Socialism or lack thereof in the US (split from Christine O'Donnell)

Started by Hunter, September 21, 2010, 06:51:08 PM

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RubySlippers

What is wrong with Socialism? I'm an army bvrat whose father was stationed all over the world. I've been in most of these nations. And there are good things about Socialism. Its odd to me most of these nations still have a free market, fair open elections with many parties and defensive militaries but have things I liked:

1. Free education K-Doctoral levels for every child based on aptitude if your low income in the Netherlands but academically gifted they send you to college its not based on ability to pay. And if your gifts are not there you learn trades in most nations Germany impressed me in that a friend was learning to be a machinist in secondary school. And had a job in his fifth year he kept after his externship earning a decent wage. I like that they are realistic in education.

2. National health care often channeled through private companies and providers.  :o (Medicare, Medicaid and the Veterans Administration are Not in the US?)

3. Social welfare programs that help the poor be comfortable if this is needed.

4. They prefer to talk to people and work with others before considering war, leaving that as the last option.

And I noticed most have people I would call very comfortably well-off to wealthy so its clearly not hurting everyone with money.

Jude

 Look at Greece if you want a strong example of the dangers of Socialism.  It leads to a burgeoning public debt which actually becomes a problem when you lack the capability to grow your GDP faster than your debt.  The United States is in great shape compared to most European states and even Canada, especially when you look at Implicit Debt, and we still do as good -- if not better -- than other states which trend further in the direction of Socialism (especially considering they don't have the world police expense we do).

Sustainability is key in government, especially in a global economy.  When you offer more social services tax increases naturally follow, resulting in businesses moving to more hospitable climates.  Lost business means lost jobs, which is a double loss of tax revenues, and more people dependent on the state.  Less tax revenue to pay for more government dependents means significantly more debt...  As you see, it's easy to cause a snowball effect and destroy your entire nation's economy.

Oniya

Most economic models, like most models of government, work rather well in theory.  The problems that exist can and will be revealed on application, especially as the group that they are applied to gets larger.
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Vekseid

Quote from: Jude on September 24, 2010, 07:15:30 AM
Look at Greece if you want a strong example of the dangers of Socialism.

Hardly. Greece doesn't have control over its own currency, so it can't devalue its currency in order to better handle its debt. It certainly has issues with socialism, but the Euro is a magnifying lens on those issues, and it's difficult to evaluate its situation without noting that.

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It leads to a burgeoning public debt which actually becomes a problem when you lack the capability to grow your GDP faster than your debt.  The United States is in great shape compared to most European states and even Canada, especially when you look at Implicit Debt, and we still do as good -- if not better -- than other states which trend further in the direction of Socialism (especially considering they don't have the world police expense we do).

Sustainability is key in government, especially in a global economy.  When you offer more social services tax increases naturally follow, resulting in businesses moving to more hospitable climates.  Lost business means lost jobs, which is a double loss of tax revenues, and more people dependent on the state.  Less tax revenue to pay for more government dependents means significantly more debt...  As you see, it's easy to cause a snowball effect and destroy your entire nation's economy.

Which explains why America sucked so much when the top tax bracket was 90%.

...oh wait, America was outproducing the entire rest of the world combined. Mostly locally, too.

Mayhaps, it has to do with the fact that not everyone with brains and ingenuity is a greedy bastard and that people who get their knickers in a bind when asked to perform a social responsibility and move elsewhere or otherwise go 'John Galt'... do so, and the rest of the world (or nation) passes them by while they throw their little hissy fit?




If the top 5% of the population earns 25% of the nation's income and is responsible for 15% of the spending (roughly the current situation), that means that they are accumulating 10% of the nation's income per annum.

If that amount exceeds GDP growth, the lower classes will become poorer unless something is done:
1) They can invest in businesses, but the stock market does not hold a great deal of trust right now.
2) They can let the banks invest their savings, but banks aren't lending
3) They can let the government invest (take on debt), but people are suddenly developing a sense of pride in forcing the lower classes to suffer
4) They can get taxed and have that money circulate lower
5) They can simultaneously develop a sudden sense of charity.
6) The lower classes can, alternately, invoke a new standard of currency and suddenly the wealthy aren't, anymore.

