'The West' as we know it now, started its history among Kelts, Romans, Greeks, and among the Germanic peoples in South West Asia. Those latter gradually invaded Europe; then settled down all over Europe, sometimes fully submitting to Roman rule and sometimes co-operating with it. This, until the Roman empire was unable to keep its rule over large parts of Europe, in 395 AD. Most authors define a Feudality as a system where a military leader, as a deputy of a King or an Emperor, owns a vast area of land, and allows the majority of the people to live on that land. The people living on that land either pay rent to or work on the land for a landlord, in exchange for military (and other kinds of) protection. The landlord, not having to work otherwise, could fully focus on defense. The king (who owns his own estate as well,) appoints new landlords to estates, or, at least, is the landlords' patron. This is the Feudal System known among the Germanic tribes. Its power was at its height from the 8th century till the 15th century AD. Feudal Society is seen as a collective, where the individual is supposed to serve the whole group. There's always some group ideal, for instance, God, the Nation, the King, or Independence, and to attain that, each person has a specific role of service, in exchange for another service. The Roman Empire, was a Feudality, too. Feudalism is a system of paid group patronage in any form. Serving oneself, or one's own family, is seen as undesirable, nepotist behavior. Self-reliance is impossible for most people living in a feudal system. Self-reliance is only possible for those who, thanks to good income or large estate, can own their means of production and housing, and also then, only up to a point. Sooner or later, also those with their own means are to contribute heavily to the collective state. The core of any feudal system, is leverage between owned property and debt. Not being owner of a production tool, house or land, means not carrying the risk of it, and, at the same time, enjoying the benefits of using it. Thus, having debt is seen as an advantage and not a liability. It's a temporary enlargement of a personal estate. This, in spite of having to regularly pay for using the borrowed or rent property. The reason behind favoring leverage, is a wish for specialization: If workers, individuals, and also organizations apply their talents and work force to only one activity, their skill, and hence their productivity, will increase. Fragmentation is seen as potential loss. Leverage is Feudality's main strength, but it can easily turn into its main weakness, once income slows down. This may happen to entire groups of households and businesses, and then lead to a major financial crisis of a whole society.
More varieties to the military Feudality exist. Western philosophers have spent many thoughts on them. Plato was inventor of an ideal feudal system. Philosophers should fully govern this society into detail, because they were considered morally outstanding. Society should be a hierarchical, communal system where individuals and groups had a clear role. Vertical mobility was possible in this utopian Platonic Community, but wasn't encouraged. Property, family life and marriage, were communal. The Romans had their own feudal system; many people had no property at all, and formal slavery also existed. Slaves lived with their masters. Big owners had the right to political and religious leadership. The Roman feudal system involved a lot more than only military patronage.
The Germanic peoples largely integrated the Roman feudal system into their systems, also after the end of Roman rule in Europe. Their feudal system changed over the ages. It started as a military system. Then, the Church entered as another feudal owner of land and real estate, and could never be disowned. A formal class society was introduced; top - down it looked like this: Church, Nobility, Free Citizens, and Serfs. With the Monarch and the Pope on top. Free citizens were those not part of both top classes, yet affluent and educated enough to afford their own estate or business. Serfs were those who lived in rent homes owned by the large landowner. Mostly, they weren't allowed to move out; they had to work and, or, pay to the landlord; and when the land changed ownership, they were part of the sold package deal. The landlord, in exchange, had to look after their safety and welfare, also after change of ownership. In business and production, the Guild System was aimed at disabling competition from newcomers on the market. It also wanted to organize the production chain top - down for more efficiency. Women, except for a few who managed to impose anyway, made no independent appearance in society; their status was defined by fathers and husbands. Women had no right of ownership, enterprise, education, inheritance, leadership, or free labour. And, in every society, a small group of non-committed nomads, gypsies, and homeless people persisted. Those who couldn't afford a residential existence, always risked to end up in that latter group. Society as a whole, was a top - down model, where the Church provided moral leadership, and Nobility and Monarchy provided economic and military sustenance. Free Citizens consisted of artistic, entrepreneurial, philosophical, and engineering persons, who couldn't be silenced by the top classes, and who gradually gained more and more influence and power on societies.
