America’s Corporate Socialism
How We do Socialism for the Wealthy
America is a socialist country — that is a fact. We are constantly enacting laws to determine how the wealth in the U.S. is distributed. What we are NOT is a country that distributes its wealth to the benefit of the majority of our citizens, and certainly not to the middle class. As almost everyone now knows, we are masters at writing laws that redistribute our nation’s wealth to the wealthy and take it away from everyone else. What we have is a government that uses its socialist powers (taxation, monetary policy, subsidies and government guarantees) to enrich corporations and wealthy individuals.
The Cost of Subsidizing the Rich
This system of subsidizing the rich not only turns more and more money over to fewer and fewer powerful players, it causes terrible inflation for the rest of us.
We have been providing government support to banks, airlines, pharmaceutical companies, health insurers, corporate farmers, oil companies and mortgage lenders for decades and longer. Of course, these subsidies are disguised as legislation to help the middle class; but they’re not and they don’t. In fact, they create and inflate dangerous bubbles throughout the economy that can and do burst.
Here are three examples:
When the government decided to make it easier for middle class workers to get mortgages, the strategy was not to provide homebuyers with subsidies but to subsidize banks that make loans to homebuyers. The program was sold as a way to get more, riskier buyers into the housing market. In reality, it was a way to indemnify lenders from making bad loans to people who couldn’t pay them.
As a result, the banks began making as many loans as possible, handing them out to anyone who asked because the lenders made money on the fees and, better yet, if the loans went belly up, the lenders (not the buyers) were protected by government. It was a no-lose situation for corporate America. As a result of so much money in the real estate market, of course, housing prices began to rise. It became a bubble and we all know how it burst.
This is essentially the same story. The government has decided it will help students get a higher education–-not by giving them money to pay for college — but by giving government financial support to lenders who loan money to students. So, as we all know, students are given loans they can’t pay back because it’s profitable for the banks to make the loans. The banks earn money from the fees and, once again, it is the lenders, not the students, the government protects from any default.
As a result, colleges are flooded with money they can’t resist and are delighted to raise their prices. It becomes a bidding war between institutions of higher learning, as they tell students they can borrow their way into a degree because the banks are happy to provide them with money. It’s the next inflation bubble waiting to burst and it’s a debt machine for students.
And Now Healthcare.
The problem with Obamacare is not that more people have health insurance, it’s that health insurance is a ripoff and Obamacare enables the gouging to expand and grow. Why? Because the Affordable Care Act is designed to help subsidize the insurance industry, not to help people pay for their health care costs. First, we must remember that insurance companies add absolutely NO VALUE to our healthcare system. So no matter how much money the government gives them, INSURANCE COMPANIES DO NOT IMPROVE our healthcare. Giving these superfluous corporations more premium money may expand coverage, but it will not improve healthcare.
Second, the ACA merely allows the government to subsidize another American corporation, this time by paying portions of insurance premiums for people who can’t afford to pay them. Once again, this money does not go to pay for people’s direct healthcare. It goes to pay the premiums demanded by companies that contribute nothing to the delivery of actual healthcare. And to compound the crime, the more the government pays these premiums, the larger the amount of money that flows into this uncontrolled, under regulated and useless insurance system and the higher premiums become.
Socialism in Action
Make no mistake about it; this is socialism in action. It’s just the wrong kind of socialism. It’s corporate socialism, designed to take money from the rest of us and give it to the folks who benefit from our current campaign finance system.
Democratic socialism, the kind of socialism that benefits the rest of us, means that the redistribution of wealth should be to and about the majority of our people. It means that the decisions about that distribution come from the voters, not the lobbyists. Unless we wake up and smell the corruption and collusion that produces a redistribution of our hard-earned tax money to corporate America (which often pays no taxes at all), we are destined to continue providing welfare to the wealthy.
Nancy Hersage has written for NBC, CBS, ABC and PBS. She is a five-time award winning playwright and is the author of the warmly reviewed, fun and funny new mystery novel, Follow the Dotted Line, available on Amazon. Read more at www.NancyHersage.com.