If 1-5 don't happen, 6 will, put simply.

Jude

Quote from: Vekseid on September 24, 2010, 02:06:28 PM
Which explains why America sucked so much when the top tax bracket was 90%.

...oh wait, America was outproducing the entire rest of the world combined. Mostly locally, too.
1)  While a 90% tax rate for the top tax bracket is punitive taxing and excessive, it is not Socialism within and of itself.

2)  Because overseas markets were completely devastated in World War II and hadn't yet caught up to American conditions, the Global Economy wasn't functioning at the time and there were no few free trade agreements.  We got by with a lot of policies in the past that simply do not work in a functional global economy where corporate transition is so easy and being rich in any number of countries is equally as luxurious because America exports every one of its greatest innovations, basically sharing the intellectual property behind them in the process.

The market produces the funds which the government sustains itself off of, policies which are openly hostile to the market will eventually effect the bottom line.  I'm not saying you can't raise taxes on the rich and businesses a little -- you can, we should, and we have to regulate too -- but the amount of sweeping change that a push toward real Socialism requires is very destructive.

It isn't that Socialism falls apart because it fundamentally can't work, that's not what I'm arguing.  If you could somehow get businesses to be OK with operating on smaller profit margins and convince the rich to tolerate a higher tax rate, thereby lessening the wealth accumulation of the upper class, then it would function just fine.  That's just very unlikely if not impossible in the world we live in.

Ending free trade agreements could cause a fundamental shift in the dynamic, but if you'd want to survive as a Socialist country after that, it means getting ready for the Iron Curtain (at least economically).  I think it's a step backward, not forward.  The Global Economy, in its current state, is more of a transition than anything.  Where we are headed is another point of contention, I'm sure.

Vekseid

Quote from: Jude on September 24, 2010, 05:05:05 PM
1)  While a 90% tax rate for the top tax bracket is punitive taxing and excessive, it is not Socialism within and of itself.

If enacted at the same level today, it would only impact those making $65 million or more per year. It is most certainly not excessive, it only occurs after reinvestment expenses after all. If you're going to sit on a huge pile of cash, use it or lose it.

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2)  Because overseas markets were completely devastated in World War II and hadn't yet caught up to American conditions, the Global Economy wasn't functioning at the time and there were no few free trade agreements.  We got by with a lot of policies in the past that simply do not work in a functional global economy where corporate transition is so easy and being rich in any number of countries is equally as luxurious because America exports every one of its greatest innovations, basically sharing the intellectual property behind them in the process.

This doesn't address my point. The land they were holding doesn't disappear, neither do their workers or the skillsets of said workers. Letting those skills atrophy (like we are doing now) is a far worse situation.

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The market produces the funds which the government sustains itself off of, policies which are openly hostile to the market will eventually effect the bottom line.  I'm not saying you can't raise taxes on the rich and businesses a little -- you can, we should, and we have to regulate too -- but the amount of sweeping change that a push toward real Socialism requires is very destructive.

The government defines the currency and prints as much as it wants. This printing - a unit token representing an amount of labor to be exchanged for in the future - is our currency. Its value is determined by its ability to be exchanged for value. We don't have taxes to leech off the market, we have taxes to prevent runaway inflation.

If that system breaks down, then the the rich have nothing. They go from being wealthy to being worthless.

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It isn't that Socialism falls apart because it fundamentally can't work, that's not what I'm arguing.  If you could somehow get businesses to be OK with operating on smaller profit margins and convince the rich to tolerate a higher tax rate, thereby lessening the wealth accumulation of the upper class, then it would function just fine.  That's just very unlikely if not impossible in the world we live in.

It happened before. You're singing one tune now, but ten more years of this will change a lot of opinions. People seem to have this implicit assumption that the poor will just up and let their families starve without complaint.

Some of them - Buffet, Gates, Grove, Immelt - are quite acutely aware of this and are trying to do something about it. But the normal methods by which they could act have been completely and utterly disrupted, so they have to intervene by directly building manufacturing here again.

