Alternative Insight

Bernie Sanders and the Affirmation of Socialism in America

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To the public, the term socialism signifies an economy owned, operated and planned by one central authority. Media coverage of Senator Bernie Sanders' presidential campaign gives an impression that Bernie Sanders intends to bring socialism to the United States. Not the case, after all, Bernie (his name has become a recognized brand) has not recommended federal ownership of anything. He is only supporting government legislation and policies to correct present social and economic problems in the capitalized system, push the economy into steady progress, and assure that all citizens benefit from the advancements. His agenda is not intended to advance socialism; on the contrary, it attempts to improve the economic system, or what is actually the political economy, an economy that has had its economics linked together with the political system.

Bernie's' agenda and intention to the issues follow decades of a pattern - use government actions to repair capitalism and advance the economy. Before displaying his agenda and description of the issues, the enormous number of times the government posse has come to rescue the falling capitalists is briefly described.

An earlier article; "Rescuing Free Enterprise," described the manner by which the United States government constantly rescued capitalism. Some excerpts:

From 1867 to 1929, the U.S. economy exhibited a mild or grave shock every two to three years. Seven severe depressions or financial panics occurred during the 62-year period.

Each economic decline stimulated protective legislation -establishment of the Interstate Commercial Commission in 1887 for regulating the Railroads; passage of the Sherman Antitrust Act of 1890, which "declared illegal all combinations in restraint of trade;" creation of the Federal Reserve System to regulate the money supply, stabilize the financial system and curb inflation; passage of the Clayton Act in 1914 in order to further restrict anti-competitive practices and enforce the earlier Sherman Antitrust act; and establishment of the Federal Trade Commission in 1914, an agency with powers to "prevent business practices that are anti-competitive or deceptive or unfair to consumers

Hunger and unemployment in the land of plenty drove the New Deal toward the rescue plan of welfare capitalism - government sponsored programs and legislation that fostered institutions (labor, public works, farm, rural, National Recovery Administration) to counter finance and capital deficiencies and distribute wealth in order to enable all citizens to escape poverty and gain equal opportunity. Soon more rescue was need and subsequent policies, such as government construction of transportation, communication and power infrastructure -- interstate highways, airports, hydroelectric and nuclear power plants, and ARPANET (the first wide-area packet switching network) - equal opportunity laws, subsidized mortgage loans, and direct coordination in research and development between the defense department and private industry tended to drive free enterprise toward a mixed economy.

Add to the legislation the many times the government directly financed corporations to prevent their bankruptcies, mobilized industries during times of strife, bailed out banks, and revived cities and land areas from natural disasters.

Bernie's agenda and attention to issues are an avenue to address the potential limitations and lapses in the socio-economic system. Somewhat vague in parts, they reflect what is on people's minds, capture a large segment of the population and draw attention to subjects that are constantly debated without being resolved. Each element acts only to stimulate discussion, whose final resolution will hopefully depend on the evaluation of ideas and not on pre-determined objectives. With charity for all Americans and no malice to the capitalist system, they intend to improve the economics and mindset of the American people and not arbitrarily replace capitalist incentives and institutions.

Not without criticism, Bernie's presentation may seem too directed and class conscious, appealing to a major but restricted portion of the population, serving to alienate much of the electorate and distracting from the discussion. Saying he will question Supreme Court Justice Candidates on their opinions of revoking the landmark 2010 "Citizens United v. FEC" decision, which allowed corporate spending on elections, insinuates he places political alliances above legal qualifications. His relative silence on gun control (Vermont is a hunting state)and Israel's oppression of the Palestinians indicate he is not immune to having political considerations override progressive attitudes.

Bernie's Agenda, which is further described at http://www.sanders.senate.gov
(1) Rebuilding Our Crumbling Infrastructure
(2) Reversing Climate Change
(3) Creating Worker Co-ops
(4) Growing the Trade Union Movement
(5) Raising the Minimum Wage
(6) Pay Equity for Women Workers
(7) Trade Policies that Benefit American Workers
(8) Making College Affordable for All
(9) Taking on Wall Street
(10) Health Care as a Right for Al
(11) Protecting the Most Vulnerable Americans
(12) Real Tax Reform

In order to obtain improved focus and voter concentration, Bernie may be wise to limit the number of agenda items and issues. His explanations omit one essential - most are not only beneficial to a major portion of Americans, they are essential to preserve the economic welfare and physical health of all Americans. Analyze income and wealth inequality, which most completely distinguishes liberal politics from conservative politics and will play an important role in the presidential debates. Aside from a moral obligation that assures all citizens share equitably in the nation's enormous wealth and providing a motivation to produce that comes from feeling properly rewarded, a more confined distribution of income and wealth has political, social, economic and health benefits.

