In America, we live in a false dream where capitalism is perfect. At a young age, we’re taught that a free enterprise system facilitates freedom. Freedom is equated with free markets. Not only is this line of thinking dangerous, it’s unequivocally and emphatically wrong.
I’m the person your parents warned you about before you decided to enter a college campus. I’m not a bearded-Marxist who sits in the library all day reading “Das Kapital” and “The Communist Manifesto,” but I am a socialist. More specifically, I am what I denote a pragmatic socialist.
Socialism has been claimed by many people and many nations, sometimes for good and for bad. I look to the good. I look to democratic socialists and social reformers like Eugene Debbs, Norman Thomas, Bertrand Russell, George Orwell and Robert LaFollette. I look for what was at the core of these men’s beliefs.
At the heart of socialism thought is the belief that every person has the means to live a fulfilling life. Political scientists would call this positive liberty. The means to achieve this has always been argued among socialists.
From libertarian socialists who would like to abolish authoritative institutions like the state to democratic socialists who would like use the democratic process to take over the state, the core belief has never changed.
Pragmatic socialism takes that core belief and looks at which actual policies will achieve positive liberty. Theoretically, it could take any form, from free markets to state-owned industries.
It could never take the form of capitalism, or so called free markets. You can just take a look at neoclassical economic models and prove them wrong with their own tools. Free market fundamentalists preach the dogma of perfect competition and profit motives leading to efficient markets. This simply isn’t true by looking at their own models.
Once you ask questions about imperfect information and competition, the models crumble. Instead of perfect competition, the real world is dominated by the oligopolies of transnational corporations like GM and Exxon. Instead of prices that respond quickly and accurately to reflect true price values, we find sticky prices and economic bubbles.
The truth of the free market is this: it never existed. It was only a myth. Don’t worry though; it has just been busted.
There’s a much larger problem than just the flaws in neoclassical economic models. There are problems with capitalism itself.
How could an economic system based on pure self-interest ever work? How could a system based on this view create a good society? It goes against the views of all major religions, including the teachings of Jesus Christ. It rewards a corrupt CEO but punishes a hard-working university student with back-breaking loans.
It’s an economic system that allows two-thirds of American corporations to not pay taxes, to not pay their employees a living wage, to lobby millions of their treasury dollars for favorable legislation against the interests of social justice, the environment and consumers.
In just a quick illustration, we see what capitalism is. Lebron James signed an endorsement deal with Nike in 2003 worth approximately $90 million. No problem with that.
Here’s my problem. Nike has workers in Indonesia making only $2.50 a day to make the products that Lebron James will be paid to simply wear on national TV. This is simply and utterly unjust.
Government can help. Government is the realization of civil society. It represents everyone and can promote the common good. The main reason it fails at times is because former corporate CEOs run federal agencies and business lobbyists water down legislation that would help the American public. These specific failures are a byproduct of capitalism.
The best way to achieve positive liberty is for the state, through the democratic process, to make decisions that will help the American people. What policies would help the American people?
A single-payer health care system (Medicare-for-all) would cover all Americans. This would fix our current inefficient health care system that leaves 50 million people uninsured, 50 million people underinsured and leads to the death of 45,000 Americans per year because they cannot afford health insurance.
Closing corporate tax loopholes and taxing financial derivatives could fund a multitude of things the American people desperately need. These funds could be spent on providing tuition-free university education to all Americans. The funds could also be spent on investing in our infrastructure and providing millions of living wage jobs to our citizens.
Capitalism will not provide positive liberty for people; its philosophy is intrinsically opposed to it.
We can either have socialism or capitalism.
As Ralph Nader’s father once said, “Socialism is the government ownership of the means of production, while capitalism is the business ownership of the means of government.” I would rather have socialism.
jared • Mar 5, 2012 at 7:56 pm
Modern capitalism isn’t capitalism, it’s corporatism. You can’t have a capitalist economy with a fiat monetary system. I agree that the inequality with money in america is definitely a problem and that we need to get money out of politics, but these “liberal” heroes aren’t helping anything, they’re just as bad as the neo-cons. There’s a reason people like Nader and Kucinich aren’t taken seriously, it’s because the establishment left don’t really care about equality.
Little Jimmy • Mar 5, 2012 at 6:07 pm
Go ahead kiddies, you think socialism is so good, tell me about it when you go looking for a job. I am retired and getting fat, hate to be you.
Karomojo • Mar 5, 2012 at 12:49 pm
What is stunning in this article is the near complete ignorance of the author as to what happened in the 1990s. To refresh his memory, the former USSR and dozens of other communist nations through off the shackles of their socialist systems to embrace capitalism. Even the hardcore Chinese adopted a limited form of capitalism. Hundreds of millions of people rebelled against the enforced poverty of socialism. Unfortunately, too many useful idiots in our society who have no real understanding of what socialism is want to embrace it.
Steve H. • Mar 2, 2012 at 9:15 am
I applaud you Mr. Loudenslager for this article. Don’t ever let the nay-sayers silence you. We need more social programs and corporations need to be better regulated. It’s ridiculous for any company to pay one “employee” millions of dollars to wear shoes when they pay their workers so little — I just don’t understand how this allowable.