So they are.

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Ending free trade agreements could cause a fundamental shift in the dynamic, but if you'd want to survive as a Socialist country after that, it means getting ready for the Iron Curtain (at least economically).  I think it's a step backward, not forward.  The Global Economy, in its current state, is more of a transition than anything.  Where we are headed is another point of contention, I'm sure.

We're not in a transition depression, so I'm not sure what sort of transition you are referring to. The economic crisis is now and always was a liquidity crisis - the poor don't have money to spend. An economic transition is where one sector of the economy is rising as it disrupts another sector faster than it can rise - that isn't happening.

Synecdoche17

Quote from: Revolverman on September 22, 2010, 05:00:10 PM
The Government acting as a bank of last resort is closer to Mussolini's Corporatism/Fascism then Capitalism though.

It's certainly not capitalism, but it is NOT fascism. The government acts as a bank of last resort in virtually all countries around the world - find me one country without a national Reserve, for instance. Yes, these agencies generally limit their function to finance, but only because finance is a complicated and vital industry. You can bet your bottom dollar there's similar bailouts for manufacturers in countries where those industries are vital, regardless of the countries' nominal allegiance to capitalism, socialism, etc.

Claiming that government "last resort" actions are close to fascism is like saying vegetarians are Nazis, because Hitler was a vegetarian!
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Jude

The majority of Americans aren't starving though.  The majority of people are just fine; look at the Tea Party for instance.  They're screaming bloody murder but if you look at Demographics they're actually better off than the average citizen.  The people who are yelling the loudest and actually seem like they're on the verge of revolt are not those who are actually suffering.  Compared to other nations, we're still very affluent and stable.

This citizen uprising that you hint at reminds me of the inevitable proletariat revolution that Marx claimed was coming.  It never really happened, and the only events that even mimicked it basically ran in complete opposition to his theory:  whenever Communist revolutions took hold they simply transitioned back into typical power dynamics where the Proletariat leaders became the Bourgeois Elite.  Nothing really changed for the better.

I understand that the wealth of the rich only counts for something because the rest of society pretends it does.  That's why there's such intense fear of Communism/Socialism in the United States as well, it's been implanted in the culture by the rich and powerful by social and governmental campaigns that spanned the entire 20th century.  That does not mean that the rich are the only people who stand to lose if such a fundamental shift ever occurred.

For all the faults of Capitalism it's been a very effective engine of technological progress, and even Marx had to admit that it was an incredibly efficient scheme.  No other system has ever really been shown to actually work.  Look at China and Russia, and even Greece:  everything eventually defaults back to Capitalism in the end because it seems to be the best method for dealing with our imperfect world.  Capitalism isn't without its faults, but isn't that more of a reflection of what we have to work with than its failings?  We can do our best to guard against the failures we see coming with regulation and government intervention while keeping the market free enough to operate, and that's what the Democrats really support, not a shift to Socialism.

Scarcity is the fundamental problem of economics.  It's a dilemma that technology and sociological change will lessen with time.  Think about the human condition of 1000 years ago, and it's quite evident that they already have reduced the impact of scarcity.  Capitalism serves as a reasonably effective, albeit imperfect solution for the time being.  The transition we're undergoing is one of unification, sophistication, and elevation of the human race.  And if you consider the rate of progress, it's actually quite speedy.

Here's a simple example to tie up my thoughts:  imagine a group of staving orphans living across the street from a very rich man.  He never gives to charity, they are on the verge of death because they do not have enough food.  Is he responsible for this?  To me, it's quite obvious that he's not so long as his personal wealth was not acquired to their detriment.  What killed them is the fundamentally cruel composition of our world, not the fact that he has barrels full of apples that could've saved their lives in his wine cellar.  Hating the rich for being rich while other people suffer makes no sense to me.  Government's role is to make sure that the rich and powerful don't unfairly exploit other people in the process of amassing their fortune (i.e. he would be guilty if the orphans had no food because he bought their facility and started running it like a for-profit business).

