CQ TODAY ONLINE NEWS
Oct. 22, 2008 – 12:34 a.m.
McCain’s “Socialism” Charge
By Madison Powers, CQ Guest Columnist
For many months the McCain campaign has been asking who Barack Obama is. The campaign has been tantalizingly vague, dropping hints along the way, but leaving it to us to connect the dots. Now, thanks to the McCain-Palin campaign, the answer has finally come into focus. He’s a celebrity Muslim socialist who pals around with terrorists at elite Hyde Park gatherings attended by Republican college presidents.
We always knew that Obama would make real history should he win the election for president, but we always thought it would be because he is an African-American. Who knew that the most extraordinary part of his biography is his uncanny ability to combine so many qualities into one persona? No wonder it took months of public education by the McCain camp to bring this to light. Most of us just wouldn’t have figured it out. Thanks for your hard work.
Too bad, however, that the public is not in the mood for fairy tales when the economy is so much at risk and we are fighting two costly wars, neither of which is going all that well. It is hard to understand why so many people are so preoccupied with these issues when the Republican campaign has been doing their best to tell us why we really should be sniffing out socialists amongst us. And while we are at it, maybe we should have Congress investigate which members of Congress are anti-American.
John McCain , Sarah Palin , and various surrogates have revived the 1950s socialist epithet as a way of dismissing Obama’s argument for greater economic fairness. The irony, of course, is stunning when this kind of rhetoric elides into the massive Wall Street bailout, most likely eventuating in partial public ownership of private corporations. McCain flew back in time to vote for this.
Perhaps McCain can be forgiven for his confusion. After all, he did confess that he really did not know much about economics. His newly minted complaint about creeping socialism in Obama’s tax plan is one more bit of confirming evidence that he was right in his initial judgment.
Worse yet, it turns out that there is good reason to suspect that Obama has had a detrimental effect on some of the people with whom he has been associating. How else can we explain the fact that Warren Buffet, the world’s richest capitalist, supports Obama? Buffet even wants to pay more taxes, and he is planning to give the bulk of his wealth to people who need it more.
There’s only one way to explain it. It must be Obama’s mesmerizing effect. There can be no doubt Buffet drank the Kool-aid. Who’s next? Colin Powell, Michael Smerconish, some writers for the National Review? No one is immune. The workers of the world are uniting, eighty-six dollars at a time. It took a celebrity Muslim socialist to bring us all together.
Many of us have not appreciated what’s been happening here. It’s now up to Palin, with an assist from her running mate, McCain, to sound the alarm. Their mission is to make sure that more conservatives, and ordinary Americans from the real America, don’t succumb to this deceptively dangerous man. He has to be unmasked. He wants to alter tax policy so that it tilts more in the direction of those who have fewer resources and face greater risk of economic ruin in a fragile economy.
Helping the worst-off is such a terrible idea that it’s a mystery that more people don’t know that. Someone needs to make sure that the public, especially members of the middle class, understand why they should not stand for it.
Everyone seems to have caught the “spread the wealth” fever. It’s a sickness, I tell you. Even McCain is not immune. He now wants to limit the pay of corporate executives. But he’s taking the first step to recovery. McCain’s first step is his pledge to cut Medicare. I think he can fight this thing. It doesn’t have to take control of his life, like it has for Obama. He still has time before it’s too late.
Maybe I am understating the extent of the problem. There are many economists who tell us that the urge to redistribute the wealth has actually reached epidemic proportions over the last three decades. It turns out that it is the silent killer. Government has been secretly redistributing wealth all this time.
Every time tax policy is tailored to give incentives to expand home ownership, encourage employer-sponsored health plans, or reduce capital gains taxes to stimulate job creation, or when government adopts plans build highways or bridges to nowhere, fund medical research, regulate or not regulate derivatives and credit swaps, it engages in inherently — often deliberate — acts of redistribution.
The only complaint, it seems, comes when the redistributive effect is downward. It’s okay to feed the birds by feeding the horses, but when someone suggests that the birds might do better off if they did not have to depend on the horses, it’s socialism or some sort of un-American activity.
McCain’s “Socialism” Charge
Those who argue against any redistributive policies whatsoever perpetuate the myth that the distribution of wealth is akin to some natural process, which if judiciously left undisturbed by government, will distribute reward in direct proportion to merit or contribution. But few have looked closely at this assumption believe in the myth.
Economist Larry Summers, former Treasury Secretary and past president of Harvard University, says that in the last 29 years, those earning the top one percent of income have gained about $600 billion. Those in bottom 80 percent have lost about $600 billion.
This result is not simply the product of naturally occurring processes. The distributive pattern is the interactive outcome of brute luck, the natural distribution of talent, and deliberate social policies that do much to pre-select winners and losers.
I am sure that many in the top 1 percent think they deserve it, and that everything they got, they got on their own. But social scientists and economists of all ideological persuasions know better. Advantages and disadvantages alike have a way of being self-perpetuating. Advantages tend to beget advantages and disadvantages beget more disadvantages. Both have a way of compounding and reinforcing one another and they produce a cascade of effects in which the better-off tend to outpace the worst-off.
