By Garry Kasparov
Thursday, March 10, 2016
2016 seems like a strange time to be arguing the merits
of socialism in an American presidential campaign. But it’s also strange for
the prospective leaders of the free world to be talking about the KKK and their
appendages, so clearly this year is not like any other. While the latter topics
are, thankfully, beyond my purview, I have a great deal of interest in socialism.
Last week I expressed some of these thoughts on Facebook
after hearing a clip of “democratic socialist” candidate Senator Bernie Sanders
on Super Tuesday. This was already a rarity, considering how little time the
networks have left after their blanket coverage of Donald Trump’s latest
outrages. My post on the nature of socialism was 113 words long, a quick
response to critics of a cartoon I had posted of Bernie Sanders wearing a
baseball cap reading “Make America Greece Again.”
My goal was to remind people that Americans talking about
socialism in the 21st century was a luxury paid for by the successes of
capitalism in the 20th. And that while inequality is a huge problem, the best
way to increase everyone’s share of pie is to make the pie bigger, not to
dismantle the bakery. Much to my surprise, my little rant went viral, as the
saying goes. Instead of the usual few hundred Facebook shares, this paragraph
quickly reached tens of thousands. By the next morning it had reached several
million people, more than any of the day’s political posts by the leading
candidates. A week later and it has over 3,000 comments, 57,000 shares, and a
9.3 million reach that is in the category usually reserved for photos of pop
stars and kitten videos.
My conclusion that “the idea that the solution [to
inequality] is more government, more regulation, more debt, and less risk is
dangerously absurd” apparently had great resonance, and I think I know why.
There is a growing consensus that America has deep troubles, and no one can
agree on solutions. Everyone agrees that Washington should change, and some
want the government to do much more while others want it to do much less. Many
of the traditional economic numbers say that America is doing fine, and yet
polls say that Americans—especially Sanders supporters—are angry about the
present and fearful about the future.
I often talk about the need to restore a vision of
America as a positive force in the world, a force for liberty and peace. The
essential complement to this is having big positive dreams at home as well, of
restoring America’s belief in ambition and risk, of innovation and exploration,
of free markets and free people. America transformed the 20th century in its
image with its unparalleled success. American technology created the modern
world while American culture infused it and American values inspired it.
In recent decades that storyline has flipped. The
tireless work ethic and spirit of risk-taking and sacrifice have slowly eroded.
This complacency was accelerated by the end of the Cold War and it has proved
very difficult to overcome in the absence of an existential enemy to compete
with. The booming innovation engine of job creation has fallen behind the
accelerating pace of technology that replaces workers. The result has been
slower growth, stagnant wages, and the steady shift of wealth from labor to
capital. In such situations many people turn to the government for help and the
siren song of socialism grows louder.
I respect and even like Bernie Sanders. He’s a
charismatic speaker and a passionate believer in his cause. He believes deeply
in what he is saying, which is more than what can be said about nearly every
other 2016 candidate, or about politicians in general. I say this while
disagreeing vehemently with nearly everything he says about policy. The
“revolution” rhetoric of Senator Sanders has struck a chord with many
Americans, especially the young voters who are realizing that their own lives
are unlikely to match the opportunities and wealth of their parents and
grandparents. They are being left behind in a rapidly changing world. It is a
helpless, hopeless feeling.
The problem is with the proposed solutions. A society
that relies too heavily on redistributing wealth eventually runs out of wealth
to redistribute. The historical record is clear. It’s capitalism that brought
billions of people out of poverty in the 20th century. It’s socialism that
enslaved them and impoverished them. Of course Senator Sanders does not want to
turn America into a totalitarian state like the one I grew up in. But it’s a
valuable example of the inevitable failure of a state-run economy and
distribution system. (Check in on Venezuela for a more recent example.) Once
you give power to the government it is nearly impossible to get it back, and it
will be used in ways you cannot expect.
The USSR collapsed because it couldn’t compete over time,
despite its massive resources and devout ideology. The Soviets put a man in
space before America but couldn’t keep up the pace against an innovating,
free-market competitor. My Facebook post went around the world on technology
created in America. The networks, the satellites, the software, nearly every
ingredient in every mobile device and desktop computer, was invented in the
USA. It is not a coincidence that the most capitalist country in the world
created all these things. Innovation requires freedom of thought, freedom of
capital, and people who believe in changing the world.