There are those who are guilty of such things in the United States, I vote Democrat because they're set on stopping such abuses.  I also vote Democrat because they sometimes force the rich to do things which are good for them longterm that they don't have the foresight to see that way (i.e. raising taxes to create a healthcare policy that will make the US more able to compete globally).  This isn't Socialism, it's oiling the engine of Capitalism and keeping it functioning properly.  Left completely to its own devises, Capitalism is like a runaway train car.  It goes faster and faster without moderation until it runs into the wall and explodes.

Sadly, this is an ideology that even Republicans should be able to get behind, they certainly have in the past.  I believe I'm simply expressing progressivism, aka Glenn Beck's Boogieman.

Vekseid

Quote from: Jude on September 24, 2010, 07:50:04 PM
The majority of Americans aren't starving though.  The majority of people are just fine; look at the Tea Party for instance.  They're screaming bloody murder but if you look at Demographics they're actually better off than the average citizen.  The people who are yelling the loudest and actually seem like they're on the verge of revolt are not those who are actually suffering.  Compared to other nations, we're still very affluent and stable.

Citizens never improve their situation with violence unless they have massive extragovernmental support. I mentioned that it wouldn't necessarily be violent and I would point out that of the two political powers seeking a major overhaul of how this country operates - or at least claim to - it's the progressives who by far have more focus and organization. The Tea Party is barely coherent, and is a frequent target of fraud.

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This citizen uprising that you hint at reminds me of the inevitable proletariat revolution that Marx claimed was coming.  It never really happened, and the only events that even mimicked it basically ran in complete opposition to his theory:  whenever Communist revolutions took hold they simply transitioned back into typical power dynamics where the Proletariat leaders became the Bourgeois Elite.  Nothing really changed for the better.

I was actually referring to FDR's New Deal.

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I understand that the wealth of the rich only counts for something because the rest of society pretends it does.  That's why there's such intense fear of Communism/Socialism in the United States as well, it's been implanted in the culture by the rich and powerful by social and governmental campaigns that spanned the entire 20th century.  That does not mean that the rich are the only people who stand to lose if such a fundamental shift ever occurred.

I wouldn't care to see communism here myself. The issue is, people who are suffering become very vulnerable to charisma. The accusation of Obama being Hitler-like doesn't come out of nowhere, it's the reaction of a genuine and valid fear of a charismatic leader taking a country desperate for one off of a cliff. A charismatic leader gets enough of a majority behind him and anything can happen.

Fortunately or not, he has affected rather little actual change, despite his campaigning.

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For all the faults of Capitalism it's been a very effective engine of technological progress, and even Marx had to admit that it was an incredibly efficient scheme.  No other system has ever really been shown to actually work.  Look at China and Russia, and even Greece:  everything eventually defaults back to Capitalism in the end because it seems to be the best method for dealing with our imperfect world.  Capitalism isn't without its faults, but isn't that more of a reflection of what we have to work with than its failings?  We can do our best to guard against the failures we see coming with regulation and government intervention while keeping the market free enough to operate, and that's what the Democrats really support, not a shift to Socialism.

Scarcity is the fundamental problem of economics.  It's a dilemma that technology and sociological change will lessen with time.  Think about the human condition of 1000 years ago, and it's quite evident that they already have reduced the impact of scarcity.  Capitalism serves as a reasonably effective, albeit imperfect solution for the time being.  The transition we're undergoing is one of unification, sophistication, and elevation of the human race.  And if you consider the rate of progress, it's actually quite speedy.

You're referring to the trend that basic needs count for something like ten percent of this nation's labor right now and shrinking?

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Here's a simple example to tie up my thoughts:  imagine a group of staving orphans living across the street from a very rich man.  He never gives to charity, they are on the verge of death because they do not have enough food.  Is he responsible for this?  To me, it's quite obvious that he's not so long as his personal wealth was not acquired to their detriment.  What killed them is the fundamentally cruel composition of our world, not the fact that he has barrels full of apples that could've saved their lives in his wine cellar.  Hating the rich for being rich while other people suffer makes no sense to me.  Government's role is to make sure that the rich and powerful don't unfairly exploit other people in the process of amassing their fortune (i.e. he would be guilty if the orphans had no food because he bought their facility and started running it like a for-profit business).

