I am a conservative that believes in both capitalism and “sustainable” socialism. So let me explain.
A great example of socialism is the family. In most families, parents work hard to provide their children the best life they can. They contribute their resources freely on behalf of the family, they sacrifice their personal desires for the benefit of their children. When they find there is something they want for their children they can’t afford, they figure out how to sacrifice more or work more. In this way, socialism is not “less productive”, it is more productive. This is what I mean by “sustainable” socialism.
Inherent in the concept of socialism is “voluntary sacrifice”. No one needs to coerce loving parents to tell them to sacrifice or work harder, the idea is totally foreign to them. This sacrifice is “natural” and is built on a concept that I want to call “kinship”. I define “kinship” as the emotion either biological or learned that causes someone to willingly give what belongs to them to benefit others they care about.
Inherent in my belief is that almost everyone holds this emotion of “kinship”, but to what degree and to whom varies a great deal not only among different individuals but also towards different individuals. So the degree of “kinship” I feel towards my children may be more or less than what you do. The degree of kinship I feel to extended members of my family may be similar or different than the degree of kinship I feel towards my immediate family. The degree of kinship I feel towards my neighbor may be different than what I feel towards my extended family. And the degree of kinship I feel towards others that are part of a group to which I belong may be different than that which I feel towards my friends or neighbors. In essence, the degree of personal sacrifice I am willing to accept to extend help to others differs depending who the “others” are.
This is a powerful concept to grasp, since sustainable socialism is totally dependent on this feeling of “kinship”. When society through government attempts to impose a level of socialism not reflected in the aggregate sense of kinship felt by those in society, than socialism begins to destroy society undermining the desire of people to work and produce for the benefit of themselves and those to whom they feel a sense of “kinship”.
So let’s use college tuition as an example. My child gets accepted to a school, I can’t afford. My wife and I really want our child to attend that school and so we agree that she will go back to work and her income will be used to fund my child’s education. Did this act of socialism, takeaway or ad to the economy? It added to it, my wife is working producing goods and services, so our child can attend the college we want her to attend.
My neighbor’s child or my brother’s child gets accepted to a school, they can’t afford. My wife and I talk about it and decide we want to help. We decide to work a bit harder, sacrifice some personal spending, and maybe even save a bit less to contribute $2,500 a year towards my neighbor’s or brother’s child’s education. Did this act of socialism, takeaway or add to the economy? Same answer.
I loved my college experience and so I decide annually to give to the school’s endowment fund to provide scholarships to worthy strangers to attend the same college I did. I give $2,500 a year to the endowment without working more, just spending less. Did this act of socialism, takeaway from the economy? No, it simply shifted consumption from my personal use to the benefit of a stranger.
In my town the school is asking residents to accept a slightly higher property tax rate to fund higher school expenditures which they claim will enable them to provide students a “richer” high school experience. I like the proposal and vote for it, I decide I will spend less on me, so the school can spend more on others including teachers’ salaries. This act of socialism does not detract from the economy again it shifts consumption from my personal use to the benefit of those who gain from the school’s greater budget.
A state politician promises if elected they will propose a law that provides free health care for all. Separately, they propose raising the state income tax by a substantial amount to fund this proposal. The politician wins and does as promised. The proposal to provide free health care for all passes into law. The proposal to fund it through higher state income taxes fails. So the state begins to incur debt to provide this “socialized” benefit.
As the debt piles up, the issue soon becomes whether to continue the benefit or coerce the public to pay more than they are willing to pay in taxes. A second attempt to raise taxes fails, so the state resorts to mechanisms to tax the public not subject to their approval and even so, it is not enough and the debt grows.
The state has crossed the line from sustainable socialism to progressive socialism. So a definition is needed here. Progressive socialism occurs when politicians believe so much in a socialized benefit, they are prepared to force taxes on the public they do not collectively support or subject the public to taking on public debt, that they will someday have to pay for.
Somewhere in the process the government decided that they have a right to spend beyond my feelings of “kinship”. So my willingness to sacrifice reached a point where I simply said “enough”. When society collectively sees more of their collective production of goods and services going to strangers, then they are willing to support, then the economy begins to suffer.
Using modern parlance, liberals often talk about people paying their fair share. What they fail to mention is that “fair share” is a two way street. What you think is my “fair share” is less relevant than what I think is my “fair share”. If you take from me more than I agree is my “fair share”, then I respond with behaviors that in the end leave the economy a wreck.
So liberals can’t demand people give more as their fair share without wrecking the economy, unless and until they convince those who are giving up their incomes that doing so is consistent with their aggregate feelings of kinship towards members of their society who are in need.
Let’s apply this concept to the real world we live in. The Federal government offers its citizens nearly $1 trillion more in entitlements, then those paying taxes are presently funding. The Federal government has not persuaded its citizens to make up the deficit. So the budget deficit serves as a “proxy” of the degree to which the government has imposed an entitlement system, that Americans as a whole do not support.
