A new poll on Talking Points Memo finds that 55 percent of likely voters believe President Obama is a "socialist." That's rich on a couple of levels. First, if Mr. Obama were a real social democrat we'd have universal, single-payer health care, a major program to rebuild our nationwide rail system, superior public schools and affordable or free (real) universities, a comprehensive social-safety net and an appropriate tax on the rich and corporations. That we don't says the president is a Clintonian corporatist at best, and millions who voted for change are disappointed and not likely voters. The second laff riot is that these morons polled don't even know what socialism is — and yet, as Arizona can teach the nation — morons vote, feverishly.
"Economic freedom" is code for...what exactly? A selfish nation of dolts that thinks roads and sewage plants are made by elves in the middle of the night, and thus the dolts shouldn't have to pay taxes? Never mind that America pays some of the lowest tax rates in the industrialized world, most major corporations pay none, and we suffer infrastructure, competitive, social and state budget crises as a result. Does it mean you should be allowed to build a toxic waste dump in your backyard — even though you would be the first to report your neighbor's unauthorized paint scheme to the homeowners' association? Economic freedom is the gibberish of the uneducated, the selfish, and aggrieved, all indoctrinated by the ubiquitous Fox "News" and white-right talk radio. Yet it is the phrase of the moment and people mouth it, along with their gun lust, theocracy and hatred of "the other" like 1930s Germans saying "Kinder, Kuche und Kirche!" or "Drang nach Osten!"
As a "socialist," taking away our "economic freedom," Mr. Obama shows his hatred for that sacred American concept, "the Free Market." What does that mean? In the elegant world of theory, it implies that given maximum freedom, human action in the marketplace will produce superior results to any kind of command economy or "industrial policy." Price signals tell producers what customers want and employees where the jobs are. Competition keeps new ideas, products and services coming. The "invisible hand" — Adam Smith uses the phrase only once, and narrowly, in The Wealth of Nations — presides over this mysteriously and effectively but...well, you don't mess with the hand. The theory has been relentlessly pushed down and dumbed down over 30 years so that perhaps a majority believe it as an article of faith. Or better. C.S. Lewis wrote of Christianity something to the effect that "it's just screwy sounding enough to be true." Free market church-goers have a completely closed-loop "proven reality."
The problems with this conception are too many for this modest blog. But we can begin. By implication, the George W. Bush revels were "the free market" at its zenith. Thus, the worst economic collapse since the Great Depression is a sound repudiation of the theory, just as the Depression sent laissez-faire into the wilderness for two generations. One other thing Mr. Bush taught us: Aside from the secret agendas of the oligarchy, "conservatives" can't handle the complex issues facing a 21st century society. But don't try telling that to a graduate of Glenn Beck U.
What emerged from the New Deal and Franklin Roosevelt's willingness to experiment was what my generation would consider American capitalism. It produced the greatest economy the world had ever seen, including consistently rising wages and living standards for average people. It contained many elements of classical capitalism (for which the hard left would never forgive FDR). But it was in reality a mixed economy, a delicate, complex and dynamic balance. To simplify, it contained two important elements. First was regulation to ensure competition, prevent the formation of monopolies and cartels, protect smaller players and customers, and tamp down the speculation that helped cause the Depression. Without such checks, the best of the free market will always be trampled. Second, it entailed a great deal of pluralism and checks and balances, including unions. This American capitalism served the nation well and even survived the Reagan years — a Reagan apologist might say his reforms strengthened it. Reagan's hero was FDR, after all. This is the America so many aimlessly, desperately angry people long for.
Especially since 1990, many of the props that kept this economy so well-functioning for most Americans and so resilient have been knocked away. Deregulation has been accompanied by "regulatory capture," where the regulated companies send former executives to staff regulatory agencies. The banks and BP come to mind. "The market will regulate itself...be self-correcting." That's what the fiction writer Ayn Rand told Alan Greenspan. The amount of money corporations can pour into politics and conservative causes has exploded. Lack of antitrust caused waves of mergers that decimated local economies and heavily concentrated industries. Bad trade deals did worse damage, especially to manufacturing (ask the shade of Adam Smith about its importance). Years of unfair labor laws decimated unions. The result has been a steadily faltering economy kept alive by bubbles and a financialized economy trading Monopoly money derivatives. The wealth it took a century to build is being sold off. And even though a moneyed elite is in firm political control, for the first time in American history a cohort growing to a majority can expect worse living standards than its parents.
Through all this reign of "the free market," we had a very large government involved in the affairs of business and the economy more than ever, right down to helping set the explosives that nearly brought down the house in 2008. Nor have we lacked for "industrial policy," whether it is subsidizing the oil-auto-housebuilding complex or carrying on endless wars atop more defense spending than all other nations combined.
This freefall was not caused by "socialism." It was caused by "conservative" free-market theories put into action as a rigged market. Mr. Obama has regrettably been a party to it. He saved the financial elite. He kept GM and Chrysler building internal combustion cars. Taxes have been cut. The rich are richer than ever, whereas they lost ground during the Depression. We will "drill, baby, drill," with cosmetic corrections. Our schools, universities, transit systems and other commons are suffering. If Hank Paulson's memoir is to be believed, Sen. Obama pretty much took charge of the nation in a pivotal 2008 meeting during the panic, while wealthy Republican John Sidney McCain III sat in paralyzed silence and W was already outta there.
So in a grotesque way, President Obama should be the conservatives' darling. Except that he's a Democrat, and an African-American, and there's still enough of America that hasn't been looted that he must be, as Sen. DeMint would say, "broken."