Recently graduating from a left-leaning university, in a left-leaning city, with a majority left-leaning friends, all of whom are overly-equipped with cuddle bears and safe spaces, every day I’ve had to suffer through hearing about the glorious socialist utopia that would come about with a Bernie Sanders presidency.
Having actually studied political science, focusing heavily on various countries’ policies and economics, I have to fight a constant urge where I don’t lower myself to the left’s standards and go on a “peaceful protest” rampage. Fortunately, it has never come to that. Being well-equipped with a basic knowledge of economics and morality, one can ask three simple questions to stun any Bernie bro.
1. How does Bernie Sanders plan on attracting business?
This is probably one of the best arguments against Sanders’ specific idea of socialism, as his views are radical even for a modern socialist.
While socialism never works in the long run, as we have seen with Venezuela’s collapse and Sweden and Denmark’s reduction in benefits and fragile economic systems, there are measures that can prolong its life.
Sweden and Denmark, both the golden standard for socialists, have some the lowest corporate tax rates in the world. In Sweden and Denmark, the corporate tax rate is 22 percent; whereas in the United States, we have a whopping tax rate of 38.9 percent; the second highest in the world. For socialism to be sustainable, even if it is only in the short run, Sweden and Denmark understood the necessity for investment. They needed incentives for companies to move to their country and employ their population.
As mentioned before, this still isn’t enough to save them from disaster that occurs from any type of economic change, which usually leads to heightened unemployment, budget imbalance and increased deficit, and the inevitable removal or reduction in welfare benefits. However, Sweden and Denmark’s policy on low corporate tax rates is something Bernie never addresses. He doesn’t understand this and seeks only to ridicule corporations and the wealthy; the very people that provide the economic means to make socialism as sustainable as it will ever be. Could you imagine a millennial wrapping his head around the idea of lowering tax rates for those evil corporations? Me neither.
This is, arguably, the biggest flaw in Sanders’ socialist dream.
2. How does one redistribute wealth and keep the economy growing?
While this should be common knowledge for a Bernie supporter, you’ll find many don’t actually know the answer or have looked at the in-depth causal effect of what is proposed.
Quoting from Bernie Sanders’ official site, he states: “There is something profoundly wrong when the top one-tenth of one percent owns almost as much wealth as the bottom 90 percent.” While this figure is mostly accurate, there are debates about its validity. Politifact references fellow libertarian Daniel Mitchell when he argues that tax laws in the late 20th century required high income taxpayers to report capital income, while middle income citizens didn’t have to. Despite this fact, Mitchell goes on to say that the rich aren’t rich because the poor are poor; the rich are rich, because they are innovative and provide services which others want.
Back to the question at hand. While Bernie mostly relies on demonizing the wealthy, there are instances where he provides a plan to redistribute the wealth.
They consist of raising taxes on the rich, raising the minimum wage, providing government-funded youth programs, and other expensive programs, all to be billable to higher income individuals. At this time, the top 10 percent already pay 68 percent of all federal income taxes and 53 percent of all federal taxes in general.
What happens when that tax rate widens and the wealthy pay more in taxes and middle class pays less? If you believe those in the top 10 percent are millionaires, you’re very wrong. The income for the top 1 to 10 percent is between $380,354 to $113,799. In other words, essentially anyone that owns and operates a successful business. The people that took a risk with their own money, bet on themselves, and came out positive; the people that are providing jobs to the middle class; the people that have to put payroll on their own credit card and often use their own funds to invest in their company; those are the people that Bernie Sanders wants to tax even more, and he hides that fact by having the public perceive the top 10 percent as fat oil men sitting on a mountain of cash.
By redistributing wealth, you are essentially taking money from those that provide the jobs for everyone else, invest and take rise, and essentially keep the economy going. Not only is it morally wrong, but economically idiotic.
3. What’s the incentive to be successful?
The American Dream is based on an idea that anyone can succeed in this country if they have the desire to work hard enough. It is one of the major reasons that America has had the most successful economy since World War II.
The government, specifically under Reagan and Clinton, facilitated an environment where people could achieve anything, because the government would interfere as little as possible. It is why the Reagan and Clinton years (despite the Democrats’ stance on the economy today, Clintonomics was very much in favor of being enterprise-friendly and making the government smaller) were some of the best economic years in American history.
Bernie Sanders’ plan is to go against this logical concept, and label the successful and wealthy as the enemy and everyone else as the victim. So, if a successful economy is determined by innovation and a strong working class – as Reagan and Clinton proved – how do you incentivize people to take risk on themselves and open businesses or try to get a promotion and make more money, when the more money you make, the more is taken away?
