For most of recorded history, humankind was horribly, desperately poor. Then, about 300 years ago, human wealth suddenly began to increase exponentially. The reason for this sudden and wonderful change was the advent of modern free‐market capitalism. And while those at the top of the income ladder undoubtedly saw major gains, those who benefited the most from this increase in wealth were those at the bottom.
In her groundbreaking book Bourgeois Equality, Deirdre McCloskey points out that in the era before modern free‐market capitalism, great civilizations, such as Periclean Greece or Song Dynasty China, sometimes saw a temporary doubling of national income per capita. Such gains were considered extraordinary. But compare that to the fact that since 1800, developed countries like Sweden or Japan have seen a 3,200 percent growth in per capita income. And with that growth came all sorts of associated benefits, including longer life expectancies, a better‐educated citizenry, expanded civil and political rights, and reduced poverty. Studies measuring inequality over time against indexes of economic freedom (adjusted to exclude exogenous factors such as educational levels, climate, agricultural share of employment, and so forth) show a small but statistically significant reduction in inequality in countries with high economic‐freedom scores.
What has been true worldwide has been true for the United States as well. Consider that by most measures nearly all Americans were poor at the start of the last century. Indeed, if we use a definition corresponding to today’s poverty measures, 60 to 80 percent of the U.S. population was poor at the start of the 20th century. Today, while some people undoubtedly continue to struggle, deep material poverty has been nearly eradicated.
It is free‐market capitalism that is at the heart of this prosperity.
Nor is the debate about capitalism vs. socialism merely a question of economics. Strip away all the bells and whistles and there are only two ways to organize society: markets or command and control. Markets are fundamentally about choice and voluntary exchange. Command and control is about, well, command and control &Mdash; that is, force. Advocates of socialism presume that this power will be exercised by wise philosopher‐economist‐kings who can magically determine precisely what wages should be, how much a product should sell for, and what consumers want (or should want). History shows that, instead, those powers are exercised by fallible human beings who not only get economic decisions wrong but cannot resist spreading their new power into non‐economic areas of our lives.
Donald Trump, with his continuing calls for government intervention in the economy, is hardly the best person to make the case against Democrats and socialism. He is, in fact, emblematic of the cronyism that has come to taint capitalism in the minds of many. But his message may still find a receptive audience.
The same Harvard/Harris poll cited above showed voters overall preferring capitalism by a 65–35 percent margin. Voters outside the Democratic‐primary base are far less enamored of socialism. Even many of those choosing socialism probably don’t really mean it, seeing “socialism” as simply shorthand for a more generous welfare state.
In particular, an anti‐capitalist, pro‐socialist message will be a very hard sell in the crucial suburbs that have begun swinging Democratic in the last few elections. Voters in those areas are repelled by Trump’s rhetoric and Republican social conservatism but remain capitalists.
There’s no doubt that Trump remains vulnerable, but so long as Democrats continue their lurch to the left, his reelection prospects will look up.