Economist Dr. Anne Bradley joins TFAS for a candid discussion on the definition, appeal and contradictions of democratic socialism and why it is never the answer (not even during a pandemic).
Dr. Anne Rathbone Bradley is the George and Sally Mayer Fellow for Economic Education and the academic director at The Fund for American Studies. You can listen to our conversation above or read a transcription below.
Right as we were preparing to record this podcast, news broke that Senator Bernie Sanders is suspending his presidential campaign. But, there is no question that his candidacy has brought democratic socialism to the forefront of political discussions in America. And even exit polling from primaries earlier this year showed that Senator Sanders has strong support from voters under the age of 29. In New Hampshire, he drew nearly half of voters aged 18 to 29, and that is more than the other four major Democrats on the ballot combined. So my question for you is, as a professor who teaches and interacts with young people, why are we seeing this growing support for democratic socialism?
Dr. Anne Bradley: I think this is a great question and so important in terms of where we are now in American politics, there’s a couple of things that I think are important to talk about here. The first I want to talk about is just the age group that seems to be more inclined to support the ideas of democratic socialism, whether they’re represented by Bernie Sanders or other American politicians who represent this kind of idea. Why is it that younger people are more likely to be enamored with the idea of something called democratic socialism? I think the first aspect here is very interesting for us that are older than 29 to keep in mind, which is last fall we celebrated 30 years of the fall of the Berlin Wall.
That was a really pivotal time in American history and the Berlin Wall, keep in mind this was a wall designed to keep people in. And if we reflect on that, we realize how horrifying that is. People only need to be kept in with walls when the place they’re in is so bad that otherwise they would try to leave on a daily basis. And so the fall of the Berlin Wall and the fall of the Soviet Union and the breakout of Eastern European countries that happened in those years that we kind of reflect back on now. Many people in that younger age group, they weren’t alive to witness that. They didn’t watch it happen. They weren’t alive during the Cold War. I think that is important for us to keep in mind.
Those of us who witnessed it have a different perspective perhaps that communism and socialism are immiserating. They necessarily lead to violence and authoritarianism and many, many people of course – under the 20th-century experiment with large scale central planning from China to Russia, to the Soviet Union, to others – millions of people died. So we know that. We’re aware of that. I think that’s different when you live through it rather than reading it in a history book. So that’s one piece that I think is important and is telling about that particular age group and why they might be more inclined to support democratic socialism.
The second part of the answer to your question is to really break down what is democratic socialism. Because even Bernie Sanders himself is not advocating for outright communism. He is talking about democratic socialism and it’s the idea that somehow if we take socialism and we make it kinder and gentler, right, by putting the word democratic in front of it, the idea there is that the government is going to control more of the economy, more of industry engage in more economic redistribution, but it’s democratic, and so you’re not going to get the authoritarianism that we saw in the 20th century. And I think that’s why that label in particular is used. Note that Bernie Sanders and AOC and others are not advocating for outright communism or outright socialism. They’re talking about a “kinder, gentler socialism,” when the people in power, if they have too much power, if that becomes a problem, then we can kind of use the democratic process to eject them from office. I think that is a narrative that’s being spun.
The third part of my answer to your question is we need to tackle that narrative. So what economics helps us understand, and I think what history helps us understand is that there really is no such thing as democratic socialism. Socialism is the public ownership of the means of production, which means the government, run by bureaucracies and people who have power tell others what to do and when and how much, rather than a market economy, which is the decentralized ownership of the means of production so private individuals own the means of production and they decide what they’re going to produce, where they’re going to work, etc. And so, it’s a top down versus a bottom up.
The reason that I get very concerned about the label democratic socialism is because I think it puts this soft side onto socialism because I think that the very people who are advocating for democratic socialism understand the danger in using the word socialism. I think socialism is just socialism and it always leads to tyranny and it always leads to greater levels of government power. And because people don’t fall in line with what the government tells them to do when you have public ownership of the means of production, you have to use force. And so there really is no such thing as democratic socialism. I think those are the three ways that I would answer your question. I think there’s these different parts to it and we have to understand all of that together to really understand why, especially young people today seem to be enamored with this idea.
I do want to talk about another narrative that we often hear and that is leaders like Senator Sanders using Nordic countries such as Denmark and Sweden as examples of democratic socialism and where democratic socialism is working well. But even the Danish prime minister came forward to say Denmark is far from a socialist planned economy. Denmark is a market economy. So can you break down that comparison for us? Why is or isn’t Denmark or Sweden examples of this democratic socialism that they like to talk about?
Dr. Bradley: Absolutely. I think this is also very important because we need to have our facts straight. And this is why I really don’t like these terms, capitalism and socialism. Because I think the first problem with those terms is that when you say that term to someone, you don’t know how they define it in their own mind. And so, this is where we run into problems of the use of these words and what it means for people. So, it’s correct to say that Denmark, Sweden, Finland – these are not socialist countries. Why? Because of what we just talked about before. In a socialist society, the government owns the means of production, which means the government is going to decide who the farmers are going to be, who the engineers are going to be, who the manufacturers are going to be.
And they are going to also give, those industries quotas. They’re going to tell them how much to produce. All of those things are part of a socialist economy, which is top-down economic planning. Remember, the planning starts at the top with technocrats, experts, bureaucrats, and they’re supposed to understand how to do this. And then they just tell people what to do. People comply. And then the goal is that you’re supposed to get abundance out of all of this. And of course, we know that’s not true. So that is absolutely not what’s going on in a country like Denmark. In fact, if you look at the data, Denmark is a country that has a lot of what we call economic freedom.
