Jun 3 2009, 8:55AM
What Socialism Looks Like
Have you heard that the United States is headed toward socialism? Jonah Goldberg says it is. Alabama Senator Richard Shelby says it is. Phyllis Schlafly says it is. Richard Viguerie says it is. The Republican National Committee says it is. We must be getting pretty close.
How close? This is what socialism looks like:
The hot-pink portion of this pie chart is the percentage of listed
American business assets that have recently been nationalized by the American
government (ie, General Motors). Obama's version of
socialism is so sneaky you can hardly see it!
(And there is some reason to think this actually overstates the portion of the corporate landscape that's been nationalized, but more on that at the end of the post.*)
If it were, 99.79% of the American corporate assets that existed at the start of the Obama administration would not remain in private hands. The differences of degree are so small that they aren't worth mentioning. And yet, somehow, they keep getting mentioned.
Update: A couple of commenters have asked for a different chart, so I've posted another item on this here.
Update 2: For something that resembles socialism more closely, you might check out Sarah Palin's state of Alaska.
---
*(I'm using asset information from the US flow of funds account. This chart is basically an updated and modified version of one I did for the business site, using slightly different data and a slightly different metric. There were some very thoughtful criticisms of that chart, so I decided to make a new one using asset information.
That said, this measure isn't perfect. I'm excluding a lot of assets -- households, farms, the financial sector -- in part because there's no precise data (see here for more) and in part because I want to avoid the same assets being counted twice. And I don't include liabilities. Please let me know of other methodological suggestions in the comments section.)
This may be a useful corrective to the silly ravings of the right, but in reality it only confirms our greater national delusions concerning the public/private or government/market dichotomies.
By many conventional estimates the "government" accounts for over 40 percent of the "economy," but it is hardly clear what this means. Economies do not stop at national borders and governments maintain all fiat currencies and property laws through which "economies" operate, to point out only the obvious. In our recent troubles, the legal status of the Federal Reserve as a private institution and the revolving door between government jobs and, say, Goldman Sachs have made these specious distinctions even more absurd.
I have never yet heard anyone who touts the superior efficiency of "free markets" provide an example of this metaphysical entity that is not supported, stabilized, institutionalized, defined, and operated through a complex system of supposedly "inefficient" government structures. The only thing approaching an international market system, as far as I know, it the illegal drug trade. The unmentionable dichotomy between an investor class and those who rely on wages is far more realistic than the government/market paradigm used to fog the issues.
Well articulated. I agree completely, Nelson.
ok this is a bit late in the game, but just b/c your assertion has not been addressed, let me be the first 'free market' advocate to provide a simple example.
Free Market:
Sumerian#1 walks into a market with a bushel of wheat (they developed currency at some point, but since socialist/communist/left-anarchist minds tend to embrace barter, lets use this example, shall we?)
Sumerian#2 exchanges a measure of beer -equivalent in value to the bushel of wheat- for the wheat.
[How do they know the value is equivalent? Consensus! I.E. the exchange will not occur if they can't agree]
Free Market (con't):
Sumerian#1 decides he can make more exchanges by staying at the marketplace, and proceeds to open a 'business' for the exchange of wheat.
Sumerian#2 walks by again, sees the business and exchanges his beer in the same manner as before. Only now he knows where to go to make the exchange and no longer relies on random chance meetings with #1.
Viola. The metaphysical entity has emerged into view.
Now the ruler smells money and proceeds to levy a tax on trade conducted in his territory. This is the origin of all that "support, stabilization, institutionalization, definition, and operation through a complex system of supposedly 'inefficient' government structures" that you mention.
I don't know why it's difficult to understand that exchange, unimpeded by political interference is simply what free market 'capitalism' is.
You say you can't see this on an international level? Surely not! Why would sovereign states pass up such a golden stream of revenue? The government will rarely voluntarily step out of the way when money's coming at it. And the constituency has become increasingly favourable to interventionism, perhaps (let me suggest) through a steady stream of propaganda and misinformation. So how could it change? How many people really advocate for a truly free market? A tiny percentage, not a majority.
True, the US has had periods when certain markets were less regulated, with economic progress to match, but this is always the exception.
So is Free Market Capitalism on par with Communist Anarchism in that it is a pie-in-the-sky? Debatable, but the "withering away of the state" is the first step forward :)
[TL;DR]
That's hilarious. The original poster pointed out the lack of real world examples and that free marketers always give these specious simple hypotheticals that are meaningless contrivances--and then what do you do? You provide a simple and specious hypothetical example . Freemarketer's are shills of the rich who think they, unlike most of the others not in the club of the rich, will be invited if they just shill for them by supporting their free market opiate for the masses. They don't accept facts contrary to their desired view but are eager to accept fantasy as long as it fits the view and pleases their masters.
As the original poster pointed out--the only example of a government-free market of any size in existence is the illegal international drug market ruled by cartels.
