Who’s Afraid of Socialism?

Walking in Davis Square two days before the election, I saw a rather dour-looking young man seated on a high pedestal holding a handwritten sign that read “No on Socialism.” Heading on by him, I looked at the back of his sign. It said, “Is Obama an American?”

Socialism has clearly returned to the agenda of popular debate, from campaign rhetoric to comedy shows. It comes disguised – not for the first time – as an ogre. Once we take note of who is presenting it that way, however, we may get the message that socialism could have something going for it.

So far as Obama is concerned, the point was well put by Colin Powell, in response to another label flung with hostile intent. Responding to the widely diffused assertion that Obama is a Muslim, Powell said: “The correct answer is, he’s not a Muslim, he’s a Christian. But the really right answer is, what if he is?”

Well, the correct answer is that Obama is not a socialist, but what if he were? Of course, that would have disqualified him in the eyes of the Democratic Party’s corporate underwriters, but why should it disqualify him to represent popular demands?

It’s important to remember historically why socialism became a popular aspiration. It was because of the failure of capitalism to respond to the needs of the majority. The majority under capitalism, which is working-class (as Michael Zweig showed for the US in his important book The Working Class Majority: America’s Best Kept Secret), suffers chronically from economic insecurity and inadequate services.

Capitalism’s incompatibility with majority interests has been reaffirmed by the current economic crisis. Earlier, the most severe effects of capitalism had been offset, within the US, by the progressive reforms of the 1930s. But capital’s political power was less restrained in this country than it was in the other rich countries. Flush with military might and bolstered by a mass right-wing culture of arrogant self-righteousness, US capital launched a withering counterattack against the New Deal legacy, culminating in an almost three-decade orgy of anti-welfare legislation, imperialist aggression, privatization, and deregulation.

The underlying economic philosophy was embodied by Alan Greenspan, whose tenure as Federal Reserve chairman (1987-2006) spanned the Reagan, Bush I, Clinton, and Bush II presidencies. Treated as some kind of oracle for those nineteen years, Greenspan could only express “shock,” last month, when forced to acknowledge, at a congressional hearing, that his “view of the world was not working.”

What we now have an opportunity to think about is how a set of assumptions which was so universally accepted at the highest levels – and, by extension, throughout the mass media – could have been so drastically wrong.

The answer, as explained in a lively recent lecture by Marxist economist Rick Wolff (video athttp://tinyurl.com/3pthrx), has to do with the failure of free-market ideology to recognize that unrestrained profit-maximization, with its assault on working-class well-being, results in concentrating an enormous surplus of private wealth which can find no useful outlet and which consequently gets drawn into an unbroken succession of speculative schemes. Underlying this “financialization” is the fact that the working class, having been prevented from keeping up, is driven deeper and deeper into debt. Home mortgage rates mount higher and higher; the resulting risks in turn become the objects of speculative investment, and a multi-layered structure of financial instruments becomes ever further removed from any real creation of value.

As long as the frenzy lasts, it generates its own compelling rationalization for speculators to seek more, more, more – until the bubble bursts and the downward spiral sets in.

Then, long-scorned government is called to the rescue. This is what raises the cry of “socialism,” albeit in a misleading way, because this government is capitalist through and through, whether in its Republican or its Democrat mutation (Treasury Secretaries Robert Rubin and Henry Paulson, serving under Clinton and Bush II, respectively, are both investment bankers, from the same firm, and Rubin is also a key adviser to Obama). The bipartisan “bailout” has been justifiably referred to as a giveaway and even as a robbery. Socialism it is not.

A socialist response involves not just state control of the economy, but working-class control of the state. Since the working class is the majority, this means democratic control, but democracy can only be implemented if the majority is organized. We are not there yet, but we would be getting there if some of the specific demands of the majority were incorporated into the rescue package – such as environmental conversion, universal healthcare, and (as a necessary precondition to such good things) an end to imperial overreach.

This brings us back to the question of Obama. Is he a socialist? No. Could he become one? Unlikely. But, could he be pushed to promote policies pointing in a socialist direction? This will depend on whether massive popular pressure can be mobilized.

Victor Wallis is a Somerville resident and managing editor of the journal Socialism and Democracy (www.sdonline.org).