By allowing ads to appear on this site, you support the local businesses who, in turn, support great journalism.
Waelti: Answer between socialism vs. capitalism
John Waelti

It was inevitable. Once Bernie Sanders declared himself a “democratic socialist,” and “socialism” became acceptable, even fashionable, among some younger voters, the debate over socialism would re-emerge with its standard shopworn cliches.

“Socialist” has long been an epithet used by Republicans to accuse Democrats of being anti-business and promoting overreach of government. Democrats strived to avoid this pejorative label, insisting that they were against socialism. Remarkably, Sen. Sanders and some younger Democrats admit to being quite comfortable with some version of “socialism,” namely, “democratic socialism.” This is red meat for conservatives who insist that these people, along with voters, must be “educated” as to what socialism really is.

For conservatives, “socialism” is the failed Soviet-style communism or, more recently, the failed Venezuelan regime. For Sanders and some Democrats, socialism refers to Western European and Scandinavian-style government, generally referred to as “democratic socialism.” Surveys consistently show Scandinavians to be among the world’s most contented people, with both their lives and their government. Liberals assert that this proves that some forms of socialism are not the evil depicted by conservatives. The same conservatives who accuse Democrats of being “socialists” insist that Scandinavian-style government is “really not socialism.”

“Socialism,” broadly defined, is an economic system in which economic resources, the central economic questions of what and how to produce, and the distribution thereof, are all controlled by central government in contrast to private enterprise. But in view of the various types and degrees of socialism, this is not helpful, especially when it comes to political discourse. How does one make any sense out of this and at least lay out the terms for any kind of rational debate?

Economists use the term, “mixed system,” to describe major world economies. They have a mix of private enterprise and government in the function of their economies.

Pure socialism doesn’t exist. Maybe in North Korea, but certainly not in major world economies. Even Communist China is far from the purely socialistic model. China’s private sector billionaires alongside struggling, oppressed workers — far from the “workers’ paradise” and economic equality envisioned by revolutionists — must have Karl Marx and Vladimir Lenin spinning in their graves. 

Similarly, pure capitalism — with all decisions made by the private sector — does not exist, and few people would want it. Even the most ardent “anti-socialist” conservative that benefits from Medicare would not fare well if all public health decisions were subject to the private sector profit motive. The central political-economic debate, when stripped of value-laden words such as “socialism,” is about the role of government in use of productive resources and the production and distribution of the nation’s goods and services. 

Should industry be given carte blanch to produce in any way that is most profitable in the short run? Or should it be subject to some regulation regarding the environment and public health? If some regulation is in order, to what degree? How will it be enforced? 

These and many other questions about the role of government in the economy are legitimate and necessary subjects of political debate. Just as clearly, putting these questions in terms of “socialism vs. capitalism” is not only unhelpful, but a false choice that stands in the way of serious discussion. Neither self-proclaimed “democratic socialists” such as Senator Sanders, Rep. Ocasio-Cortez, nor any other left-of-center politician is advocating government take over production. What is important is where a candidate stands on each specific issue rather than the labels that are loosely tossed about by politicians and the media. The private sector will remain the major portion of the American economy regardless of which politicians control government. The private sector does some things very well, such as producing a wide range of consumer goods. It is not too cynical to assert that the fall of the Soviet Union was due as much to Levi-Strauss and Reebok as the cajoling of Ronald Reagan. The Soviet system did not measure up to the innovativeness, productivity and freedom of choice afforded by private enterprise.

That said, there are some things that private enterprise capitalism does not do well. The profit motive does not provide affordable education and infrastructure to all citizens. The profit motive fails miserably to provide affordable medical care to all citizens. For this, we need government involvement in some form. Any politician who doubts this is invited to try to turn Medicare totally over to profit-driven private insurance companies. When Paul Ryan proposed his private sector oriented “reforms,” he was clever enough to assure current beneficiaries that changes would be confined to those less than 55 years of age.

Advocates for, and beneficiaries of, popular programs such as Social Security and Medicare avoid referring to them as “socialism.” Wealthy owners of professional athletic teams who benefit from publicly financed stadiums would never call themselves “socialists,” or admit to benefitting from “socialism” in any way, shape, or form. Clearly “socialism” still has negative connotations that Trump and his Republicans have declared will be central to their 2020 campaign, conflating socialism with failed Soviet-style communism. 

Couching legitimate debate of the role of government as “capitalism vs. freedom” or “capitalism vs. socialism,” is a false choice and an egregious disservice to the voting public. 

Politicians and the media owe voters the intellectual honesty of refraining from reckless use of these meaningless labels and false choices.


— John Waelti of Monroe, a retired professor of economics, can be reached at jjwaelti1@tds.net. His column appears Saturdays in the Monroe Times.