My only suggestion: if you can, edit the title of the article from “Socailism must fix the flaws of modern captalism” to “Socailism WILL fix the flaws of modern captalism”
Danny • Mar 2, 2012 at 9:15 am
Show me one socialist nation that has a prosperous economy and a free and happy population and I’ll agree with you. Socialism is based on Marxist theory which is badly flawed. Marx was simply wrong about the idea that wealth redistribution and a centrally planned economy works. Capitalism works.Its not perfect as some people fall through the cracks mostly due to their own fault. But its the only system that provides everyone a chance to prosper. Socialism enslaves everyone. The problem is that we do not have a pure or even semi-pure capitalist system in this country anymore. There is heavy government control over many sectors of the economy which explains why things have not worked properly. Given that Obama is essentially a Marxist, things are not getting any better. Stop listening to your leftist professors about the virtues of socialism. They have not a clue.
lorq • Mar 1, 2012 at 9:37 pm
@RIP: Your comment ends with a string of platitudes with no correlation to specific institutions or situations. “But when everything is ‘free,’ nothing has value.” (All socialism everywhere reduces to “everything is free”? And nothing without a price has intrinsic “value” — like a parent’s love for their child? Oh — you mean something more precise than that? Then make a more precise statement.) “Government mandated equality means everyone is equally worse off.” (All socialism reduces to “government mandated equality”? Even if it did, how would it then follow that “everyone is worse off”? What does that even mean? What is the precise claim?) Unless you have some *specific* claim to make about the specific (measurable) effects of a specific social order — which the article you’re responding to does — people will quite rightly suspect you’re engaging in flim-flam.
You seem to have set up a false dichotomy between “equality” and “freedom”; which looks to me like a muddled way of talking about state protection of the interests of the public as a whole versus state protection of private interests. Face it, “private property” in its *legal* sense is an agreement between an individual and the state about what falls within the individual’s purview. Any other private property is just what you can claim at the point of a gun. Whoever has the bigger gun wins — UNLESS there’s a state entity to enforce property laws. We all need the government. We ARE the government — or should be. But once wealth is concentrated enough, as the article above discusses but which you, tellingly, refuse to address, then the wealthy have unlimited leverage against the public as a whole.
I notice that you avoid discussing this problem of unjust distribution of wealth and opportunity, the major topic of the article. You challenge the writer to name a place where socialism has succeeded. I cast my eye toward the countries of Northern Europe and Scandinavia, unquestionably *more* socialistic in their organization than the US, and consistently superior in the overall quality of the lives of their citizens by every measure. Then I look at recent wealth-concentration-favoring rulings here, like Citizens United, and I see just what I described above: unlimited leverage of the very wealthy against the interests of the general public. That ruling is not about some magical outside-the-law concept of “private property”, it is precisely about *defining* what the range and scope of private property (wealth) in relation to the state and the public is going to be.
If the vast majority of the citizens of a country are shut out of the democratic process by concentrated wealth, then the concepts of property and wealth themselves have become dysfunctional and untenable.
Taxed Enough • Mar 1, 2012 at 5:45 pm
The more we pay people to be poor, the more poor people we have. I know that many of the people in financial trouble today are the result of the recession, but the core welfare crowd was there before the recession and has been growing ever since the government started paying them.
Since the mid 60’s we have spent over $16 Trillion on over 70 means tested income re-distribution programs. We are now $15 Trillion in debt.
71 million households (47% of tax filers) are not paying income taxes primarily because of EITC and the Child Tax Credit.
How can a tax system be called “fair” when 47% of households are getting a free ride on the backs of the 53% who are paying income tax? Do we really want a society where half the people have to be carried by the other half? That is neither freedom nor equality.
Single payer health care? Everybody gets health care but 50,000,000 people do not have to pay for it. What is fair about that?
All the corporations combined have never received this much of the taxpayers money. The cost of all the wars this country has ever fought doesn’t come close to this massive shift of wealth.
I am not wealthy. I am tired of paying other people’s bills while tens of millions have been trained by the left to keep crying “woe is me”. And I see their “benefits” just keep growing and getting passed from generation to generation.
It is going to take individual responsibility and millions of decent paying private sector jobs to get us out of this mess, NOT more government intervention.
RIP Breitbart • Mar 1, 2012 at 4:40 pm
Shame on the North Wind for publishing this dribble, then conducting a survey supporting it.
Poor Aaron. Reread this after you’ve held a job for 10 years, and maybe have a family to support. GM, GE, and Exxon aren’t products of the free market. They buy their way into government controls. Your “corrupt CEO” is breaking laws, and needs to be introduced to the judicial system. What about successful CEO’s? Weren’t they once poor college students? The free market is how they became successful and paid off those loans.
Labron James? Please. Which country do you think has more economic freedom, U.S. or Indonesia? I’ll give you a hint. It’s the one where a kid of minority heritage with a sad excuse for a sports scholarship education can be a millionaire, not the one where a 12 year old works in a sweat shop.
No Capitalist should claim it is perfect. The world is not perfect. But when everything is “free”, nothing has value. No one wants to take ownership or pay for anything. Government mandated equality means everyone is equally worse off. You gave examples of great socialists. Please give an example of socialism succeeding. I submit the former U.S.S.R., Greece, Italy, Spain, and Cuba as socialism failures. China is an example of success in moving away from socialism and toward capitalism.
In seeking liberty and equality, one should first seek the former. For in ensuring liberty for all, equality can follow; legislating equality for all guarantees liberty for none.