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Fernando Espuelas Headshot

Barack Obama Is a Lousy Socialist

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I was asked on my radio show to explain why labeling President Obama a "socialist" is incorrect. Short answer: I think it comes down to objective reality.

A more thoughtful answer would start with the facts. Socialism is an economic/social/political system with specific attributes. Whereas historically the Soviet Union had been the main global sponsor of socialism in the 20th century, today's example of socialist societies include Cuba and Venezuela.

In both cases, the ruling parties enjoy a monopoly of power, and through their appointed governments, own the economy. They exert central control of most, if not all, economic activities in those countries.

Through state-owned companies, government entities and the deployment of totalitarian command-and-control methods, private enterprise is made illegal or at the very least, extremely risky because of the threat of confiscation (as has happened in Venezuela in the last few years) or other extrajudicial action.

Moreover, political rights are suppressed by these regimes. Violence against dissidents is common and brutal. The Castro brothers have their political prisoners -- and so does Hugo Chavez.

The resulting economic effects of socialist policies are predictable. (Hello Soviet Union!) The Cuban economy has been on international welfare -- first from the Soviet Union and now oil-rich Venezuela -- since Fidel Castro became dictator. In spite of its gushing oil wells, Chavez' Venezuela has been seeking foreign loans to stabilize Chavez and his failed command-and-control economy.

By contrast, the United States, its government, society, and free market economy are organized around the principle of "democratic capitalism." That was the intent of the Founders, and has been the policy of every administration in history (although executed with different rates of success, e.g., Hoover vs. Clinton).

Although the United States Government, first under President George W. Bush and then President Obama, had to rescue the financial and automotive industries, there has not been a policy to maintain control over those companies or industries on a long-term basis because of "national-strategic interests" -- a common method for property seizure in Venezuela.

To the contrary, the U.S. Government has sold off most of its stakes in companies it saved during the crisis. Many of those rescues were effected without nationalizing the companies, but rather through cash infusions in exchange for equity - the equity that has now been sold off to private investors. A "socialist" policy would have surely resulted in the government's ongoing control over the institutions it rescued. Industrial policy and control are essential to socialism. That simply has not happened in the United States.

Today, we can say with complete confidence that the private corporate sector in the United States is healthy and robust, booking the single biggest collective profit in 2012. Investments by venture capitalists have continued to grow. New business are being created every day. Housing starts have jumped. The stock market is reaching its historic highs. The interest rate on U.S. Treasury bonds are historically low -- representing the financial world's belief in the solidity of the American system. No one serious thinks the US is on a path to socialism.

The American people live in liberty, with constitutional rights and the ultimate protection of an independent judiciary. In short, the "socialism" label Republicans want to pin on the President may be helpful to stir the hearts of an aging GOP member base, composed primarily of older men, but the facts do not support that claim.

Indeed, the facts prove that the economy of 2013 is superior to the economy of 2008. And of course, Obama has been president since 2009.

You simply can't logically and empirically connect "socialism" to our country's economic/social/political system's reality, a reality that we can see and measure. And that was my answer to my caller.