Without government policy that remains vigilant in ensuring that its various tax incentives and other policy choices do not do more harm than good, the predicable result is what we have now: the most massive redistribution of wealth since just before the market crash in 1929. Only someone who admits that he doesn’t know anything about economics would label as socialism any governmental effort to make sure the winners and the losers are not always the same groups.
Madison Powers is Senior Research Scholar, Kennedy Institute of Ethics, Georgetown University. His column appears weekly in CQ Politics on Wednesday.
Comments
Conservative Republicans always want the government to stay out of business and avoid regulation as long as they are making lots of money. When their greed, however, gets them into a fix, they are the first to cry out for rules and laws and taxpayer money to bail out their businesses. Obviously, Republicans are socialists. The Bush administration has decided to socialize the debt of the big Wall Street Firms. Taxpayers didn't get to enjoy any of the big money profits on the phony financial instruments like derivatives or bundled sub-prime paper, but we get the privilege of paying for their debt and failures.
I like your article except this sentence: "We always knew that Obama would make real history should he win the election for president, but we always thought it would be because he is an African-American." If you think race is what makes Obama's impending presidency exciting, then I'm afraid that you haven't been paying close enough attention to his message!
I believe McCain is either confused, or he is a grumpy old man; or both. McCain/Palin team in their spread of misinformation they harm themselves. How far can they stretch Obama's policiy of lowering taxes for those who make under $250K. How does this can ever be confused with Socialism. McCain campaign will never close the gap if they don;t get on message. Every day they are attacking Obama's campaign with yet another buzz word. I truly hope that they don't win because they are unstable and untrustworthy. Just like the Bush Republicans they are pandering the the Wall Street Fat cats and pursuing the tired old trickle down economics.
This article touches on some interesting points. It really sums up Obama in a nut shell, for one. It points out that, no matter how hard you try to explain it away, Obama promotes Socialist policies. Madson Powers, you just convinced me not to bring children into a world that puts any amount of creedence in your sophmoric understanding of macro economic theory and pitiful class warfare rehtoric.
So Socialism is the the F Word. Fine. But it seems that no one even know what 'socialism' means. I think some people get confused between "socialism" "fascism" "capitalism" "republicanism" and "communism." The difference between Communism and Socialism is more than just LIPSTICK. Democratic Socialism, as it exists in Europe today, is simply using MORE of our TAX dollars for DOMESTIC, SOCIAL projects, and LESS for SUBSIDIZING FAT CATS. It's NOT about nationalizing every business. In fact the EU (European Union) is making its member states PRIVATIZE much of their holdings. I'm an American living in France, and I can tell you, socialism works. The government here does not "tell us what to do." They don't "take our money." They don't "redistribute wealth." That, my friends, is called "communism." They do not "spy on you." Except when they send you remeinders that you haven't taken the x-ray, or gotten the exam that your GP prescribed. More on that later... My wife and I gross about 65,000 Euro/ year, and we pay 27% Income tax. They regulate the industries (nothing wrong with that!) And yes, they partly own public utilities, such as the gas and electricity services. The Phone Co leases its line to private broadband providers, which allows for low cost, competitive ISPs; most people pay 30 euro/month for a "triple play" boxes: ADSL, cable TV, and VoiP. The trains are state owned, but run by private subcontractors under VERY strict guidelines; we haven't had a fatal accident in many years, and people complain if the train is 5 minutes late. Why? Because it very rarely happens. The state does the paper work and collects the taxes for health care (for me, about 25 euros/month) Speaking of healthcare, last month, for my share of 25 euros, I got an endoscopy with follow-up and meds, an emergency hand operation, and a filling replaced. All with doctors of my choice, and with an average wait time of 2 weeks, except the hand operation which was in the ER of a private hand clinic. I had to pay about 200 euro upfront for all that, but got fully reimbursed by my company's supplemental insurance, of which I pay 5 euro/month. They're very stringent about labor laws (which means it's harder for employees to fire you for no reason) and other than that, it's not much different than in the States.
Wow, just wow. This scathing piece was a perfect articulation of exactly what I've been thinking. Are you hiring? Seriously though, I think the most striking thing you mentioned, and I feel it should be emphasized more, is that the thing that is actually socialist (relatively speaking) is the bailout bill that just passed with the help of McCain as well as Obama. Obama's tax plans are Clintonian, not socialist. As far as I have hear, Obama has not proposed any plans to socialize any industry sectors. Instead of abstract fear-mongering, McCain needs to put forth a vision of America. Unfortunately, This socialist attack has, in a way put the final nail into his most powerful vision, that of a service to a cause greater than yourself. And how best to serve one's country? Vote, and pay your taxes.
