Methinks I should invest more time into this blog; after all, talking about politics has not exactly become easier since the great socialist/Satan/angry black guy took office. I plan on posting more sincere entries in the coming days, but, since I have the time and material, I suppose I will just post an essay I recently composed for my PolySci class.

Note: Though I typed this for a class, I did so in a very erratic manner. There are a generous amount of errors, so, for that, I must apologize.

Common Socialism or Modern Capitalism?

An Analysis of the Obama Administration

Essay #1, Option #7

An Introduction

There are few things more desirable to the typical American than the traditional, capitalistic, free-market system. For some inexplicable reason, the majority of the American public has lent their unrelenting support to this treacherous, unrelenting system. The reluctance to explore other systems of government, as well as other economic systems, has been instilled in the American mind since the “Red Scares,” or the eras of fearful sentiment regarding communism and socialism following the creation of the Soviet Republics.

Throughout both of the “Red Scares (The first “scare” occurring during the First World War, and the second following the Second),” the American public, as well as a few patriotic, but ill-tempered politicians, produced slews of anti-communist and anti-socialist propaganda, that created an angry, confusing air of patriotism, introducing unconditional disdain for both forms of government; ever since, the American public has been particularly cautious of political assertions comparable to those of communist, or, more importantly, socialist states.

Though the days of the USSR are long gone, the fruits of Mcarthyism are as ripe as ever; however, this time the accused socialist is at the helm of our very own government. I am speaking, of course, of the irrational accusations against Barack Obama’s administration—those claims of domestic socialism. In t qhe following essay, I will analyze several of the decisions made by the administration of Barack Obama; through this analysis I will demonstrate that Barack Obama’s administration does not act socialistically, but in a manner suggesting a novel approach to capitalism.

The Rules of Engagement

To begin, it is imperative that the definition of the word “socialism” be made clear. Though the definition tends to vary among the American public, The Library of Economics and Liberty has defined “socialism” most accurately, both in terms of history and contemporary, American thought, declaring that it is “a centrally planned economy in which the government controls all means of production (Heilbroner).” That being said, in order for any political action to be considered socialistic, said action must actively seek to seize power over a privatized institution or means of production. This must be made clear initially in light of the recent attitude many Americans have taken, asserting that any expansion of government or taxation is a completely deplorable, socialist act.

What is most frustrating about analyzing an administration’s actions and policies in terms of socialism is the sheer multitude of socialist theories that exist today. Spanning from the theories of the social-anarchist Proudhon, and his belief that all property is “theft,” to Lenin’s belief that socialism is simply the transitory period between capitalism and communism, any public action that has any affect on privatized industry, through one theory or another, can be justified as a socialist action’ however, in the following paragraphs, the word “socialistic,” as it applies to administrative action, will only be used, as expressed previously, to demonstrate the intent, or lack thereof, of the central government to usurp industrial power from the private sector.

On Investment

With all other presidencies in mind, Barack Obama’s administration has, compared to many other infant presidencies, achieved a great deal; however, the administration is still in its infant stage, therefore lending much less fodder for analysis. There have been, however, a number of decisions made by the Obama administration that have been subject to harsh criticism from those who subscribe to the political philosophy of conservatism, or, more accurately, of what conservatism has become.

One of the first actions of the Obama administration to be incorrectly considered as socialistic is both the support and signing of the American Recovery and Reinvestment act of 2009. Barack Obama entered the presidency of the United States of America on January 21^st, 2009, well after the country’s economy took a very noticeable downturn. Channeling the political philosophies of Franklin Delano Roosevelt, Barack Obama began championing a series of proposals that would later make up the American Recovery and Reinvestment Act of 2009. Ultimately, the legislation invested $787 billion into Healthcare, education, tax cuts, infrastructure, and various other institutions of similar importance and in need of similar levels of attention. The idea of the legislation is that institutions receiving said money could use such in expansion and investment, therefore creating jobs and reducing unemployment to some end that has yet to be announced. The staggeringly high sum of money to be invested, however, seemed to be off-putting to the majority of conservatives in the United States; so much so that the bill passed through the house without a single republican vote, and passed through the senate with only three.

