Socialism, capitalism, and racism: part two–one hundred years of unequal freedom

In the 1840s, French political philosopher Alexis de Tocqueville foresaw difficulties the United States would face dealing with a population of Africans surrounded by a dominant culture of Europeans. De Tocqueville did not prophesy the Civil War, but he realized that slavery would end in North America. He warned that the African population would not be easily assimilated into the European culture of the United States, anticipating that conflict between the two populations was inevitable.

With the election of Abraham Lincoln as President in 1860, some southern states seceded and formed a Confederacy. Northern states answered Lincoln’s call to go to war to preserve the Union. The Confederate states seceded to preserve their practice of slavery, as their own documents from the time reveal. Northern states went to war, not to free the slaves, but to keep the country united; even Lincoln said that he would accept the continuing presence of slavery if it would keep the nation undivided. His Emancipation Proclamation did not free all the slaves—only the slaves held in the rebellious Confederate states. Only the thirteenth amendment to the Constitution ended slavery in the entire country, and that amendment was not passed until after the Civil War had ended.

Although the purchase and sale of slaves had operated until capitalistic practices, southern plantation owners perpetuated an economy that predated the rise of capitalism. After the war, they attempted to continue a feudal economy, treating the freed slaves as serfs who lived on white-owned land as sharecroppers and tenant farmers, leaving the white property owners in control of the political and social structure of the southern states. Northern reformers attempted to bring capitalism and equality to the south. They brought railroads, factories, and banks to the south. They established schools for black children and adults. They set up political systems that allowed black adults to vote, and some blacks were elected to positions in the local, county, and state governments. When this time of Reconstruction ended, the white power structure in the south reasserted their power. They instituted voting practices that kept black citizens away from the polls and prevented black candidates from being nominated. They reduced or eliminated black access to education. They used lynchings, race riots, and other crimes to terrorize the black population, keeping them under control of the same wealthy whites who had previously owned slaves.

National law, built upon the premise that all people are created equal and have certain human rights, allowed for the development of “separate but equal” benefits for white and black citizens. Schools were permitted to function, but taxes collected from white families funded schools for white children and taxes collected from black students funded schools for black children, perpetuating the poverty of black citizens and the predominance of white citizens. Businesses, medical care, and even train and bus transportation were segregated. Sometimes enforcement of the law bordered on the comic: a museum planation in Arkansas has preserved a doctor’s office which had separate entrances and separate waiting rooms for white and black patients but only a single room for treatment of all patients.

Many black workers traveled north, hoping for better opportunities in the big cities. Already those cities had traditions of separate neighborhoods for separate cultures—German, Swedish, Irish, Italian, Polish, and so on. Soon black neighborhoods were created, complete with black schools, black churches, and black businesses. Segregation, “separate but equal,” was as real in the north as it was in the south.

Would socialism have provided greater equality for white and black citizens at the end of the nineteenth century and beginning of the twentieth century? Definitely not. Every step in that direction continued to separate white and black, giving greater benefits to the white. White labor unions, among other expectations, were intended to keep factories from replacing white workers with black workers. Roosevelt’s New Deal provided much more help to white workers and families than to black. One reason for the disparity was that local direction of government programs always fell into the hands of the same powerful families that had managed the economy before the war and after Reconstruction. They had no intention of offering true equality to their black neighbors under any economic theory.

During this “separate but equal” era, some American blacks found ways to succeed. Black labor unions were developed for industrial and for agricultural workers. Black businesses, following the principles of capitalism, brought services to black communities and wealth to black entrepreneurs in both north and south. Black banks, black insurance companies, and black social organizations grew. Black schools, including institutions of higher education, improved. Although many schools for blacks limited their education to vocational training, others offered broader education. Black writers and poets, black musicians, and black historians and philosophers all gained an audience among both black and white Americans.

