Bernie Sanders and Alexandria Ocasio-Cortez’s Democratic Socialism vs. Trump’s Crony Capitalism!

Believe it or not, I sat through President Trump’s entire 2019 State of the Union address! Nothing unexpected from his reading of the speech off the teleprompter, but one part of the speech caught my attention. He proclaimed, “Tonight we renew our resolve that America will never be a socialist country.” I wonder if he truly understands the word socialism, especially democratic socialism. I doubt it. 

Trump is not a man of philosophical or ideological convictions. He’s not the kind of guy who seeks knowledge or is interested in reading or understanding anything other than business deals that personally benefit him; whether legal or illegal, ethical or unethical, proper or shady. I do believe, though, that he has personal and political reasons to bash socialism. After all he has benefited enormously from the crony capitalism pervasive in the American economic and political system since he was very young. But first I need to explain what crony capitalism and democratic socialism mean, in case you are wondering.

Tastes Like Crony CapitalismCrony capitalism is a term describing an economy in which success in business depends on close relationships between business people and government officials. It may be exhibited by favoritism in the distribution of legal permits, government grants, special tax breaks, or other forms of state interventionism.”

On the other hand, “social democracy, now often referred to as democratic socialism, in which extensive state regulation, with limited state ownership, has been employed by democratically elected governments (as in Sweden and Denmark) in the belief that it produces a fair distribution of income without impairing economic growth.”

The key difference between the two socioeconomic and political philosophies involves the robust state regulation and oversight in social democracy and lack there of in crony capitalism. Notice that Socialism is a system wherein political representatives are “democratically elected” to ensure “fair distribution of income” to citizens.  Such systems require extensive state regulation but “limited state ownership.” Whereas favorable state interventionism beneficial to businesses, achieved through close relationships with corrupt politicians euphemistically called “lobbying” in America, permits and is essential for crony capitalism to flourish. It is not hard to see why Trump is a beneficiary and hence a strong proponent of crony capitalism and is profoundly averse to democratic socialism. He simply hates government oversight.

Many who knew Trump well claim that he showed affection for crooked business practices before he became a president and has been a poster boy for crony capitalism after occupying the White House. Apparently, according to Trump, he borrowed a mere one million dollars from his father to start his real estate business but the truth may be that the loan was more than just a million. An extensive report in The New York Times, however, concludes that he inherited over $400 million from his father’s real estate fortune by engaging in “suspect tax schemes”. Then there were the suspect businesses of Trump University and Trump Foundation, which had to be folded recently due to possible illegal practices. 

The billion dollar question though is:  did Trump and his children (as well as his son-in-law) engage in illegal or unethical (or both kinds) of business practices to build their real estate empires? Can that be the reason why he bucked tradition and didn’t reveal his taxes before the presidential election, and continues to fight to keep them from becoming public? The more serious issue is whether money was laundered into his businesses from shady foreign sources. Many are wondering if that could be the reason why he has been inexplicably very friendly with Putin, Russian oligarchs and the Saudi royal family well before – and during – his presidency.  Various committees in the Democratic Party-controlled House of Representatives are launching hearings to determine the underlying reasons for Trump’s cozy relationships with these undemocratic foreign nations.

Trump has been a shameless champion of not only crony capitalism but also nepotism. He gave enormous powers to his daughter Ivanka Trump and Jared Kushner, his son-in-law, in spite of Jared not getting FBI security clearance. Ivanka wields enormous influence on him and rubs shoulders with leaders of many nations even though she has no political experience whatsoever. I am not sure what their qualifications for such position and power are. Nepotism appears to be the one obvious explanations I can think of.  At the same time, both his daughter and son-in-law may share the same questionable business values and practices as Trump, and may value the necessity of keeping any shady deals in the dark.  

Ethical and moral business practices, being a responsible citizen, paying due taxes and contributing to the society from which he benefits are not values Trump bothers about. He bragged that he contributed to the politicians from both parties who write the laws – laws which may be immoral or unethical, but are legal and beneficial for businessmen like himself.  This is a characteristic of crony capitalism that allowed him to personally amass considerable fortune. And it helps explain why he appears to be committed to amplifying and perpetuating crony capitalism while demonizing democratic socialism. The unfortunate fact is, he has the power and the bully pulpit to do both in his role as the president of USA.

Trump campaigned and won the presidency promising that he was going to drain the swamp in Washington, DC. He also said he would promote legislation that would benefit the middle class.  In reality, he has come far from fulfilling either campaign promise. In fact he and his cabinet could never identify with the lives of middle class Americans and are possibly the “swampiest” ever in American history. He chose billionaires as his cabinet members: Treasury Secretary Steven Mnuchin, Education Secretary Betsy Devos and Commerce Secretary Wilbur Ross, all of whom may also have benefited from crony capitalism. When Dr. Tom Price, his Health and Human Services Secretary had to be fired for ethical reasons, Trump hired ex-pharmaceutical industry lobbyist Alex Azar to replace Dr. Price. Mr. Azar, by the way, earned millions lobbying for greedy PHARMA.  No wonder Trump and other Republican politicians rammed new tax legislation through Congress that gives billions worth of tax breaks for real estate moguls like himself and to corporations.  These tax breaks to the wealthy and to corporations have had the consequence of increasing the national debt by around 1.8 trillion dollars.  Meanwhile, this tax legislation package gives mere crumbs to the hard working middle class.  This is a classic case of crony capitalism, and it is anathema in democratic socialism. 

