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Cato Weekly Podcast: Is Socialism Cool Again?
Host: Paul Meany, Editor for Intellectual History, Libertarianism.org (a project of the Cato Institute)
Guest: Marian Tupy, Senior Fellow, Cato Institute’s Center for Global Liberty and Prosperity, and Founder and Editor of HumanProgress.org
Cold Open
The episode opens with a montage of news clips on the revival of “democratic socialism.” Speakers are identified below where reasonably confirmable; this section is archival broadcast material, not part of the Paul Meany–Marian Tupy interview.
News narration: It’s increasingly more common for Americans, and among some in the Democratic Party, to wear the “Democratic Socialist” badge with honor. Self-described democratic socialists — why is socialism cool again?
Rep. Alexandria Ocasio-Cortez (from a widely circulated clip): I think young people are looking out there and they’re saying, why are we not doing better for ordinary Americans? … Democratic socialism is the value that, in a modern, moral, and wealthy society, no person in America should be too poor to live.
Mayor Zohran Mamdani (from his January 2026 inauguration address): I was elected as a Democratic Socialist, and I will govern as a Democratic Socialist.
News narration: An episode of Real Time with Bill Maher — he asserted that America, like other Western democracies, is already quasi-socialist.
Bill Maher (on Real Time with Bill Maher): The Democratic Socialists talk about socialism like we don’t already have a lot — Social Security, unemployment, Medicare, nutritional assistance, Medicaid, Obamacare, disability, housing subsidies. Again, not against it — just, same question: how can you be soaking the rich and failing the poor so badly? But that is not socialism, and confusing it with socialism is not just wrong — it’s dangerous.
Introduction
Paul Meany: I’m Paul Meany. Welcome to the Cato Weekly Podcast. For this episode, I’m joined by Marian Tupy, founder and editor of HumanProgress.org and co-author of the book Superabundance. He has spent decades studying global development and economic growth. On HumanProgress, you wrote a piece on Bill Maher’s discussion of socialism — democratic socialism seems to be having a revival.
Marian Tupy: Socialism — I mean, I think it’s got kind of a bad rap these days, because people automatically think, “Oh my god, it’s the same thing as communism,” and communism is — it’s the worst thing ever. It’s like the 1950s again, for me — it’s just where the government decides everything, tells you what to do, tells you how you’re going to do it, to the point where you don’t have that pursuit of happiness, you don’t have that ability to make those choices for yourself.
Paul Meany: There seems to be a difference between what people call socialism — which you might refer to as the USSR, or in some cases even the People’s Republic of China — and what a lot of people like AOC, Bernie Sanders, and Mayor Mamdani argue: that they’re not socialists or communists, they’re democratic socialists. Mamdani, when he describes socialism, often references the words of Martin Luther King — he says there should be a more just distribution of wealth “amongst God’s children on the earth.” AOC argues that democratic socialism, more properly, is just that people should have the basic dignities of life. Bernie Sanders, who’s kind of the person who started this revival of democratic socialism, talks about it as a more just distribution of income, where the top one percent don’t own more than the other 99 percent of the population. So I guess the easiest way to start this conversation is: what is socialism?
Discussion
Marian Tupy: Great to be here. Socialism is typically defined as collective or government ownership of the means of production — factories, for example — but also of natural resources, and in extreme cases, such as China under Mao or Cambodia under the Khmer Rouge, even private property, such as homes, and maybe even domestic implements. It is true that not all government involvement in the private lives of citizens is necessarily socialism. For example, the state does tax people to pay for certain public goods, such as defense or the police force. That’s fundamentally different from a world where the government basically owns all the factories — but also, for example, all transport mechanisms. So let’s put this in practical terms. If you want to travel from Washington, D.C. to New York City, you can take a government-owned Amtrak — it’s pretty bad, it’s dirty, it’s often late, and so on. But you can also opt for a number of private alternatives — you can take the Acela, which is a privately owned railway company, you can fly on countless American private airlines, or you can drive your own car, sometimes on private roads. Under proper socialism, all of those things would be government-owned.
Paul Meany: You used the phrase “proper socialism” — what are some examples of proper socialism in practice?