The feudal system changed from the eighteenth century. The third class of free citizens had gained enough strength of argument over Nobility and Church to raise their voices and change society into a place where all inhabitants could participate on a more equal basis. Philosophers like Adam Smith wrote works on how to arrive at change. Why was it seen necessary to come to a more equal distribution of wealth and distribution? Not only because it wasn't understood, why some individuals were more worthy of property, enterprise, leadership, inheritance, education, and free labour -- those rights didn't necessarily correspond with their capabilities -- but also because a hierarchical society wasn't able to fulfill all practical needs of all its inhabitants. A healthy market, after all, gives free access to all who can and want to participate. Only then, market forces can work efficiently and reach every supplier and customer. Every need will be met, at the right price. In a feudal system, there's only a handful of suppliers. They can't keep in touch with every 'customer'. They don't know, nor are they able, to fulfill every need. And, most people aren't allowed to fully participate. There's always something they are barred from: Be it work, selling, ownership, or production. And the reasons aren't always objectively justified. Prices are set by the small number of suppliers, who have insufficient knowledge of the real value of the product, in buyers' eyes. And buyers aren't allowed an alternative. There's enough alternative thinkable, such as home production or finding another supplier, but that's impossible in a feudal system, because of the compulsory patronage relations. This leads to severe shortages, when market supply slows down. And to severe debts among the many whose monthly rent duties to their landlord continue. And, landlords have resembling monthly or weekly wage duties to their workers.
During the Middle Ages, population didn't grow much, in Europe. Epidemics kept populations small. The problem of goods supply became a problem, when populations started to grow, as a result of new, improved farming technologies. The elite had to fulfill a much larger number of dependents' needs, and of course it failed. The West's traditional answers to this friction, have always been new Technology, Interest, and Occupation of Foreign Lands with Natural (and Other) Riches. Latter is called Colonialism, or Imperialism. Also Colonialism, Interest, and Technology failed to properly connect supply and demand, and also failed to keep all of its working population involved in its society. The cost of providing for everyone and of finding the necessary supplies to do so, has been immense, and cruel. Even the sincerest, most compassionate elites are never mind readers, nor providers, for an entire people. Then -- what happens, if the people's fate falls in the hands of tyrants? The problem, that the traditional feudal system didn't allow bottom - up feedback, had to be solved. Free Civilians have tried to find answer in replacing Church and Nobility by equalitarian legislation. More people had to be allowed to participate in society. But, that was only possible after a lengthy process of violently removing Church, Nobility, and Monarchy, in most countries. Those elites didn't voluntarily give up their positions. And those countries that were spared of violence, finally weren't necessarily better off (That is, they didn't reach the aim of equal opportunity.)
What did the struggle towards Equality result in? Three main roads were chosen: Communism; Fascism; and our present, more complicated, inexplicable road, called Planned Market Economy, also called, sometimes, Social Democracy. Briefly, those three systems have in common, that a small group of outstanding leaders are responsible for engaging the population in making One Society. Work, especially a group working activity, is considered key component of a society where all work for one, and one for all. These three systems are a direct inheritance of the ancient feudal society, with its patronage system, meant to build a society. However, only the third route, Planned Market Economy, has survived so far, and also that system doesn't look like it has a good permanent survival chance. Communism and Fascism couldn't survive their self-created ravages. Both teachings are naturally autocratic systems that don't allow divergence from the mainstream. In practice, this led to extermination of minorities: Those smaller groups who don't fit in the collective workforce of the state. Those minorities were specifically mentioned groups and those who didn't fit in anyway: The most outstanding and most humble groups of people. Not only people of color, homosexuals, gypsies, or people with a handicap, but also investors, intellectuals, or outstanding artists, were typical victims of Communist and Fascist regimes. They were killed. There are many differences between Communism and Fascism, the most important two being their fierce competition over the same target group they aim to service, and the ownership of large property. Those matter less for the topic at stake here: The Feudal Patronage. The violent destruction of those minorities has been rejected now, which is the main reason, why most countries have turned their back on Communism and Fascism. It is perceived, that any state, at least, should uphold some sort of non-violent economic standard for all. Destruction of minorities obviously clashes with that standard. Therefore, the West thought that Democracy finally could overcome all inequality. Then, why did it fail?
