I don't think so at all! I just disagreed with your definition of socialism in your previous post. I agree with your definition of capitalism and communism.
Disagreement =/= intelligence. Its just different understandings.
Political and Economic Theory Thread
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Disagreement =/= intelligence. Its just different understandings.
Bowers and I finally agree on a point and you go and shoot it down!
First off I’m not disagreeing w anything you’ve said as I find it very interesting and I also tend to view myself in the same light as Bowers posted.I’ve heard it said there are two ways to make money.
1. Bundling
2. Unbundling
The internet was the unbundling of the Information Age. AI may seem like an extension of that, but in reality it is rebundling the means of production. Compute, IP, and data storage are being fenced off in ways that the general population cannot participate in. The systems being created will attract users, which will extract more data and synthesis to increase their assets and create lock-in and incumbency that will discourage new entrants and competition. Continuing a trend toward monopolies.
AI and robotics will also rebundle manufacturing and distribution in ways that will add to the bifurcation of our economy. What happens to trickle-down economics then? Does it trickle down to the robots?
This is all creating a flywheel that gives more and more wealth and power to the billionaires as a reward for investing early. I think we’ll see a shedding of blue collar and white collar jobs. The middle class will continue to be hollowed out. We will likely need to institute a UBI to create a safety net for lower income homes.
Eventually, this too will be unbundled, but it may take a while. I think we will eventually move to a Relationship Economy where we actually begin to use technology to bring us together and enhance the human element. But that is just a hare-brained thought I’ve had. Not grounded in research or any objective data.
UBI is an interesting concept. I’d like to read thoughts on (1) who pays the UBI (feds? Corps?) (2) if it’s the feds how do they get the $s to pay out UBI? Since corps will have saved $ hand over fist by not paying salaries, 401ks, health insurance, FICA, OSHA costs and on and on? (3) How do you qualify for UBI and what’s the metric for how much you receive? (4) What happens to health insurance and other benefits like 401ks/retirement plans if businesses don’t employ? This would seem to put a huge strain on individual healthcare/insurance costs and the retirement system. (5) What happens to Social Security Income/Medicare if employees and employers are no longer paying into the system bc they have been moved to UBI?
Seems like there’s a huge tax coming on corporations and ultra wealthy. You can’t just disappear millions from the labor market and not have a complete system collapse.
There are likely others who are more familiar with the funding mechanisms for UBI. Your questions prompted me to do some searching on this. It appears there are different models. Below is what I found.
I also noted UBI is best described as a floor to stand on, not a safety net as I inaccurately characterized it. Usually no more than $1000/mo. so people are still motivated to work.
———
Andrew Yang’s Freedom Dividend (2019 U.S. plan)
10% VAT on goods/services (~$800B/yr) + financial transaction tax (0.1%, $50B) + carbon tax ($20/ton) + lift SS payroll cap + capital gains as ordinary income. Net cost: ~$1.4T (after benefit savings).
Progressive Tax‑Funded UBI
(e.g., wealth/carbon taxes)
Wealth tax (1–3% on ultra‑rich), progressive income/estate taxes, end corporate subsidies, carbon/resource rents (e.g., Alaska oil fund). Replaces some welfare to offset costs.
Negative Income Tax
(NIT, Friedman/Yang hybrid)
Progressive income tax + VAT; phases out as earnings rise (e.g., 50% subsidy up to $20K, then tapers).
Key Design Choices Across Proposals
- **Universal vs. means‑tested**: Flat to everyone (simpler admin, stigma‑free) or tapered (cheaper, targets need).
- **Replacement vs. supplement**: Many replace means‑tested welfare (savings ~20–30% of cost) but keep contributory programs like SS.
- **Corp tax angle**: Yes—profits/automation taxes (e.g., robot tax) or VAT on AI services to claw back labor savings. Addresses his #2/#5 directly.
- **Healthcare/retirement**: Hybrid public expansion + private persistence; UBI as floor, not full substitute (avoids his #4 strain).