Every single type of transaction was an example before some doting control freak/elitist oligarch declared that 'rules' needed to be imposed on everyone who engages in trade. But the freemarket can't be stamped out completely, just like anti-freemarket elitists can't rule completely... if you need examples to understand how the freemarket works, then go to a yard sale or buy something on the internet (if you can find something that isn't taxed yet). You could also read a book on basic economics to understand that it is not about money at all, it is just about reallocating scarce resources. Money, especially in the form of fiat currency like the USD, interferes with the process when the managers manipulate it... just another form of oligarchs wielding power. Manipulation of information is also dubious, and Conor deceives people in representing the other side here; the road to socialism didn't start with Obama's takeovers, it started with taxes and the dispensation of public services, which is not represented in his pie-chart. Why doesn't he show how much the government consumes and spends? Because that sliver would be a wedge... and like most things from the left, the only concern is with reinforcing a perception, so the communications (usually) devolve to manipulation.
What is really rich is your taking a shot at freemarketer's as being shills of the rich... as though anti-capitalist rules provide a better alternative for freedom loving individuals to prosper. I don't think I will be 'invited' to some rich club, in fact I tend to reject that element of elitism which exploits the liberty inherent to freemarket principles by conniving groups and/or fraternal clubs. And even the greatest supporters of freemarket principles recognize we require some oversight to prevent collusion. So if we both agree that oversight is necessary, the question then becomes how much and in what form? No matter how much is present, the liberal elitists always seem to want more. Some of my liberal friends have admitted to me, that they believe power should be held by the most intelligent people, who then need to take care of those who can't take care of themselves. It makes sense then to embrace liberalism if you think you should wield power over the masses, or if you believe somebody else should take care of you. I reject liberalism outright though, because it is based on the false presumption that some people have the right and ability to effectively pass judgement on others as being either qualified rulers, or the lesser people, who need help from the rulers. I don't want liberal rulers, and I don't want to rule others, I just want to take care of my family, and I want to help other people that I choose to help - the freemarket system allows me to do both better.
Interesting chart & I agree with your assessment. Just for fun though show the same chart for the ten most and ten least socialist countries to compare degree.(think there are any surprises?)
"Kind" of socialism is interesting because there is a growing conflict between the classes (the haves and the have nots) that is being mirrored in different contexts: Plenty of auto parts suppliers have gone bust without government aid; plenty of smaller banks too. Big is good and must be protected (big car companies, big banks, big insurance companies) small is insignificant and does not need to be protected (the shareholder, the taxpayer). How un-American! The founding fathers went out of their way to check factions (re-read Federalist 10). I am not afraid of us becoming socialist - far from it. I am afraid that we are becoming increasingly unAmerican and worse yet most Americans can't tell the difference!!
Publius would say that, wouldn't he? But federalist 10 is about political factions! I suppose I can imagine factions by industry ("banking," "insurance") but it's harder for me to imagine a generic "bigness" faction out there.
am trying to think of other comparisons to chart... maybe total assets in the US versus all government assets? that could be compared to, say, all french assets versus french government assets.
Conor
At this point I may actually be more interested in seeing Liabilities assumed (er, "assumed") than Assets...
Anal_yst
http://1-2knockout.typepad.com
I tend to agree that the entire "Socialism" discussion is over done but I do think that your chart minimizes some of the impacts of recent events. For example, the governments effective ownership of Fannie and Freddie gives it control of not just the mortgage market but since finance drives real estate, the entire U.S. housing market. As a percentage of business assets it's miniscule, yet it represents enormous influence in one of the larger sectors of the economy.
You don't need to own a terribly large amount of assets in order to control a market.
well I'm interested: do you have any suggestions on a better measurement?
fwiw Fannie and Freddie were GSEs from the start, and the expliciit nationalization of the two was something that happened pre-Obama. I guess what I'm more interested in is the charge that Obama is some kind of uniquely evil socialist.
Conor
Isn't your quest your destination.
maybe it's just late and my head is foggy, but I don't follow
Correct me if I am wrong here, but isn't the U.S. government's ownership of these "nationalized" assets in the form of stock?
How does owning stock in public companies like GM and AIG provide the government the type of ownership over the means of production that is the hallmark of socialism (as Hayek and Von Mises tell us themselves)? Stock ownership does not necessarily yield control; the management still has that. Hence, I don't see how it makes any sense to call this activity socialist in any way.
The Bush and Obama administrations were faced with three basic choices: (1) let these companies fail, (2) help these companies out with no strings attached, or (3) help these companies with strings attached that allow the government to be participate in any downstream upside. While I don't necessarily agree with it (or its execution) in every instance, option 3 certainly seems like the most rational choice given where everything stood. It's also the most business-like approach.
I don't disagree with your last paragraph -- that's certainly been the administration's argument. (ie, temporary interventions in the market to promote the future flourishing of said market.) but the administration could certainly fire the management and the board of directors if it wanted! (actually, you did see this with both GM and AIG, didn't you?)
Conor
In one of the cases you mentioned (AIG) the government has exercised significant control due to its "investment" in the company. Bonuses that were contractually earned, and in many cases, deserved, were indirectly taken away by the government. Normal business practices such as offering incentives to independent agents who sell AIG's products were effectively outlawed by the government. The CEO who was brought out of retirement by the government itself was then ambushed by Congressional panels only months later, effectively chasing him out of his position.