Is he letting his land lay fallow while they starve?

That's part of the idea behind extreme tax brackets. Wealth is a token defined by society, and if he (and in the modern case, his banks too) does nothing but stick it under his bed, it's putting deflationary pressure on the outside world and that sort of thing leads to nasty surprises for people who think they have everything. Again, and I've said this before in the thread - it's not always violence. In the US, violence is not generally the way improvements get made, even.

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There are those who are guilty of such things in the United States, I vote Democrat because they're set on stopping such abuses.  I also vote Democrat because they sometimes force the rich to do things which are good for them longterm that they don't have the foresight to see that way (i.e. raising taxes to create a healthcare policy that will make the US more able to compete globally).  This isn't Socialism, it's oiling the engine of Capitalism and keeping it functioning properly.  Left completely to its own devises, Capitalism is like a runaway train car.  It goes faster and faster without moderation until it runs into the wall and explodes.

Sadly, this is an ideology that even Republicans should be able to get behind, they certainly have in the past.  I believe I'm simply expressing progressivism, aka Glenn Beck's Boogieman.

Honestly, I imagine he'll switch his tune eventually when his current audience starts going deaf to him. Anyone who speaks to a couple million people has visible impact, and it can sway a few percentage points on occasion, but this doesn't change the aging factors of his audience and those of his fellows.

Asuras

First, "socialism" is defined in many different ways. I suppose that the dictionary definition speaks of "government ownership of the means of production" which practically means excluding private enterprise from certain areas of the economy. In the US the common understanding is broader, encompassing government economic regulation in general, whether it's taxes, state-owned enterprises, or regulations. But I frankly don't care what it's called.

I ascribe to a utilitarian mentality - if the cat catches mice (to go off a Chinese saying) I don't care what color it is. The economic order should establish the greatest good for the greatest number over the long term. I don't give a lot of credence to arguments about "Does the government have the right to do this or that" or "This person had a right to this or that." What rights people have over their property should be determined exclusively by whether or not giving them such a right improves the welfare of the nation.

So for instance if a factory is polluting a local community and causing harm to the community, that won't be reflected in the owner's income unless the government steps in and taxes the factory for its pollution. That's called an externality. The government ought to step in and tax them for it. If the law makes the company pay for the harm it does to the community, then the company will effectively be making the decision "Does our business do more harm or good to the community?" That is good law.

Maximize opportunities so that people's talents aren't wasted. Subsidize education, health care, and housing. Provide affirmative action to counter prejudice. Get people on their feet so they can work as productively as possible. Provide strong law and order in their communities so they can do these things.

But at the same time I think that the profit motive is extremely valuable and in general the capitalist ideal can be trusted. People strongly respond to it and they work for it. The government should strive to make the profit motive and the national interest identical and it can work toward this through regulation.

So the government shouldn't impede the profit motive - punishing lenders (which currency devaulation does) or borrowers arbitrarily, for instance. It shouldn't take ownership of a company or an industry unless there are sound reasons for doing so.

RubySlippers

I have a different view any government has a prime duty to provide for the wants of all their citizend poor or rich. For me that includes freedoms but also real wants - minimal standards of housing, clothing, food, medical care, access to education and employment.

If we have homeless people and working poor struggling to get health care the government is not doing its job. And the government has a duty to fairly tax if needed to provide these wants but also should not unduly waste the money.


Vekseid

Do you mean needs, or at the very least, a guarantee of a minimum standard of living?

Just handing out candy is not going to fly.

Jude

I agree that if government can afford to, it should provide for people who cannot provide for themselves, I have a feeling this is a mainstream view even, but the devil is in the details.  There are people who are perfectly capable of working and providing for themselves that get government assistance, and it only takes seeing one or two of those people to lose your faith in the system on an emotional level, even if statistically things are just fine overall.  Unfortunately people are easy swayed by anecdotes.