These aren't collapse‑proof, but pilots (e.g., Stockton CA: $500/mo reduced joblessness without work drop) suggest feasibility with tweaks. His "huge tax on corps/wealthy" prediction holds—most plans rely on it.
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This is one of the best conversations I have listened to all year. Its a longer conversation, but a good one nonetheless.
Its between a couple of brits: Aaron Bastani and Rana Dasgupta. The latter just released a book called After Nations: The Making and Unmaking of a World Order. They talk about what is a Nation-State, how they came to be, parallels between Islam and the European far right, theology's interplay with the rise of nations and theological critiques of modern liberalism, British and American Hegemony, the use of the nation-state and international order as a vehicle for empire building and the rise of China. They also talk about the failures of the liberal order and what could come after the nation-state.
I have a lot of windshield time today driving from DFW to Tulsa. I plan to give this a listen. Thanks!
The Sayyid Qutb tie in was in particular really interesting. I had to read Milestones for one of my Middle Eastern History classes at OSU and it was really insightful, as it along with Ibn Taymiyyah are the ideological underpinnings for Islamic extremism & Al Qaeda.
Edit: I should also add the Muslim Brotherhood.
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Government social programs are utilitarian. Utilitarianism is an ethical theory that, according to Bentham, one ought to do to that which causes happiness for the greatest number of people. Mill added that the quality of happiness is as important as the quantity.
We make utilitarian decisions in healthcare every day. My own position as a clinical pharmacist practitioner is a utilitarian creation, I am less expensive than a physician and, staying in my lane and practicing according to my skills and expertise, we can deliver more care to more people and free physicians for other things, give them more time to pay attention to other matters. We also ration scarce resources. There are not enough livers for everyone who needs a transplant so we try to give them where we think they will do the most good.
Utilitarianism is consequentialist. The outcome matters. The intention does not. Utilitarianism demands that if an action doesn’t actually produce the anticipated happiness that it be modified or abandoned altogether for something that will produce the happiness.
The problem with government social programs is that they are created, and sustained, politically. This makes measuring the consequences and modifying social programs somewhere between difficult and impossible; and I can’t think of a federal social program that was abandoned because it was ineffective. Thus we have Social Security which behaves like a Ponzi scheme and Medicare which will be insolvent around 2030, which isn’t far away. So we have social programs which fail to maximize happiness and instead share misery and there is no way to fix them.
We make utilitarian decisions in healthcare every day. My own position as a clinical pharmacist practitioner is a utilitarian creation, I am less expensive than a physician and, staying in my lane and practicing according to my skills and expertise, we can deliver more care to more people and free physicians for other things, give them more time to pay attention to other matters. We also ration scarce resources. There are not enough livers for everyone who needs a transplant so we try to give them where we think they will do the most good.
Utilitarianism is consequentialist. The outcome matters. The intention does not. Utilitarianism demands that if an action doesn’t actually produce the anticipated happiness that it be modified or abandoned altogether for something that will produce the happiness.
The problem with government social programs is that they are created, and sustained, politically. This makes measuring the consequences and modifying social programs somewhere between difficult and impossible; and I can’t think of a federal social program that was abandoned because it was ineffective. Thus we have Social Security which behaves like a Ponzi scheme and Medicare which will be insolvent around 2030, which isn’t far away. So we have social programs which fail to maximize happiness and instead share misery and there is no way to fix them.
Things got busy for a bit there, so this took longer than I expected. I also want to apologize in advance, this is going to be long. First, lets define some terms:
Capitalism
Capitalism is the system where there is private ownership of the means of production. Private meaning individuals, groups, or shareholders owning things. A 21st century way of defining this is that individual(s), groups or shareholders own the businesses and the enterprises. This generally means that the state is not the predominant owner nor is there collective, public, employee or worker ownership of businesses and enterprises at a significant scale.
This system rewards those who already have means or were born into means much more than those who do not. It also means that those who own the means of production have a distinct advantage over those who do not and have to work for a wage, or do not have capital to start their own business or enterprise. This leads to increasing wealth stratification over time and emphasizes growth over everything else, including human rights, workers rights, the environment, democracy/representative forms of government and looks to capture them all for its own purposes.
