A New Report Shows the White House Is Terrified of Socialism

The Nation
October 26,2018
By Kate Aronoff

The Council of Economic Advisers’ investigation into the “opportunity costs of socialism” reads like a nervous undergraduate’s term paper.  

The White House Council of Economic Advisers this week authored a report assessing the “Opportunity Costs of Socialism.” Really.

The council may have decided to pull the trigger and release it after polling came out yesterday showing that a majority of Republicans support Medicare for All, which the report spends no small amount of space attempting, unsuccessfully, to debunk.

At 72 pages, though, the report clearly wasn’t compiled overnight—no matter how many Heritage Foundation and American Enterprise Institute white papers were used to create it. What, might we imagine, was the moment when they decided to commission it? Was it self-described democratic socialist Alexandria Ocasio-Cortez’s primary victory in June? The Democratic Socialists of America’s swelling to 50,000 members a short time later? Recurring rumors of another presidential run by democratic socialist Bernie Sanders?

The stated reason is even more interesting: “Marx’s 200th birthday.”

The reports’ authors correctly write that “socialism is making a comeback in American political discourse.” And that fact has clearly got at least some subset of the Executive Branch worried, so much so that they decided to spend whole pages litigating such pressing topics as century-old debates among socialists, and highlighting such damning quotes as “from each according to his ability.”

They note to this end, that “the socialist narrative names the oppressors of the vulnerable, such as the bourgeoisie (Marx), kulaks (Lenin), landlords (Mao), and giant corporations (Sanders and Warren).” This may come as news to decidedly non-socialist Elizabeth Warren. The French economist Thomas Piketty is also referenced, even though his politics are hardly revolutionary.

Other highlights include a graphic representation of Milton Friedman’s “Four Ways to Spend Money,” famously paraphrased in Margaret Thatcher’s line that “the problem with socialism is that eventually you run out of other people’s money.”

In what reads like a Red Bull–addled college freshman’s attempt to parse their introductory economics course through a first-response paper, the White House Council of Economic Advisers (!) explains that “In the market system, people spend their own money, and are therefore more careful how much to spend and on what the money is spent. To the extent that they also use what they purchased…they are also more discerning, so that the items purchased are of good value. They will gather and consider information that helps compare the value of different options.” If they keep at it, a few weeks from now, they might even learn the formula for the consumption function!

Sill, neoclassical economics isn’t their only line of attack. The Council of Economic Advisers (CEA)—comprised of professional economists—also compares mildly social-democratic policies, such as taking health care out of the hands of the private market, to Mao’s Great Leap Forward, which caused literal famine. “Modern journalists and analysts routinely claim that single-payer programs are more efficient—and thus are similar in spirit to Lenin and Mao,” the CEA writes by way of an attack on Medicare for All.

As Vox points out, they also claim to show the evils of bringing so-called socialized medicine to America by noting the short wait times enjoyed by American seniors—the recipients of America’s own already-existing government-run healthcare system, Medicare.

In a section detailing the ills of Scandinavian social democracy, another graphic finds that it is far more expensive to own and operate a pick-up truck in Finland than in the United States. Quelle horreur! Then, displaying some cross-disciplinary flair, the report also compares the incomes of people of Nordic ancestry living in the US to the wages of those living in their country of origin. The goal of this ethnocentric exercise is not to argue for more immigration from Norway, as Trump has in the past; it is to assert that low wages are not part of “Nordic culture” but rather, a product of public policy (it’s worth noting as well that the median household income of white households in the United States is tens of thousands of dollars more than that of black households.)

The conclusions of the report are about what you would expect: Venezuela bad, free markets good, MAGA forever—never mind that Democratic Socialists of America members aren’t exactly teeming to recreate an authoritarian petrostate, let alone collectivized agriculture. In fact, few are even claiming that an American socialism should attempt to be a carbon copy of the Scandinavian social democracies.

What the report does show that the White House feels threatened by socialism’s newfound ascendance to the point of, well, actually deciding to draw up dozens of pages about it. If the CEA’s apparent skittishness about Medicare for All is any indication, what would seem to worry them the most is the idea of a democratic socialism that’s uniquely suited to the United States. That’s why socialists, leftists—and indeed, anyone looking to challenge the Trump administration’s dystopian vision of the future in earnest—are rightfully pushing for policy proposals intended to address the needs of working-class Americans such as a Green New Deal, a federal job guarantee and abolishing cash bail and ICE.

With any hope, we can expect CEA reports on those too.

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