While you're right that the government has not yet stepped in to tell AIG which insurance products to sell or which risks to underwrite, it has taken many actions in the public eye that have hamstrung AIG in its efforts to claw its way back. What makes you think that the same behavior won't be looming with GM?
We had press conferences months ago in which reporters asked the President of the US whether he thought the expense cuts at GM are deep enough. Does that not strike anyone as a slightly socialistic warning sign? We ask the chief executive of our nation to weigh in on issues that the chief executives of our largest private entities can't answer with certainty? Of course Obama hasn't moved us into a socialistic position in his first 150 days of office, but some of these things feel like bellwethers of socialism. GM goes bankrupt, the employees get 60 cents on the dollar while the debtholders get 10 cents on the dollar, and all the while our president cheers the decision? It feels a lot like socialism to me.
You misremember what happened in the case of AIG bonuses.
The executive, i.e., the owner of all those shares, approved the bonuses. Congress, on its own, passed a special law taxing the bonuses at a very high rate.
Whatever it "feels like" to you, you can't call it socialism, which requires control of the means of production (go back and read Hayek and Mises on the topic). Governments have always imposed taxes, that doesn't make any of them per se socialist.
They also asked Obama about who he thought would win the Super Bowl. Are we about to see nationalization of professional sports? The guy cannot control what questions reporters ask him. Besides, government officials are asked to opine all the time on a variety of issues that are outside of their office. They are citizens, too, after all.
Hi Tao Jonesing,
You wrote:
"Whatever it "feels like" to you, you can't call it socialism, which requires control of the means of production (go back and read Hayek and Mises on the topic)."
I'm not sure I would agree with this characterization of what Socialism entails (although I agree Socialism is more than mere taxation, although more than mere taxation is going on currently IMO).
Here is Mises from Chapter 2 of "Socialism:
"It is the aim of Socialism to transfer the means of production from private ownership to the ownership of organized society, to the State. The socialistic State owns all material factors of production and thus directs it. This transfer need not be carried out with due observance of the formalities elaborated for property transfers according to the law set up in the historical epoch which is based on private property in the means of production. Still less important in such a process of transfer is the traditional terminology of Law. Ownership is power of disposal, and when this power of disposal is divorced from its traditional name and handed over to a legal institution which bears a new name, the old terminology is essentially unimportant in the matter. Not the word but the thing must be considered. Limitation of the rights of owners as well as formal transference is a means of socialization. If the State takes the power of disposal from the owner piecemeal, by extending its influence over production; if its power to determine what direction production shall take and what kind of production there shall be, is increased, then the owner is left at last with nothing except the empty name of ownership, and property has passed into the hands of the State."
http://www.econlib.org/library/Mises/msS1.html#Part%20I,Ch.2
The chart does not measure the controlling effect of new government regulation on the private sector. For example the President recently announced new mileage requirements - in effect a form of executive control over corporations.
You need some sort of chart or graph to count new regulations.
I would love to hear suggestions on how to measure that ... especially since I'd like to get more into the chart making business!
But the chart was mostly about ownership ... am I wrong in thinking that when people think socialism they think the mass nationalization of industry? My sense is that's the most commonly accepted definition.
Conor
Not sure this qualifies as socialism, at least not in the classical sense, though it is maybe a small step in that direction.
CAFE standards would not be a good example, however, since this is hardly new regulation and what Obama is proposing is merely jumping up the timeline on the Energy Security and Independence Act of 2007, signed by Bush.
Health care might be a better example, let's see what gets proposed.
Why do you equate Socialism with state ownership of the means of production? Socialism is about using the instruments of state to reduce inequalities of wealth, income, and power. It's about emphasizing society as a whole over the individual. State ownership of the economy is certainly one path to this objective, but it is not the only path. Sweden, for example, is more "socialist" than the US, and that's not because the Swedish state owns a big chunk of Swedish economy.
Doesn't the word get used in two senses? There's the totally unoffensive (at least to me) 'democratic socialism' of western europe, and then there's socialism as state ownership national wealth. "Socialism" is an effective and worrying charge not because it makes people think of modern-day sweden but because it makes them think of various communist and totalitarian governments of the 20th century.
Conor
Actually, socialism IS, by definition, state ownership of the means of production. What you are referring to is called "welfare capitalism."
In the case of Sweden, the government does, in fact, own whole chunks of the economy. But what makes Sweden Sweden is its welfare capitalism funded by BOTH state and private profits.
FWIW, I live in a state with the most real socialism of any in the country - Tennessee. The TVA, a government entity, owns the production and distribution of electric power here.
I would love to have TVA's rates here in NJ. Municipal utilities consistently have lower rates than privately owned utilities.
