I’ll Keep My Capitalism, Thanks

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“The problem with socialism is eventually you run out of other people’s money”.

After reading last Saturday’s Rolling Stone column penned by the overly self-confident and vowed communist Jesse Myerson, in which he resurrected and extolled the seemly virtues of socialism and its necessity in America, it’s difficult to resist the temptation to begin and end any rebuttal I could make with the Iron Lady’s ever suitable quotation on the topic. It’s pithy, quite unassailable, and boils the argument down to a basic denominator: a society’s wealth is finite.

However, he spent five sections doing his best to throw centuries’ old spaghetti at the wall in hopes that this time it might stick, so I feel obliged as a fellow Milennial to air out some of my own thoughts.

Myerson begins his dissertation with the transparently obvious point that “unemployment blows” and states that the “no-brainer” solution is an expansive–and expensive–government intrusion in the form of guaranteed jobs for millions in the public sector. He cites as justification for his proposal the New Deal-era Works Progress Administration (WPA), a federal program aimed at employing millions of largely unskilled workers during the worst of the Depression.

Simple arithmetic is a big reason transplanting that program into today’s situation is asinine. The WPA provided nearly eight million jobs over an eight year stretch between 1935 and 1943, at a 1935 price tag of $13.4 billion. In today’s dollars, that’s roughly $227 billion. Not exactly chump change.

That’s not all that would be necessary. Official unemployment stands at roughly 10.3 million Americans, including only those still looking for work. Many millions more are just too discouraged to continue searching for work, so the actual tally is much higher. To immediately employ just those 10.3 million, using the metrics for the WPA, would require about $292 billion, at minimum. Time to raid several million sofas nationwide, because short of massive and punitive tax hikes to fund Myerson’s five initiatives, I’m not sure where else the money will come from, as I’m quite sure he would add that on top of current social programs. No big-government stooge ever eliminated a program before adding another. Our $17.3 trillion dollar operating debt says we’ve tapped out our capacity to borrow, as well.

Myerson also takes this opportunity to advocate a “living” wage without saying exactly where such a wage would begin. I say “begin” because everyone knows there would be yearly calls on the Left for wages to increase. That’s what government does. It’s also confusing that he states that such wages would anchor prices. How so? Businesses, large and small, seek to grow their profit margins. Paying a living wage, whatever that is, means that short of action, margins would fall. Does one expect companies to simply eat the increased cost of doing business out of the goodness of their hearts? No, and why should they?

In order to stabilize the hit they would take, businesses would either reduce their work force (contrary to the point, yes?), pass the cost to consumers with increased prices, or both. Ready to fork over a ten spot for a Big Mac, and require a bachelors degree in order to make them? Paying such a higher wage would make companies more discriminate in their hiring practices, pricing younger and unskilled workers out of the market. High schoolers, want to make sure you can’t work to put gas in your first car? Latch on to Myerson’s crusade. He seeks willing suckers.

Because I enjoy the fruits of empiricism–it’s hard to argue with actual observation–let us consider the tiny Baltic state of Estonia, and compare it’s fortunes under the auspices of Myerson’s preferred social order, and mine. In 1940, Estonia was occupied by the U.S.S.R. and kept under communist rule until 1991, when the Soviets left. In describing communism’s effect, former Estonian Prime Minister Mart Laar said:

“Look at what happened in this context during the fifty years and then you can understand how terrible the communism system really is. And it’s not only in the economy. This is in all fields of life–the social structure, cultural standards, education, health care, or whatever. When you compare those two countries…then you will find what communism really means, and how bad it is. Our economy, our nature, and our environment were destroyed.”

However, once Estonia came out from under communism in ’91 and embraced capitalism, their fortunes rapidly swung the other direction. A few short years after the Soviets left, Estonia’s life expectancy stood at 72.6 years. But after being free to build and invest in their own health-care system, by 2008, it jumped to 75.2 years, a rate of growth nearly identical to “free” neighbor Finland, who enjoyed a fifty year head start. In 1994, Estonia’s infant mortality rate was 19.1 deaths per thousand births. Fourteen years later, it was 7.5 per thousand, a sixty percent drop. In 1993, Estonia’s GDP per capita was a paltry $5,480. By 2007, it soared to $21,100, nearly double Finland’s growth over the same period. In 1993, Estonia had 25 telephones per thousand people. Thirteen years later, they boasted 41.1 hard lines and 127 cell phones per thousand, enough for the New York Times to dub them “a sort of Silicon Valley on the Baltic Sea”. Not bad for a decade and half’s worth of work under capitalism.

Do you own the latest Galaxy S4? Drive a Ford? Wear a pair of Hanes boxers? Or briefs, if that’s your bag. Free-market capitalism build that. What has socialism built, besides the book cases necessary to hold endless tomes recounting its trials and ultimate failure? Then again, capitalistic IKEA–repository of home furnishings and indecipherable instruction manuals–bears ultimate responsibility for building those even, so that example sort of bombed out, didn’t it?

