In the still unfolding national debate about the economy, everything opposed by the extreme Right and the Republican Congressional caucus (the two can hardly be separated) is labeled as socialism. Repeal the Bush tax cuts? Obama wants to redistribute wealth. He’s a socialist, cry Sarah Palin and Joe the Plumber. Propose government spending to counteract the worst economic crisis since the 1930s? More proof that the Democrats want to expand government instead of letting the market cure our ills—that’s socialism. Address urgent issues of global climate change? Another charade to attack business and bring on socialism! If the Democratic Socialists of America were larger and more influential, its button proclaiming. “Obama is not a socialist, but I am” would be a boon to our national debate.
Socialists continue to believe what we have always believed: that we need to shape the economy to meet human needs. The economy exists to serve people, not the other way around. Profit-maximizing corporations distort the economy and the polity. In the United States today, few people share our full perspective, but in many policy areas, we can move toward a society that fosters greater equality and greater democratic decision-making in the economy. Thirty-two years ago, Michael Harrington wrote in these pages, “What Socialists Would Do in America—if They Could.” It’s still a good question. What would we do today if we could? Here are a few proposals of the sort that we used to call “transitional.” If they were enacted and if people could see them work, the country might be ready for further leftward movement.
The housing bubble caused the current crisis, and continuing turmoil in the housing market threatens the fragile recovery. While daily headlines inform us of an oversupply of housing, the Harvard University-MIT Joint Center for Housing Studies revealed in its October 2009 report that the number of Americans paying more than half their annual income for housing rose from 13.8 million in 2001 to 17.9 million in 2007. “While homeowners led the growth, the share of renters with severe burdens remained much larger.” Federal policy needs to be directed toward affordable housing—with an emphasis on affordable rental housing. The Obama administration is proposing to fund the National Low Income Housing Trust Fund at one billion dollars, using TARP (Troubled Assets Relief Program) funds. That’s a good start. Yet, in this area, as in many others, administration officials have been overly solicitous of the financial sector that caused the crisis. Federal programs aimed at bringing down mortgage payments for distressed homeowners focus on interest rate manipulations and on direct subsidies to lenders. The holders of the mortgage notes continue to collect payments on fictitious home values, based on bubble prices that will never return.
Dean Baker, an economist with as solid a claim as anyone ...
For just $19.95 a year, get access to new issues and decades' worth of archives on our site.
Print + Online
For $29.95 a year, get new issues delivered to your door and access to our full online archives.