Social Democracy Beats Democratic Socialism
Now that US Senator Bernie Sanders has emerged as a leading contender for the Democratic Party's presidential nomination, his brand of democratic socialism warrants closer scrutiny. Simply put, it is neither a close approximation of the "Nordic model" that Sanders often invokes nor a solution to what ails the American economy.
CAMBRIDGE – It used to be an unwritten rule of US politics that a socialist could never qualify for high national office. But now a self-proclaimed “democratic socialist,” US Senator Bernie Sanders, is the leading candidate for the Democratic presidential nomination. Should America embrace the change?
Democrats have made the primaries about much more than US President Donald Trump. Sanders’s momentum reflects a yearning for radical solutions to serious structural economic problems. In the decades after World War II, the US economy became steadily more productive, and wages for all workers – regardless of education – grew by over 2% per year, on average. But that is no longer the case today.
Over the last four decades, productivity growth has been lackluster, economic growth has slowed, and an increasing share of the gains have gone to capital owners and the highly educated. Meanwhile, median wages have stagnated, and the real (inflation-adjusted) wages of workers with a high-school education or less have actually fallen. Just a few companies (and their owners) dominate much of the economy. The top 0.1% of the income distribution captures more than 11% of national income, up from around just 2.5% in the 1970s.