Capitalism? Democrats Say, Pfoo!
By Harold Meyerson | Aug 15, 2018
The biennial Gallup poll on Americans’ sentiments toward capitalism and socialism came out this week, and the numbers tell us a lot, particularly about today’s Democrats. As in the 2016 poll, the share of Democrats who have a favorable view of socialism remains both high and essentially unchanged: 58 percent two years ago, 57 percent today.
In this year’s poll, however, for the first time the share of Democrats who view socialism favorably has taken a non-trivial lead over the share who feel the same way about capitalism. Two years ago, 56 percent of Democrats had a positive view of capitalism, essentially tying it with socialism (however much that meant that some Democrats had a positive view of both, and, for all we know, a positive view of a whole lot of things). This year, by contrast, the share of Democrats viewing capitalism positively tumbled to 47 percent—a full ten points beneath the share looking kindly on socialism.
It’s easy to read too much into these numbers (after all, yesterday’s poll showed that 16 percent of Republicans had a positive view of socialism, though this finding, like much of quantum mechanics, runs counter to reality as humans have experienced it). When many Democrats hear the word “socialism,” they think of such popular social democratic programs as Social Security and Medicare, or the single-payer systems and free public universities that exist in Western Europe. When many Republicans hear the word “socialism,” they think of Joseph Stalin.
That said, it’s not hard to see why even minimally sentient beings would be increasingly wary about capitalism, most certainly as it’s currently practiced in the United States. Just yesterday, as Gallup was releasing its data, the Financial Times produced its own analysis of profits, profit margins, and wages in the United States. With 90 percent of the companies in the S&P 500 now having filed their second-quarter reports, profits have risen by 25 percent over the same period last year, and profit margins—how much companies profit from their gross revenues—have hit 11.8 percent, which the FT says is “the highest level since financial information provider FactSet began recording the data in 2008.”
How very nice. Of course, as corporations rake in more profit from their sales, the share of those sales going to wages likely declines—and indeed, that’s exactly what’s happened. That partly explains why real wages have actually gone down over the past year when the rate of inflation (which by historic standards is still pretty low) is taken into account.
So—record-high profit margins, with record amounts then being shoveled to major shareholders through all-time-high share buybacks, while wages stubbornly sag despite low unemployment levels. Americans—Democratic Americans in particular—likely aren’t able to quote you the numbers, but they certainly sense that big money is being generated, and most Americans aren’t getting it.
No wonder Democrats are more and more dubious about capitalism. They should be.
Tax Cuts for the rich. Deregulation for the powerful. Wage suppression for everyone else. These are the tenets of trickle-down economics, the conservatives’ age-old strategy for advantaging the interests of the rich and powerful over those of the middle class and poor. The articles in Trickle-Downers are devoted, first, to exposing and refuting these lies, but equally, to reminding Americans that these claims aren’t made because they are true. Rather, they are made because they are the most effective way elites have found to bully, confuse and intimidate middle- and working-class voters. Trickle-down claims are not real economics. They are negotiating strategies. Here at the Prospect, we hope to help you win that negotiation.