A Socialist America?

Socialism is a philosophy of failure, the creed of ignorance, and the gospel of envy, its inherent virtue is the equal sharing of misery. – Winston Churchill

In the 2016 Democratic presidential primary, Senator Bernie Sanders famously promoted elements of socialism throughout his campaign platform. More recently, several new members of Congress were elected this past November by extolling the benefits of moving our economic and political system in a socialist direction (most notably New York Congresswoman Alexandria Ocasio-Cortez). While there seems to be increasing talk on this subject, and it’s receiving some pop culture attention as well, we don’t believe it will amount to any real change. The obstacles that need to be overcome for our country to shift to a socialist model are just too great. Despite passion that may ignite behind popular figures who espouse this economic/governing model, we see no logical or technical way the transition could possibly be made. This may be why the Democrat party (a cousin to socialism) has chosen not to openly embrace the enthusiasm of Senator Sanders and Congresswoman Ocasio-Cortez. Socialism is simply a bridge too far.

Before we give our reasoning why socialism won’t take root in our country, here is a good definition of the term taken from the Collins English Dictionary – Complete & Unabridged 2012 Digital Edition.

Socialism – an economic theory or system in which the means of production, distribution, and exchange are owned by the community collectively, usually through the state. It is characterized by production for use rather than profit, by equality of individual wealth, by the absence of competitive economic activity, and, usually, by government determination of investment, prices, and production levels.

Granted, the are degrees of “adherence” to the above, and a society deemed “socialist” does not have to conform to all the absolutes in that definition. Nevertheless, we highly doubt the U.S. could even transform to a moderate form of socialism. Here’s why:

Origins – Our country was founded on the economic principles of capitalism which is the antithesis of socialism. Dictionary.com defines capitalism this way:

Capitalism – an economic system in which investment in and ownership of the means of production, distribution, and exchange of wealth is made and maintained chiefly by private individuals or corporations, especially as contrasted to cooperatively or state-owned means of wealth.

Capitalism has reigned for all of US history as our only economic governing model. That sets us apart from many other countries in the world where some aspect of socialism was part of their founding, evolution, or present-day structure. Starting a new government with a socialist model or transitioning one that is partly there already is one thing. Converting a government and economy such as ours from a deeply-rooted capitalist model to one of socialism is quite another. There is no quick political pathway to achieving this in the United States. If attempted, it would require decades to “undo” the many aspects of our government and economy that are presently the exact opposite of socialism. Because that timeframe would necessarily cross multiple national election cycles, there would have to be a large and consistent socialist voting base to support the transition over those decades. If our recent 40-year electoral history is any example (going back to 1976), the last thing we are is consistent in our political choices. During that period, we’ve had a nearly even split – 6 Republican Administrations and 5 Democrat Administrations. There is nothing to indicate this alternating pattern is about to change dramatically.

Political Consistency – The reason long-term consistency in political philosophy would be critical for a transition to socialism is perfectly illustrated by the last two Administrations. You might have thought the 2010 Affordable Care Act (a.k.a. ObamaCare or ACA) along with the 21 separate tax increases enacted under the Obama administration heralded the onset of socialism. However, less than 18 months after President Obama left office several of his tax increases along with hundreds of Obama-era regulations were rolled back. Also, a large corporate and personal income tax cut was signed into law by the Trump administration and eliminated a cornerstone of ObamaCare, the individual mandate. Currently, several failing underpinnings of ObamaCare are no longer being “repaired” as they regularly were under the previous Administration. Finally, a Federal Judge recently declared the entire ACA unconstitutional which will now require a long and costly appeal process by supporters of ObamaCare to try and overturn that ruling. The current makeup of the Supreme Court with the recent additions of constitutionalist Justices Gorsuch and Kavanaugh does not favor overturning this ruling especially since that court already declared two parts of ObamaCare unconstitutional in 2012. The brakes have clearly been applied to what many thought was an inevitable big step toward socialism. Vacillation in political philosophy from one administration to another has been the natural and intended way our government has worked since 1787. It has successfully prevented any one political philosophy from ever becoming permanent.

