Columns » Ernest Dumas

What socialism?



Scary times always breed popular delusions and this season's is socialism. Creeping government control demolished the economy and now the socialists are using the crisis to finish the conversion from capitalism to a socialist state.

The letters to the big newspapers are full of this nonsense, and it is the mantra of Republican candidates for everything from county judge to Congress. Up in Northwest Arkansas, Republicans are accusing each other of being "incremental" socialists. John Boozman, the bland GOP nominee for the U. S. Senate, is supposed to be one of those — he voted for the big bank bailout, is a ravenous pork barreler and supports big subsidies for rich farmers — although he has declared himself foursquare against socialism.

The oldest definition of socialism is government ownership of the means of producing goods, and an advanced form of it would include the means of distributing the goods.

The truth of our circumstances is exactly the opposite if the opposite of socialism is corporatism, which is management of the economy and society by large industrial and commercial organizations. That is the drift of modern U.S. history, at least the past 30 years, and it has come at the hands of Republican and Democratic administrations and Congresses. It proceeds at only a slightly diminished pace under President Obama, who is accused of being a socialist agent.

Corporate money, in the form of political contributions and lobbying, is the dominant influence on public policy. It still is even amidst the popular hysteria against Wall Street, bankers everywhere and the two automakers that got the big government rescue in 2008 and 2009. What else would explain Congress's refusal last month to close a giant tax loophole that allows hedge-fund and private-equity managers, some of the richest corporate profiteers in the world, to treat their massive earnings as capital gains and pay a rate less than half of what ordinary people pay in federal income taxes? The Senate caves in because Republicans and Democrats get huge sums from hedge-fund managers and other financiers who benefit from it.

Is this a coincidence? The big beneficiaries of tax favors and the general largesse of government subsidize the propaganda about rampant socialism, including its peak during the crusade against elements of the health-care reform legislation last year, mainly the public option to private health plans.

What about the health reform law? Socialism? Obamacare, as the Republicans like to call it, is the corporate solution to the health crisis, and it has been since 1974, when Presidents Nixon and Ford and the Republican congressional leadership proposed it. The central feature is that people who don't have health insurance will be herded into buying it from the insurance industry. There is a little bit of social planning in the law — the companies will have to spend 80 to 85 percent of the premiums they collect from people on actual health care and give the money back to people if they spend less. The industry has one big hang-up with the law. Insurance companies don't think it imposes a stiff enough penalty on people to make them buy policies from each state's menu of commercial plans, and they may be right. They would like a stronger government hand.

The economic crisis, now two and a half years old, is the product not of advancing government control but the gradual surrender of every kind of government supervision of financial activity that kept the country on a stable path for the half-century after the Great Depression.

The gargantuan deficit that scares the daylights out of the tea party? Same story: Corporate dictated tax cuts that lowered marginal rates on the wealthy to the next lowest level since the 1920s, two costly wars that produced the greatest corporate profiteering in history and an expensive Medicare expansion written to help the big drug companies and insurance companies and deplete the Medicare trust fund.

The most hair-raising evidence of the trend is the day-to-day destruction of the Gulf of Mexico, the result of a hands-off policy by the government that put the corporate needs for profits, in this case poor British Petroleum, over the health of the environment. The Interior Department under George Bush and, yes, Bill Clinton and Barack Obama, approved a categorical exclusion from environmental scrutiny for deep-water wells that would do little for the nation's economic vitality but put the sea and everyone around it in great peril.

The evidence is everywhere. The "socialist" Obama submitted legislation that is apt to result in the privatization of public housing in America, a potential bonanza for private developers and banks. That is the conservative ideal: No public good, just private goods.

That, not socialism, is the truth of things in America.

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