Marian Tupy: Well, our left-wing friends would of course say that socialism was never done properly — and that’s a problem, because it’s like nailing jello to a wall, figuring out exactly what socialism is. But there are degrees of socialist experimentation. In my native Czechoslovakia, the government owned the means of production — all the factories, all the shops, and so on, as well as agricultural land. But in Poland, which is just to the north, there were small plots of land actually owned by ordinary people, who could privately produce some of their own food. When you move further east, to China and especially Cambodia under the Khmer Rouge, you get to a position where the government could even own homes — apartments — and assign people, sometimes a certain number of families, to live in a certain apartment. So even those kinds of property rights disappear. And in the case of the Khmer Rouge, you get to a position where the government tells people what kind of jobs they can have — for example, making all the intellectuals and academics unemployed, and chasing them out into rural areas to become peasants, because that’s what the state needed at the moment. So there are degrees of socialism, and also degrees of failure. Sometimes socialism fails at a scale that’s unfathomable, such as the Khmer Rouge killing a quarter of the population in three years. And sometimes communism only ends up killing a few thousand people.
Paul Meany: This is the obvious problem people have to evade — this association with these terrible regimes, whether it’s the USSR or Cambodia. But AOC, Bernie Sanders, Mayor Mamdani — they all say, “Well, when we’re talking about socialism, we’re not talking about the USSR, we’re not talking about Czechoslovakia. What we’re talking about is the Scandinavian nations, the Nordic nations, that have lovely, generous social welfare programs — school vouchers, unemployment benefits, disability checks, public pensions, what we’d call Social Security in America.” So what are they getting wrong here? What’s the problem with saying that this is what true socialism actually is?
Marian Tupy: None of those are examples from early or late twentieth-century socialism. What it actually is, is very generous government programs that benefit the people who are least well off in society. The proper name for Scandinavian countries is social democracy. Even in those contexts, you can get to a place where some Scandinavian countries are actually more free-market than the United States — in Sweden, for example, schooling is done not only privately but also for profit. In many of these countries, social security has been at least partially privatized. Trade with foreigners is freer than it is in the United States. So even there, the size of the state, and its interference in the private lives of citizens, is quite complex and complicated. Nonetheless — if what you’re saying is, “Keep the private economy humming along, but we’re going to tax you at a much higher rate,” that’s what’s usually called social democracy. And it’s a great puzzle why Americans — who are essentially social democrats, people who want to keep the private economy but just increase taxes — call themselves socialists, which is obviously much more disturbing to the American ear. If only, instead, they called themselves social democrats. But then you have to ask yourself: well, how much of what they’re telling us is actually true?
Mayor Zohran Mamdani (clip): New York City, it is time for a grand experiment once again. Just as LaGuardia used government to respond to the challenges of the Great Depression, we will use government to respond to rising prices and unaffordable groceries.
Paul Meany: When Mamdani talks about government-run stores, he’s no longer just talking about social democracy — private sector plus high taxes. Now he’s talking about high taxes and public provision — of, for example, groceries — which would be a step further toward socialism.
Marian Tupy: Well, it reminds me of being from Ireland — Ireland and Sweden are two countries that normally rank in the top ten, or at least top fifteen, of all economic freedom indexes, including Cato’s and the Fraser Institute’s. So these places have a functioning market economy, what we’d call capitalism — free trade, people can start businesses quickly, there’s lots of competition. But they take the fruits of that and redistribute it to people who are least well off.
Paul Meany: The difference, I guess, with socialism is it’s not just about taking the fruits of people’s labor after the capitalist process is done — it’s about controlling that entire process.
Marian Tupy: That is correct, and that’s where the fundamental danger lies — I cannot overemphasize how dangerous this is. When the private sector disappears and the government is in charge of capital distribution and investment, it has to, by necessity, have some sort of central plan. Right now, for example, there are a bunch of rich people in the United States thinking about building a hospital, and they have to figure out: what’s the likelihood we’ll make a profit? Are we going to build it or not? In a socialist economy — not social democratic, but socialist — the state has to decide that it’s going to spend some number of billions of dollars to build a hospital, and therefore have fewer billions to invest in schooling, or defense, or whatever else. There are trade-offs, like in any normal society with a finite amount of capital — unless, of course, you do hyperinflation. But you have to make those trade-offs, and once you do, you need a plan: we’re going to build this many hospitals, this many schools, this much into defense, and so on. The danger is: if people’s preferences contradict the plan, what is the government going to do in response? I’ll use an actual example — my parents were medical doctors in Czechoslovakia under communism. What if more people want to be doctors, because it’s their free choice, in a country that, according to the central plan, only needs so many doctors? Well, the government has to tell you, “I’m sorry, but your ambition doesn’t conform with the plan — therefore you must become a teacher, or a soldier, or something else.” And this is the fundamental inversion: in a social democracy, or even better in a semi-capitalist or mixed economy, people can decide what career they want to pursue, and then bear the risks of that decision. Under socialism, the government tells you what you can and cannot be — the government becomes your boss. You’re no longer the boss of yourself.
