With the success of 2020 Democratic presidential candidate Sen. Bernie Sanders (I-VT) and rival Sen. Elizabeth Warren (D-MA) has come the rise in notoriety and popularity of so-called Democratic Socialism in the United States.
According to a 2019 Gallup survey, 43% of Americans said that “some form of socialism [would] be a good thing” for the United States. Regardless of whether or not Americans fully understand what “socialism” means, they appear to support it in some way nonetheless.
Because of this development, I thought it would be vital to speak with Swedish author Johan Norberg, an historian of ideas and CATO Institute fellow, who has written such books as “In Defense of Global Capitalism” and “Progress: Ten Reasons to Look Forward to the Future,” among others.
In part one of this two-part interview, which can be read here, Norberg talked about socialism as a philosophy, the rise and fall of Sweden due to its experimentation with socialist ideas, the popularity of Sen. Bernie Sanders and what that means for the United States, and how even voluntary “libertarian” experiments in socialism have failed.
In part two of this interview, Norberg discusses the essentially non-existent distinction between “socialism” and “democratic socialism,” polls suggesting that 43% of American voters are amenable to socialism, how Sweden turned things around, how capitalism hasn’t “failed” as many socialists suggest, and more.
DW: Sen. Bernie Sanders says that he’s not a “socialist,” but a “Democratic socialist,” and that they are not the same thing. Can you speak to that?
NORBERG: When it comes to democratic socialism, it really means socialism. The point is not which means to you use to enforce it and implement it on everybody. If you’re saying that you will go in there and socialize people’s abilities and innovations and businesses, you will destroy individualism, and you will destroy wealth. Whether you do it democratically by having a majority or by dictatorial means, that’s like the difference between murder and suicide. It’s not who does it or how many are in favor of it, it’s the result that really counts.
I think what he’s referring to is that, “Look, it’s not Venezuela or the Soviet Union. It’s Sweden and it’s Denmark.” That’s more his take on it, or that’s what he wants to be associated with nowadays, and then his problem is just that we do not recognize his ideals in any way or form whatsoever. Sweden is now lowering its corporate tax even further so that it will be lower than in the United States. I guess that’s not the direction he would take the United States.
DW: There’s a 2019 survey from Gallup that says 43% of Americans believe that “some form of socialism [would] be a good thing” in the United States. What does that tell you about the American voter?
NORBERG: It tells me that you’ve never experienced socialism and you don’t really know what it means. I think people believe that it means “free stuff.” And obviously, everybody wants free stuff – but I don’t think they really understand what it’s like.
If you compare this to a country where we’ve actually seen socialists in power having tried to implement similar policies, like Sweden, we would not have those polling numbers. I know there’s a poll recently where I think 10% of Swedes said that they were socialists. So, it seems like there are fewer socialists in Sweden than in the United States. If you ask our most successful social democratic prime minister of the modern era, Göran Persson, he was asked, “Are you in favor of socialism? Are you a socialist? Would you call yourself that?” He said, “No, I don’t because you get confused with too many crazy people.” And I think that’s what you get when you’ve experienced socialism. You have a more nuanced way of looking at it.
DW: Sweden pulled the reins and turn things around. With the rising tide in the United States that seems to favor socialism, or at least what they believe to be socialism, has the ship sailed on the advancement of this ideology, or is there a way to turn it around?
NORBERG: Well, as a Swede, I would have to remind you that, unfortunately, the only thing that turned it around was that the economy collapsed in Sweden. We experienced the results of socialism and that’s why it changed. But I don’t think it would necessarily have to go that far because there’s also so much information and knowledge about this. So many places where they tried, and we’ve tried, to implement policies similar to that, and we know the results. They are there if you care to just open a book or Google it. I think that’s an important task right now for those who oppose this development, to get that knowledge out there. It’s an important moment in U.S. history in that way.
DW: Have you seen a shift in attitude globally and in the United States toward socialism since 2015/2016?
NORBERG: What I’ve seen is that something happened after the financial crisis, because after 2008 or so, people began to lose their faith in the financial system, in the banks, and rightly so because they’d been awful in so many ways. I would argue, and I’ve even written a book on this subject, that this was because the government really pushed everybody in that direction by an excess of liquidity, and at the same time, a promise of bailouts if they made stupid mistakes. Then of course you take stupid risks because heads you win, tails the taxpayer loses.
Unfortunately, what often happens after recessions, and especially the financial crisis, is that people begin to lose their faith in it and begin to think that the government should step in to a larger degree. I think this was the pivotal thing that made people begin to think that they could experiment with anticapitalist ideas.
DW: Proponents of socialism or socialistic ideology will claim that the United States is an example of “failed capitalism.” They will point to the wealth gap or to the way corporations operate in certain ways, and claim that we need to go in a new direction. What would you say to that?
NORBERG: The system isn’t broken. American capitalism is not broken. If you look at the kinds of benefits it’s creating for people, for consumers, for workers, and for retirees who have their money invested in businesses, it keeps delivering.
There’s this narrative saying that the American worker is getting a raw deal over the last decade, and you look at the headline numbers like, “Hourly wages have only increased by 5% since 1970,” and it’s a completely distorted number. It doesn’t include all the non-monitored benefits that we’re getting to a larger extent now, for tax purposes and because workers demanded to take a particular job, like health insurance, pension contributions, paid leave, vacation, etc.
If you include that, it’s not a 5% increase in hourly wages since 1970, it’s 66%.
That’s a bit of a difference and it’s pretty good – and that doesn’t even capture the most important thing, namely, the reduction in price of all the goods and services that we buy on the market, which increases our purchasing power to a larger degree. So, that’s the first thing that has to be mentioned. It keeps on delivering. Don’t take this for granted because that doesn’t happen in every place around the world.
The other thing I would say is that there are things that are broken. There are sections of the economy that definitely don’t work. In the U.S., we’ve failed in getting people who’ve lost their jobs into new jobs; we have a housing market that’s completely broken, etc. But when you examine those things, in every case, the problem is not that people acting in their own best interest on the market have failed, it is that the government has stepped in and stopped them from doing that.
When it comes to the housing market, it’s a perfect correlation between the places blocking new construction and the zoning laws and all those things that make it impossible to move to the places where the jobs are being created.
Occupational licensing is another one of the major problems, especially coming from Sweden, where we don’t do stuff like that. I’m appalled to see how it can take months, even years to get an education for a simple job that’s traditionally considered low-skill in many ways – and this is just to protect those who already have the jobs. Even worse, when they are not coordinated across state borders, it means that if you lose your job as a plumber or a barber in one state, you can’t move over the state border and take a similar job without going through the efforts, the costs, and the time to get a new license like that.
We need to look seriously at what the government does to hurt us before we start saying that the government should do even more.
DW: Is there anything that we haven’t mentioned on this subject that you want our readers or the general voting public to know?
NORBERG: I’ve noticed that one of the more popular suggestions by the left-wing of the Democratic Party is some sort of wealth tax, and it’s important to mention that we’ve abolished that in Nordic countries – in Denmark as early as 1997, and in Sweden in 2007. It wasn’t a tax on rich people because the rich people always find a place to stuff their assets or move somewhere else. It was a tax on investing in Sweden. It was a tax on creating new businesses and jobs. We benefited tremendously by abolishing the wealth tax because suddenly people felt free to create fortunes and moved to Sweden again. So it’s also worthwhile for people to look at the experience of European countries who experimented with the ideas that are now on offer in the United States.