Objections to socialist at University of San Diego

Rancho Guejito closer to Valley Center

Anderson Homestead, built in the 1870s
  • Anderson Homestead, built in the 1870s

Capitalism vs. Socialism, redux

Prof. Chibber: According to Matthew Lickona, a reporter for the San Diego Reader, you participated in a debate (“Is it time for America to embrace socialism?) with Michael Munger on March 12, 2019 at USD during which you and Prof. Munger discussed capitalism vs. socialism and it appears to me that you made several statements that constituted serious errors, omissions and/or distortions (“Capitalism vs. Socialism: a civil debate between Duke’s Michael Munger and NYU’s Vivek Chibber at USD,” Golden Dreams, March 27).

Nothing like a debate to set things rolling on campus!

Nothing like a debate to set things rolling on campus!

In order to frame my objections to what you reportedly said please allow me to reach back to some of your earlier pronouncements. In the Socialist Register (Capitalism, Class and Universalism/2014) you insisted that “After a long, seemingly interminable hiatus, we appear to be witnessing the re-emergence of a global resistance to capitalism, at least in its neoliberal guise.”

Given this claim how do you explain the finding in NBC’s March 3, 2019 poll (taken from Feb. 24th to 27th) which found that just 18% of all Americans view socialism positively. Was there a great reversal during the last five years or were you just thinking with your heart instead of your head? You went on to opine that “Whatever their crazy disagreements may have been over the past century or so, radicals and progressives have almost always agreed on two basic postulates – that as capitalism spreads, it subordinates all parts of the world to a common set of compulsions; and that wherever it spreads, those who it subjugates and exploits will have a common interest in struggling against it regardless of culture or creed.”

In light of this contention how do you account for the March 2019 WSJ poll which found that only 25% of the American electorate supports socialism? Has there been a lack of compulsion, subjugation and/or exploitation? According to you – since 1980 85% of the increase in US income has gone to the top 10% but if you were to take the time to research the source of this claim you would find that it comes solely from the work of Piketty & Saez who examined federal tax return data since the imposition of the US income tax in 1913.

This historic record is therefore based entirely upon incomes for “tax units” and the composition of these “tax units” has undergone dramatic changes since the 1970s due to single motherhood, smaller family size and a variety of additional sociological factors. Unlike a sociologist like yourself economists know that since 1960 the US Gini coefficient (which measures inequality) for “All Persons” (i.e. individuals) has remained constant. Therefore, your belief that any increase in inequality is attributable to economic (as opposed to sociological) factors is not supported by the available data. Thus, you should refrain from repeating you misleading statement. The truth is that capitalism reduces inequality rather than exacerbating it!

But perhaps worst of all you asserted that “If Swedish-style social democracy is what the right wants to push for, then sign me up.” This of course suggests that you are wholly unaware that for more than forty years Sweden has been steadily moving away from socialism toward a more market -oriented economy. In 1975 roughly half of Swedish companies were government-owned. Today this figure has been cut in half. From 1981 through 2018 GDP in Sweden averaged only 0.56%. Sweden tried socialism and didn’t like the results that they got. Since 2000 Sweden abandoned its wealth tax, eliminated its property tax, lowered income taxes, reduced corporate taxes, slashed its tax-to-GDP ratio and made sharp cuts in unemployment benefits.

In 2009 Sweden’s “stimulus” was a permanent tax cut rather than bailouts, or debt-fueled spending. This tax cut (using mostly tax credits) paid for itself. Today, the Swedes are apparently undeterred. Bloomberg reported on Jan. 16, 2019 that Sweden’s new governing coalition plans new tax cuts into 2020 in order to stoke jobs. On Feb. 1, 2019 Fox Business pronounced that “As Democrats propose tax hikes, Sweden is pushing cuts.” Prof. Chibber. in light of all of these facts may I still sign you up? Lastly, do you count yourself among the progressives or among the radicals?

  • Richard W. Burcik
  • Pennsylvania

Rancho way-out

The story on historic Rancho Guejito “(Biking back in time,” Neighborhood News, April 4) is datelined Ramona and the copy identifies the property as near Ramona. Actually, Ramona is 20 or more miles distant from the ranch which is located in the historic Bear Valley district, known today as Valley Center. A full history of Rancho Guejito, titled “California’s Last Rancho,” can be found by clicking Historic Sites at www.valleycenterhistory.org which also has a history on the first commercial winery in San Diego County, also located on the property. The Valley Center History Museum maintains a complete archive and a permanent exhibition on the historic ranch.

  • Robert Lerner
  • Historian
  • Valley Center Historical Society

Editor: Thanks. Fixed.

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That letter from Pennsylvania is quite wrong about inequality in America.
Wealth and Income inequality have greatly increased in the USA in recent decades. Nearly all of the increased wealth and income in the last 35 years has gone to the wealthy. The share of wealth owned by the top 1% increased from 24% in 1979 to 42% in 2015. The stock owned by the top 10% increased from 71% of all stock in 2001 to 84% in 2016. The top 1% of households received approximately 20% of the pre-tax income in 2013, versus approximately 10% from 1950 to 1980. The top 0.1% of households received approximately 10% of the pre-tax income in 2013, versus approximately 3–4% between 1951–1981. A 2018 study by the Congressional Budget Office (CBO) found that the top earning 1 percent of households increased their income by 242% after federal taxes and income transfers over a period between 1979 and 2015, compared to a gain of 46% for the 60 percent in the middle of America's income distribution, and a gain of 79% for the lowest 20%. The top quintile increased their income by three times as much as the middle class from 1979 to 2015.

The U.S. was ranked the 6th from the last among 173 countries (4th percentile) on income equality measured by the Gini index. In the last 50 years, the Gini income index for the USA has increased from about 36 to about 45 depending on which calculation is used. The world bank says USA Gini went from 34.5 in 1979 to 41.2 in 2015. The CIA and the US census show even higher increases. The US Census says USA Gini is now .482 as of 2017, up from .466 in 2008, .426 in 1987, .402 in 1978, and .390 in 1968.

The Gini wealth index is .8 (so we are 80% of the way to 1.0, where 1.0 is complete inequality, meaning all of the money is owned by the richest) Wealth and Income Inequality in the USA is now as high as it was in the roaring and gilded 1920s.

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