies and without explicit coordination, ultimately complement each other in their struggle for control of social surplus.
On one hand, internal sectors of the country—comprising established business groups, traditional political classes, segments of the public administration subordinate to private interests, and entrenched clientelist networks—use the Welfare State narrative to capture public funds opaquely, sustaining power circuits, preserving historical privileges, and reinforcing control over the state apparatus. Under this model, social spending is not genuinely aimed at equity but at redistributing benefits within preexisting power structures, thus perpetuating the dominance of these privileged minorities.
On the other hand, actors external to the country—transnational corporations, financial organizations, and global investment funds—impose the rhetoric of fiscal deficit and the need for austerity as tools to dismantle the state’s redistributive functions. In the name of “modernization” and “fiscal responsibility,” policies are promoted that weaken state capacity, facilitate the privatization of strategic assets, and open key sectors of the national economy to foreign control. In this scheme, the benefits extracted from social resources are not reinvested nationally but are redirected to global power networks, outside of local structures.
Although there are sincere attempts at political redirection—projects that, despite enormous resistance, seek to rebuild redistribution mechanisms, strengthen society, and democratize access to collective resources—too often, discourses about social welfare or fiscal responsibility end up serving as tools to legitimize wealth concentration for privileged minorities.
Thus, this dynamic usually perpetuates a historical cycle of extraction that feeds itself. First, domestic power groups capture the state, using the social welfare discourse to divert public resources toward their own interests, generating inefficiency, corruption, and indebtedness. External actors then exploit this fragility by imposing austerity and economic modernization programs, leading to further privatizations, adjustments, and cessions of sovereignty. As social consequences—inequality, exclusion, resentment—worsen, new internal demands for state recovery emerge, restarting the cycle, which usually results in new forms of extraction, wealth concentration, and the weakening of the social fabric.
In this context, the real contest is not between opposing social projects, but between two alternative forms of extraction: one local and one global.
Wealth concentration has reached unprecedented historic levels, as evidenced by the latest figures from major international reports—Oxfam, World Inequality Report, Credit Suisse Global Wealth Report, and Forbes—which provide compelling data:
The world’s richest 1% owns nearly 50% of all global wealth and controls about 46% of existing financial assets. Meanwhile, the bottom 50% access just 2% of available resources. In just the last two years, the richest 1% captured about 63% of all new wealth generated globally, while the bottom 50% received only 0.7%.
Extreme inequality and the steady dismantling of social protection systems are not system failures: they are the logical result of contemporary capitalism, which, absent ideological counterbalances and redistributive policies, systematically reinforces dominant positions.
Far from deviating or collapsing, global capitalism functions exactly as designed: concentrating wealth, maximizing profits, and expanding the economic power of a minority entrenched in privileged positions.
Furthermore, when the Welfare State is dismantled, the individual is exposed to the pure logic of the market. And in a market where the 1% controls nearly half of financial assets, the game is structurally rigged from the start. Free competition is a fiction: initial conditions are so unequal that the market does not correct asymmetries, but instead reproduces and deepens them.
The feeling that things are not as they should be does not result from the system malfunctioning, but from the brutal realization that the system operates exactly as it was designed.
And it works, unfortunately, better than ever.