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Wasserman-Schultz: Unable to define Socialist vs. Democrat

Written By | Aug 8, 2015

WASHINGTON, Aug. 8, 2015 — Democratic National Committee chairperson Debbie Wasserman-Schultz was recently asked to explain the difference between Democrats and socialists. After stumbling with her words and then offering some double talk, she could not give an answer. Asked again, she continued to fumble her words, still unable to answer.

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Let’s define socialism.

Socialism is an economic system in which the government is the primary owner of productive resources and capital. It gives a large role to government and reduces the importance of private property. Socialism falls between communism and capitalism, two basic economic systems, differentiated by defined characteristics.

Communism is a system in which almost all property and all productive resources — factories, mines, retail outlets, land, and so on — are publicly owned. Property beyond personal consumer goods — clothes, radios, razors — cannot be bequeathed to heirs.

In principle, the government decides who “needs” property and awards ownership based on need.

"Socialist states by duration". Licensed under Public Domain via Wikimedia Commons -

“Socialist states by duration”. Licensed under Public Domain via Wikimedia Commons –

socialism-color-codeThe above map shows countries (using present-day borders) that have constitutionally declared themselves to be “socialist” under any definition of the term, at some point in their history.

They are color-coded for the duration of their claims to be socialist. (Source:

Communism gives the dominant role to government. Government decides the products that are made, who makes them and who gets them. This severely restricts personal freedom.

The basic assumption is that people should be motivated primarily by the welfare of society, so they will accept the government’s decisions. And since all people have the same basic needs, the output and resulting money made should be divided among all people equally.

People who generally value personal freedoms reject Communism.

There is no incentive for an individual to work harder, work better or produce more, since no matter how much is produced, the worker receives the same amount as others who produce little or nothing at all.

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Without individual incentives, communistic economies stagnate, which can be seen in real life in countries like Cuba and North Korea, where most people live in poverty.

A second economic choice is capitalism. Under capitalism, property (except for some public goods like infrastructure) is privately owned. Anyone has the right to own any property as long as he is willing and able to pay the market price for it. Americans own and sell property, from land to businesses to personal items like jewelry or investment portfolios.

The property owner has the right to bequeath the property to his heirs, although estate or inheritance taxes must sometimes be paid.

Decisions about what products are produced, how they are produced and who gets them are made freely in the market through the interaction of companies willing to produce and consumers willing to buy.

The role of government is small and limited, while personal freedom is encouraged.

Capitalism also assumes that people are motivated primarily, although not necessarily entirely, by self-interest.

Socialism generally advocates private ownership of non-productive property, although it considers more products than capitalism as public goods. But the role of government is larger.

Government controls many markets, usually influences prices and redistributes income to cut the income inequality that results from a purely market-based economy.

The primary differences between socialism and capitalism are that with socialism, there is more government ownership of resources, more income redistribution, more government control of resources and less personal freedoms than one has under capitalism.

Under capitalism there is greater economic disparity among people, leading to classes such as the poor, middle class and wealthy, that we have in America today.


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The Democratic Party today, which is much different from the Democratic Party prior to Obama’s presidency, seems to follow the philosophy of socialism. This differs greatly from the view of Bill Clinton, the last Democratic president prior to Obama, who said in 1996, “the era of big government is over.”

Today’s Democratic Party advocates a takeover of the healthcare system which accounts for about 1/6 of the economy. Today’s Democratic Party redistributes income by overtaxing those that give the most to economic growth, giving that money to those who for whatever reason give little or nothing to the economy.

Today’s Democratic Party wants to cut personal freedom by forcing citizens to buy healthcare services that they don’t want or need, by forcing employers to pay workers more than the value of their output and by controlling behavior to limit the consumption of products the party deems to be not in the citizen’s best interest.

They also want to control the defensive devices, like guns, making it impossible for law-abiding citizens to arm themselves, a right guaranteed to Americans in the Second Amendment.

Today’s Democratic Party wants to severely restrict financial markets. The intent of  the Dodd-Frank bill was to prevent market casualties; the result of the Dodd-Frank bill is the restriction of financial markets so that the economy stays mired in stagnation.

If Democrats continue to advocate for more government control, more government intervention, fewer personal freedoms and more government ownership, then it is no wonder that chairperson Schultz could not explain the differences between Democrats and socialists.

Michael Busler

Michael Busler, Ph.D. is a public policy analyst and a Professor of Finance at Stockton University where he teaches undergraduate and graduate courses in Finance and Economics. He has written Op-ed columns in major newspapers for more than 35 years.