I really like to use the economic freedom of the world report and that index, which is empirical data that helps us grade a country in terms of how people are able to live. Are they able to open businesses? We’re really trying to measure voluntary exchange. And if you look at countries like Denmark and Sweden, they score in the very top of economic freedom. And it’s because they don’t have government bureaucrats directing every aspect of the economy. In fact, in Denmark, it’s very easy to open a business. I think where the confusion lies is this, in a country like Denmark, also true for Sweden, there’s a lot more income redistribution. So in other words, the citizens of Denmark, pay much higher tax rates and in return for those tax rates, they get more of what we would call public goods or public benefits. Things like, a year of paternity and maternity leave and guaranteed vacations in the workplace, maybe guaranteed daycare, these types of things, guaranteed healthcare, those can only be financed when you have a pretty significant tax rate that all people are willing to pay.
I think when we look at that, some people tend to confuse that with socialism. I would not say that’s socialism at all. I think it’s a mistake to call that socialism. It’s big government. It’s lots of redistribution. Here’s the other thing that I would caution all of us about – Denmark has a population roughly about the size of Manhattan. And so it’s a lot easier to get the political will to engage in those high levels of tax rates when you have a small homogeneous population, which we do not have in the United States. We have a very large population and we have a lot of diversity in our population because we are a nation that has been founded on immigrants, people from a variety of different countries and cultures coming to the melting pot. Therefore, it’s going to be a lot harder to get the political will for people to agree to those very high tax rates.
We can see in our own country that hasn’t worked very well. The people who are proposing more government spending and things like this, kind of always have to answer the question, well, where is the money going to come from? We don’t have the money to pay for those programs. So not only are they not socialist, I think that the way they engage in income redistribution is very different from what goes on in the United States. I also think what they want to do would be impossible in the United States because we’re a much larger country.
What would you say we should be doing to teach Americans, and especially young Americans, about what democratic socialism actually means, and try to give them a better understanding of that term?
Dr. Bradley: This is a great question. I think the first way I would answer this is to say – and of course I’m biased, I’m an economist – I think we all need to go back to the very basics of economics. It’s not very complicated, but there’s some very basic principles in economics that would help us understand whether democratic socialism is a good idea. I think we need to be equipping our students – and beyond our students – we need to be equipping everyone with what are those basic principles of economics. One of the most important principles of economics is that we live in a world of scarcity. No matter what type of economic system someone is advocating for, that has to be the first recognition. We live in a world of scarcity and so, we’re going to have to make trade-offs.
And in that type of world, the other thing that we have to figure out is who is going to be the best at doing what? And the only way to figure that out is through a discovery process that’s very decentralized. Markets provide an environment in which people can test their ideas and through entrepreneurship those ideas get tested by consumers with this feedback mechanism that goes directly to entrepreneurs. And so, that’s how I would start the conversation about this idea of democratic socialism. I think we have to go through some very basic economic principles. And then, when we have those under our belt, then we can say, okay, in an imperfect world, what system is best at affording ordinary people the best possible lives they can have?
Right? So note how I phrase that question. We’re not looking for utopia because that cannot be found in a world of scarcity with imperfect people. So utopia is off the table, but rather we’re asking what system allows ordinary people to flourish? And if we look at that, then we can say, okay, what do markets do? What do they do well? What are their imperfections? What do governments do well and what are their imperfections? And the big difference here is that governments do not know how to allocate resources effectively because nobody knows how to allocate resources effectively. That has to be discovered.
During a pandemic like we find ourselves in, we hear a lot of people talking about the nationalization of some industries and stronger safety nets. As an economist, what is your reaction to that kind of response? Are there alternatives?
Dr. Anne Bradley: This is a great question, and I would say this is the exact wrong thing to do in a time of crisis. The first thing you should do is go back to your principles, kind of what we were just discussing in the last question. We need to start with our principles because no matter whether you’re in a pandemic, not in a pandemic, in a state of war, not in a state of war, in a famine, not in a famine, whatever the situation, whatever the crisis may be, the principles always remain. So, we have to start there and what are those principles? They’re what we’ve been talking about –large government bureaus don’t know what to do. I think with the COVID situation, there are really good examples of this.
For example, right now when the average American goes to the grocery store, they might have a hard time finding toilet paper and they might have a hard time finding bleach and cleaning supplies and they might have a hard time finding things like hand sanitizer. Those are at the top of the list and that’s a problem, and we know that that’s a problem. When you have this kind of supply and demand problem, you have to ask the question, who figures this out and how do they figure it out? Well, what we should be astounded by in the COVID crisis, and I think that this is kind of the ray of hope, is when you’re living in a country like the United States, those grocery store shelves may be cleared out every night by 11 p.m., but you know what’s astounding? They’re restocked every morning.
Now you might not have toilet paper every morning. Maybe it’s every other morning and you might have to wait a week for hand sanitizer, but you get it. In a socialist or communist economy, the stores are never stocked. This has been the case in Venezuela for years. It was the case in the Soviet Union for 80 years. The stores are never stocked. Why? Because the right incentives for entrepreneurs to discover what people need and to get moving very fast to give them what they need – those incentives, those structures are not present. So I would say COVID is just a time when we need to say what are the principles? The principles are, we need entrepreneurs now more than ever. They’re going to give us hand sanitizer. They’re going to speed up the production of toilet paper. But more importantly, they’re going to give us vaccines. They’re going to give us more tests. They’re going to give doctors the PPE equipment that they so desperately need. So we need markets now more than ever. If we nationalize business and industry, we will continue to have shortages and those shortages won’t be refilled. I think that economics is very clear on that.