Paul Meany: I’d say, for some people — maybe that was a different time, that was back when people didn’t have computers, they didn’t have all this AI. Now we can plan things better. Experts don’t always get things right, but I’m a very disorganized person, and people are always telling me to plan more — so why not plan more, for the government? Why do you distrust experts? Why do you think experts don’t always have the right answers? It seems like, when you talk to people, having a plan seems like a good idea. What you’re saying here is that plans can sometimes go wrong.
Marian Tupy: Yes, and when they go very wrong, you end up in a situation where tens of millions of people die, like they did in China under the Great Leap Forward — there was also a Long March, but this was the Great Leap Forward. Hayek — our great hero — addressed this issue back in the 1940s, in a very famous essay on the distribution of knowledge. Fundamentally, a bureaucrat armed with even a very powerful computer — maybe even a super-smart AI — cannot possibly account for all the preferences and changes in preferences that individual people have every day, let alone eight billion people on the planet. If today I’m running late for work and I forget to go to Starbucks and buy a cup of coffee, that has an impact on the price of coffee — the free market knows how to handle that, through supply and demand. If many people behave like me, the price of coffee will drop; if a lot of people suddenly start drinking more coffee, the price will rise, and that in itself sends signals to the private sector that maybe we should grow more coffee, or import more. But a computer and a bureaucrat cannot know how many people are simply going to switch from drinking coffee to drinking tea, or Coca-Cola, and so on. So the great failure of communism and socialism is not having the prerequisite knowledge to accomplish central planning. There’s an anecdotal story, which may well be true, that Khrushchev once said that even if the Soviet Union conquered all of Europe, it would keep Switzerland free — because they could learn from Swiss prices what things should cost in the communist bloc. Markets and prices are like signals that tell people what’s profitable to go into, and what to move away from. If someone sees the price of coffee greatly rising, it tells a lot of people this is a good industry to get into — you can make a lot of money. So it distributes knowledge across society.
Paul Meany: But this is an economic case, and I don’t think a lot of the democratic socialists we’re talking about today really bother arguing against the economic case, because I think a lot of people already know about the collapse of the Soviet Union, the collapse of central planning, and its failures. So they kind of shift the ground to a more moral case for democratic socialism — they argue it’s part of our basic dignity, our basic human rights, to have these kinds of social welfare programs and social safety nets. What’s the argument against that? Why should we oppose these things — or are these things even socialism to begin with? You’d argue that Social Security, unemployment benefits, all these things, don’t actually count as socialism.
Marian Tupy: Well, obviously, as libertarians, we have one or two things to say about who should, for example, provide pensions or Social Security in this country — I think a lot of people would prefer to put more of their money into a 401(k), invested in private markets, rather than Social Security, where it grows at a much lower rate than it usually does in the stock market. So, you know, we libertarians believe the government is already far too large. Nonetheless — there is a fundamental difference between, say, providing unemployment insurance, where I get taxed every month, and so do you, in order to create a pot of money out of which unemployment insurance is paid, and, alternatively, a properly socialistic system where you essentially become a ward of the state, or property of the state — where the state can tell you, “This year we only need a hundred doctors, therefore you cannot become a doctor.” And in extreme cases, like some of the Asian communist regimes, the government could even tell you whom to marry.
Paul Meany: So the distinction for you is between assistance and control. A person on Social Security, or any kind of welfare or unemployment benefit, can still choose what to do with their life — they can say, “I want to go to college to be a doctor,” or maybe they won’t, and they’ll work at 7‑Eleven instead. It’s still their own fundamental choice what to do with their life. That’s the distinction we’re making: it’s not state control over you, it’s state assistance for you — even though we’re critical of that, we still believe there can be some sort of safety net for people.
Marian Tupy: Yes. And another way to think about it is that very often, when socialists fail to deliver on their promises and people become discontented — when people start raising questions about socialist economic performance — the socialist response, very often if not exclusively, is to clamp down on free speech and, ultimately, exterminate political freedom. So you end up not only with fewer material comforts, but also without personal liberty.
