All these -isms — what do they mean? Americans in particular are well known for their disdain of most of these. (Well, many Americans, anyway, and they tend to be pretty vocal about it). The thing is, no one actually teaches economics anymore, except as specialized College classes, so how do Americans think they know so much?
The answer is simple: they don’t. All they know is the propaganda: capitalism = good; everything else = bad.
So what makes us so sure? Part of the problem is that economic systems tend to drive social systems too, and many of the combinations have had horrible results: Marxist-Leninism, Maoist Socialism, Stalinism, etc. These forms of government were heavily tinged, even corrupted, by the people who’s names were associated with their particular versions of these systems. The truth is, each one has it’s good points.
Take socialism, for instance, the current boogeyman in the closet of the American psyche. Wikipedia defines socialism in this way:
Socialism refers to a broad set of economic theories of social organization advocating state or collective ownership and administration of the means of production and distribution of goods, and the creation of an egalitarian society.
Some interesting words here. “Collective” essentially means together, while “egalitarian” means equal.
I seem to recall such a concept in the Declaration of Independence:
We hold these truths to be self-evident, that all men are created equal…
The concept of an egalitarian collective is hinted at throughout most of the important American documents. None of them specify anything in particular as the means by which Government should secure the rights of the people, of course, though it seems obvious Feudalism and Imperialism were being rejected outright.
Back to economic systems. The British of the 18th century were traders, accustomed to traveling far and wide and bringing back “goodies” they could sell in England, or trade with other nations. When they landed in America, they continued the tradition, at least for a time, though eventually their imperial traditions overtook them and we know where that landed us.
Once Independence was declared, America had to come up with a new way of doing things. Eventually, thanks to Adam Smith, they settled on Capitalism as the way to go. Nonetheless, it has occasionally, and as circumstances warrant, been tinged with various socialist leanings. Adam Smith himself wrote, in “The Wealth of Nations“:
The necessaries of life occasion the great expense of the poor. . . . The luxuries and vanities of life occasion the principal expense of the rich, and a magnificent house embellishes and sets off to the best advantage all the other luxuries and vanities which they possess. . . . It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.
Note that Adam Smith died in 1790, more than 20 years before Karl Marx was even born.
Various American Presidents, aware (or at least informed) of Smith’s work have, at various times, infused a smidgen of socialist doctrine into our economic landscape, usually with just the right degree of success: Dwight Eisenhower, Bill Clinton, Richard Nixon, and even (gasp!) John McCain have all supported a higher tax bracket for the wealthy, who can better afford any taxation at all. The “Flagpole“, a local arts and music weekly publication, has a humorous cartoon going into more detail. I must admit I was shocked to learn that under Dwight Eisenhower, the wealthiest paid a whopping 91% tax. That’s a far cry from the 39% Barack Obama is looking to reinstate, as it was during Clinton’s Presidency before Bush lowered it to 35%.
That’s right, Obama wants to raise taxes on the wealthy by a mere 4%. The wealthy have investments that return at least that much, and their businesses, through various tax shelters, have much more money hidden away from the country’s coffers.
If 4% makes Obama a Socialist, while a wartime President refuses to pay for a war he almost certainly wanted, then perhaps Capitalism needs a serious revision.