I don't know what constitutes "whole chunks", but 54 companies with a combined turnover of approximately $50 billion in a $348 billion economy seems to be substantially less than full state ownership of the means of production. Not sure it constitutes big chunks, even.
http://www.sweden.gov.se/sb/d/8908
Moreover, Vattenfall (energy) accounts for more than one-third of this turnover, while teliasonor and posten account for another third. Add the state alcohol monopoly and you get another significant element. These four together account for $36 billion of the total. Sweden thus seems to look a whole lot like Tennessee when it comes to state ownership.
My original point was that we are more likely to look like Swedish style Social Democracy than a Soviet style state-owned economy. Consequently, perhaps we could discuss whether we wish to look like Swedish style Social Democracy rather than whether we wish to be "socialist" precisely because it is much easier to compare the status quo with concrete realities than with loaded terms with multiple connotations.
What about government control of wealth as a percentage of GDP as a signifier of socialism?
Conor,
The chart was instructive and made a point. I was just offering another angle from which to view the issue.
As for Obama being a socialist or for that matter the country becoming socialistic, I think that time is the only thing that will answer that question. The real test with Fannie and Freddie or the car companies is what the government does now that they have control. Does it relinquish that control as quickly as would be prudently possible or does it maintain control and use the leverage afforded by ownership to dictate terms of business to sectors of the economy.
You don't necessarily need an avowed "Socialist" party to move a country in the direction of central planning and industrial policy. It can happen that way but it can just as easily evolve over time. Once previously inviolate lines in the sand are crossed without political repercussions, the incremental power that accrues to the political class can be heady indeed. Relinquishing power, as you know, is not something that comes naturally to politicians.
For now, I take Obama at his word that he does not want to own banks, car companies or any other businesses. I also realize that he isn't a king and there are lots of others in government who are quite pleased with the recent turn of events. Who wins might be the bigger question.
I don't think it wise to conflate totalitarianism with socialism. Moreover, it seems to me that we are much more likely to wind up with Swedish-style than Stalinistic-style socialism. So I don't see the merit in the fear of totalitarianism (Unless, of course, you believe Hayek's Road to Serfdom). A lot of the utopian societies (Robert Owen, for example) are philosophically socialist, and in true communism there is no state.
Finally, the two senses aren't really different things philosophically; only empirically. The fact that they actually managed to achieve a "totally unoffensive socialism" in Sweden (by which I guess you mean without having to kill millions of people and oppress everyone else) but could not do so in the Soviet Bloc or China or anywhere else is perhaps a reflection of how hard it is to achieve a socialist society that people wish to live in. Do you think that Lenin really didn't want to create a socialist society?
But I really think they are different philosophically. It just seems like there is a difference in kind between saying "you are free to make your own choices and we will take X% of what you reap," and saying "no matter what choices you make, there is some chance of us swooping in and taking it all."
Maybe the difference is just the rule of law. But I like the rule of law!
Conor
Look at you all grown up with your own blog. Congratulations.
Now to the long knives: You haven't refuted any off the allegations that the US is headed toward socialism; you've only refuted your self-created straw man about being "pretty close." Besides, just wait healthcare (an enormous part of economic activity) & student financing is nationalized.
Also, I believe you've selected a much too narrow definition of socialism: owning stock. The govt doesn't own stock in schools, but it does own most of them. The govt doesn't own stock in energy companies, but it means to arrange the winners and losers. "Ownership" isn't a thing, its a lot of things, and if the govt annexes some of them, its headed toward socialism even if it doesn't annex all of them.
But those are hardly new. Public schools date to the early 19th century. Were we "headed toward socialism" in the 1840s when Massachusetts required all children to attend public schools? Perhaps. But Obama is hardly to blame.
Same is true for all sorts of energy regulation; CAFE is not exactly new.
The question, then, is how much is Obama really heading toward socialism compared where we already were?
Basically, I want to make two sets of distinctions. The first is between the state of affairs that existed before Obama and the state of affairs that exists now. (That's why I focus on GM to the exclusion of other things.) The second is between the government creating separate, parallel institutions (EG, loan organizations, schools, etc) and the government swooping in and taking private property. The second is what seems philosophically more pernicious to me and, I think, to most people.
