Labels: Socialism vs. Capitalism

Shannon Bohrer

(6/2022) Our country has been divided for some time and the differences are often reflected in our two political parties. Having differences is not new; in fact, our form of government encourages individual thought and expression of ideas. The "melting pot," a term often used to describe our various ethnic origins, was often credited for the creativity, ingenuity, and innovations that continually developed our country. Yet, today the "melting pot" is used as a foil to divide us, and sometimes very effectively.

Our political differences are not new and for many years while we had differences, the two parties frequently worked together. Working for the betterment of the country overshadowed individual parties. Unlike today, it was country before party, and it worked. Today, some would have you believe that our differences are so significant that they are unresolvable. It is common to label these differences and then express them as good for their party and bad for the other side.

Two very central and well-known labels include the idea that the democratic party represents socialism, and the republican party favors capitalism. These labels are not new; they have existed for generations. For many people, the word socialism has a negative connotation, and conversely, the word capitalism sounds -well profitable. Of course, that is what some want you to believe. The history of our "socialist programs" is not bad, and the history of "capitalism" is not all good.

The socialism label has a long history, as in this example, "Never in the history of the world has any measure been brought in here so insidiously designed so as to prevent business recovery, to enslave workers, and to prevent any possibility of the employers providing work for the people." While one might think this is a recent quote, it was said in 1936, by Representative John Taber (R-NY), as an argument against the Social Security proposal. There was also "Social Security is the end of democracy," as stated in a pamphlet by the American Liberty League in 1935. The fearmongering of socialism has long been a staple of conservatives. And yet, social security works, it is well-liked, and it is paid for by the citizens. If the program is paid for by the individuals receiving the benefits, is it socialism?

A more recent quote from Ronald Reagan, "if you don't [stop Medicare] and I don't do it, one of these days you and I are going to spend our sunset years telling our children and our children's children what it once was like in America when men were free." He was arguing against the passage of Medicare because it was a "socialist program". He espoused the theory that if the law passed, the federal government might control where Americans could live and how they could earn a living. Sometimes, the word socialism is thrown about like a paintbrush, and anything covered with the brush - is anti-American.

In the early 1960s, a common theme was that the socialist Medicare program was going to be the end of a free people. What is missing from this argument is that Medicare was created because insurance companies routinely dropped older people when they got sick. Our health care system is a form of capitalism; insuring healthy people is profitable and insuring older and sicker people is not. Dropping older and unhealthy people, anyone over 65, was good business, meaning it was good capitalism.

In 1964, Senator Barry Goldwater had a warning about Medicare, "Having given our pensioners their medical care in kind, why not food baskets, why not public housing accommodations, why not vacation resorts, why not a ration of cigarettes for those who smoke and of beer for those who drink?" There are many that believe anything that can be painted with the brush of socialism should be. Of course, the socialist program called "Medicare," is very popular, and many would like to see the program expanded. Like social security, Medicare works, it is well-liked, and it is paid for by the citizens. Again, if the program is paid for by the users, is it really socialism?

The end of freedom as we know it was and still is a common theme with Social Security, Medicare, and, more recently, the Affordable Care Act. It is said that Socialism will ruin us; it will make people dependent on the government and take away our freedom. Oddly, the freedom to collect social security and Medicare that you pay for gives one more freedom. Imagine what our country would be without social security and Medicare? "Among elderly Social Security beneficiaries, 37% of men and 42% of women receive 50% or more of their income from Social Security." And without Medicare, how many elderlies would not have medical insurance?

Conversely, capitalism is hailed as the engine of America, and capitalism is responsible for building American businesses, employing workers, and creating the American dream. As Bill Gates once said, "Capitalism has worked well, anyone who wants to move to North Korea is welcome." Words from a successful capitalist.

What is avoided by the supporters of capitalism is that many large companies not only fail to pay any taxes, but they also receive subsidies from the federal government. When industries receive subsidies, is that a form of welfare or socialism? Can businesses become dependent on the government? If so, are they in danger of losing their freedoms?

In 2018, sixty profitable businesses, which were on the Fortune 500 list, paid no federal taxes, yet they received a tax rebate of $4.3 billion. That 4.3 billion is a minor figure compared to twenty billion in subsidies, or industrial socialism programs, received by the fossil fuel industries. When two dozen fossil fuel companies pay no taxes while reporting record profits and receive tax "rebates," otherwise known as subsidies, should that be called industrial socialism, or corporate welfare?

Could the insidious design of industrialized socialism enslave our capitalistic companies? If we do not stop industrialized socialism, will we be telling our grandchildren what it was like when American companies were free?

You might be thinking that industrialized socialism is not that big of a deal, or it’s helpful for the creation of jobs. Of course, that is what the beneficiaries of the subsidies tell us. Corporate welfare or socialist capitalism is estimated to be one hundred billion dollars each year. That may seem like a lot of money, but it is being paid for. Just as we pay for social security and Medicare, we also pay for socialist capitalism.