In an article, The explosion in U.S. wealth inequality has been fuelled by stagnant wages, increasing debt, and a collapse in asset values for the middle classes, Emmanuel Saez, professor of economics University of California-Berkeley. and Gabriel Zucman, assistant professor of economics at the London School of Economics (LSE), which is posted on the LSE website, place the disparity in income and wealth in context.

There is no dispute that income inequality has been on the rise in the United States for the past four decades. The share of total income earned by the top 1 percent of families was less than 10 percent in the late 1970s but now exceeds 20 percent as of the end of 2012. A large portion of this increase is due to an upsurge in the labor incomes earned by senior company executives and successful entrepreneurs. But is the rise in U.S. economic inequality purely a matter of rising labor compensation at the top, or did wealth inequality rise as well?

Wealth inequality, it turns out, has followed a spectacular U-shape evolution over the past 100 years. From the Great Depression in the 1930s through the late 1970s there was a substantial democratization of wealth. The trend then inverted, with the share of total household wealth owned by the top 0.1 percent increasing to 22 percent in 2012 from 7 percent in the late 1970s. The top 0.1 percent includes 160,000 families with total net assets of more than $20 million in 2012, the wealthiest 160,000 families own as much wealth as the poorest 145 million families, and that wealth is about 10 times as unequal as income.

May seem harmless, but a study by the Political Economy Research Institute of the University of Massachusetts, Amherst, "shows that a 10% increase in the share of total income earned by the top 10% of income earners leads to a 2% decline in the incomes of households in the middle of the income distribution (based on data for the period between 1979 and 2005). It's not just that the rich get richer and the poor get poorer, rather that the rich getting richer makes the poor (and the middle income earners) poorer."

The consequences of inequality are most notable and most overlooked in shaping politics and its damages to health and the social fabric. Previous articles, Health is a Socio-Economic Problem, and The Battle for Income Equality describe the damaging relationships in depth and with facts. Some brief statements:

Thomas Piketty, in his book, Capital in the Twenty-First Century has shown that profits are being sidetracked into passive investments that produce only more capital and not useful goods, into accumulation of excessive personal wealth, and into financial speculation that features the constant churning of paper money, which removes dollars from the market and creates difficulties for manufacturing to grow. Accumulation of excessive wealth generates social problems, which diminish the quality of life and burden the middle class as taxes are used to seek relief. Wealthy individuals are more and more controlling the political debate, influencing selection of candidates, having their interests placed before national interests, and determining the directions of political campaigns. Skewing the electoral process distorts government and the decisions that guide social and economic legislation. Democratic prerogatives, fair elections and equality before law are all reduced by wealth concentration.

Poverty is defined as an absolute number but its effects are relative. The lower wage earners in the United States are unaware of what they have in relation to foreigners; they are aware of what they do not have in relation to others living close to them. The wide disparity in wealth creates resentment and tension leading to psychological and emotional difficulties. Minimizing social problems means combining the giving of more to the lower classes with the taking of less by the upper classes.

The social problems and associated costs in developed nations that have wide distributions of income and wealth are well documented - elevated mental illness, crime, infant mortality, and health problems.

The trend to socialism is neither planned nor conspired. Due to the consistent failures of the capitalist system, it is a natural progression. Because the measures taken to maintain capitalist activities are rarely withdrawn, the measures accumulate. Being that credit is a significant contributor to enabling profit, which is the lifeblood of capitalism, if credit availability ultimately hits a wall, profit will drop and government will initiate rescue plans. One day the government may no longer be able to bail out banks and industry and will, by default, be left with permanent investment in and control of businesses. That phenomenon will grow; capitalism will find itself slowly fading from economic life, and the socialization of the economy will be gradually accepted.

Although a long shot, imagine an election that has Sanders vs. Trump. On one side, America's representative of cooperative spirit and on the other side, America's representative of rugged individualism. - the best reality show in town. Who more than the other will usher in the age of socialism? Will it be Bernie, whose social programs will provide band aids to an injured capitalist system or Donald, who by following previous Republican style policies, which have caused the major economic calamities in the Panic of 1907, Depression of 1930, and Great Recession of 2007, and will trigger more socialized legislation and policies in the inevitable rescue plan? History has spoken, if you want more socialism vote Republican.

alternativeinsight
october 2015

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