Paul Meany: It seems, though, that you have a very different experience than most people — because most people in America have no firsthand experience, or even know a person who has firsthand experience, of a socialist or communist state. When I talk to average people, who don’t spend their whole life buried in books and buried in politics, and you say “democratic socialism,” they think it’s about community — “socialism, in my eyes, is just being there for the community, supporting the social aspect of life, and making everything easier for everyone else around you.” They think it’s about taxing the rich, paying their fair share — for me, it’s a bit more not equality-based, but people-based, based on the wider good and what the wider good needs, as opposed to what the governing class thinks is best and then disseminates from there. And a lot of the time, they think it’s about helping people in the worst situations possible. Where are people going wrong? Why do people think so positively about something you, through your own firsthand experience, have such terrible memories of?
Marian Tupy: Fundamentally, I think the default position of a human being — unless he’s been educated to understand and appreciate the miracle that is the free market and capitalism — is one of zero-sum thinking. And we’ve seen that on display from somebody like AOC, who recently tweeted that you cannot make a billion dollars, you have to take a billion dollars.
Paul Meany: You can’t earn a billion dollars.
Marian Tupy: That’s exactly correct. You can abuse labor laws, you can pay people less than what they’re worth — but you can’t earn it, right? So that’s zero-sum thinking: it’s impossible to create new wealth, the only way you can become wealthy is by taking from somebody else. Quite aside from the fact that, obviously, society in Anno Domini 2026 is much richer than it was in, say, 1900 or 1800 — so clearly we have created new wealth. How does AOC respond to, for example, J.K. Rowling? J.K. Rowling is a billionaire because she produced something new — a universe of new literary figures, called Harry Potter — and people who valued those books more than the twenty or thirty bucks they paid for them bought them, turning her into a billionaire. That’s what’s happening throughout the American economy — somebody comes up with a new idea, produces more value, becomes rich in the process, but the whole society benefits as a result. But the primitive thinking we’ve evolved with is zero-sum. When a chimp band wanted to extend the amount of food they could control, they’d simply invade the neighboring band’s territory — slaughter all the males, take all the females and the fruit trees. That’s how you became wealthier for millions of years — just taking. It really was a zero-sum existence. But today it isn’t — J.K. Rowling is a perfect example of how you can become filthy rich by creating new value, by creating new things. Bernie Sanders also wrote a book he made quite a lot of money off of, but I’d describe that as very different — people want to read your book, and so on — but it seems like a lot of these democratic socialists focus on titans of industry, people working on AI and data centers, big banks.
Politician (clip): When I ran for mayor, I said I was going to tax the rich. Well, today we’re taxing it — Elon Musk is not a scientist, he is not an engineer. He is a billionaire con man.
Marian Tupy: People like Elon Musk, Jeff Bezos, Mark Zuckerberg, Peter Thiel, Bill Gates, and other multibillionaires — they don’t focus on the nice things, like the wonderful books we read. They focus on things that are a little less popular in general.
Paul Meany: So how do you respond to them saying — they don’t even want to take all of the person’s wealth, they’re not describing what you have, where you have a very dictatorial government that wants to take everything. In their opinion, they just want billionaires who have billions and billions of dollars to just pay their fair share.
Marian Tupy: Let’s start with the facts. The top ten percent of American taxpayers already pay 72 percent of federal revenue. The bottom 50 percent pay three percent of federal revenue. If that’s unfair, I don’t know what would be fair. So all the potentially successful, and therefore rich, people will start thinking: okay, how far should I push my luck, how far should I push my entrepreneurship, at what point do I become so wealthy that I get on the radar of somebody like AOC, and she’s going to come after me and take my stuff away? Now, I think there’s one additional thing that’s very important here: the money that Elon Musk, and Altman, and others have is, first of all, usually tied up in stock, and stock goes up and down. So when Mamdani and AOC look at them becoming billionaires one moment — wait a few weeks, and they may be much less wealthy. But more importantly, that money can be invested at greater social benefit, in additional entrepreneurship. If we take Elon Musk’s trillion and distribute it among the American people, we’ll do so only once, because after that, Musk will simply give up trying — and it’ll make us only tiny bit better off, since the U.S. federal budget is already six trillion dollars a year. So, okay, for one year we’ll have seven trillion dollars, and after that, no more to be heard from Musk. But what if he simply leverages the money he has in his stock to start a new company — maybe invest more in the Boring Company, so we can have more underground transportation in the United States, or invest part of that trillion dollars into expanding his Starship fleet or Starlink, so that people in poor American areas, or in Africa, have access to the internet? He can create more value for himself, but more importantly, more social value for the rest of us — than if we simply consumed it through, say, social welfare over twelve months. And we don’t know who’s going to make that decision — it could be a Republican, it could be a Democrat, it could be anyone.
