Written By: Becca R.
Thanksgiving is coming up, so you know what that means. Arguments over who gets to sit at the adult table, repeatedly getting asked why you’re still single and where you’re going to college, and political arguments between that one uncle and other family members that actually know what they’re talking about. If your family is anything like mine, there’s a decent chance the 2020 Democratic candidates will come up. Perhaps one of the most controversial aspects of this discussion topic (besides Mayor Pete jumping the gun and claiming it’s between him and Warren, or Warren’s Medicare for All plan that we still don’t know how to pay for) will be Bernie Sanders and his “socialism.” But how socialist is he really, and what would his policies do to the United States’ economy?
Maybe you’re not a nerd like I am for current issues and politics, so let me fill you in. Bernie Sanders is the guy who had a heart attack a few months ago while campaigning. He’s (somewhat) fine now, and still running for the Democratic spot to go up against Trump in 2020. He’s probably best known among our age group for wanting to make college free (and considering how many blog posts are on here about student debt... it’s pretty relevant). He’s a self proclaimed “Democratic socialist,” but he hasn’t really explained a whole lot of what that means.
He wants free medicine and education, livable wages, guaranteed jobs. His campaign often has the phrase “we must create an economy that works for all, not just the very wealthy” (Gregory). So, would socialism work?
The Council of Economic Advisers released a report titled “The Opportunity Costs of Socialism” in 2018. In it, the report detailed that should the United States adopt Nordic countries’ (Sweden, Norway, and the like) socialism, “its real GDP would decline by at least 19 percent in the long run, or about $11,000 per year for the average person.” Now, if the United States were to adopt more “hard core” socialist policies, like those in Venezuela (which, sure, isn’t exactly the poster child of economic/political stability right now, but we’ll ignore that), “[they] would reduce real GDP at least 40 percent in the long run, or about $24,000 per year for the average person.”
Now, a 40% reduction in the US’s GDP? As of 2017, our GDP was 19.39 trillion. 40% of that, as in how much we’d lose in the long run, would be 7.756 trillion dollars. Safe to say Bernie better not start pitching adopting Venezuelan policies. As for his actual policies... they’re extreme, to say the least. “All told, Sanders’s current plans would cost as much as $97.5 trillion over the next decade, and total government spending at all levels would surge to as high as 70 percent of gross domestic product. Approximately half of the American workforce would be employed by the government. The ten-year budget deficit would approach $90 trillion, with average annual deficits exceeding 30 percent of GDP.” (Riedl) And if we want to compare that to some European social democracies that seem to be used as role models for US socialism, it still doesn’t look so good. Those countries average 43% of GDP in government spending.
We can argue for hours about whether or not the US’s brand of late capitalism has overstayed its welcome or is just getting started. But Bernie’s radical ideals would not work in our current economy. Even when trying to emulate countries that have made it work for them, our GDP would be reduced in a way in which the opportunity cost is just too high. Socialism may or may not be the answer, and I’m not about to tell you what you should believe, but at the end of the day there’s just no way to pay for Bernie’s plan.
Works Cited
“How Socialist Is Bernie Sanders?” Hoover Institution, www.hoover.org/research/how-socialist-bernie-sanders.
Riedl, Brian, and Manhattan Institute. “The Unaffordable Candidate.” City Journal, 15 Oct. 2019, www.city-journal.org/bernie-sanders-expensive-spending-proposals.
“You Can See America's Future Under Socialism, And It Isn't Pretty.” Investor's Business Daily,
Investor's Business Daily, 25 Oct. 2018, www.investors.com/politics/editorials/socialism-poverty-democrats-standard-of-living/.
Becca, this is so interesting! I was thoroughly engaged in your article the whole time I was reading it! I have never really spent the time to deeply look into the policies of the different presidential candidates, so thank you for writing this, it's so eye-opening. It's nice that Bernie Sanders wants to create free medicare and education, but I never realized how much of a detriment it would be to our economy!! My question is, would we ever be able to bounce back from the loss in GDP if the country were to adopt these socialist policies?
ReplyDeleteDang! that's a lot of money to spend in only a decade, if he is actually elected will congress even allow him to actual start spending? Also, if he is a socialist will he try to convert everything we have known into a socialist culture? Honestly, I do not think that congress will allow him to achieve half the things he wants to. Sadly, as you said, this is very beneficial to us as a people but hugely detrimental to us as an economy I wish we could find some sort of middle ground.
ReplyDeleteWow I didn't know that Bernie's plans would cost so much money! I really like this blog post because I have always wondered what socialism was, and why is it ridiculed so much,but now I know! It costs so much to have free college or free anything really. Its really hard to get everyone to get everything and that is why I believe as well that Bernie's plan wouldn't work as well. I also believe it should't be the government to give you stuff like free college because it harms the economy. Socialism may be good on paper, but the applications for it in real life don't work out like they should.