Conor,
Chart is interesting but misleading. The Federal Government does not report complete balance sheets for sectors (farms, financial sectors, federal government, state & local governments, or rest of world (foreign owners). Instead, they report statements of financial assets, financial assets and financial liabilities. In other words, they leave out the fact that all these other sectors own tangible stuff like land, buildings, cars and computers, in addition to securities. The numbers you provide have specifically fail to report that because as of now it is unreportable as that 'tangible' number isn't specifically tracked or 'valued'. Additionally, I'm sure you and I would agree that everything short of God or a god has a beginning and an end. So let me provide a quote from today, which specifically and quantitatively illustrates the beginning of socialism. Today before the House Budget Committee Bernanke said, "it's (the federal deficit) driving up the debt as a share of gross domestic product, the total value of U.S. goods and services produced in a year. Last year, the total U.S. debt was 41 percent of the GDP; this year it's estimated to be 59.9 percent." (read the Fall of the USSR...Will give insight to what is happening here) Guess what? In 2010, this percentage will be higher. This threatens our ability to maintain our AAA rating on world's financial stage. In otherwords, we will not be able to receive, produce or distribute cheap money to corporations and businesses including illegals in this country and Americans alike. The service (bond payments) on the debt we have accumulated will cost tax payers by 2012 $700 - $800 billion. To put that into perspective, last year we ran a deficit of $438 billion and the people of this country had a conniption with that administration. Now add the cost of universal healthcare (Obama says $1.5 trillion to get it started...How much there after?...We know it will be in the $100s of billions in 2009 dollars), education (Obama says he wants to ensure that the first $4,000 per year of a college education is completely free) $50 - $100 billion/ yr, GM bailout which will probably cost the taxpayers $50 billion/ yr in 2009 dollars for the next 25 to 30 years or until the legacy costs 'die off', etc. And I could go on and on. Let me get to the brass tax here: How are we going to pay for it? When you get to that point where even the most liberal are asking that question, and we decide to implement these programs anyway with the burden of paying for it passed on to future generations. Then you, my friend, are living in a Socialist State because eventually we will be workin from Jan - Oct to pay taxes rather than Jan - May today. Finally don't bother responding back that raising taxes is the answer because not one country in the history of the modern world has increased the size of its general account by raising taxes only lowering does that (Laffer Effect/Curve). Does the Constitution say that we all have to be economically equal or just equal. The former is Socialism. The latter is a right to one's own potential.
To your first point: that's why I excluded everything but corporate and noncorporate business -- because the balance sheet is incomplete the other sectors. (I do say this at the bottom of the post.) this makes the current % of nationalized assets an underestimate, but it's erring (I hope) on the side of caution.
I think it's perfectly fair to talk about the size of the federal government and the national debt, but this isn't people have in mind when they worry over nationalizing G.M! (Which is what this post is responding to.) it's the bureaucratic running of formerly private industries, not the overall size of the federal government.
Conor
Ignoring the primary debate here, your graph brings up an interesting potential problem for pro-nationalization people: if GM is such a tiny feature of our economy such that its 60% nationalization is not a major step towards socialism (as your graph shows) then why is it so important that we attempt to save it? I am not sure if you support or oppose the administration's plans for GM, but I would put the question to those who do: couldn't an anti-nationalization advocate use this same graph to argue that the impact on our economy of "not saving GM" would be so tiny that we shouldn't deviate from the status quo?
It seems that all (most?) pro-nationalization arguments proceed from the assumption that GM is so important to our economy that it must be saved -- and by showing that it isn't, you undermine that argument. If on the other hand, GM truly is that first domino because it exerts such influence over all of its employees, suppliers and dealers (out of proportion to the assets you measure in the graph) -- then nationalizing it is putting that vast economic influence in the hands of the government.
I think that's a good point (I can't remember if you brought this point up on the original post. .. but someone did and it was a good point then, too) and I don't totally know how to respond.
I guess I would say that these things vary by degree. It's true that a lot of suppliers depend on GM. It's also true that a lot of the restaurants near my office in DC depend on the federal government. But I think it would be strange to say those restaurants are "nationalized" industries.
Maybe the big difference (and that's a big maybe) is the rule of law. A government takeover must break the rule of law for the industry involved. For me, that's part of what makes nationalization offensive. But I don't know if that problem applies to the secondary and tertiary institutions involved. is the government forcing them into something in quite the same way?
Conor
Tao, problem is that, with the financial sector bailout, we didn't actually do option 3, but option 2. If you think TARP, TARP 2.0, TALF, etc. have any meaningful strings attached, I have a bridge in Brooklyn I can sell cheaply.
As a check on your methodology, I would ask the following question. Obama has stated his preference for single-payer health care, which is one-seventh of the economy. If he were successful, would your chart suddenly reflect a 1/7th pie slice for the government's portion of the economy?
I'm not sure of the answer, but either way your point fails. If it would not be reflected in your pie chart, then the quantity you are plotting does not reflect in any realistic sense how socialized our government is. If it would be reflected in your pie chart, then Obama's intention is surely to make our government more socialized.
Therefore, the point of your article, that we are not becoming very socialized, is baloney.
Please cite, with links, Obama's "stated preference for single-payer health care." As a single-payer supporter myself, I'd love to know he's on our side.
Your "chart" reminds me of something my wife is fond of noting. You would gladly drink a glass of pure water, but if you put a drop or two of arsenic in it (say maybe .21%), would you still drink it?
That would be an incisive analogy if it made any sense at all.
Then let me explain it. I thought it was simple enough for a child to understand.
You take a glass of water, and add 0.21% poison (arsenic). Nobody with any sense would want it.
You take a nation, add 0.21% poison (unconstitional control, call it whatever you like - socialism, fascism, or any other label). Nobody with any sense would want it either.
Sorry that was too complicated for you.
Come on, a POTUS has taken over what was once the largest company in the world and fired their CEO! If you don't see this as a significant step over the slippery slope, you should move to Europe.
Yeah, I got that. The part that doesn't make any sense is government ownership = poison. But then I assume you're one of those privatize-the-dogpound types, so we're speaking different languages here.