I don't think that capitalism is all bad and has some distinct strengths. My interest is finding something that keeps the majority of those strengths while addressing the many weaknesses, especially the system breaking ones that it has. Historically, without guardrails, it tends to destroy itself and work in opposition to the free market in relatively short order. It happened in the early 20th century leading world war twice before guardrails were created and then it took about 40 years in the strongest economy in world history to destroy those guardrails and the foundations that made it successful in the first place. In some places and historical examples, it didn't even take that long.
That being said, I do think capitalism is a net negative at this point in human history due to the inequity, anti-democratic, human rights and surveillance state it has created for profit. It also has shown that it is unable to tackle the rising climate change risks. This is not to mention the flexible labor pool that AI is designed to be, permanently reducing all worker's bargaining power for a higher (in many cases livable) wage. This system is on deaths doorstep. What replaces it?
Liberalism
This is the ideology that most of us are familiar with, so this one is going to be more brief. It has been the predominant power structure in the west, starting with the American and French revolutions and methodically spreading across Europe over the ensuing 150 years. Based on enlightenment ideals about human rights and particularly on negative rights, it has been the predominant ideology in American politics, both for the Democrats and the Republican parties, at least until very recently.
Married to capitalism, its contradictions between lofty goals of human rights and equality are juxtaposed with capitalism, which operates in an authoritarian manner and works to undercut those rights over time. This is especially apparent with the neoliberal economic order, which reinforced both those founding ideals with its contradictions and got us into the mess we have today.
Socialism
Socialism comes down to ownership. Unlike the predominant narrative in the US, it is not when the government does stuff. The definition of socialism is simply "worker ownership of the means of production". In 21st century terms, it is who owns the businesses and who owns the enterprises.
Historically, the predominant understanding ended up being dictated by the USSR after the 1917 Russian revolution, which was state ownership of the means of production, with people voting via democratic centralism on what should be done. So in theory there was "worker ownership" but only via the state. In actuality, the reality is that only lasted a few months before a vanguard of party members (bolsheviks) became the only folks voting on it after the they lost an election to the social revolutionaries, a party that wanted to implement a type of social democracy and instead dissolved the duma (parliament). This didn't stop the USSR and many of the other communist countries to continue to define it that way however, despite the fact that it practically never worked that way and was more or less just controlled by the party.
Please note: state ownership of most industries is not what I am advocating for. I think history has shown this system is inferior and rife with human rights and civil rights abuses and stifled creativity and growth. For industries where the profit motive go against human wellbeing like in insurance, healthcare and prisons, those should be ran by the state or non-profits. Also, note that the "free market" did not go away in these historical examples, as by many prose accounts there was a very robust black market and a high degree of bribery and corruption to meet market need that the system could not. That culture continues today in the countries that composed the former USSR.
Democratic Socialism
What makes democratic socialism different than most historical examples of socialism is that it embraces democratic processes while setting up more decentralized & horizontal power structures. It is based on a continuation of enlightenment values, where rights are not just seen as negative rights (someone cannot prevent you from doing X), but also as positive rights (you are empowered to have Y). The idea would be to create a society that would most likely result in human flourishing for the most people due to the basic needs being universally met.
Instead of the economy being centrally planned and everything being controlled by a single party or complete control by the government, the goal of the system is to shift the balance of power in the marketplace to workers and away from capital owners. The goal of a new system is to take the things that capitalism is good at and combine it with an approach that allays its shortcomings and provides a more equitable approach to economics.
It also is the realization that some sectors should not have a profit motive, specifically, healthcare and insurance are two sectors where there is motivation to NOT cover paying people, so decommodifying would be a wise move.