Democracy aims at answering the general human need for justice, freedom, and equal opportunities for everybody. The traditional Feudality, after all, clashed with those values. The Church, Nobility, and Monarchies were, in most Western nations, seen as the main oppressive culprits to hinder them. Democracy rejects, that society's top classes should develop values and standards for everybody. Those powers were either overthrown, or they were given a much smaller, symbolic function in their nations. In the course of the twentieth century, also legislations were adjusted. Ownership, enterprise, leadership, inheritance, and labour were opened to everybody of sane mind and body and above certain ages. Same for the right to participate in politics. So, apparently, a society of freedom and equal right to participate had finally come. However, in many Western nations, large landownership persisted, and its population hence was still unable to provide for themselves. Technology had transformed Society in an industrialized, urbanized environment. Yet, in reality, the Feudal State moved with its people from the country to the city. In the city, and in villages with urban lifestyles, Social Housing Corporations and Local Authorities now became owners of most estates. They housed the people now, largely under very similar rules as in the Medieval days of the Feudal Estates. Because the people have to pay heavily for these Social Homes, a new patronage system needed to be established. How to achieve at that? Communism and Fascism were only partly able to arrive at that, because citizens were unable to freely express their needs and opinions. Since the Church and Nobility were dismantled, a new patron had to be found, and it was found in a depersonalized welfare and insurance system. The Nation's Tax Office and Government Insurance Institutions had key roles, here, in collecting funds from each citizen, as a percentage from their personal income, estate, or inheritance. Those funds had to be transferred to citizens without income, and to care institutions such as schools, hospitals, homes for the elderly and disabled, prisons, universities, and many others. An elaborate protective legislation for labor, housing, health care, education and several other fields of interest was developed. With the fall of Communism and Fascism, the Democratic political process took over the legislative role. In the past, Guilds, Nobility, and Church organizations had these tasks more informally. Guilds nowadays have resurrected as Organizations for Employers and Worker Unions -- to keep it very brief. Democracy granted the average citizen the opportunity to ventilate needs and opinions, but the basic economics hadn't really changed, in spite of the advancement of technology and medicine. Most people still have no access to work, property, etc. And they must carefully balance leverage, and if the balance heads towards the debt side too much, homelessness still is a real threat. Homelessness in the West may even have increased in several countries, especially in the Netherlands, because they don't allow nomadic lifestyles nowadays, and because only the state is allowed to build homes. I hate to say so -- I once had to call the ambulance for a homeless man in my own street. And we know, how monopolies and oligopolies lead to increased prices. The reality is, that the majority of people have no property, no independent source of income, and can, therefore, be considered economically bankrupt -- like the Serfs, in the Middle Ages. Democratic rights haven't given those people a lot more economic right than to express their needs. 'Redivision of property' may very well mean ending up without property, to many, as a consequence of the duty of surrendering a large part of their property and income to the Tax Office. This may mean loss of a house or a business, a situation that also effects those people who do have property. In times of low income, this threat is very real to many people. Economic rights, such as ownership or inheritance, exist on paper, but for many, not in reality, also today.
Because the Feudal State in economic reality persisted, also in today's Western Democracies, loss of income may, to many, lead to a large debt crisis of a whole society. Technology and Interest haven't led to the answer; they may even worsen the problem of scarcity and redivision, and it didn't put a stop to Imperialism and Colonialism. The many large State Institutions and Social Housing have to be paid. Some Western States have experimented with a newcomer on the Market Place: Money Creation. Money Creation had to become a declutter tool. Could Money Creation be the all-in solution, or is more needed ...? And, why and to whom, is the Feudal State such a problem?
Plato - The Republic http://classics.mit.edu/Plato/republic.html
The Germanic Peoples - Odin's Volk http://www.odinsvolk.ca/GermanicPeoples.htm
History of Feudalism http://www.historyworld.net/wrldhis/PlainTextHistories.asp?historyid=ac35