[Socialism] is a monster of so frightful mien,
As to be hated need but to be seen;
Yet seen too oft,
familiar with her face,
We first endure, then pity, then embrace.
69birdman, I think we have been poisoned by degrees. Case in point: southsidered.
But isn't that still 0.21% more than should be allowed? Or are we comfortable with the government nationalizing segments of our economy.
I agree that sensationalizing that Obama is turning our economy socialist is out of line, but I think we should all be worried when even a small portion of our economy is owned by the government. It's 0.21% more than necessary.
What a nice sentence: "Socialism, like farenheit, comes in degrees." You're in good company, too, since Eric Hobsbawm is of the same mind:
http://www.guardian.co.uk/commentisfree/2009/apr/10/financial-crisis-capitalism-socialism-alternatives
Are you smoking crack? The federal governmenet is over a third of the national economy. Military, intelligence, gov't services, border patrol, TSA, hospitals, the list goes on an on. Now we took over Fannie and Freddie, the U.S. took huge ownership stakes in america's largest banks (Bank America, Citibank, and others) we now own America's largest insurance company (AIG), we own two automakers, we subsidize the postal service, we prop up the railroads, we subsidize national farming, and 1 in 6 dollars "earned" by individuals is coming from the U.S. government.
When Hugo Chavez and Pravda say Obama is a Marxist and is turning the US into a Socialist state, it's not a right wing conspiracy theory.
The above chart is bogus as others have pointed out, besides, it's just the beginning of a process. But what Obama is doing resembles fascism more than socialism as he is ordering the private sector around and using mob tactics.
Would be nice to know where exactly these number came from - chart and page number, etc. They don't appear to be anywhere in the linked document that I can find. I do find, for example, that the government owns $188 billion in corporate equities (chart L.106, page 66), which is signficantly more than the amount that Conor Clarke says the government has "nationalized".
Now that is hilarious. Did all the socialist lemmings "fall in line" and eat up what you were saying? Google the quoted text below to see where it came from...it isn't made up like the story.
"In 1997, 83 percent of all persons under age 65 years had health insurance. In 1998, 87 percent of persons of all ages had a usual source of health care. Also in that year, 83 percent of pregnant women received prenatal care in the first trimester of pregnancy." yet the Democrats want to nationalize,or socialise this entire industry from the healthcare insurers to the medical transcription systems, to the hospitals themselves. How many TRILLION do you think that will involve and when the health care insurers are destroyed where do you think the jobs are going to go? If you say to the US Govt, who will then employ them to manage the US Healthcare system you are right. That product will be a mixture of socialism/Marxism.
"Healthcare is an exciting and dynamic industry and the career possibilities are nearly endless. The industry accounts for about 1/7th of Gross Domestic Product" of the United States of America.
SO, if we combine the health care and auto industries we are easily talking about 20% or more of the GDP and jobs in the USA. Far more than GM and Chrysler are going to be controlle dby the govt. There are MILLIONS of jobs and tens of billions of dollars going through those companies every year in the USA.
At this time the Chinese can manufacture any good for one fifth of what it takes us to manufacture the same good. They have 1.2 billion people, and the USA has 350 million. If you take the top 20% of their most brilliant minds, the highest ACT/SAT, it equals the population of the USA. Soon their infrastructure is going to be all shiny and new and their best minds will be managing themselves to the dominant position of NUMBER ONE.
Let me be perfectly clear. From my notes you may not be able to tell. I am fed up with BOTH, the Democrats and the Republicans, and Americans in general, and am coming very close to saying I hate the country COMPLETELY and hope it implodes under the weight of its stupidity SOON! I may even live to see it if I live just twenty short years.
If you losers cannot come to an agreement and figure out that a socialist country is not going to outperform most other countries on the global market after we put the spank on the Soviet Union and China...enough to force China to adapt to a more pure capitalism...then all of you can F*K off. It's over.
We are allready approximately 64 trillion in obligations for the next fifteen to twenty years...where we get that money is beyond me. That 64 trillion does NOT include the trillions and trillions for the healthcare system that the Democrats want to add on to our backsides. IF I managed China's assets and I wanted to take over the global economy, it would be a snap!!! I would take a fifteen to twenty year look at the world. I would quit buying US bonds now and immediately start spending every cent on my infrastructure to build it up. The Chinese govt owns 51% or more of ALL the companies in China, this means they own a managing interest. The Chinese Central Committe, a Communist entity decides who gets paid what, what companies get assets to expand and what assets get spent to support those companies...assets that build bridges, roads, electrical subsystems, etc. The Chinese govt gets 100% of ALL profits from the sale of any goods and services and redistributes them internally to districts managed by Communist party members. Some of these entities are turning in to companies that get funded by local govts....all Communist owned and operated. I would let the US slooooowly wind down. In that time I would build roads, bridges, highways, dams, electrical distribution power lines and facilities, schools, universities, then manufacturing for the military hardware we would need to take over....and I would wait. I would build one thousand long range bombers, a thousand nuclear submarines, put hundreds if not thousands of satellites in space, some of them with the possibility of sending a nuclear strike on a target in an hour, and I would build high powered lasers that were based on the ground and in space to knock systems out that were airborn and being launched. In five to ten years I would sell the trillion held in US bonds...crashing the US dollar and the economy. The US would NOT have the power or assets to buy a cumquat from a Latin American Dictator. Then I would wait until the socialists and Marxists in the US took over and bankrupted the USA. It is happening now, but the pace would be even faster...they would render US nationalism a thing of the past...as they are now.
