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By Tom Cushing

What's in a name?

Uploaded: Oct 21, 2015

... That which we call a rose,
By any other name would smell as sweet."

Not to say that the politics of the Montagues and Capulets weren't fierce, but would Juliet feel the same way about voting for an avowed Socialist?

That's the stake that Bernie Sanders is placing -- that he can overcome that label on his way to the Democratic nomination and the Presidency. Far from shrinking from it, he has embraced the term to describe his candidacy. It's an unorthodox move, and consistent with his thirty years in office.

But is it true, and what does it all mean?

The term ˜socialist' has long been radioactive in American politics. It is considered to be a first cousin to communist, with all the leftover baggage of the Cold War and bygone McCarthy era witch hunts. Politically, the ˜socialist' label is used as a pejorative, to discredit policies and delegitimize candidates. It's like ˜librul,' only a lot more so.

It was flung improvidently to the current inhabitant of the people's house, usually preceded by the term "Kenyan." The term did not seem to stick adequately in that case (Mr. Obama was re-elected, after all), but for a candidate to actively adopt it, as Mr. Sanders did in last week's blessedly issues-focused debate, is counter-intuitive, to say the least.

My Econ major's understanding of socialism is that it consists primarily of government ownership of the major institutions of the society, including its economic means of production, and some manner of centralized planning of the economy.

Pure capitalism, by contrast, entails private ownership and conduct of most important things, and heavy reliance on the market's ‘invisible hand' to maximize performance and the general welfare. As such, they are very different ways of organizing the society, and defining the relationship between the public and private sectors.

So, is ol' Feel-the-Bern really an economic socialist? Let's look at his actual policy proposals to seek answers, especially in those areas linked to matters economic.

Income and Wealth: Sanders favors raising taxes on the wealthy and trying to repatriate corporate overseas earnings. He has been coy about by how much, but he clearly has in-mind another hot-button for The Right: '€˜wealth redistribution,' which The Left calls '€˜paying one's fair share' -- so we have dueling sound bites.

But #socialism? The marginal personal tax rate was as high as 92% applied to exceptionally large incomes during the Eisenhower Administration, and he was nobody's socialist. We may safely guess that the Sanders rates â-- if they could be achieved via legislation, would be substantially less than that.

Of course, rates themselves say very little about what percentages actually get paid. The tax code contains more than 72,000 pages of dodges. And they are ably applied to the famous point that a billionaire's assistant can pay a higher percentage than her boss. 'Tis said that IRS officials go home at night -- CPAs do not.

This issue is actually pretty popular among Democrats, having finally found some traction among the governed. Sanders' proposal is neither confiscatory nor an outlier among Dem candidates.

College Tuition : it's notable here that a majority portion of the US education system is already publically owned and conducted -- at both the K-12 and college levels. In our mixed system, some goods and services are seen to have a sufficient ˜public benefit' that we are expected to pony-up for them, regardless of our individual usages. They are investments in our collective future. Public education has been around since the days of Horace Mann in the 1830s.

Sanders advocates treating, and funding undergraduate college much the same as K-12 -- free to students. He would pay the tab via a tax on financial transactions -- purchases and sales of stocks in the speculative casinos of capitalism. He considers the proposal to be an extension of the present approach -- a bow to the evident needs of the 21st century world. Of course, funding by securities sales implies continued private ownership of companies, in contrast to the socialist model.

Bernie would also substitute the federal government for the banks in issuing and pricing student loans, for the same reason as above. This step would, indeed, replace private sector lending with government funding; as such it is socialistic. Frankly, for the '˜investment' rationale above, I'm okay with that.

Campaign Finance: Sanders would work to overturn the (wretched) ‘Citizens United' Supreme Court decision that auctions political offices and influence to the highest bidders. While some might call the current approach the ultimate 'free market of ideas,' democracy was never meant to be a financial bazaar. The marketplace competition is supposed to be in the ideas themselves -- most of which get drowned in a flood of spending by well-heeled individuals. Our representatives should be '€˜unbought.' Today, they are the wholly-owned subsidiaries of 166 wealthy pipers who fund campaigns, and call tunes.

