The study of the Council of Economic Advisers entitled "The opportunity costs of socialism" analyzes the experience of socialist or communist economies – such as the Soviet Union, China and Venezuela – as well Nordic social-democratic countries more open. and presents the criticism of a standard economist of central planning: That it stifles competition and innovation, two qualities that make America great.
"Historical evidence suggests that the US socialist agenda would create shortages or degrade the quality of a product or service under a public monopoly," the authors wrote.
At a meeting with reporters, ACE President Kevin Hassett said the report was inspired by the ramping up of proposals such as the Medicare for All plan by independent Senator Bernie Sanders of Vermont, which would create a single payer health care program.
The mid-term cycle also saw the emergence of so-called Social Democrats posing as candidates, such as congressional candidate Alexandria Ocasio-Cortez and actress Cynthia Nixon, who ran unsuccessfully against New York Democratic Governor Andrew Cuomo. In August, Gallup found that Democrats – especially the youngest – viewed socialism more favorably than capitalism for the first time since the beginning of the issue in 2010.
"If our study convinces citizens of all parties that if they rely on central planning and try to reduce the influence of private property by specifically nationalizing or regulating or taxing things in the country," he says. Forgetfulness would be bad for the economy, "said Hassett," I think the newspaper has achieved its goals. "
ACE staff has 45 people writing as a team. The name of each is not included in the report. This body is part of the executive and traditionally carries out analyzes on issues related to the President's political program. The CEA announced the publication of the report "as a coincidence" with the 200th anniversary of Karl Marx, born May 5, 1818.
Under President Barack Obama, for example, ECA has published reports on everything from the gender pay gap until the Affordable Care Act moves forward.
However, under President Donald Trump, the CEA strongly advocated for economic initiatives inspired by the White House, such as the imposition of work requirements in social protection programs and the reduction of regulation.
Hassett previously worked in a conservative think tank and was very early considered a relatively common choice since he had previously advised the presidential campaigns of George Bush, Mitt Romney and John McCain. He has often been invited to TV shows on the network, proclaims solid economic numbers and defends Trump's policies.
Some of Hassett's claims have been criticized, such as his argument that last year's tax cuts would raise household incomes by $ 4,000 a year, contradicting most other projections. . Hassett also Recently, he returned to some of his long-standing positions, especially in favor of free trade, claiming at a press conference at Rose Garden in July that Trump's tariffs had reduced the deficit. commercial while the decrease was a jolt that reversed several months later.
Hassett, in his briefing, stated that the idea of the report on socialism had been suggested by a new staff member, including Professor Casey Mulligan of the University of Chicago, who had left his academic post to become chief economist.
According to a CEA Mulligan had noticed that socialism had become a subject of interest to his students.
Mulligan has long argued against economic redistribution. In 2012, he published a book claiming that expanding social protection programs such as Food vouchers and unemployment insurance as a result of the Great Recession have reduced work incentives, thereby prolonging the slowdown.
"The more you help low-income people, the more you will get," said Mulligan in his speech at the Hayek Award's 2014 acceptance by conservative Manhattan Institute. "The more you help the unemployed, the more you will get."
Obama's CEA president, Jason Furman, declined to comment on the report, but some economists have not retained their criticisms on Twitter, including the professor of economics and public policy. 39, University of Michigan, Justin Wolfers.
The report comes at a time when Trump is marching through the battlefield states ahead of the midterm elections, portraying Democrats as a far-left mob. "New Democrats are radical socialists who want to shape the American economy of Venezuela," he wrote in a USA Today editorial.
The ECA document uses the poor economic performance of Venezuela and other countries as proof that socialist policies are not working. He points out that the Nordic countries, often used as examples of successful democratic socialism, actually apply lower tax rates in their health care program than those commonly believed in the United States, but still have a per capita income lower consumption.
The report includes a graph of the per capita income of people of northern descent in the United States, who earn more than the people of their home country. "This suggests that Nordic incomes are not lower because, aside from public policies, low incomes are somehow part of Nordic culture," the report says.
The Nordic countries, however, are not low income. According to the Organization for Economic Co-operation and Development, Iceland has the highest annual average annual full-time annual salary of any developed country, with Denmark and Norway in fourth and fifth place. In addition, the ECA document states that Norway's GDP per capita is "only slightly above the US average" while it is an oil-rich country, "while the United States is now the world's largest producer of crude oil.
The Nordic countries are also at the top of the 2017 global happiness ranking, which measures many indicators of well-being.
In January, President Trump expressed the wish to bring more immigrants from Norway than nationals of African countries.
The CEA report did not deal with other proposals from the progressive left, such as various forms of universal employment and basic income guarantees, designed to combat inequality. Proponents argue that such programs strengthen economic freedom by allowing workers to continue their education or take more risks because they are not afraid to live on the streets without one of the lowest paying jobs in the world. are available.
The Socialist Democrats of America, whose membership has grown to 50,000 in recent years, have not refuted certain aspects of the report in their response to a request for comment.
"DSA agrees with the White House's" socialist "report on one point:" Socialism is making a strong comeback in American political discourse. "We believe this report is an opportunity to respond to real needs of the American people, "said the group in a statement. "Socialism gives hope for a future that this administration is doing everything in its power to destroy."
Kevin Liptak from CNN contributed to this report.