A great column Mr. powers/ One of the best I've ever read Thank you
The author's comments (quoted below) are exactly the problem of govt intervention i.e. the unintended consequences of a group of people (Congress and/or the president) who believe they can "help" others with legislation. F.A. Hayek called it the "fatal conceit." Anytime govt does something ostensibly to help the poor or middle class or the rich, it ends up costing all of us money in the long run but provides politicians with power forever. BTW - reducing cap gains taxes is not redistributive. That's classic socialistic thought to believe that allowing someone to keep more of one's money is "redistributive." (author's comments) "Every time tax policy is tailored to give incentives to expand home ownership, encourage employer-sponsored health plans, or reduce capital gains taxes to stimulate job creation, or when government adopts plans build highways or bridges to nowhere, fund medical research, regulate or not regulate derivatives and credit swaps, it engages in inherently -- often deliberate -- acts of redistribution"
Also worth recalling: The Republican Party has historically stood strongly against such "socialist" measures as Social Security and Medicare. Therefore, following Republican logic, "real" Americans, pro-America Americans, must favor mega billion dollar giveaways only for the benefit of the top 0.1 per cent of Americans. What a satisfaction to know that we are standing up to socialism!
This article doesn't do much to define socialism, and rather dismisses the charge with the idea "Hey! Socialism is FAIR!". That the fortunate are just that "fortunate" and the "unfortunate" must have Government to provide them with the luck they were so unfairly denied at birth. The freedom of America is that anyone can make their own luck, without requiring government to dictate what handicaps should be added to the fastest horses to make a good race.
"The freedom of America is that anyone can make their own luck, without requiring government to dictate what handicaps should be added to the fastest horses to make a good race.-Burke" Really Burke? And just how much "luck" do you think Trig Palin would be able to create once he reaches adulthood? I'm sure his parents have the financial means to see that he gets into a good care home but many people don't have a trust fund or unusual talent to create "luck". There are many Americans out there working two jobs, raising families, and are still struggling yet somehow those people should subsidize the very wealthy for their poor business decisions.
The only people I hear whining about a bailout are democrats. Also, you will find that the root of our current crisis is related to the 2006 elections when democrats took control of the house. Things haven't been right since.
Robert, that's a load of crap that I can smell from my monitor. Every financial expert has debunked that. But it seems like Fox hasn't which I assume is where you get your "news."
Thank you for this fine article.
Jonathan: Let me guess you watch CNN, and MSNBC. It was McCain, who said two years ago, that Freddie and Frannie, were getting in above their heads. But no one listened to him. Pelosi, Reed, and even Prince Obama, said no that they were fine, there was nothing wrong. this just goes to further prove, that two years ago, Obama was bad for this country, and no two years later he is worse. God help us all, if people are stupid enough to vote for this man simply because he's not White.
How about redistributing wealth to the mortgage cos without even requiring them to modify mortgages. That's what Paulson just did to the tune of $7.7 Billion with PNC who was balking at modifying mortgages, just like all the other good corporate citizens. What they fear is a new "bottom up" strategy, rather than their usual "top-down". Did you know that Bancruptcy judges already have the power to modify second, vacation, or investment home loans (and luxury boat loans)? It is not socialism to ask that the same rules be applied to primary residences. Check it out: http://seekingalpha.com/article/101965-hedge -funds-threaten-to-block-mortgage-modifications
The super-rich have been using the "Republican base" to win elections for decades now. But that base gets tossed into the ditch come the Wednesday after Election Day every time. This "Obama's a socialist" argument makes that hypocrisy clearer than ever. Obama wants to give a break to the middle class, and this is somehow wrong and anti-American. What is wrong is allowing all wealth in the country to be concentrated with a privileged few. The top 1% of income earners earn 15% of the income and pay 33% of the income taxes, which might sound unfair until you consider that (1) they all pay the same tax on the first $50,000 (and every other amount) they make as you do and (2) that same top 1% owns as much wealth as the bottom 90%! In raw numbers, the top 3 million people own as much stuff as the bottom 270 million people. Is this fair? Does this make you proud of your country? This wasn't always the case. But it has become the case after 30 years of supply-side tax cuts to the very wealthy and no governmental oversight of the shenanigans in the board room and on Wall Street. And it is harder than ever for those of us in the bottom 90% to make ends meet, to pay for college, to get any kind of economic security. While the top 1% has thrived, we have seen wages FALL in real terms over the last eight years. Obama is going to help you out. He give us a tax break and adopt other economic policies that will allow you and me, members of that bottom 90%, to make a life for ourselves. Folks who work hard deserve to get paid, to save and to be able to provide for their families. The supply-side policies John McCain is championing will make that harder and harder by not doing a damned thing for you but giving more and more to the rich who, instead of hiring you as he would like you to believe, will take that extra money and gamble it in the stock market or buy another yacht or vacation house somewhere. Not to mention that McCain wants to make your employer-provided health insurance no longer deductible, meaning that your employer will probably cut off your health insurance. But that's another topic for another day. Do what is best for you and your family. Vote Obama-Biden.
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