Though the majority of republican politicians who voted negatively on this bill did so in regard to the amount of federal spending, a large amount of the American public recognized this legislation as the introduction to socialism. Websites, such as FreedomRide.us, began making absurdist claims, asserting that the legislation was an act of “socialist central planning (“Sean” of FreedomRidde.us).” What makes these types of assertions outrageous is the fact that the Reinvestment and Recovery Act of 2009 cannot even be considered socialistic in nature, simply because the central government is in no way trying to usurp industrial power from the private sector. The only possible avail this legislation could be to a blossoming socialist government is, if the legislation works superiorly, would be using its success as evidence of the central authority’s ability to make effective investments on a large scale.

On the Bailout of General Motors

Shortly thereafter, on June 1^st, 2009, General Motors, who had been requesting aid from the federal government since November of 2008 (Armstrong), filed for chapter eleven bankruptcy, which, through a bizarre series of complicated, political loopholes, ended up becoming an entirely different, restructured company, The New General Motors. Now a privately held company, the majority of which (sixty percent) in owned by the Treasury of the United States, with the rest divvyed between Canadian governments, creditors, and the UAW health care trust (Detroit News). The conditions of this unique apprehension were several, and before any of this took place, GM had to create and adhere to an efficient plan of restructuring.

While many Americans are rather quick to assume this to be a socialistic move, it appears to be more of a corporatist move than that of a socialist, although, I find neither to be the case.

If pressed to classify this action, I would have to say this demonstrates a novel approach to capitalism, one in which the government simply influences the market, rather than seize it. Though the Treasury of the United States currently owns the majority of the New General Motors’s shares, it is hardly commanding its destiny, and has plans to become publically traded by 2010. Though social in nature, this particular action cannot accurately be described as socialistic.

On Healthcare Reform

The most recent controversy of socialism has risen recently, in the efforts asserted by the Obama administration to reform healthcare, particularly regarding the presented “public option.” Though the house has yet to reconcile the technicalities of the “public option,” it will, assuming its passage, will give Americans the option to obtain very affordable health care on behalf of the United States government.

Judging this decision as socialistic is particularly hard, given that the legislation is far from finalized, so the analysis is more or less restricted to generalizations.

Ultimately, the idea is to create a new form of insurance, provided by the government, who would, in turn, compete with private insurers (Barackobama.com). The criticisms are several and varied, but the most common, I have found, are those accusations regard an “inevitable” collapse of the private healthcare system altogether, and the now frequent claim of socialistic tendencies. Neither could be more wrong.

Given the nature of this essay, I will say, in concise summation regarding the former of the two accusations, that the majority of nations with nationalized health care are practicing such quite well (Norway, France, Spain, etc.(The Healthcare-economist.com staff of writers)), seemingly making this more of a question of modernity than a question of socialism. In regard to the second accusation, or that of socialism, I disagree wholeheartedly.

In fact, such policies seem to reflect a new take on capitalism in which the central authority pressures the market through mild intervention. I suppose such a situation could be considered vaguely socialistic in nature, but, to be absolutely honest, it is neither socialistic or capitalistic enough for me to declare it an action of either, and I would say the very same things in regard to the bailout and restructuring of General Motors and the Reinvestment and Recovery Act of 2009.

Change, Indeed.

Though I do not consider the actions of the Obama administration to be socialistic in nature, there is a clear and undeniable emphasis on social policy; however, none of these policies have yet to usurp any real power from the American people.

Based on Conor Clarke of the Business section the Atlantic’s projection, the United States only owns .0507% of companies within the United States; with this assertion in mind, claiming Barack Obama has introduced an era of socialism is absurd; although, claiming the administration’s policies are vaguely socialistic, or something of the sort, seems to be very reasonable.

If pressed to classify the policies of the Obama administration thus far, I would have to describe it as a sort of neo-capitalism, in which the central authority influences the free market through semi-social intervention within the free market.

As of right now (October 8^th, 2009), the effectiveness of this approach to the market and policy of the United States is a bit too early to call; however, I find this shift very ideal.

This shift to more social and liberal policy, to me, implies the rising level of comfortability in terms of government intervention and oversight, notions a large sum of the American public have been uneasy about since the era of Mccarthyism. The administration’s actions convey a sincere desire to help the people of our nation, rather than accommodate the elite few who have come to govern through pecuniary influence.

Weather or not these policies will come to the fruition promised during Barack Obama’s campaign remains to be seen; after all, this is a very new presidency; what can be seen, however, in an administration not afraid to compete with and pressure the private sector to better accommodate the American citizen.