I think mostly people would agree that if you can work and you choose not to, the state has no obligation to help you.  We only need to help those who cannot help themselves, everyone has the choice to survive but is choosing not to take it.

Then there is the question of what "surviving is" and just how forgiving/helpful we're going to be as a society.  Vekseid often talks about the debt traps people can find themselves into and how that can ruin their life, and I agree completely, but it all goes back to regulation.

If the government does its job in creating effective regulations, then the rest should be easy.

itsbeenfun2000

I don't think  you can call providing services as socialism. After all we have public education which was promoted by our founding fathers especially Ben Franklin because private education was too expensive for the common man. At the time health care was not but is today.


OldSchoolGamer

We don't have socialism in America.  An oversized government that regulates too much--and often the wrong things at that?  Yes.

Although quite frankly, I think we're in more danger of corporations co-opting government and using it as a puppet than we are with some sort of government takeover of industry a la Marxism.  I would say fascism is a far more likely "runaway government" outcome in America than socialism or communism.

Vekseid

We can thank the Constitution for not having fallen into it already. For all the idiocy being paraded about now, I am noticing that a lot of smart people are getting their act together politically and it gives me hope for the long run.

Salamander

Quote from: OldSchoolGamer on September 29, 2010, 02:01:10 AM
We don't have socialism in America.  An oversized government that regulates too much--and often the wrong things at that?  Yes.

Although quite frankly, I think we're in more danger of corporations co-opting government and using it as a puppet than we are with some sort of government takeover of industry a la Marxism.  I would say fascism is a far more likely "runaway government" outcome in America than socialism or communism.

I think that what you're afraid of has already happened, although we're not (yet) at the stage of actual fascism. It seems to me that the terrible disconnect between the people and their elected representatives that we see in the US and (to a lesser degree) Britain is a consequence of the Anglo-American model of capitalism. Basically, government is largely serving the interests of the corporations, and especially the banks and other financial institutions, rather than the interests of the general population. Unfortunately, the 'tea party' programme, if enacted, would only make things worse.

Its interesting (and instructive) that the citizens of countries that actually are significantly socialist- Sweden and the Netherlands for example- seem to be markedly less negative about their governments than folk in the US or UK.

Loke

I don't understand how the americans people can believe that the democrats are socialists, in my opinion the democrats are capitalist just like the republicans but not to the same extent. I myself am a socialist and I can't understand that anyone can talk agings it without feeling bad about it (just my opinion I'm not trying to pick a fight with you or be rude to you in any way, it's just my opinion).

Capitalism is a ideal based on greed, privatisation of everything that can be private, hospitals, dentists, schools and only the individual in mind, Socialism is an ideal that wants to give all people free he altcare, free denial care, free school and have a strong state controlling it, not greedy corporations all controlling one part of it.

I just can't get my head around it, don't people have any empathy or a conscience, Capitalism that gives the few rich percents of a country's population more money while the working class and singel moms work like animals for minimal waders to be able to afford to take their kids on vacation or get them in to a descent collage. Don't every person have the same social rights? don't every child have right to a good education? Should parents work like animals to be able to afford to send their children to a good collage?

Free social care, free schooling, free health care, no privatisation and help to the working class that keeps a contry on its feet. It's not giant corporations like Mc Donald's or Coca Cola that keeps a contry on it's feet's it's a strong and supported working class that does.

Quote from: Salamander on September 29, 2010, 01:00:56 PM

Its interesting (and instructive) that the citizens of countries that actually are significantly socialist- Sweden and the Netherlands for example- seem to be markedly less negative about their governments than folk in the US or UK.