COOL HUH!
Dude, you forget to mention the Amero, or the flouridation of the water supply.
I do not know why I am responding to your d*mb *ss comment, you are a socialist and do not deserve a response. If you think socialism is going to work after the United States put the spank on the USSR and China in it's pre 1975 form then socialize all you want. China will have to get rid of even more socialism in order to take over. If it goes south in the USA...I am leaving. I am not going to stand by a bunch of people I hate and struggle with them to support a system I do not want.
From your other posts throughout this document....Volvo and SAAB are failures. The country that gave them their start is turning it's back on them and they are going out of business. Hate to burst you little socialist world. Sweden decided that they will NO LONGER support those companies through socialist means/measures. The tax burden was too heavy. Hahahaha....a country that was formerly very socialist said that the TAXes were too heavy but here comes Obama to save the USA by raising the taxes! But don't get me wrong. The downfall of the USA will be the Democrats and Republicans for burying us with these debts, not just Obama.
Go ahead all you lemmings; try to justify what your president is doing. What is happening is no less than an economic 9/11, only instead of some mad-man in a cave, it's being conducted by a narcissistic socialist in the Whitehouse - a man that has never run anything in his life and now thinks he can run the auto industry, healthcare, banking... Try to justify the behavior of this administration, but future generations will hold you responsible for this mess!
OK, I'll justify it. The social-democratic nations (Canada, the Netherlands, the Scandinavian countries, France, etc.) have the highest standards of living and the lowest economic inequality in the world. And they're also home to enormously successful and dynamic capitalist enterprises (Volvo, Shell, Airbus, etc.). Our country should be more like those countries. Then our lives will be better, as will the lives of those "future generations". The End.
Just a side note - It is often said that Obama is "a man that has never run anything in his life." This is untrue. He ran a Presidential campaign organization that was larger than many state governments.
Not only did he run it, he built it from nothing in just a few months.
I was a member of this campaign, and it was the best-run organization that I have ever seen. Every time I second-guessed orders from above, I discovered that I was mistaken, and that leaders were already way ahead of me. The whole thing was so perfect, it was a little eerie.
This afternoon I'm off to a meeting with some of those same people to agitate for socialized medicine.
Love ya!
Mr. Clarke,
How it is interesting to see your lack of rigour. Socialism is not about ownership but about who control. Communism is when the government own everything in the society. Socialism is when the government control everything. May I remind you that the government control : university, health care, road, the supply of money, the interest rate, the legal tender, the minimum wage, the way enterprise should produce safe product,etc. Is not Socialism ? Are you kidding ? And when things go wrong, we accuse the free market, lack of regulation and the capitalism... I am sorry to remind you that free markets doesn't exist anymore since the creation of the Federal Reserve. How can a free market could exist when the government with the Federal Reserve decide the value of the money ? How can a free market could exist when 50% of our income go to many tax ? Maybe you should stop to dream and be a little bit in touch with the reality. You should start with the reading of the Austrian School of Economic.
So let me get this straight. If a nation has public roads, consumer safety regulations ("the way enterprise should produce safe product"), public universities (alongside, of course, thousands of private ones), a minimum wage, and a national currency, it's socialist? Wow. Looks like us socialists won a global revolution and didn't even know it! Gratz, comrades!
Yes, you are right, socialism won a long time ago. You should be proud ! So, why blame capitalism and free market for everything wrong ? So, why talking about more regulation ? We have more than 1 million laws and regulations in North America. Government intervene in each aspect of our life. Why when things go wrong our leaders don't take credit for the results ? Greed and cupidity exist in all systems : communism, capitalism and socialism. It is a characteristic of the human being not a characteristic of a system. The best protection against greed and brutal force is the system of liberty and propriety rights. Why ? Because my liberty finish where yours begin and I can be sure that with this kind of system (common law and free market), people who abuse will find an opponent. Without liberty and propriety rights, nobody cares and nobody needs to protect anything because they have nothing. More a government use central planing, less the individuals can plan their life. Yes, you should be proud : Now, governments take all the important decisions in your life. How does it feel to be like a little kid ?
This is a very deceitful graph to use to try and make a point that our President is not a socialist. I know he is not a cold-blooded socialist, but to be fare, you are admitting he did just spend almost $100 billion (that's 1,000 of these -> 100,000,000) to buy a company "for" America against the voters will. That seems a little lame, don't you think?
Your asset statistic is a red-herring. At best as it is a short sighted view and ignores the more telling Socialistic activities in the spending strategy of the administration. The measurement of money - how much and who is spending it is more telling today. Though assets become important later.
