The Insuperable Problems of the Democratic Party

Sisyphus and his rock.
Photo Credit: Wikimedia Commons/Titian(1490-1576), Prado Museum, (PD-US-no notice)

In the post Democrats’ 2016 strategy assumes America is lurching left. Are they wrong? in this morning’s theweek.com blog, Pascal-Emmanuel Gobry states,

A self-proclaimed socialist like Bernie Sanders will always be an oddity in American politics; one who polls so well in Iowa and New Hampshire doubly so.

I really want to believe this, that socialism in the United States will forever lie beyond the pale. However, just the fact Senator Sanders  is doing so well in the polls is very worrisome.  

Indeed, there was a recent YouGov poll that indicated one-third of millennials and 43% of Democrats view socialism more favorably than capitalism. The 43% of Democrats  who favor socialism is exactly equal to the proportion of Democrats who favor capitalism. Unfortunately, there was no indication of what all these people meant by “socialism”. They may have meant the classical definition of socialism as an economic system where the means of production are completely owned and managed by the state; or they may think of socialism as “European style socialism”, which is a highly mixed economy where the control of the state predominates over that of companies. “European style socialism” may or may not  involve partial ownership of the means of production. However, almost all the arguments against classical socialism can be reiterated for European style socialism. So if that is what most people who favor socialism mean, that is not much comfort.

Gobry went on to write that “what was so odd about the Democratic debate on Tuesday was not the socialist; it was how little his opponents disagreed with him.” Given the present make-up of the Democratic Party revealed by YouGov, it may not be so odd after all. In order to answer the challenge of Bernie Sanders, Hillary Clinton is forced take positions just as far left as Sanders.

Gobry then goes on to paint two different pictures of the evolving American electorate, or in his metaphor, to write two different narratives. The first is that the U.S. is basically what it has always been: a center-right country. There may be a minority that is “trending leftward”, but they are not increasing all that fast and not by very much. According to the Gallup organization, as of January 2015 the American electorate was 30% Democratic, 26% Republican and 43% independent. According to the YouGov poll we cited earlier, 22% of independents and 9% of Republicans are for socialism. Putting it all together gives a pro-socialist percentage of the electorate of 25%. This first narrative, then, has the whiff of truth about it.

However, as they say in the stock market, “the trend is your friend, until it is not.” So if the trend does not continue to be my friend, Gobry’s second narrative will dominate. This says the U.S. truly is becoming a more progressive nation, irrespective of the Gallup and YouGov poll results. With the increasing secularization of the U.S. making the population more attuned to progressive social issues, and with the sometimes injurious impact of economic globalization and technological change, there may be an increasing call for government solutions.

Which narrative is more true? Gobry is uncertain, as am I. I would expect from the anger expressed about the results of the Obama administration (Obamacare, increasing national security threats, government regulations destroying jobs and economic growth) that 2016 election results would favor the Republicans. But then I thought Obama would not have been reelected in 2012, given the bad job he had made of his first term.

However, even if the Democrats conquer in the 2016 elections, retaining the Presidency and taking back both houses of Congress, their long-term prospects are extremely grim because of three insuperable problems they face. In order of importance, they are the following:

1. The policies they favor can not be supported and sustained by the U.S. economy. The pudding holding the proof of this statement is the ever-burgeoning national debt that now stands at 103% of GDP. Their viewpoint is that every serious societal problem, including economic problems, must be solved by the federal government. See the posts Progressives’ Basic Assumptions and The Complexity of Reality for more discussion of progressives’ view of reality. Carmen Reinhart and Kenneth Rogoff have shown that sovereign debt greater than 90% of GDP would cause governments to begin crowding corporations out of capital markets to service their debts, thereby causing smaller investments and less GDP growth. As long as the federal budget does not constantly pay off debt, that debt will grow exponentially. If the federal budget is chronically in deficit, the debt will grow super-exponentially. The national government would then be financially doomed along with Democratic Party control over it. One interesting aspect of exponential growth is that initially it looks to be very slow, indeed linear with time. Towards the end of the growth, just before nonlinear mechanisms (generally unpleasant) halt the growth, the growth goes from linear in time to explosive growth in the blink of an eye.
2. Their view of economic reality obscures from their sight the economic solutions of our problems that would really work. Their view of reality predisposes them to increasingly autocratic solutions, which means they usually want to increase government’s economic power. Friedrich Hayek in The Road to Serfdom (see reference [E2] ) would have described this tendency as a bent toward the Fascist form of socialism. I do not make this statement lightly or inadvisedly. Hayek pointed out it was illogical to classify the fascism of Italy and the National Socialists of Germany in pre-World War II Europe as on the opposite side of the political spectrum from socialists and communists (chapter 12). They were not, as many have argued, a capitalist reaction against socialism. They were instead just another variant of socialism that had the same roots in central planning and in allowing the state to dominate the individual. Because of this philosophical bent, Democrats have generally embraced Keynesian economic doctrine, which gives a justification for state intervention into the economy. This inevitably leads to the state creating imbalances between supply and demand that destroy the health of the economy. Consider all of the posts in the Leftist vs. Neoclassical Economics theme for many demonstrations of this truth.
3. Their view of social reality similarly obscures from them the realization that the complexity of reality denies them the capability of solving social problems for all parts of society using the same program for all. Because of their diffuse and various forms, social problems may require very different solutions in different parts of the country. One of the beauties of the U.S. Constitution that helped make the United States a truly exceptional nation, was the severe limitation of federal government power and the reservation of all other powers not explicitly given to the national government to the people and the states. The laboratory of democracy was to be in the states, not in the federal government. In this way a mistake by one government would not be forced on all, and a great success by one government would quickly be mimicked by all. Ever since President Woodrow Wilson, progressives have chafed under the limitations to federal power imposed by the Constitution. See Is Democracy the Best Government? Is It in Danger?. The more autocratic Democrats become, the more mistakes they will make like Obamacare that make the people suffer, thereby getting closer to the point where people will cry “No more!” and oust their oppressors from office.

The first two of these insuperable problems attack the Democrats’ economic ability to solve problems; the last one eats away at their mandate from the people. The Democratic Party can not solve any of these three problems and remain the leftist Democratic Party of today.

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