Posted 12/02/2011 07:05 PM ET
Economic Systems: The former head of the Service Employees International Union says capitalism is on the ash heap of history and sees China as our role model. We have seen his future, however, and it doesn’t work.
President Obama once reportedly told aides, according to the New York Times, that things would be easier if he were president of China. Presumably he meant there would be no pesky things like a Congress, free elections and a free press to deal with.
Former SEIU chief Andy Stern, who may still hold the record for visits to the White House under this administration, would agree with that assessment. Stern, in an op-ed in the Wall Street Journal, writes of China’s “superior economic model,” a command-and-control economy unimpeded by such anachronisms as democracy and a truly free market. Stern writes that the “conservative-preferred free-market fundamentalist shareholder-only model” of capitalism “is being thrown onto the trash heap of history in the 21st century.”
We should, he says, “rethink” our economic model rather than “double down on an empirically failing free-market extremism.” He speaks glowingly of China’s 12th five-year plan and “Deng Xiaoping‘s government-led growth-oriented reforms (that) have created the planet’s second-largest economy” soon to replace us as No. 1.
Stern is wrong on at least two counts. The first is that what we have been practicing of late can hardly be called unfettered capitalism. We labor under the burden of ever-restrictive regulation and the highest corporate tax burden in the world. The administration has embraced industrial policy to dictate where factories can be built and what energy can be developed. It, not the free market, picks the winners and losers.
If we were practicing capitalism, Boeing would be allowed to make its Dreamliner passenger jet in South Carolina without the commissars at the National Labor Relations Board interfering. We’d be building the Keystone XL pipeline to bring Canadian tar sands oil to American markets. We’d be drilling offshore and in ANWR.
If we were practicing capitalism, there would be no such thing as too big to fail. There would be no bailouts, no nationalization of health care or buying of car companies. There would be no Solyndras or government “investments” in failed alternative energy. We wouldn’t shoot ourselves in the foot building high-speed trains.
The second is that China is hardly the worker’s paradise Stern portrays. Its progress has been built on the corpses of millions sacrificed for this or that great leap forward. China has perhaps the worst distribution of wealth on the planet.