One can argue the merits of each individual entitlement and we should. But in aggregate, the sense of self sacrifice has been exceeded and sustainable socialism has been replaced with progressive socialism. Progressive socialism always ends badly, especially for the poor.
What motivates progressive socialism and what are some of the signs it has begun to creep into the society. The first sign that progressive socialism has established itself is systemic budget deficits. Systemic budget deficits reflect that the middle, upper, and wealthy classes of society are no longer willing to sacrifice any more of their income in taxes to support income redistribution to raise the living standards of the poor.
The second sign that progressive socialism has established itself is systemic invasion of “class warfare” into the political debate. Since the middle, upper, and wealthy classes “outnumber” the poor, the debate generally targets the “upper and wealthy” class only in order to push the middle class to the sidelines. Other times the middle class are offered “small bribes” in the form of reduced taxes or entitlement benefits to side with politicians attempting to coerce income redistribution from the upper class and wealthy beyond what they feel is their “fair share”.
A third sign that progressive socialism has establish itself is a complete disconnect between the cost of entitlements and the tax system necessary to fund it. Politicians quickly learn that promising entitlements that are “free” can be very appealing to a large number of voters and as long as the funding mechanism is to Byzantine for the public to understand, the politicians get elected and the entitlements get approved.
Again let’s apply these “signs” to our current political environment in the US. Are we developing “systemic” budget deficits? Yes. Are we seeing an increase use of “class warfare” in politics? Yes. Are we seeing a disconnect between entitlements that politicians are promising and easy to understand new taxes to pay for them? Yes. All these acts point to the reality that our country has moved passed sustainable socialism into the world of progressive socialism and that should be concerning to all.
What concerns me most is the motivation of politicians to take the country beyond sustainable socialism to progressive socialism. For some like Bernie Sanders, I think he has little grasp of economics and a strong belief in his socialistic policies. He has a sincere desire to push entitlement programs and somehow believes in his heart of hearts that Americans can be convinced someday to pay for them. Even though history has shown that never happens and instead governments default or revert to crushing austerity programs.
For other politicians the motivation is far more selfish. They believe promising entitlements and funding them with debt is a quick and easy way to rise in power become wealthy and get out of town before the proverbial “sh*t” hits the fan. They want to be powerful and wealthy and don’t really care what happens when they are gone. One sure sign of this type of politician is one whose positions make no economic sense, but tend to fall down on the side of the issue with the most political support.
The third group of politicians are what I would classify as the “reformers”. They believe in the “progressive vision” of expanded entitlements and are also economic savvy enough to realize progressive socialism leads to a tipping point that they are prepared to gamble on the outcome. These politicians believe in the message they are selling much like the Bernie Sanders’ type, but hold the belief that once Americans see the benefits of greater entitlements that the middle, upper, and wealthy classes of society will be persuaded to sign up to fund them. In other words, this group believes they can elevate the overall level of income redistribution by creating a change in the collective sense of “kinship” felt by citizens towards one another.
For this group the systemic deficits, combined with “wealth shaming”, and “education” will cause the taxpayers to willingly sacrifice more income to convert progressive socialism back into sustainable socialism. The systemic deficits are necessary to force society to experience cognitive dissonance, whereby they must rationalize the disconnect between government expenditures either by voluntarily accepting higher taxes or imposing crushing austerity. They believe the American people will opt for the former.
While “wealth shaming” is an important education tool, it is directed at the upper and middle class as much as the wealthy. For clearly if a great deal more is expected of the wealthy, then some proportional sacrifice should be made by the other classes. It does not need to be stated, it is implied.
This calculated strategy comes with great risks especially to the future poor and the lower end of the middle class, who depend on entitlements to sustain their lifestyles. Having viewed American tax paying history for the last 75 years, there is little evidence this strategy will work. Sustainable socialism based on this history suggests Americans are prepared to contribute around 18% of GDP towards funding the government including its entitlement programs.
So a sustainable socialist politician would strive to reduce wasteful government spending to preserve as much as possible for sustainable socialistic entitlements. Keep in mind implicit in this assumption is that taxpayers as a whole are willing to support socialistic entitlement programs to a point. The next step a sustainable socialist politician is to design an entitlement program that is not only effective but which reinforces among the citizens the “good deeds” they are funding.
America has crossed the road from sustainable socialism to progressive socialism. We must demand politicians stop talking about expanding entitlements and begin talking about how to fit our entitlement spending within the funding levels that our “societal” kinship level is prepared to pay. For those that believe that funding level is to low, then you owe it to convince America to pay more before government spends more.
The point of this article is to show our country is not about capitalism or socialism, we are primarily a capitalistic economy and a socialistic society. And we reconcile the two when we reach a level of sustainable socialism. We are out of balance when the degree to which we redistribute income is more or less than that. Progressive socialism is dangerous in that it leads to economic disaster. Pure capitalism is dangerous in that it leads to societal instability. But where an economy operates in the “Goldilocks” zone of sustainable socialism, both the economy expands and the society is politically stable.