One of the essential ground rules of any debate is definitions of terms. In the debate over such proposals as universal health care, affordable college education and increasing the marginal tax rates, conservatives howl “socialism,” but to quote a line from the movie The Princess Bride; “You keep using that word. I do not think it means what you think it means.”
The term “socialism” is commonly used by conservatives to convince the public that anything that term is applied to equates to totalitarianism and eventual economic collapse. The scaremongering is typically accompanied with allusions to Venezuela, Cuba and the departed Soviet Union.
Democrats haven’t worked as effectively to clearly define the terms in this debate as the Republicans have to muddy them. To parry Republican scaremongering, Democrats often use the term “democratic socialism” and point to affluent, advanced, western European democracies that have robust social welfare systems.
However, the term “democratic socialism” contains that scary word, “socialism,” and that instantly engenders suspicion and anxiety among many Americans.
Relax. Addressing particular societal problems or needs through government is not necessarily tyranny. National defense, justice courts, public safety and public education are examples of things free societies agree to have and tax themselves to provide. To use a term, it’s the “general welfare.”
If the majority of a society freely chooses to expand the general welfare to provide something existentially essential to every citizen, those who oppose that choice can call it whatever they like.
What matters is whether it works to address the problem or provide the need. If it doesn’t, then it must be reconsidered. That can and has been done in free societies. Great Britain, Sweden and Germany adjusted their welfare systems when those impeded economic vibrancy.
Most issues in society are economic. How an economic system is organized to address those issues is crucial for peace, stability and the general welfare.
In a real-world contest between classic socialism and free-market capitalism, the latter is the clear winner. Free-market capitalism is inseparable from fundamental ideals of personal freedom and the pursuit of happiness. It has proven to provide the most prosperity for the greatest number of people.
Capitalism works because it is compatible with key aspects of basic human nature — freedom, ambition, creativity and self-preservation. It also fails because of basic human nature — greed.
For capitalism greed is good to a point — then it isn’t.
Winnowing abusive greed out of the market is necessary to keep capitalism vibrant and healthy. Free-market capitalism’s natural tendency is to monopolize and quash competition.
An insufficiently competitive market becomes predatory and threatens the general welfare. Prices of essential goods and services push more and more people into subsistence and further away from affluence — especially when wages lag behind rising prices.
It’s not that wealth isn’t growing in America, it’s that the vast amount of that growth is going to fewer and fewer people. There is a point where the standard of living begins to decline for too many people and the concentration of wealth is perceived as unfair.
When people began to lose trust in the fairness of the economic system, when the belief that they, too, can attain a certain level of affluence fades, that is when a society becomes agitated and unstable and does something to usher in radical change.
The term I have coined to describe America’s current economic system is “cannibal capitalism.” The pursuit of profit is merciless. Nearly every corner of American society is now effectively a profit center enriching an economic aristocracy of managers and investors with little if any empathy with the victims of their infinite greed.
The insatiable rapacity is inherent in the dynamics of stock markets. The value of a company’s stock is directly affected by how much it grows its profits.
It is not good enough for a company to be consistently profitable and pay a steady dividend to the owners. It must constantly increase profits either by raising prices, selling more stuff or acquiring other companies in order to raise the price of company stock.
Management is lavishly rewarded by playing this growth game successfully. This motivates gross abuses in the market that we see exposed again and again.
Wells Fargo repeatedly cheating its own banking customers in multiple ways. Big pharmaceutical companies intentionally misleading health-care providers to prescribe deadly addictive drugs. Automobile companies covering up deadly defects in their vehicles and continuing to sell them to the unsuspecting public. Energy companies negligently maintaining plants and equipment that results in catastrophic disasters and loss of lives.
And this is a short list.
There is arguably no more egregious cannibal capitalism than that found in America’s health-care industry. Americans are dying so other Americans can make even more money. That’s cannibal capitalism.
The proper role of government is to reasonably regulate the economic system to ensure equal opportunity and prevent the ravages of excessive greed. But, government has been purchased by the very forces of greed it is charged with regulating. In fact, many of those appointed to head regulatory agencies are executives from the very industries being regulated.
Elected politicians can and do accept huge campaign donations from, and can directly invest in companies affected by legislation these very politicians are voting on. This is gross conflict of interest, venal and corruptive, and helps explain why cannibal capitalism thrives in America.
In President Donald Trump’s State of the Union address last week, he vowed that America would never become a socialist nation. This, of course, was a continuation of the scaremongering intended to frighten Americans into rejecting expanding the general welfare, especially universal health care.
Most of America is endangered more by the very real abuses of capitalism than by the perceived threats of socialism. But, if America veers deeply into socialism it will be because of the failures of its brand of capitalism.
— Randy Alcorn is a Santa Barbara political observer. Contact him at randyaalcorn@gmail.com, or click here to read previous columns. The opinions expressed are his own.