There are many political reasons for Trump to start negative and false propaganda against socialism, and try to shift the national conversation to condemn democratic socialism.  Trump’s presidency and his leadership are becoming unpopular. Coupled with the popularity of Bernie Sanders (a Democratic Socialist) and the recent shellacking of Republican House Representatives by young, energetic (many female if I might add), progressive democrats like Alexandria Ocasio-Cortez may be perceived by Trump as a warning of potential danger. Trump may also be thinking about the possibility that these new legislators could move  the national political discourse towards what is considered by many from the right as support for democratic socialism. His businesses and personal finances as well as foreign policies toward Russia, Turkey and Saudi Arabia are coming under increasing and intensified scrutiny by the new Democratic-chaired committees in the House of Representatives. His bid for reelection could be in peril. It is understandable why, during the recent State of the Union address, he launched a preemptive strike against what he believes are the winds of socialism blowing in America. Watch out for this to be his incessant theme for the upcoming reelection campaign.

During the 2016 campaign, Trump was very effective in whipping up hatred and fear about Mexican rapists, MS13, and other violent, illegal immigrants from Central America. Was there a dose of white nationalism also? You decide for yourself! The 2020 presidential campaign strategy is more likely going to involve fear mongering about America becoming a socialist country. He is ignoring the fact that we already institute a few highly popular social programs:  Social Security and Medicare, for example. I have a feeling that he wants to make socialists and democratic socialism the dirtiest words in America during the next campaign. I won’t be surprised if Trump took aim soon at the rising popularity of Alexandria Ocasio-Cortez (AOC), a representative with progressive ideology who is not ashamed to be labelled a Democratic Socialist. The statement that America will never be a socialist country may be a subtle dog whistle to die hard Trump supporters! He may also be thinking it can be a winning campaign slogan. Trump really knows the pulse of a significant population of Republicans, who he is counting on to reelect him in 2020. When it comes to touching a sensitive nerve and eliciting an emotional, deep visceral hateful reaction among his followers, Trump is a genius!

Many of Trump’s loyalists, right wing talking heads and other conservative pundits on FOX News are quick to jump the gun and they have already started the propaganda to label the progressive, democratic, and  socially beneficial safety net policies, “Socialist”! Many go even further and equate democratic socialism to communism. I can guarantee they don’t know the fundamental difference between the two political philosophies. It is not hard to find out. All they have to do is just “google it.”  In case they don’t want to, let me help.

In “communism there is societal and communal ownership and governance of the means of production, (no private ownership) and the eventual establishment of a classless society.” (Merriam-Webster Dictionary)

Unlike democratic socialism, communism does not allow individual ownership, which is a surefire killer of many citizens’ interest for innovation or hard work in the long run. 

That’s precisely what happened in Russia and China when those countries tried communist political philosophy. There was initial empowerment in both countries immediately after their respective revolutions, but communism failed in the long run because Karl Marx’s communist doctrine underestimated the power of the self-interest of people, and their desire for ownership and accumulation of personal wealth. On the other hand capitalism generally succeeds because it allows for self interest and rewards hard work. Hence, we see the recent transition of both those countries to market economies, but parts of the communist political structure and methods of governance still persist.

While communism is on one end of the socioeconomic spectrum, greedy capitalism is on the other end  – with an enormous gap in between. Unregulated capitalism becomes a social problem when it becomes predominantly profit oriented, at any cost or means, resulting in worsening inequality and poverty, as is currently happening in America. The inequality is not as profound in Scandinavian countries which respect and follow the principles of democratic socialism. Scandinavians still follow reasonable capitalism that rewards hard work and private ownership but governments there monitor and regulate any unfair or unethical means of accumulation of wealth. Hence the gap between the haves and have nots is not nearly as wide in those countries as it is in America. Additionally the citizens of these countries are consistently the highest among all the nations of the world in reporting happy lives. Trump and his posse never mention that fact but are quick to point to what’s happening in Venezuela, as he did in his State of the Union speech. They say that America will “become Venezuela” if socialist ideas and policies are allowed. 

Venezuela is not a true democratic socialist country. The primary source of revenue in Venezuela comes from the oil industry, which is owned by the state. Venezuela had problems due to volatile oil prices, mismanagement by the state, and resistance by the wealthy elite class against socialist government. The covert and overt American intervention in that country’s domestic affairs, probably due to oil interests, didn’t help the country any either. In fact it fueled the fire of unrest and turmoil, pushing millions into poverty and causing many to flee Venezuela. Relying on the military became essential for President Nicolas Maduro to survive, which unfortunately curtails freedom, making matters even worse. The situation in the democratic socialist countries is far from that of Venezuela; there is no comparison.

