Is Donald Trump a socialist, or is he just governing like one? For a man who made his money in the freewheeling and dealing Manhattan property market, it seems an odd term to use. And doubtless he and his supporters would reject it vehemently. But let’s go back to first principles and look at what he does, not what he says.
The very essence of a socialist policy is that an economy should not be run by free market methods. It can and should be run on others, designed to support the welfare of all the groups living in it. If they are poor, money must be found through taxes to alleviate that. If their communities depend on certain industrial conglomerations. such as steel making for example, then money must be found to sustain those industries, to avert the social damage which would ensue/ In Britain the key exponents of this view were people like Arthur Scargill and Tony Benn, who felt public money should be found to support the mining industries, even if those industries operated at less than optimum economic efficiency. In the 1970s Benn went further, suggesting a siege economy protected by tariffs as an alternative to joining the European Community, forerunner of the EU.
The alternative view was pioneered by thinkers such as Adam Smith and David Ricardo. The unhindered operation of free markets, with the lowest possible levels of tax and tariff would facilitate the best possible social outcome. Ricardo developed this in his theory of comparative advantage. By which countries or regions specialising in different products would trade in these to their mutual benefit. His example was Britain and Portugal, which mutually traded manufactured goods and port wine. The same principle holds today.
The key political exponents of this view were Ronald Reagan and Margaret Thatcher, whose most memorable declaration was “you can’t buck the markets”. As we write, Mr Trump’s policies seem to be doing exactly that. Unlike others, we judge him to have an honesty of purpose: he is trying to protect the communities that voted for him. Communities whose social structure and very identity depend on the old smokestack industries around which they cluster. Time will tell if he will be successful. But two things worry us. Firstly even if factories are attracted back to the rustbelt, it is unlikely that modern automated plants will need many factory hands. And second: the last twenty years or so of the Communist bloc were spent trying to keep these same sort of plants going. History did not judge that enterprise kindly.
#free markets #socialism #communism #adam smith #david ricardo #margaret thatcher #donald trump #united states of america
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