ReplyDeleteI knew that Bernie was on the extreme end of the democratic party, but I didn't know about all the expenses that would come along with his plans. While some of his ideas are targeting some important issues, they just are't reasonable in our economy. I also think the cost of all these plans would be a large deterrent for people.
ReplyDeleteThis is a great piece. I do find it interesting the debate that we have created around socialism. I don't think it would be as extreme of a debate if the people most opposed to socialism, often rich people, were not constantly in the news for tax evasion and other financial stories. I do think it is good to explain what socialism is because so many people make a judgement on whether it is good or bad before knowing what it is.
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ReplyDeleteThere is also a distinct difference between the plan that Bernie Sanders is proposing versus the countries of Europe. This is that Bernie Sanders is a true socialist, while the more liberal countries in Europe are not. For example, Denmark, Sweden, and Norway don't have any minimum wage laws, were Bernie Sanders has proposed a minimum wage of $15 an hour. This minimum wage law is a problem because it leads to vast inefficiencies in the market since a price floor is above the equilibrium. It also leads to inflation, because businesses will be forced to raise prices in order to pay workers, which will lead to the lowering of purchasing power of the dollar. This will result in the minimum wage needing to be set even higher creating a vicious cycle of accelerated inflation. And before anyone tries to call slippery slope fallacy on me, this same exact sequence of events has already happened in Venezuela, where in 2018 the minimum wage was hiked up 6 separate times but the purchasing power of the people at the end of the year was lower than it was at the beginning.
ReplyDeleteI think I can speak for everyone when I say that the amount you described was a LOT of money. I really like how you went in depth and allowed us to understand how his reforms would effect us both in the long and short run. But one question that still gets me is if Bernie Sanders has made it this far and receives enough support to be a household name, could there possibly be some benefit to what he's preaching? Maybe he doesn't garner loads of support through reforms like you mentioned, but you vilify his borderline-socialist views with no saving grace. We never hear of modern day political parties like the Communist Party of America or the American Socialist parties because we know that their views lack rational ideologies to run a country. If Congressman Sanders has received enough support to become a household name, maybe his ideologies possess some benefits you negated to research.
ReplyDeleteWow, that's a lot of money. I hear the world "socialist" thrown around a lot with all the presidential drama coming up, but you rarely hear about the realistic effects of what Bernie is promising. Like a lot of people before me have said, he probably won't be able to put a lot of his plans in effect due to congress in the event that he does get elected. It's nice to think about how college could be free and how education and jobs could be more available, but there doesn't seem to be a way to achieve this without either spending a ton of unrealistic money or jumping through a million hoops in government.
ReplyDeleteThis article was very interesting. I always believed there was no way any form of socialism would work and now this has been proved as true. Everything in this post makes sense, however, I believe there is still something missing. That would be all of the principles America was built off of and "The American Dream." Giving everything big out for free completely goes against that. Some may even say that they can't live the American dream because they can't go to college for free, however, you don't have to go to a college that costs $40,000 a year, you could go to one that's under $10,000. With around $40,000 in debt, anyone could manage that if they are financially literate. It is not worth wrecking America's economy to help pay for everyone's tuition because in the long run, even those who went to college, won't have the opportunity to be as successful as if capitalism were to still exist.
ReplyDeleteThis was one of my favorite blog posts I've read purely on the fact that it was factual and actually hit important issues. A lot of people don't actual take the time to research facts on their own so they believe the mainstream media and adopt their opinions. I feel like the way that you laid out this blog post was pretty much free of opinion and was a factual way of showing the economics of bernie's plans. I think that his plans are irrational and unreasonable considering how they would cripple the economy.
ReplyDeleteI think its very underlooked how important being unbiased in a political article is. It is so easy to stray from facts and starting to look at opinions and feelings. I think that this is a perfect example of how staying unbiased in an article about politics can impact one's viewpoints. I think that because it's unbiased, it becomes more persuasive. Great work.
ReplyDeleteThe only issue I had with understanding this blog post was what GDP was before looking it up using one of the sources provided. Otherwise, this blog post really is eye opening to what Bernie Sanders is going for and what free college would take money-wise. The fact that if we have completely free college as well as a legally enforced minimum wage of $15 we would have accelerated inflation and a high national debt is really concerning. Maybe instead of having free college we have affordable college would be a better compromise.
ReplyDeleteI am usually the type of person who avoids politics and political talks as much as possible, however, this article was really well written and informative, and kept me engaged while reading. You described things in ways that I could easily understand, which isn't usually the case for political essays. I think it was nice to see solid numbers as the consequences of his actions instead of vague ideas, because it really puts these issues into perspective and allows us to see exactly what would happen as a result of his plans. Overall, this is a really well written article and helped me truly understand what is going on.