A typical democratic socialist platform would look something like this:
- Medicare 4 all/universal healthcare
- Expansion of Labor rights
- More progressive taxation
- Social housing (check out the Vienna model for more info)
- "Free" college (covered by taxation)
- Universal childcare
- Green New Deal or a similar environmentally conscious energy policy
- Extensive safety nets
- Collective ownership of businesses (employee/worker owned for most sectors in medium to large companies)
- Creation of a public bank
Economic Democracy/Market Socialism
An economic system that keeps market principles and commodification intact for the majority of the sectors of the economy, but reduces private ownership of the means of production in favor of worker owned enterprises. The idea behind this is that command economies cannot address the knowledge question (Hayek) adequately and they run into issues with supply & demand. Whereas capitalism is able to grow quickly, but is unstable, and tends to become more and more oppressive to the working class over time.
Market socialism has an economy composed of primarily worker owned business & enterprises (co-ops) and publicly owned business. Publicly owned entities are entities that are owned by the public of a region, but are independent from the state.
Partial ownership, however small, and shared profits from the operation of the business mean that as the business grows, the vast majority of wealth does not just go to one person or several people. It goes to the workers that made that growth possible also. This is important as it would prevent the primary cause of our wealth stratification which is vastly unequal rewards for success in the workplace.
One worker, one vote for major company decisions. Non-worker shareholders of the business are unable to vote, but can hold shares of the company. Leadership positions at companies would be elected instead of selected and this means that company leadership is chosen from and accountable to the workers themselves, not a board of directors or to private equity. This also has helped reduce the wage discrepancy between workers and leadership to a more reasonable level.
Co-ops have higher employee satisfaction, higher wages than non-worker owned entities in the same industry, far more benefits, better work/life balance and much lower levels of wealth stratification. They also are just as competitive than typical capitalist businesses, if not more so. Their biggest hurdle is funding for creation. Most people who start a business want to keep the majority of wealth it generates for themselves and once a business is established, it is hard to make it worker owned, although programs like an Employee Stock Ownership Plan can lead to a successful employee owned business.
We really only have two historical examples of any country getting close to this system, one is Sweden under the Meidner Plan (specifically the wage-earner proposal of the plan) and the other is Yugoslavia in the 1980s. Both ended up being unsuccessful, but for different reasons. In Sweden, the wage-earner proposal essentially bought out a portion of each large company on behalf of the workers a year at a time, and while it made some headway, capitalists were able to block the full implementation of the program and eventually reversed it. In Yugoslavia, a similar system grew out of the old Soviet block they still had a lot of central planning and massive amounts of foreign debt, compounded by massive subsidies to companies operating at a loss (good reddit post summarizing a paper in an academic journal). The latter was particularly egregious, as the point of markets is that some enterprises do well, make a profit and grow, while others don't do well and fail. With robust safety nets, this will make a harder transition time for an employee at a failed enterprise easier.
There are two additional policies to help facilitate and economic system transition, that would be creating a bank of the commons to have an additional outlet for co-op creation and also an altered corporate tax structure that would provide lower taxes to co-ops and a higher tax on standard corporations.
If you are interested in reading more about how such a system would function from someone a lot smarter than me and is far more comprehensive, I recommend the book After Capitalism by David Schweikart. He goes into great detail on how banking, lending and entrepreneurship would work, business structures, etc.
This would be my preferred economic system based on the information we have at this time.
What democratic socialism isn't:
Social Democracy
Social democracy is simply capitalism with robust safety nets. It is not socialism as ownership structure does not change and private ownership dominates the economy. Ironically, this is what most Americans picture when they think of socialism. There are many examples of successful social democracies: the Nordic countries are the most famous, but most western European countries and even the US from the 1930s-1970s also fit the bill, although our safety nets were not as robust as the European countries. The main issue they have had is that none of them have been able to stave off the capitalists in the long run and the safety nets have ended up being weakened and democratic processes becoming monetized over time. This has even happened in the Nordic countries, they just had a better starting point than us. The issue is they don't address the problem of ownership, so capital finds ways to weaken these safety nets over time and the system collapses, leading to authoritarianism and/or fascism.