Yes, the free market can be cruel and it is by definition
unequal. It has winners and losers. It also sparks the spirit of creativity
that humanity desperately needs to flourish in our ever-increasing billions.
Failure is an essential part of innovation and the free market. Of every 10 new
companies, perhaps nine will fail in brutal Darwinian competition. A
centrally-planned economy cannot imitate this engine of creative destruction
because you cannot plan for failure. You cannot predestine which two college
dropouts in a garage will produce the next Apple.
A popular rebuttal is to invoke the socialist leanings of
several European countries with high living standards, especially in
Scandinavia. Why can’t America be more like happy Denmark, with its high taxes
and giant public sector, or at least more like France? Even the more
pro-free-market United Kingdom has national health care, after all. First off,
comparing relatively small, homogeneous populations to the churning,
ocean-spanning American giant is rarely useful. And even the most socialist of
the European countries only became wealthy enough to embrace redistribution after
free-market success made them rich. Still, why cannot America follow this path
if that is what the people want? What is the problem if American voters are
willing to accept higher taxes in exchange for greater security in the embrace
of the government?
The answer takes us back to all those inventions America
has produced decade after decade. As long as Europe had America taking risks,
investing ambitiously, attracting the world’s dreamers and entrepreneurs, and
yes, being unequal, it could benefit from the results without making the same
sacrifices. Add to that the incalculable windfall of not having to spend on
national defense thanks to America’s massive investment in a global security
umbrella. America doesn’t have the same luxury of coasting on the ambition and
sacrifice of another country.
Who will be America’s America? What other nation could
attract the brightest students, the biggest investors, the most ambitious
entrepreneurs in the same way? Germany? Russia? Japan? China? India? Each may
take over leadership in some areas if America continues to falter, but none is
equipped to lead the world in innovation the way the United States has since
Thomas Edison’s day. None possesses the combination of political and economic
freedoms and the human and natural resources required.
The government does have a role in addressing rising
inequality. I turn not to Denmark or Venezuela or, god forbid, to the Soviet
Union. Instead let us look to the last great battle between labor and capital
in America, between public and private power. Just over 100 years ago,
President Teddy Roosevelt spoke loudly and used his big stick against some of
the world’s largest corporations when they were abusing their monopoly power.
His successor, fellow Republican William Taft, continued the antitrust mission,
at least initially.
Both men dealt with critics from industry and Wall Street
who called their use of government power against them “socialism” and both
answered eloquently. In his 1908 State of the Union address, Roosevelt spoke
about “the huge wealth that has been accumulated by a few individuals of recent
years” being possible “only by the improper use of the modern corporation,” and
that these corporations “lend themselves to fraud and oppression than any
device yet evolved in the human brain.” He also warned against the accrual of
unaccountable political power in the hands of “men who work in secret, whose
very names are unknown to the common people.” You can easily imagine Teddy in
the bully pulpit today calling for the breakup of the big banks and ending
their cozy relationship with Washington.
To give credit, Senator Sanders supports breaking up the
giant banking institutions that dominate American finance and politics in a way
that would evoke jealousy from John Pierpont Morgan himself. However, Sanders’s
socialist policies would replace banks that are too big to fail with a
government that is too big to succeed.
Taft warned about exactly this in his 1911 State of the
Union. Busting the trusts was to free the market, not to insert the government
into it. It was necessary to break up Standard Oil and American Tobacco in
order to preserve capitalism, not to institute socialism. Taft said, “The
anti-trust act is the expression of the effort of a freedom-loving people to
preserve equality of opportunity. It is the result of the confident
determination of such a people to maintain their future growth by preserving
uncontrolled and unrestricted the enterprise of the individual, his industry,
his ingenuity, his intelligence, and his independent courage.”
Bravo! Beautiful words and an even more beautiful
sentiment that is deserving of its own Facebook meme! Unfortunately, today’s
progressive solution would instead be to raise Standard Oil’s taxes and those
of its wealthiest shareholders in order to pay for more services, like free
college and health care. It would have been an acceptable choice for many, but
the American 20th century would never have happened.
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