Socialism is hot right now. The upset win by New York City congressional candidate Alexandra Ocasio-Cortez last month triggered a wave of stories and opining about how some of the new faces of the Democratic Party have embraced socialist economic and social policies.
The Associated Press reported recently that “there are 42 people running for offices at the federal, state and local levels in 20 states this year with the formal endorsement of the Democratic Socialists of America. The AP said membership in the DSA has increased from a mere 6,000 prior to Donald Trump’s election to 45,000.
The DSA’s constitution states, “We are socialists because we reject an economic order based on private profit, alienated labor, gross inequalities of wealth and power, discrimination based on race, sex, sexual orientation, gender expression, disability status, age, religion, and national origin, and brutality and violence in defense of the status quo.”
The most talked about policies of the socialists are Medicare for all, free college, a $15 minimum wage and abolition of ICE—the federal department of Immigration and Customs Enforcement. Vermont Senator Bernie Sanders campaigned hard on several of those issues during his 2016 run for the Democratic nomination for president and he won a lot of converts. Sanders even beat Hillary Clinton in conservative West Virginia, winning 51 percent of the vote, compared with 36 percent for Clinton.
At its simplest level, the appeal of socialism is predictable. The lure of free college, free healthcare, higher pay without increased responsibility or skills is powerful for some. Additionally, a free market economy, by definition, is going to lead to unequal outcomes. Those who work harder, possess skills that are in demand or bring a fresh idea to market increase their chances for greater economic success.
Of course, the free college and healthcare are not actually free. Somebody is going to pay, and that’s where the foundation of socialist economics weakens. The libertarian-leaning Mercatus Center at George Mason University has released a study predicting Medicare for all would cost $32.6 trillion over ten years.
The free college plan would cost about $75 billion a year, by Sanders’ estimate. He has said that a tax on Wall Street trading would pay the bill. However, according to PolitiFact an investment transaction tax would pay two-thirds of the cost and the states would have to pay the rest. Could the taxpayers of West Virginia afford to pay for one-third of the cost for every student’s college education?
The $15 minimum wage is being tried in a number of cities with mixed results. Some studies show there has been little or no negative impact on business, while others have found low-wage workers have actually done worse because employers have had to reduce hours or the number of employees.
Sanders and the socialist ideas essentially got a pass during the 2016 campaign because Clinton knew she would eventually win the nomination and she did not want to alienate those voters. But that’s changing. Democratic socialism is gaining a foothold in the Democratic Party and, with its rise in popularity comes additional scrutiny.
The fascination with socialist policies will wane as taxpayers begin to take a closer look at the actual costs. As former British Prime Minister Margaret Thatcher famously said, “Socialist governments traditionally do make a financial mess. They always run out of other people’s money.”