Socialism Will Never Carry The Day

By Peter C. Earle

During the decades bracketing the arrival of the 20th century, the United States was a graveyard for successive waves of the revolutionary vanguard. Collectivist economic philosophies — including but not limited to communism, socialism, syndicalism, and fascism, with a heavy preponderance of the former two — arrived on American shores transmitted by books, pamphlets, and fiery orators. Yet each and every one found scant purchase and was rendered stillborn in short order.

So regular and definitive was the thwarting of communist and socialist proselytizing in America that it eventually called the very underpinnings of Marxist theory into question. An industrial power with millions of workers should, so the narrative went, be especially receptive to the establishment of a radical labor movement. As late as 1907, August Bebel of the German Social Democrats proclaimed that “Americans [would] be the first to usher in a Socialist republic.” And while one year before Bebel’s proclamation (one he would continue to make for some years) the sociologist Werner Sombart had already expressed exasperation in Why Is There No Socialism in the United States?, the Bolshevik revolution in Russia — an extremely unlikely place for the seeds of the worldwide socialist takeover to begin, at least according to Marxist dogma — turned attention away from the young, worker-rich, yet oddly revolution-averse North American nation.

Even during the Great Depression, when unemployment spiked to an estimated 25 percent in 1933 and GDP dropped by some 50 percent during the first five years, communist and socialist organizations saw a surge in membership, but never one that approached a groundswell.

Numerous explanations for the inability of collectivism to gain a foothold in the U.S. have been offered. Among Marxists, some are philosophically self-referential, such as dismissing Americans as lacking in “class consciousness.” Others are somewhat thoughtful, such as those focusing upon the United States’ being similar to (indeed, surpassing) England and Germany in its degree of industrialization but without the freighting of post-feudal cultural mores. The political structure in the United States, given its institutional inhospitality to third-party and fringe political movements (via federalism and the electoral college), is at least a contributing factor. But a lack of effort was never blamed, nor should it have been: whether targeting labor, farmers, the poor, intellectuals, egalitarians, or the changing but ubiquitous throngs of the disenfranchised, international collectivist organizers have had the United States in the crosshairs for decades; America has stolidly resisted all of them.

Yet the intransigence may be faltering. In May 2018, the University of Chicago released the results of its most recent GenForward Survey, meant to gauge the political and economic leanings of Americans aged 18 to 34. Among this group, known commonly as millennials, 62 percent indicated thinking that a “strong government [is required] to handle today’s complex economic problems.” Of those identifying as Democrats, 61 percent indicated that they view socialism positively, as did 25 percent of those identifying as Republicans.

While the opinions of one demographic group (much less a single poll) does not a Far Left revolt signal, the recent rise to national prominence among several avowedly socialist politicians in American politics is surprising. Over 2 million Americans voted for Senator Bernie Sanders (D-VT) in 2016 in his campaign for the Democratic presidential nomination; his platform, in addition to the standard raft of welfarist proposals, included a massive new government railroad system (explicitly intended, in part, to take trucks off of roads) and the forcible breakup of large firms.

Also surprising is the widening acceptance of massive government programs among average Americans: a Green New Deal, Medicare for All, a universal basic income, a jobs guarantee, “free” college, and others. So, too, is the incremental effusion of collectivist speech among American officeholders, perhaps nowhere greater evidenced than by former President Barack Obama’s attack on the concept of the self-made man and individual responsibility: “If you’ve got a business — you didn’t build that.” (Obama reversed himself four days later: “Of course Americans build their own businesses.”)

American exceptionalism as a philosophy is alive and well; perhaps that is why it's so easy for so many to dismiss the notion that socialism is utterly impracticable and inevitably leads to totalitarianism and economic ruin. The insistence after each great failure of collectivist economics — the Venezuelan tragedy only the most recent illustration — that “it wasn’t really socialism” is likely believable by some Americans; it would not be surprising to find, complementing that belief, that many more believe that the fabled pluck and ingenuity of American know-how could somehow finally get it right. That such a system finally made workable would ostensibly free them from the never-ending scourge of living expenses, housing costs, college tuition, medical bills, and other mainstays of economic life can only be seen as sweetening the deal. But this is a heady place where costs are abstract. When they, on some rare occasion, become concrete, they’re either kicked down the road or paid for by someone else. In any case, the proposals are viewed less as revolutionary than as what was right and salutary all along.

So when did the change take place?

We know now that communism never got out of second gear in the Soviet Union and that China ultimately came to embrace markets. Yet the embrace of statism — the soul of the counterrevolution — has proceeded at an accelerating pace domestically: Americans face an exploding national debt and mounting annual budget deficits, and $1 from Colonel Harwood’s pocket at the time of the original publication of The Counterrevolution (1951) would purchase what it takes over $10 to, today. A government that once held that individuals were overwhelmingly responsible for their personal conduct and fortunes has grown into a behemoth that deigns to tell us what food, drink, and substances we can ingest. Indeed: the so-called War on Drugs has cost the United States over $1 trillion since 1971; half of the world’s incarcerated population languishes in American prisons.

Taxes are levied on everything from fruit bought from a vending machine rather than in a store (California) to soft drinks (Chicago) to selling and licensing performing rights for music (North Dakota). And once taken, these funds are handled in as irresponsible a way as can be imagined: in 2014 alone, the U.S. government misspent or lost over $125 billion of taxpayer monies.

A nation whose founders took a very dim view of a standing military force now reveres uniformed service virtually unquestioningly. Where James Madison — ironically, a proponent of some of the stronger theories of central government during the Constitutional Convention — famously quipped that “a standing military force, with an overgrown Executive, [would] not long be safe companions to liberty”, the U.S. now has a military presence in nearly 80 percent of the countries on Earth. In seven, combat operations are being conducted; in one, Afghanistan, the U.S. is currently fighting its first multigenerational war with no pretense to an end in sight.

It is a resounding testament to the power of human innovation coupled with free markets that despite being increasingly laden with political fetters, they steadily continue to improve lives. For compared to the hundreds of thousands of years of human existence in which subsistence was the default state, the last 250 years — a veritable blink of the eye, cosmically speaking — represents a major point of inflection in standards of living, longevity, infant mortality, and nearly every other measure of quality of life. Despite the screeds and slogans of would-be central planners and opponents of private property, individual liberty and steadily rising prosperity were — and remain — the true revolution.

(This essay is an excerpt from the Introduction to E.C. Harwood’s The Counterrevolution, now available at Amazon.com.)

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Peter C. Earle

Peter C. Earle is an economist and writer who joined AIER in 2018 and prior to that spent over 20 years as a trader and analyst in global financial markets on Wall Street. His research focuses on financial markets, monetary issues, and economic history. He has been quoted in the Wall Street Journal, Reuters, NPR, and in numerous other publications. Pete holds an MA in Applied Economics from American University, an MBA (Finance), and a BS in Engineering from the United States Military Academy at West Point. Follow him on Twitter.