In his State of the Union address, President Donald Trump was entirely right to reject socialism. He was right to add, “America was founded on liberty and independence — not government coercion.”
Yet to many, the idea of socialism seems to have growing appeal.
Representative Alexandria Ocasio-Cortez, an influential new voice, is a member of the Democratic Socialists of America. Senator Bernie Sanders, a leading progressive voice, has long described himself as a socialist.
Recently, 57 percent of Democrats reported such a favorable attitude, well above the 47 percent who said they have a positive attitude toward capitalism. By contrast, 71 percent of Republicans are upbeat about capitalism, and only 16 percent feel positively about socialism.
True, most of the Americans who approve of socialism are likely to be thinking of something like Scandinavian social democracy, rather than Karl Marx. But words matter, especially when they refer to systems of governance. What, then, is socialism?
According to a standard definition, socialism calls for government ownership or control of the means of production. By contrast, capitalism calls for private ownership and control — for a robust system of property rights. In capitalist systems, companies are generally private. In socialist systems, the state controls them. If they are given room to maneuver, their rights are conditional and can be taken away.
Many people have identified socialism with government planning. Socialist systems give public officials a great deal of authority over prices, levels of production and wages.
Friedrich Hayek, socialism’s greatest critic, showed that giving authority to government is a recipe for disaster. The reason is that even if officials are well-motivated, they lack information.
Markets establish prices, levels of production and wages on the basis of the desires, the beliefs and the values of countless people. No planner can possibly do that.
So here’s the problem. Many Democrats say that they like socialism. But it is doubtful that they want the government to own and operate the nation’s airlines, hospitals, restaurants and department stores.
Nor is it likely that they would favor a political candidate who called for a National Planning Agency, establishing prices for goods, services and wages. Even if they want an increase in the minimum wage, socialist-style planning is surely a bridge too far.
In his own effort to explain what he meant by socialism, Sanders did not invoke Karl Marx. Instead he spoke of Franklin Delano Roosevelt.
In particular, Sanders pointed to Roosevelt’s great 1944 speech, in which he called for a Second Bill of Rights. As Roosevelt described it, the Second Bill includes a right to adequate medical care; a right to a good education; a right to protection against the fears of old age, sickness, accident and unemployment; a right to freedom from domination by monopolies; a right to earn enough to provide adequate food, clothing and recreation; and a right to a useful and remunerative job in the private sector.
Roosevelt contended that “economic security and independence” are essential to individual freedom. Sanders endorsed that claim.
Sanders also spoke of economic inequality, emphasizing the extraordinary wealth of the top one-tenth of 1 percent, and the distress and difficulty faced by those at the bottom.
In his words, “Democratic socialism means that we must create an economy that works for all, not just the very wealthy.” That means better access to health care, higher taxes on the wealthiest, better educational opportunities for all, and an effort to “put millions of people back to work.”
Reasonable people are drawn to all of those ideas. But please, let’s not call them “socialist.”
Roosevelt’s own goal was to save capitalism, not to overthrow it. As he once put it, “One of my principal tasks is to prevent bankers and businessmen from committing suicide.” He believed in what Democratic Rep. Joe Kennedy of Massachusetts is now calling “moral capitalism.”
Roosevelt created the Social Security program. He insisted on a minimum wage. He fought to protect the interests of the working poor.
But FDR was firmly committed to private property and to free markets. He spoke of economic planning, and he even did a little — but he never embraced socialist-style planning.
The contemporary interest in “socialism” is (I think) mostly expressive. It is a way of raising the volume, pounding a fist and offering a signal — of saying, in shorthand, that the U.S. has far too much economic insecurity; that the current system is not working nearly well enough for millions of people; that incremental change is not enough; that bold thinking is in order.
Fair enough, and also true. But Roosevelt — the nation’s greatest progressive — was no socialist. Those who now favor large-scale change should avoid a term, and a set of practices, that have so often endangered both liberty and prosperity.
—Cass Sunstein is a Bloomberg columnist.