This Sanders position stands for the separation of either economic system from the fundamental electoral process of small-d democracy. It is anti-oligarchic, but not socialistic in an economic sense.

Jobs/Wages: Sanders would seek to raise the federal minimum wage to $15/hour by 2020. The federal number of $7.25 has lagged twenty-nine states and many cities (LA, Chicago, SF, Seattle), which have announced similar moves. The purchasing power of the min wage peaked in 1968, at about $8.54/hour. 73% of Americans, including a majority of Republicans, favor raising it, at least to more than $10/hour.

Now, the minimum wage, first enacted federally in 1938, is clearly a socialistic response to employment markets in which some desperate folks would literally '€˜work for food.' It establishes the economy's minimum decencies as to wages. Dire economic assumptions about throwing low earners out of work, and the mythology that it is a '€˜gateway wage' for youngsters have just never stood-up to actual scrutiny. So it's socialism, all right, but also firmly entrenched in the culture.

Is $15 the right number? It was chosen because it is slightly above the so-called poverty line for most families. Regardless, it represents a difference of '€˜degree,' rather than ‘kind.'

Rights of women, racial minorities, LGBT citizens: to summarize these points inadequately, they concern primarily social issues, such as contraceptive coverage and equal pay for women, and freedom from physical violence, voting disenfranchisement, and job discrimination against minorities.

Anti-discrimination laws and policies are theoretically socialistic, I suppose, in that they countermand unfettered freedom-of-choice -- as by employers in the hiring marketplace, or landlords of apartments. They are also deeply woven into the American fabric, at least since the 1964 Civil Rights Act.

Climate Change: The website is a bit spare here, but unsurprisingly, Sanders favors a carbon tax, opposes the Keystone Pipeline, and voted to secure federal grants for greenhouse gas reduction (I think these encourage solar paneling).

Frankly, a true socialist might've gone much farther -- say, by nationalizing the utilities or even the car companies to promote a cleaner agenda, sooner. The above proposals and record are pretty mainstreamy on his side of the aisle.

Wall Street Reform: Sanders calls for re-establishment of the separation of banking from speculation that ended with repeal of the Glass-Steagall Act in 1999. He wants to break up the Big Banks -- '€˜too big to fail' means ‘too big to exist.'

These are unabashedly liberal policies, but they go to reforms to a regulatory system that is distinctly, rapaciously capitalistic. Reinstatement of Glass Steagall is hardly radical-- it just requires banks to avoid risking depositors' money on speculative adventures; it posits that banking should be a boring servant of the value-adding economy, rather than a master of the universe.

And breaking-up the banksters is mostly a matter of antitrust law enforcement. Those are laws in-place since 1890. They address market failures, rather than replacing markets themselves.
A true socialist would move toward public ownership of financial institutions, rather than tinkering with the existing, market-based system.

Prescription Drugs: Here Bernie would allow Medicare to negotiate drug prices for seniors paid-out by the program (from everybody's taxes); he would also open the US market to Canadian drugs, remove restrictions on generics and require pricing transparency.

Each of those concepts is distinctly capitalistic -- they all go to improving market circumstances for consumers, rather than replacing markets themselves. Medicare payments are made out of everybody's money, broader markets mean more competition, and even Milton Friedman would agree that competitive market models assume transparency -- what the econ wonks call "€œperfect information."

None of those reforms exists today, but all of them are predicated on a market economy, and a reduction in artificial imperfections leading to so-called monopoly profits. Adam Smith would be proud -- Karl Marx, not so much.

Okay, so Mr. Sanders' policies must surely be a disappointment to the radical socialists among us, Kenyan or otherwise. So, if his proposals are so tepid in that regard, why does he embrace the socialist label?

More on that next time.