Perhaps the most maddening aspect of his proposals aren’t the ideas themselves, but what I’ve alluded to already: his bizarre self-confidence that his ideas count as “jaw-droppingly simple” remedies.

How do you figure?  In addition to their as-yet unproven ability to solve anything, they are also politically untenable. Republicans aren’t going to vote on a bill instituting something like universal basic income on top of the current welfare system, and Democrats won’t vote for anything that dismantles it, so the idea that there’s anything “simple” about them in terms of their ability to, you know, get passed by Congress, defies logic.

Also, even as unwieldy a government as ours would have tried hitching it’s wagon to such “simple” solutions long ago, yes? Of course, building a 20 foot high, double thickness and partially-buried fence the entirety of our southern border would “seem” a simple remedy for illicit border crossings–and engender respect for our laws and sovereignty–but that sure hasn’t happened. So, what do I know.

Or his belief in government’s ability to solve anything at all. The federal government can’t even get quasi-capitalistic enterprises like Amtrak or the post office right, but we’re to believe government can cure endemic cultural maladies like poverty and joblessness? Don’t hold your breath too long, now.

We must also contend with questions of whether or not the Constitution empowers federal government to perform Myerson’s intended proposals or not. It’s a legitimate question, as the Founders were intimately aware from examples out of history (and their experience with England), that big government, instead of providing cures for social ills, almost always collapsed under the weight of its own largess once it assumed for itself the power to even attempt them. Which is why the Founders provided for strict enumerations of power to avoid such collapse into dysfunction and eventual tyranny.

Which brings us to one of Myerson’s later calls for, what amounts to, communal land. The only way to “stop letting rich people pretend they privately own what nature provided everyone,” as Myerson stated, is for federal government to claim eminent domain and forceably seize and re-appropriate it. The Founders were, understandably, quite wary of such attempts to emphasize collective ownership over the rights of the individual. Says Samuel Adams:

“The Utopian schemes of leveling [redistribution of wealth] and the community goods [state ownership of property] are as visionary and impractical as those which vest all property in the Crown. [These ideas] are arbitrary, despotic, and, in our government, unconstitutional. Now, what property can the colonialists be conceived to have, if their money may be granted away to others, without their consent?”

It has been tried before. In 2005, Kelo v New London was a Supreme Court case that revolved around this very principle: when could government seize private land by eminent domain and give it to another entity to “further economic development”, in this case a private developer? By a 5-4 margin, the high court stated that “the general benefits a community enjoyed from economic growth qualified private redevelopment plans as a permissible ‘public use’”, and ruled against Susette Kelo, who lost her land and her little pink house.

However, the developer (in this case, to be anchored by Pfizer) was unable to obtain financing for the redevelopment and abandoned their plans. Ms. Kelo’s land to this day amounts to nothing more than a temporary dump, a sad consequence of allowing for governmental seizure of private land to “benefit” the collective. One gets the feeling in considering the Founder’s reticence to bow to an all-powerful government, that they would have used this occasion alone to justify locking back the hammers on their muskets to march on Washington, whether the community “enjoyed economic growth” as a result or not. It’s simple: the system they put in place necessarily favors the individual, who can never hope on their own to face down a federal Leviathan and win.

A free market allows for and encourages innovations that touch every facet of life, and makes life simpler. Without capitalism, does Mr. Myerson believe that the likes of Bill Gates and Steve Jobs–who started with naught much else besides an idea and a plan–could have built their respective powerhouses? Companies that have changed the face of modern technology, allowed thousands to become millionaires and billionaires themselves, and put millions of driven individuals to work, enabling them to share in the immense wealth attendant of such success? He may well believe so. Personally, I sincerely doubt it.

Americans face stiff problems. There’s greed, corruption and inefficiencies to be found that hinder attempts to solve them, there’s no doubt. But I feel that the “level of suspicion” that Myerson, and those of his bent, have towards a free market lies in their failure to consider that capitalism’s short-comings are less an inherent flaw in its framework, and more an indictment on the heart’s of the individuals practicing it. Evil people exist, and no economic system will completely alleviate poverty, hunger, or joblessness. At very least, however, we can point to capitalism’s demonstrable success in pointing in the right direction. Socialism, on the other hand, has only firmly entrenched those problems, killed millions, and allowed those issues to grow roots that take decades to pull up.

But, to each his own. Mr. Myerson is, of course, free to espouse which ever system he wishes. As for me, I’ll keep my capitalism, thanks.

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About Michael Haugen

Michael Haugen is a full-spectrum conservative and recent graduate from Eastern Washington University (BS Biology). His main interests in politics and public policy center around health care, education and tax reform. He'll be returning to EWU in 2014 to complete a Master's degree in Public Administration. Follow him on Twitter: @HaugenTRA

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