Two statistics that would actually be valuable would be:
1. A number indicating what percentage of every dollar spent in the US is controlled by the government.
2. A number to show how much money per person the government is spending.
Socialism is not only about assets, it is about control of the economy.
Look ahead 5 years to what our tax rates will be. Tell me that we can sustain our current spending model at current tax rates. There is no way out of this kind of spending binge unless taxes are raised to confiscatory levels. Obama's course today is to break Capitalism and leave us no choice but Socialism. Our insane spending spree is Obama's way of sowing the seeds of Socialism.
The measurement of assets is less meaningful at this time is part of their overall strategy. The ownership of assets by the government will dramatically increase naturally as private industry is taken over. The Health Care industry will be the first to fall.
I am not as intelligent as some the posters on here but I think a great comparison would be to post the above pie chart next to one that shows assets % owned by either the government and wholly owned American businesses vs those owned by foreign countries. I think the only thing that scares those who worry about socialism more than socialism is America being owned by someone else.
socialism always has to START SOMEWHERE... doesn't it. Just because it isn't big (yet) doesn't mean it's not socialism. In other words, this pie chart proves nothing.
"Start Somewhere" and hopefully sometime soon! We are lying to ourselves and to our people if we think we are anywhere NEAR socialism. Life has to be about balance and economics should be no different. We need a some level of socialism just as much as we need capitalism. Too much of either is not beneficial to our growth as a society. The disparity from the haves and the have-nots is too great. Show me a chart that illustrates the growth of salaries for the top 10% of wealthy individuals in this country vs. everyone else, say since 2000.
Maybe not the best analogy, but Major League Baseball shares profits. Larger market teams give money back to smaller market teams. Without it, the smaller teams would not make it. Maybe they are Socialist?
It seems to me that our economic issues are a direct result of capitalism unrestrained and without accountability.
Conor, just found this post today, but if you're still reading, one slight correction for you. The Permanent Fund Dividend (PFD) was started many years ago, after the state had decided to tax all oil leaving the state (I believe), and found that it couldn't spend all the money, and decided to return it to us. The money comes out of the Permanent Fund, and the distribution amount is driven by a 5 year average of fund performance, which is heavily driven by the price of oil and the state of the market in general. Thus, while the PFD for last year was ~$3200 (which includes the additional $1200 to offset heating oil costs, or something like that), this year and for the next couple it'll be greatly reduced.
Mr Conor Clarke, You are not a true american. Socialism can start in many ways. Obama will def move this country more and more towards Socilism. I honestly believe that we will give our country to our children and grandchildren in terrible conditon due to Mr. Obama.
The Government should not interfere with the private sector. I see an Obama coountry where the US FEDERAL, STATE, COUNTY & CITY GOVERNMENTS employ the largest number of americans. When I look at all the city, state & federal employees which are hired by the government, wages are set by the government, and benefits are paid by the government----it simply amazes me. And how do you think these government agencies get their revenue----by TAXES ( all forms). I am amazed at how much taxes have gone up in every aspect. Many of the taxes are higher than all the cost and profit a private company makes on the product. This is WRONG. The cigarette taxes and gasoline taxes (to name a few) are higher than the entire profit and cost of making the profit. Talk about a middleman socking it to the consumer. The state of Florida has just added another $1.40 tax (in addition to already taxes) to each pack of cigarettes. I don't smoke but I suspect this will continue in other avenues to help the government pay for all the things it is promising. We will become a nation where the majority of people work for some form of government which sets our pay and benefits. Eventually it will collapse because the private sector cannot continue to pay for everything. So the private sector will get hurt. the employee working for the government wants lower taxes. results will be failure, governments will run out of money and the country and people will be poorer.
This is where obama is taking us.
I think china will be stronger and better than us in 200 years!!
I'll start with Tim "Turbo Tax" Geithner's report to congress which states that we have invested $565.4 billion through EESA. That already equals 1.4% of the total asset value of the US.
We ended September 2008 with $1.974 trillion in assets.
Of course the government does not book the ability of "stewardship assets, including natural resources, and the Government’s sovereign powers to tax, regulate commerce, set monetary policy and the power to print additional currency."
Quickly over 6% in hard assets owned by the government. With an ability to leverage more through taxing its citizens.
http://www.financialstability.gov/docs/Ltr-to-Warren-re-EESA_42009.pdf
http://www.fms.treas.gov/fr/08frusg/08stmt.pdf
If you analyze the current data.
You find that between the data you used to now, (nonfarm, nonfinancial corporations plus nonfarm noncorporate business) you will find that:
Total business assets have fallen from $39.169 to $37.213 T, from 2008Q4 to 2009Q2.
At the same time the nationalization of private assets has risen to $565.4 B.
Since the private increase is less than 0, your graph should be admended to show an infinite % increase towards socialism.
This would be a percent of recent nationalization to total recent private asset increase.
Shockingly, over 1,000,000% socialism.
http://www.federalreserve.gov/releases/z1/Current/z1r-5.pdf
http://www.financialstability.gov/docs/Ltr-to-Warren-re-EESA_42009.pdf