Paul Meany: But you’re saying it’s better off to leave people to decide for themselves what to do with their money, basically. So I think one of the big questions here is: let’s say you don’t want to soak the rich, you don’t want to eat the rich and tax everything they own, you want to have markets, you want to have private property, you want to let people decide for themselves what to do with their lives — what happens to people who fall through the cracks, whether through their own choices, or natural disasters, or bad things that happen to them, or even just plain old bad luck? What do we do for people who find themselves at the bottom of the income ladder?
Marian Tupy: Clearly there are free societies in the world that manage to combine a great degree of economic and political freedom with some sort of social safety net. I would argue that in the United States, and especially in the United Kingdom, we’ve reached a place where so much welfare is being provided that it’s beginning to disincentivize people from working, simply because the state can cut them a check. So we want to be very careful about who receives government help, and obviously the place to start is to ensure that, if the government is going to provide a social safety net, it should provide it to people who truly are incapable of helping themselves — which would already reduce a lot of the social welfare we spend. And then, of course, you could bring in communities, and churches, and mosques, and synagogues, and mutual-help societies. Before the welfare state expanded in the United States, especially in the 1930s, Americans used to derive a great deal of security from mutual-help societies — you’d contribute a few pennies every month to a widow’s trust, so that if you died on the job, maybe in the mine, the widow and children would be provided for. There were many of these fraternities and sororities across the United States that provided a safety net for ordinary people. It’s difficult for Americans today to think about that, because the social welfare state — our government — has crowded out all those mutual-help societies. We no longer even think about how this kind of help could be provided privately and by mutual consent, because we no longer see them — they’ve been killed off, because the social welfare state could be more generous. So that’s what I’d want to do: start by limiting the social safety net to people who really cannot help themselves, and then see if we can recreate those sorts of fraternities and sororities that helped Americans so effectively before the rise of the welfare state.
Paul Meany: This idea that maybe we have some state guarantee for people, so that people don’t have to rely just on their family or just their community — we have some sort of guarantee that all people will get something. One thing that shocked me, moving to America, is that every now and again you’ll sit on a bench, and there’ll be a little plaque saying, “This bench was donated by so-and-so” — and that shocked me, because in Ireland there’s really not very much of that. You only really see it at universities that get large amounts of money from people. It seems that when people have enough wealth, they actually want to share it voluntarily. So someone like Bill Maher thinks America is already quasi-socialist — he says we already have a lot of these programs, these social safety nets, these welfare policies. Why is what he’s saying potentially dangerous? Is it not just an academic dispute over definitions, or can this lead to something more dire?
Marian Tupy: Well, I think there’s an important difference between assistance and control, and the fundamental problem with Bill Maher is that he’s essentially normalizing the concept of socialism, by blurring the line between social democracy, or a mixed economy, and socialism. He’s normalizing the concept of socialism — and history tells us that when socialists proper have their way, the outcome is invariably a mountain of dead bodies. This has to be avoided at all costs, and we must work twenty-four-seven to make sure it never happens in this country.
Paul Meany: I have a little bit of experience of socialism — and I don’t mean in my home country of Ireland. When I was about eighteen or so, I barely read about politics, I didn’t even really know what socialism and capitalism were, but eventually I went on a trip to Cuba, and it shocked me — the rules I heard about. Having more than fifteen people in your house might get you investigated by the government, because there’s a suspicion you might be running a business, or a restaurant, or something like that. If you walk around the streets of Havana, you’ll see lots of people selling stuff on the side of the road — whether it’s popsicles, or a jailbroken Galaxy phone, or frozen pizzas, normal stuff that’s sold every day in America — but you find out this is illegal, and people have to do it to make a living, but it’s dangerous, and you can be picked up by the police at any time. I think when people talk about “controlling the economy,” they think it’s just moving numbers around in a spreadsheet, manipulating stock prices, going on a computer and typing in a few commands. But what controlling an economy really means is controlling the actions, the lives, and the aspirations of everyday people.
Marian Tupy: Beautifully put. Thank you very much.
Paul Meany: Thank you, Marian, for joining us, and thank you all for listening to today’s episode of the Cato Weekly Podcast. If you enjoyed today’s discussion, please subscribe and leave a review wherever you get your podcasts, and to learn more about the ideas and research discussed in this episode, visit cato.org. The Cato Weekly Podcast is a production of the Cato Institute, dedicated to advancing individual liberty, limited government, free markets, and peace. Join us next time for more insights and conversations about the issues shaping our world. Thank you.
