U.S. Shaped By Both Capitalism, Socialism

We have seen, read and heard a lot of fuss lately about the precipitous dangers of socialism undermining the American culture. We are rightfully leery of any extreme form of political governance such as communism, fascism or autocracies. But before we can the judge the influence of socialism on our society, we need to understand that there are many versions of socialism defined under the "socialism" umbrella.

On one end of the scale is totalitarian communism, a form of autocracy where self-serving political power is concentrated in a small group of political leaders who manage the social and economic policies of a society with an iron hand. Stalinism is the foremost example this form of socialism.

On the other far end of the socialism spectrum is the social market economy. This is the socioeconomic model most associated with European economies, and certain aspects of this model are supported by members from all American political parties. The social market economy combines a free market capitalist economic system alongside social policies that establish both fair competition within the market and a welfare state. The social market economy was designed to be a third way between laissez-faire economic liberalism and socialist economics. It was inspired by the tradition of Christian ethics. The social market economy uses the organic means of a comprehensive economic policy support planning, which can influence the economy but specifically does not plan and guide production, the workforce or sales. Effectively combining monetary, credit, trade, tax, customs, investment and social policies, as well as other measures, this type of economic policy creates an economy that serves the welfare and needs of the entire population.

The social market approach rejects the far-left socialist ideas of replacing private property and markets with social ownership and economic planning. The "social" element to the model instead refers to support for the provision of equal opportunity and protection of those unable to enter the free market labor force because of old age, disability or unemployment. These are, in fact, some of the guiding principles that have shaped the modern social contract between the federal government and its constituents, the American people.

The influence of the social market approach is illustrated by these examples: the GI Bill implemented at the end of World War II, which subsidized the cost of higher education for soldiers returning from the war; the Fourteenth Amendment to the Constitution, which guarantees the equal protection of the laws; Social Security, a retirement system funded by American citizens and managed by the federal government; and federal regulations intended to limit the harmful pollution of our water and air by businesses, by local, state and federal governments, and by individuals.

The notion that capital economies and social economies are mutually exclusive and competing in a zero sum game is simply not true. Our American economy has been shaped by principles derived from both capitalism and socialism, and we citizens are well served by the influences and judicious implementation of features from both systems. Fomenting fear and mistrust by spinning a view that these influences, from either side, only serves to further divide and alienate whole segments of our political culture.

John Barry Franklin