Budget Realities – There is even less chance of the required socialist fiscal overhaul ever occurring, both in government as well as in corporate and personal affairs. The federal government has run annual budget deficits for each of the last 18 years. We presently have a national debt that is so large the interest payment alone makes it the 4^th largest annual expenditure in the federal budget (behind Medicare/Medicaid, Social Security, and Defense). There is no “headroom” in the federal budget to enact any of the programs being advertised by advocates of socialism. In order to create any headroom, there would need to be massive tax increases coupled with large reductions somewhere in the federal budget. Since the federal budget is completely dominated by just four expenditures – Healthcare services, Social Security, National Defense, and National debt interest payments – any reductions sizable enough to be useful would have to come from one or more of these four areas. Two of these expenditures would presumably not be targeted since they are already socialist-style programs – Healthcare (including Medicare and Medicaid) and Social Security. A third, the interest payment on the national debt, cannot be reduced except by lowering interest rates, which are currently increasing. That leaves only one item, the Defense budget, as a source of money for the socialist agenda. Raising taxes and cutting Defense have never been successful campaign strategies in U.S. national elections, necessitating any candidate who has this as his goal to disguise his aims. Even President Obama, who was successful in raising taxes ostensibly to pay for the Affordable Care Act, could not cut Defense nearly enough (some would argue at all) to free up any additional money. Of course, new socialist leadership could simply “borrow” more money from the Treasury and plunge the country even deeper into debt to pay for socialist programs. But mathematics gets in the way of that strategy. The more that is borrowed, the greater the annual interest payment becomes on the national debt. That means only a shrinking portion of the money borrowed is available to spend (because some of it must go to the now increased interest payment on the debt). The more that is borrowed, the worse this predicament becomes. And the math only gets worse from there. Lurking in the background of the need to find more money for new socialist programs is the fact that our existing socialist-style programs – Medicaid, Medicare, and Social Security – are all projected to be insolvent within 20 years unless much more money is diverted to them. No socialist politician has even acknowledged this unavoidable budget roadblock, let alone offered a legitimate solution.

Wealth and Taxes – For the U.S to become a truly socialist country, the wealth of the nation would have to be spread far more evenly across the population than it is presently. In addition, socialism contains the notion of an upper limit to personal wealth. In the socialist model, wealth accumulated beyond a certain threshold provides no additional value to the individual and instead would be of far greater use to the society as a whole. To transform the country to this aspect of socialism, people and businesses that have accumulated a lot of wealth through their hard work would have to be subject to some sort of confiscatory government transaction – additional taxes, fees, penalties, etc. The “surplus” money collected would then be redistributed by funding new social programs which would be “free” to everyone. We’ve seen the result of similar attempts to do this before in this country when the top marginal income tax rate was over 90%. People and corporations would simply hide their money outside the country or leave the country entirely (they didn’t get rich in the first place by standing still). Today however, socialism champions have a much bigger problem than the possibility of wealth leaving the country if taxes are raised too high. Even a 100% tax on the wealthiest people in the country could not possibly overcome the accounting problem with the federal budget described in the previous paragraph. This is the intractable fiscal reality facing any proponent of socialism in our country. As with most radicals, logic and reason aren’t stopping hard-core advocates from continuing to push the idea anyway. And while they may find a measure of popular support because of all the “free” government services socialism would hypothetically offer (tuition free college, Medicare for all, much higher minimum wage, etc.) there’s no escaping the hard reality that our existing social programs have imminent shortfalls that must be addressed first. No matter how high taxes are raised, there won’t be enough money to save the old social programs and fund new ones.

Lastly, there seems to be a genuine fear that despite all the above reasoning, charismatic and naïve promoters of the socialist model may ride a popularity wave into Congress and the Senate – and possibly even the Presidency (Bernie Sanders came close). Once there, it is thought that they would blindly try to implement socialist policies while ignoring all the practical realities of doing so. That would then lead to an economic collapse and a revolt of some sort against the government as we’ve already seen happen in Greece and are starting to see in France. Before it would ever get to that stage here though, our built-in system of checks and balances would kick-in. Even if a socialist Congress and President were to be elected, the sheer legislative mechanics of raising taxes and borrowing money to the degree necessary would halt any meaningful progress to a true socialist model. First, there will always be a minority party to contend with who can stop or delay legislation (look what’s happening right now with border wall funding). Second, the Supreme Court is now solidly conservative and will be for some time. Any socialist legislation would likely be challenged in court (just like ObamaCare was) and would have to be argued as being properly derived from the constitution. Many of the socialist-styled programs on President Franklin Roosevelt’s agenda in the 1930’s and 1940’s were thwarted in just this way. Third, there would be many legal battles over state sovereignty. States retain a large degree of independence in our model of government and can make their own laws, policies and investments. This runs counter to the socialist governing theory which favors more federal control, especially of economic policy to guarantee the even distribution of wealth. States with leaders elected by an “anti-socialist” voter base will not simply capitulate.

Our Constitution is the greatest safeguard of all against socialism. The structure of our government -proportional representation in the House, non-proportional representation in the Senate, the Electoral College system for determining a President, a mix of 3/4ths, 2/3rds, and simple majority voting rules for different legislative processes – all these things are an anathema to socialist governing theory. And changing the Constitution to accommodate socialism would be very difficult (by design), requiring a 2/3rds majority in both the House and Senate to propose an amendment, and then 3/4ths of the states to ratify the proposed amendment. This is why two popular proposals favored by supporters of socialism, eliminating the electoral college and changing the rules for representation in the Senate, have little to no chance of succeeding.

In the end, we think the odds are impossibly stacked against socialism becoming the economic and governing model in this country. It may be entertaining to watch a few politicians try anyway, but there are too many barriers intentionally embedded in our laws and constitution whose purpose is to prevent any change of this style and magnitude from occurring.