ReplyDeleteThanks for this post, Becca! But really though, this is pretty informative. As most of us will be able to vote next year for the presidential election, this is something we’re gonna need to think about. Such a large decrease in GDP could result in potentially horrible outcomes, like a failing economy. Even if some of the ideas seem ideal like free college, if it results in the economy taking a complete downturn I’m not too sure if that really is the best idea. I’m definitely still gonna be looking for possible ways for that part to work, but with all of the other policies he wants to enforce, I just don’t think it’ll be something reasonable when looking at it in terms of our economy. There might be things he would want to do to increase the economy as well, but that’s not the main focus of this article here.
ReplyDeleteYou addressed a question that lingers in many people's mind, prone to misinterpretation and has many misconceptions. I applaud you for the brave step. A brave step in the wrong direction. Sadly your article has not nullified misinterpretations but done the opposite. Like the majority of the populus you are confused by the broad umbrella term: Socialism. The socialism you are mixing up is MLM socialism and democratic socialism. Mixing these words changes the entire argument and the fundamental argument becomes wrong. MLM stands for Marxist-Leninist- Maoist socialism. Comparing MLM socialism(Venezuela) to democratic socialism is like comparing an industrial log splitter to scissors, both cut a form of wood but that does not mean they are similar. As far as I know MLM socialism is not the kind Bernie or Warren are talking about. Even the democratic socialism they talk about is half the extent that many democratic socialist countries go to. For example both are not proposing government owned companies,fixed job wages,etc. They are proposing policies that are as socialist as FDR, such as health care and education.
ReplyDeleteYour GDP “reductions” that will affect the US if we follow the nordic countries’ system does not seem factual as when you look at the GDP graphs of all the Nordic countries, they have been exponentially increasing from the late 1900’s, they also have the highest GDP per capita (not including tax havens), highest amount of millionaires per capita (not including tax havens), and some of the lowest wealth inequality(including tax havens). I agree that it would not translate to the US because of the difference in situation, the scale of the country and many other obstacles but your argument is flat out wrong. Increasing consumer spending by relieving burdens such as education and health care will increase our economies’ productivity and goods demanded which in turn increases job growth. That will only improve our economy, not hurt it.
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ReplyDeletePart 2:
ReplyDeleteThe current economic system that you would argue hours for, is called Reaganomics.
Even though it is not as implemented as it once was, it still is the major economic policy right now. It is also called trickle down economics. This policy reduces taxes on the rich and help them get richer, so they can invest it back into the country and the wealth “trickles down to the poor.” What if the rich don’t invest it back? That is what happened to our country, where the rich keep getting richer and the poor either stay the same or get even poorer because the rich can store their money somewhere else instead of investing it back. It is a colossal failure that only increased the wealth inequality in this country.
The US pays around $6000s more per person just for health care compared to several Europeon healthcare systems, so that means out of your “-$11,000 per person” you have to remove $6,000, and the economic boom that would be felt by increased consumer spending, would make that -11,000 into a positive. Your sources seem credible, however they appear to be biased such as “The Council of Economic Advisers”. The economists working under the rich or are rich won’t support economic ideas that also hurt the rich, but you used a source filled with rich economists. Another biased source you used is “Investor's Business Daily”, investors who invest into large companies. Democratic socialism will tax companies more or just make them pay more than 0% *cough*Apple*cough*Amazon*cough*. This is terrible for an individual company in the short run, however, in the long run the industry benefits as increased consumer spending would mean more products would be bought such as an Iphone or Kindle.
I do agree with you that Bernie’s policies can be daunting for a country this big. Paying it seems like an impossible task. Nevertheless it is a policy with a positive intent to empower the poor and disallow anyone to die on the streets or sucide because of health care costs which occurs at a rate of 50,000 per year. The current economic policy does not have naive intentions, instead only helping the rich. When concerning the price to pay, congress does not have any problem increasing the debt limit each year to fund our military. The military does provide many jobs and does help the economy, but investing in health care and especially college with the same amount of money will help the economy several times more. Of course we need a military but allocating some of that money and using it efficiently and getting money by getting taxes from many tax evading companies means it is possible to do it. It is not that it has never been done before, it is just doing it at this scale and with American beliefs is hard, but if any country could do it, it is Murica, baby!!!
I agree with your take on Bernie Sanders and Socialism. His plan wouldn't work out for us and if it were to be put into place the consequences would most likely be disastrous. He doesn't take into account people that will take from the system but not reciprocate by giving back to it. Laziness could bring the whole roof down on his operation. His plan also doesn't take into consideration how this loss of GDP and other factors would play into our role internationally. We need to keep our edge on the other nations of the world and Bernie's ideas would be a handicap. Losing the top spot in the world to China would not only be shameful but also harmful for us and the wider world. There might be some ways to integrate socialist ideals into America but Bernie is certainly not the man who would be able to bring any such changes.
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