State Capitalism
China is not currently a socialist country. They were from a period of time after Mao rose to power, but after Deng's reforms in the 80s, they embraced capitalism with a government stake in many of their larger businesses, but allowed private ownership. Now, over 96% of their business entities are privately owned (Source: http://english.scio.gov.cn/pressroom/2024-06/14/content_117253322.htm). They do have some have aspects of central planning mixed in with their market economy, but that percentage of private businesses tells the tale. What confuses a lot of people that mistakenly call them socialist is due to the marxist-leninist vanguard party (CCP) that runs the country, but that describes an authoritarian governmental structure, not alterations in the ownership of the means of production.
While the whole populace is part of the All-China Federation of Trade Unions, this is a symbolic entity. They are not adversarial in the least (they can only take action and strike if the party gives them the green light) and it is illegal to form your own union, or to participate in wildcat strikes. China is also starting to deal with the massive wealth stratification that a capitalist system causes over time and is catching up to the US in that regard.
Communism
A stateless, moneyless, classless society with communal ownership of the means of production. It sounds great, but I don't think humanity is anywhere close to evolved enough for such a system. Sorry Star Trek fans, fully automated, luxury space communism is probably at least a couple centuries away. Historically, most of the countries that claimed to be communist were nowhere close to this goal and have historically had some of the worst human rights abuses and highest body counts in history. Why? In my opinion it is due to the extreme concentration of power this approach takes.
Conclusion
In short, we are seeing similar material conditions and contradictions in our capitalist systems that gave rise to socialist movements in the late 1800s and early 1900s. Will we choose a different path that avoids the pitfalls that lie on both sides of the road? Only time (and us!) will tell. What are your thoughts about these ideas and any other political/economic theories you find that resonate with you?
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I’ll need a little think time on this.
My response...
From Forbes:
The Treasury just declared the U.S. insolvent. The media missed it
By Steve H. Hanke and David M. Walker
March 23, 2026, 11:14 AM ET
Steve Hanke is a professor of applied economics at The Johns Hopkins University and a member of the Board of Directors at the Federal Fiscal Sustainability Foundation. He is the co-editor, with Barry W. Poulson and John Merrifield, of Public Debt Sustainability: International Perspectives (Lexington Books, 2022). David M. Walker is the former Comptroller General of the United States and the Chairman of the Board of Directors at the Federal Fiscal Sustainability Foundation.
The U.S. government is insolvent. That’s not hyperbole — it’s the conclusion drawn directly from the Treasury Department’s own consolidated financial statements for fiscal year 2025, released last week to near-total media silence. The numbers: $6.06 trillion in total assets against $47.78 trillion in total liabilities as of September 30, 2025.
Importantly, the $47.78 trillion in reported liabilities does not include the unfunded obligations of social insurance programs like Social Security and Medicare — those are disclosed separately in the off-balance-sheet Statement of Social Insurance (SOSI).
The government’s consolidated balance sheet position, excluding the SOSI, deteriorated by nearly $2.07 trillion between FY 2024 and FY 2025, reaching a staggering negative $41.72 trillion. Total liabilities are now nearly eight times the value of reported assets. The largest drivers were a $2 trillion increase in federal debt and interest payable (now $30.33 trillion) and a $438.8 billion increase in federal employee and veteran benefits payable (now $15.47 trillion).
The Off-Balance-Sheet Iceberg
The off-balance-sheet picture is even more alarming. The 75-year unfunded social insurance obligation surged by $10.1 trillion in a single year, rising from $78.3 trillion in FY 2024 to $88.4 trillion in FY 2025 — driven primarily by a $6.9 trillion jump in projected Medicare Part B shortfalls and a $2.5 trillion increase for Social Security. The Treasury’s Statement of Long-Term Fiscal Projections shows the 75-year fiscal gap widening from 4.3% of GDP in FY 2024 to 4.7% in FY 2025.
If the $88.4 trillion in 75-year off-balance-sheet obligations were added to the $47.8 trillion in official balance sheet liabilities, total federal obligations would now exceed $136.2 trillion — roughly five times U.S. annual GDP.
The Government Accountability Office (GAO) issued a disclaimer of opinion on the U.S. government’s FY 2025 financial statements — the 29th consecutive year it has been unable to determine whether the statements are fairly presented. This is primarily due to serious, ongoing financial management problems at the Department of Defense and weaknesses in accounting for interagency transactions.