Trump also asserted during the State of the Union that, “America was founded on liberty and freedom, and not government coercion, domination and control. We are born free and we will stay free.” I think this statement is a dog whistle for his ardent supporters. The true democratic socialist countries do not curtail freedom. I have been to Denmark, Holland and Sweden. I have personally talked to people there. They have freedom, choices and also get a much better bang for their buck as far as their taxes are concerned. An average middle class citizen pays 30% taxes and gets quality healthcare and education up to and including university for their children. I pay more than that in federal taxes and get zero healthcare and education benefits for my family as an American citizen. It doesn’t matter whether you call it socialism or something else, why is that not a better system than greedy crony capitalism?!? The citizens of those countries also enjoy a robust social safety net if they get sick or become unemployed. While employed, they have lengthy paid time off for pregnancy and parenting as well as support for child care. They even have significantly more vacation time for rest and relaxation than American employees. Their productivity is not compromised and is comparable to that of America. Scandinavians are also conscious of and working to remediate the destruction being caused by climate change. Citizens of those nations believe in and embrace policies promoting renewable energies. To them protecting our blue planet, the only one that we know of that gives and sustains life, is more important than greed and amassing unimaginable personal wealth. In contrast, it appears that many American businesses prefer unregulated greed and profit that trumps (no pun intended) the concern for the well-being of Mother Earth. 

Self proclaimed Democratic Socialists like Alexandria Ocasio Cortez and Bernie Sanders take global warming seriously and want to do something about it. AOC’s Green New Deal is a start. Instead of acknowledging the climate crisis and working with them, Trump attacks those policies and doubles down on democratic socialism. I wish, while in Helsinki, instead of having a secret meeting with Putin, Trump had a chance to meet the citizens of Finland and get a sense of their lives and how they feel about their democratic socialism. He might have gotten enlightened –  but then I wouldn’t bet on it. This is Trump we are talking about. He could care less about rule of law, or democracy, or social equality. His goal is personal enrichment. He will shamelessly ignore or dismantle any societal oversight or laws that are in the way. He is undermining the justice and intelligence institutions considered to be the foundational pillars of American democracy. He may be really concerned about any incriminating truth that may come about in the Mueller investigation. The plethora of ongoing and potential future litigations as well as congressional committee investigations against him (and many of his business and campaign associates) must be causing him nightmares. This might also be behind the fear and loathing Trump exhibits toward government regulations, as evidenced by his unparalleled slashing of regulations that protect workers, ensure clean air and water and preserve the pristine forests and state parks – all in the name of economic prosperity. 

One of the founding fathers, John Adams, understood why we need state/government regulation. He said, “If men were angels there is no need for government.” He recognized the selfish nature of men, and how, if left to their own devices, societies will devolve into predatory jungle law. The consequence of lack of government, he predicted, will be selfishness of the rich and powerful triumphing over justice and fairness for the vulnerable and the helpless. Unfortunately we see that in the current state of affairs in America – where already inadequate government oversight is being systematically eroded further; thanks to Trump who doesn’t know when to say enough is enough! There is a reason why the founding fathers crafted a constitution that distributes power among co-equal branches of the Congress, the Supreme Court and the Presidency. 

They must have envisioned people like Trump who need to be kept in check through necessary, adequate, and effective governmental oversight. I hope the Supreme Court would judiciously limit Trump’s overreach. If not, nepotism and unregulated greedy crony capitalism will thrive and exacerbate social inequality. Unfortunately, with a bench that is made up of a conservative majority, I am not sure if that will happen. 

Do we have a better alternative?

Looks like there may be one, and that is:  electing to congress more senators like Bernie Sanders and house representatives like Alexandria Occasion Cortez to rein in Trump and his Republican accomplices who are taking the country down a dangerous path. The Republicans  beat their chests with patriotic fervor but are not doing much to protect the country from what almost amounts to cyber warfare attacking our democracy They talk about the rule of law but give a pass to Trump who breeches it. They say they are the guardians against presidential and government overreach, but have been derelict in their duty. Time and again they profess family values, but their allegiance to Trump undermines that. Most importantly, they say they are fiscally conservative, but irresponsible tax cuts and unnecessary wars are ballooning the national debt. I guess the Republicans are in reality sham patriots, with opportunistic morality, Frankenstein foreign policies and flexible family values. Their phony fiscal conservatism and predilection for crony capitalism will drive many more from the middle class into poverty in America. It is time for responsible citizens to get informed, take a serious, rational, and open minded look at alternative socio-economic philosophy.  There are alternatives to the current greedy crony capitalism in these United States of America.

It really doesn’t matter whether you call such a system democratic socialism or responsible capitalism. As long as it creates a society that allows all the citizenry – as a collective and as individuals – a good life, liberty, and the pursuit of happiness, it is the right system!