Image credit: AzamKamolov at Pixabay
* Braden Paynter is your average Joe Schmoe, who loves his country and all the freedom it entails. He has received an education in political science and international politics, being one of the few in his class to emerge without shouting leftist propaganda at the top of his lungs.
Braden Paynter
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[…] 3 Questions for Bernie Supporters – Being Libertarian […]
Currently enrolled in a left-leaning university, in a left-leaning city, with majority left-leaning friends and as a former libertarian(although I still retain some tendencies), I thought it’d only be fair if I were the one to respond your article. Doing this partly to play devil’s advocate but also because I think you’re misrepresenting his positions deliberately(or perhaps not)… aka strawmanning.
“How does Bernie Sanders plan on attracting business?”
If this wasn’t a rhetorical question, google “Bernie Sanders small business” and a lot of useful links from his websites show up, but if this was a rhetorical question, business as you use here it is an incredibly generic term and “supporting or attracting business” is equally vague. To some, the fiduciary rule passed by the DoL that requires financial advisers to work in consumers’ best interests is “not supporting business” ….”bad!”. To some, environmental regulations that prevent wastewater flowing into your local river is “not supporting business”…”bad!”.. But if you’re referring to the tax code, his agenda includes lengthy tax reforms that you can easily look up by googling “Bernie Sanders tax reform”. Under President Obama’s administration, 11 million full-time jobs were gained with the highest weekly earnings in history, record exports, 25% GDP growth,etc..(I bring this up because you imply a causal relationship between corporate tax rates and economic prosperity in your writing).
I will say, as someone that has taken taxation and public budgeting courses that the tax code is too complex and definitely needs reform. Sanders’ wants reform just not the type you want. His agenda would continue Fmr. President’s Obama’s crackdown on Caribbean tax havens that deplete the revenue base, cap the mortgage interest deduction at $300K(very smart),etc.
Again, the United States has had probably the best recovery in the OECD despite supposedly having the highest corporate tax rates so this is not nearly as important a “problem” as you make it seem. You make it comprise the bulk of your “Bernie bad for business” portion of your essay.
Also regarding taxes, you talk about the tax rates in Denmark and Sweden and contrast them with the seemingly high U.S. rate of 38.9% while failing to disclose that the effective rate, which is much more relevant, is less than 10 percentage points the aforementioned figure. This is not trivial and once this is taken into account, the U.S. doesn’t actually have the highest rate.
With regards to Venezuela, Sweden and Denmark, Venezuela’s collapse is due to its corrupt politics, high levels of internal conflict, currency mismanagement, and over-dependence on hydrocarbon resources(combined with falling global energy prices). These are not synonymous with socialism so the relevance of this and your inability to distinguish between economic factors, political factors, global geopolitical factors(with regards to oil) to explain the situation in Venezuela is a bit head-scratching. You can’t just blame anything that goes bad in the world on boogeyman socialism.
Furthermore, there is no way in the stratosphere Sweden and Denmark can be compared to the situation in Venezuela. In what way, does Sweden and Denmark have “fragile economic systems”? What is your basis of measurement for this claim? Compared to who?
But let’s go on…
“By redistributing wealth, you are essentially taking money from those that provide the jobs for everyone else, invest and take rise, and essentially keep the economy going. Not only is it morally wrong, but economically idiotic.”
You need to define wealth redistribution. Is Social Security wealth redistribution? Medicare? Pell Grants? Low-interest loans to small business? Pentagon spending? Every government program? Please be specific. I would love to have read a discussion regarding the budget but it has to be based off data and reality, not ideology.
“As mentioned before, this still isn’t enough to save them from disaster that occurs from any type of economic change, which usually leads to heightened unemployment, budget imbalance and increased deficit, and the inevitable removal or reduction in welfare benefits.”
Lol whattttt? Sweden and Denmark have unemployment rates far below the EU average. Sweden’s unemployment rate has been declining bigly. Denmark has a 4.3% unemployment rate. Sweden & Denmark’s deficit as a % of GDP is very low combined with equally low debt-to-GDP. Also social service spending as a % of GDP has increased markedly in Sweden and Denmark and has remained at a steady range(not declining as you suggested) in the last few years. This whole sentence is pretty much wrong. A lot of what you write is based more off rhetoric and ideology than actual data.
“This is, arguably, the biggest flaw in Sanders’ socialist dream.”
The premises were incorrect so your conclusion is incorrect.