What $136 Trillion Looks Like in Your Living Room
Not only has the financial press ignored the consolidated financial statements, but most members of Congress and members of the general public will not read the consolidated financial statements. Documents like the consolidated financial statements are not the kind of thing you want to read before driving. If that’s not bad enough, most people cannot relate to the trillion-dollar numbers in the financial statements. Therefore, it is appropriate to translate them into terms that people will understand.
Most people cannot relate to trillion-dollar figures on a government ledger. So consider this: divide every number by 100 million — drop eight zeros — and federal finances look like a household budget in freefall.
That household earns $52,446 and spends $73,378 — running a $20,932 annual deficit. Its total liabilities and unfunded promises amount to $1,361,788 against just $60,554 in assets, leaving it $1.3 million in the hole. Uncle Sam, by any accounting standard, is insolvent.
Congress has clearly lost control of the nation’s finances. America is facing a fiscal catastrophe. The reckoning, long deferred, is becoming impossible to ignore.
Two Bills That Could Change Everything
Addressing this crisis — and preventing recurrence — requires two specific legislative actions.
First, Congress should pass the bipartisan H.R. 3289 — Fiscal Commission Act, sponsored by Rep. Bill Huizenga (R-MI), Rep. Scott Peters (D-CA), and 41 co-sponsors. Such a commission would force a public reckoning with the facts, the trade-offs, and the hard choices that restoring fiscal health requires.
Second, Congress should call an Article V Convention limited to proposing a fiscal responsibility amendment to the U.S. Constitution. H.Con.Res. 15, sponsored by Rep. Jodey Arrington (R-TX), would do exactly that.
Modeled on Switzerland’s Debt Brake, such an amendment would mandate a balanced budget over the business cycle and prohibit federal spending from growing faster than the U.S. economy.
These two bills represent the most credible path forward — if Congress has the will to act.
The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.
The debt is going to get printed away, it will not be "paid off". I know you are an advocate for austerity, which is something that has historically had the opposite of the intended effect, increasing rather than reducing budget deficits. How do you rectify this? Keep in mind the harm austerity does to the economy ends up reducing the amount of taxes collected and thus does not end up ultimately result in a better budget, but in an economic downturn.
Lets pretend that is not a likely outcome from this exercise and as a thought experiment, lets say we cut enough of the budget so there is a $1T surplus from our annual budget. How long would it take to pay off the debt? Do you think that sort of fiscal discipline would exist for the length of time needed to pay it off?
I'm not an advocate for "austerity" whatever the freak that means, and please don't put words in my mouth. I'm an advocate for fiscal responsibility. I don't see how we get out of our current state by being more fiscally irresponsible.
I don't mean to put words in your mouth, but the concept of fiscal responsibility requires austerity measures to be implemented to reach them. Here is the definition of austerity:
Let me know if you disagree with this portrayal of your position.
What does the term "fiscal responsibility" mean?
You are not answering my question.
“Let me know if you disagree with this portrayal of your position.”
I already have when I asked you not to put words in my mouth.
Now answer my question, what does “fiscal responsibility” mean?
Yeah, you said that before I gave you the definition of austerity. That isn't answering a question, its dodging one.
I know why you are dodging it though.
Two can play this game.
Let me know when you are ready to quit playing games and we can have a real conversation.
JTOSU
Ranger
Fiscal responsibility is about sustainability over time, not necessarily austerity. Fiscal responsibility means spending discipline (something our nation lacks) and efficiency rather than austerity. In addition to spending wisely, it’s about supporting economic conditions that strengthen the overall fiscal picture.
Although significantly reducing the $39T debt is laudable, the goal should be strongly curtailing or eliminating future deficits. We cannot continue the current growth of interest. Respectfully, printing away debt is not an answer.
Although significantly reducing the $39T debt is laudable, the goal should be strongly curtailing or eliminating future deficits. We cannot continue the current growth of interest. Respectfully, printing away debt is not an answer.
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Maybe you should define what YOU mean by “fiscal responsibility”…..since you’re the one using the term.
Just saying….
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