I'm from Sweden and for the last 90 ears have we mainly have had a socialist leaning government, and look at the results! Sweden have great health care, free denial care until you are 21, schools that are controlled by the state and that does not cost you a singel krona (our currency) and you can get anywhere in life with that education. although our government have lost it's roots and have gone more and more to the right and started to privatised some of our health care we still have a good social structure on our contry.
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Salamander

All true, but you've left a few things out. Sweden is also extremely safe (murder rate roughly a fifth of the US), and has much better voter participation- 86% vs 54% in US general elections. The superior health care system is less expensive (9.2% of GDP vs 14.6% for the US), but delivers much better results- Life Expectancy is 80.9 yrs in Sweden, 78.2 in the US; Infant Mortality is 3.2 vs 6.3 (yep, thats right- babies in America are almost twice as likely to die before their first birthday than babies in Sweden- shocking, isn't it?). Sweden has an exemplary record on civil liberties, while America pretty clearly does not. Sweden is also more tolerant of minorities. For example, same-sex marriage is legal there, LGBT couples have the same adoption rights as anyone else, and the Swedish constitution bans discrimination on the grounds of sexual orientation. And...oh yeah...Sweden is even more socially mobile than the US.

For the very wealthy, the US is a great place to be- the country is essentially run in their interests. But for the remaining 90% or so of the population, Sweden is a far far better place to live. Ditto The Netherlands, Norway, Denmark etc. Sweden is a better place to live than my own country (the UK) too. So much for the evils of Socialism.

OldSchoolGamer

Quote from: Loke on September 29, 2010, 01:13:52 PM
I'm from Sweden and for the last 90 ears have we mainly have had a socialist leaning government, and look at the results! Sweden have great health care, free denial care until you are 21, schools that are controlled by the state and that does not cost you a singel krona (our currency) and you can get anywhere in life with that education. although our government have lost it's roots and have gone more and more to the right and started to privatised some of our health care we still have a good social structure on our contry.

Bear in mind most American conservatives cannot (or don't bother) to distinguish between the Nordic model of socialism (which does actually have a dynamic private sector) and the dismal state socialism once practiced by the Soviet Union and Eastern Europe, where the Bureau of Non-Home Meals runs storefronts and sets the price of a half-moldy cheeseburger at $1.50 and if you complain the secret police come to take you away.  These two models are quite distinct, yet the Tea Partiers lump them together.

I am a supporter of regulated capitalism (the means of productions are privately owned, but with public regulation and oversight).  The way I see it, the American economic model has five major shortcomings:

1) The wealth is no longer going to those who actually produce value.  One of the major talking points of free-market economics is that capitalism rewards those who produce goods and services of value, thereby encouraging them to produce more.  But with multimillion-dollar golden parachutes to CEOs bailing out of failed companies, and billions going to banksters who create phony (or at least rather questionable) "securities" like collaterized debt obligations and securitized mortgages, this incentive to produce is broken.  And in the meantime, the wages of the working class--people who undeniably produce value--have been stagnant or in decline for well over a decade now.

2) We have embraced free trade at all costs, rather than fair trade.  The free-market crowd claims competition is best, and for the most part I agree.  But the point the lassiez-faire crowd misses is that competitions have rules that all who compete must follow.  America has every right to tariff goods from countries that manipulate their currencies, bust unions, have lax or no environmental safeguards, and so forth.  We need to withdraw from WTO, GATT, NAFTA and so forth.

3) We have allowed our infrastructure and civic institutions (like our education system) to decline.  Whether it's gas pipelines in urban centers exploding, bridges collapsing, or student test scores falling, America has been underinvesting in infrastructure and education for quite some time now.  This is already exerting a drag on our output, and it's just going to get worse until the underinvestment is addressed.

4) We have allowed an excessive disparity in wealth to develop between rich and poor.  I differ from most Swedes in that I believe there is value in the rich being rich and those who produce being able to prosper...but there is a point of diminishing returns, and clearly America passed it some time ago.  Even Henry Ford, one of the richest industrialists of his day, recognized that the working class had to be reasonably prosperous for industrial capitalism to function.  After the "Reagan Revolution," we lost sight of that and figured that the more rounds of golf played per capita in the millionaire class, the more society as a whole would prosper.  Wrong.  We need to work at reducing the gap between rich and poor to a more productive level.