I could do this for the entire article but I’ll stop here. This entire post reminds me of the segment Bill Maher did regarding Bernie Sanders and what hear. Very applicable. Enjoy! watch?v=LATqcoGOsxE
From a left leaning town and a left leaning school, kind of conservative libertarian now. My view is for a “Libertarian” you are too business. A psudo Libertarian is “for” business, staying out of it means staying out of it, stop calling yourself a Libertarian or quit that. Not to say I completely agree with Bernie but I think his ideas could be fixed and refined. You talk way to much business for a poli-science discussion. I would define you as not a true libertarian but a business man that is in conflict with the governmental system and thinks libertarianism would be ideal as it would mostly leave you alone and not mess.
Capitalism has many flaws of its own. My sense is that Sanders’ policies are an attempt to use the levers of democracy to correct some of these flaws, particularly in regard to the unfair advantages that very large multi-national corporations (not those small business folks!) have on public policy and, ultimately, on the world economy. World over, the game isn’t a fair anymore. Unbridled corporate interests’ involvement in elections, lobbying, and legislation since the early 1980’s has resulted in a sort of socialism for the rich. Many business costs, for instance the health costs related to the coal industry, have been socialized, allowing businesses which the Free Market would sacrifice long ago to continue beyond their prime. Furthermore, some costs which are not immediately socialized in one country often get moved to another country. The whole of world economy and the 99% of world’s population is suffering from the ills of capitalism. My sense is that Sanders’ policies are an attempt to correct these stunning inequities in a way that does not harm the small business owners to which the author here refers, and to do so not just in our country, but around the world simultaneously. Never before have we had the technology for a world-wide movement such as this. I believe that because it is the will of so many billions of us, the movement will ultimately succeed. Capitalism worldwide will be democratically sculpted to better support humanitarian ideals alongside a new renaissance of economic growth and ingenuity that emerges from a more-unified global population that is able to focus a bit beyond mere survival.
Here’s the deal. Governments can and should create, through legal structures, free markets for the efficient production and distribution of (nearly) pure private goods (i.e. rivalrous and excludable, and not substantially compromised by externalities). That, fortunately, includes most goods. But when it comes to public goods (national defense. clean air and water) or goods with substantial externalities (most form of energy production), markets fail to produce efficiently, and in addition, where there are potential private goods, but where there is a moral dimension to the good that makes equity as important as efficiency (healthcare) market forces also fail….unless the government creates a structured market within which those forces can operate. That’s it, that’s why all modern economies are mixed, and no amount of late night Rothbard reading will change it. Markets are incredible tools, I think they DO provide many of the freedoms that Friedman ran on about, but they only do what they are supposed to do: allow for the EFFICIENT (not equitable) production and distribution of PRIVATE GOODS (not public goods).
Q1 attract business? Answer: What kind of business do we want to grow? Are we going to continue to perpetuate a trickle down economic policy that has went our once-great economy over a cliff? Hell no. But isnt that the question really? You’re assuming that the American people are dependent on being prostitued by the huge corporations that have put us in the current situation. You say there’s no alternative? Are you the American people? No ur a pundit paid by these corporations , so the onus Ian much more on you to explain why on earth we should continue failed economic policy…
Q2 answer: how can you have an increase when the middle class is shrinking and the top 1/10 of 1% owns almost 50% of the global wealth? How can you grow if the money is locked up at the top? You’re question is the answer. The ONLY way to increase growth is to “redistribute.”
Q3? Answer: what’s successful mean? Does it mean being paid more than every member of the middle class and then convincing them that they aren’t entitled to an education, or that they’re not entitled to live in a decent home, or not entitled to retire with dignity? Are you implying that success is fighting every day for scraps from the table? Is it considered being successful when you premise a whole op ed on outdated talking points that have perpetuated lies and misconceptions about how America works? Make America great again, lets redistribute the wealth!
And let me guess you think the government is going to redistribute the wealth fairly? They are the most inefficient body when it comes to spending and its easy when you are spending other people’s money while you enrich yourself. I would rather choose how to spend my money then give 60-70% to the government as they see fit. There is a reason we are $20T in debt-
The government certainly redistributes wealth more efficiently than free market forces, and can do a much better job at it than now with the right policies. You use the word “inefficient” very carelessly. Choosing to deficit spend for specific purposes is not inefficient. Choosing to allocate more resources to the production of a good than is necessary is inefficient. There are inefficiencies at work in both the public and private sector. There are a variety of reasons we are in “debt”, or rather, have chosen to raise $20t through the sale of treasury notes that involve debt service LOWER than returns in any other type of investment, if you’re asking “what did we buy”. But the MONETARY reason is that it ADDS ASSETS TO THE AGGREGATE PRIVATE SECTOR BALANCE SHEET. (modern monetary theory)
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