5) Much of the wealth and power America has today was built on the exploitation of non-renewable energy resources.  The trouble with market economics is that its view is myopic.  We aren't looking ahead, to the day that is no longer far distant when we're going to be looking at a permanent shortage of crude oil and coal.  Long ago, we should have begun taxing oil and coal and increasing levels, to get the market to put a premium on them and encourage development of sustainable, renewable energy resources.  At this point, we are going to need more direct government involvement to steer the economy away from these fast-dwindling resources, and to perfect permanent replacements, like wind, solar and thermonuclear fusion.

Loke

Old School Gamer -
You make some points but I cant get over "We have embraced free trade at all costs, rather than fair trade"
Fair trade is the human choice, it's ok to pay a bit more for a product if you know that those extra dollars goes to preserve the rainforest, help the survival of the tiger or helps a school in Africa to recruit more teachers to teach the poor children of Africa !
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Salamander

Hmm....I can't see that withdrawing from international trade agreements would benefit the US. More likely start a huge trade war, leading to further economic dislocation and decline.

The root of the problem is maybe the underlying worldview- the fundamental assumptions that most Americans seem to make about the way that things are. One of these assumptions is that free market capitalism is somehow 'natural' and that attempts to regulate it are somehow 'unnatural'. Which is of course pure unadulterated nonsense. Modern-day Capitalism is the product of history, just like all other socio-economic systems; free markets are no more or less 'natural' than regulated markets. The systems that we create reflect the values that we choose to prioritize, and the interests of those who hold positions of power. The US is geared almost completely to prioritizing short-term economic gain over everything else, including long-term investment. It is also geared towards serving the needs of the few and (at best) ignoring the needs of the many. Welfare in the US is mainly corporate welfare- bailouts for banks, pork for special interests, foreign policy objectives to suit the oil lobby. And this corporate welfare is paid for by ordinary citizens.

errantwandering

While we did indeed create the free markets, capitalism is indeed the most natural thing in the world.  Why?  Because in our hearts, just about every human being is incredibly self centered, and out only to benefit himself and those he cares about.  Capitalism plays off of this fact by incentivizing working hard and being better then everyone else, thus boosting production by harnessing our own inherent avarice.  Indeed, a lot of the social programs that are in decline short-circuit this basic principle, and thus tend to fail when put up against their private counterparts.  Just look at most private schools, a capitalist program, vs public schools, a socialist program.  They outperform their counterparts in just about every conceivable way.

This isn't to say that complete deregulation is a good thing.  People are by nature avaricious, and so they will try to take advantage if they can.  The capitalist system only works if there are options, competition.  If one company gets to be so big that there is no competition, or if there is collusion, where they are working together, then they will cut costs wherever they can to make a profit, thus hurting their workers and the people who need their products.

Jude

Monopolies aren't the only danger of capitalism:  the prisoner's dilemma highlights another.  When everyone competes, there isn't always a winner.  Sometimes everybody loses.

Vekseid

Quote from: errantwandering on September 29, 2010, 11:37:58 PM
While we did indeed create the free markets, capitalism is indeed the most natural thing in the world.  Why?  Because in our hearts, just about every human being is incredibly self centered, and out only to benefit himself and those he cares about.

Hardly. People have a natural inclination to altruism for the most part. It's only in times of desperation or delusion where that changes.

Quote
  Capitalism plays off of this fact by incentivizing working hard and being better then everyone else, thus boosting production by harnessing our own inherent avarice.  Indeed, a lot of the social programs that are in decline short-circuit this basic principle, and thus tend to fail when put up against their private counterparts.  Just look at most private schools, a capitalist program, vs public schools, a socialist program.  They outperform their counterparts in just about every conceivable way.

Have any studies accounted for economic and family factors? People tend to buy their schools, which has an enormous impact.

Quote
This isn't to say that complete deregulation is a good thing.  People are by nature avaricious, and so they will try to take advantage if they can.  The capitalist system only works if there are options, competition.  If one company gets to be so big that there is no competition, or if there is collusion, where they are working together, then they will cut costs wherever they can to make a profit, thus hurting their workers and the people who need their products.

It's my experience that the avaricious trait accounts for a tiny fraction of the population. Even less so amongst those who actually drive invention and production. But they exist, so they have to be accounted for.