During these years, the United States did not meet its high standards of “liberty and justice for all.” Life was unfair for black citizens, native Americans, and immigrants from Europe and Asia; poverty persisted among populations of every culture and nationality. Prejudice and discrimination were widely practiced against blacks, Chinese, eastern Europeans, Catholics, and Jews. Capitalism was not the problem; socialism would not have solved the divisions and inequalities of American society. But in the later half of the twentieth century, new ideas and new approaches would make greater efforts to provide Civil Rights to all citizens of the United States. J.

Social Security

For as long as I can recall, every candidate for federal office has spoken about the need to rescue Social Security. I remember one Presidential debate, at least twenty years ago, in which one of the candidates referred to two unrelated opinion polls. One had asked young adult Americans whether they believed Social Security would still exist when they were ready to retire. The other had asked a similar demographic whether they believed that space aliens were visiting the Earth in UFOs. The result of the comparison was that more Americans believed in space aliens on UFOs than believed in Social Security.

Social Security was part of the New Deal enacted by Congress under President Franklin Roosevelt. Contrary to its name and to popular perceptions of the program, Social Security is a tax on working people used to pay other people—mostly the elderly and the disabled—not to work. The goal of the program, when it was created in 1935, was to open jobs for more workers and reduce unemployment by giving incentives to certain workers to leave the work force.

In 1935, the median average lifespan of Americans was seventy years. Today it is more than eighty years. This means that, when Social Security began, roughly half of the Americans who retired at age sixty-five could be expected to draw from the program for five years or less. Now, given better nutrition and health care than existed in the 1930s, more than half the Americans who retire at age sixty-five will draw from the program for fifteen years or more. No wonder many Americans doubt that Social Security can survive for another generation!

In 1935, each working American was taxed two percent of his or her income, but only up to $3000; money earned above that amount was untaxed. The tax was further hidden by requiring employers to match employee contributions, making the apparent tax only one percent. Today, the tax (including Medicare, which was added in the 1960s) is 15.3%, although it still seems less because employers are still matching employee contributions, making the tax appear to be less than eight percent (except for people who are self-employed). The ceiling of taxable income has risen from $3000 to $137,700.

Employment rates, salaries, longevity figures, and other numbers vary from year to year. Each year projections are offered to guess how long Social Security can continue to fund disabled and retired persons given current numbers. The dire prospect of running out of money for Social Security usually projects only a few more years of survival for the program, but somehow Social Security has continued to remain solvent even as some of the early years for its projected failure have passed.

The easiest way to keep a balance in Social Security are to raise the tax rate and to reduce the benefits paid. Neither of those options are popular in today’s political climate. Other questions can be addressed that might also help preserve Social Security as a government program for the foreseeable future:

  • Why place a ceiling on taxed earnings for Social Security? This practice causes Social Security to be more of a burden on low-income and middle-class taxpayers than on the wealthy. Removing the ceiling would generate more income for Social Security without adding any costs to the program.
  • Social Security earnings have never been taxed, but many recipients of Social Security are drawing more total income from various retirement programs and investments than the average American worker can earn. Replacing the ceiling on taxed earnings with an income above which Social Security is subject to withholding tax would generate income for the government without harming the average disabled or retired recipient of Social Security.
  • Retirement age needs to be reconsidered. Retirement at sixty-five (and early retirement at sixty-two) removes productive workers from their jobs while stressing the Social Security system. I plan to work full-time until I am seventy; I think most people my age are capable of doing the same. (Both my parents and all four of my grandparents lived into their eighties—two of the six into their nineties.)
  • Understand that Social Security never promised to provide a sustainable living income for retirees. Social Security is meant to supplement other investment and retirement income. Unlike life, liberty, and the pursuit of happiness, Social Security is not a God-given right. Social Security is a government program of taxation and payment of benefits which can be adjusted by the government whenever it chooses (remembering that the members of government are subject to replacement by the voters whenever they make and enforce unpopular laws).
  • Understand that currently Social Security is generating more government income than it is costing government expense. Predictions of the collapse of Social Security always depend upon extending current trends. Adjustments made over the years have sustained Social Security well beyond earlier forecasts of shortfalls. Continued adjustments will be more significant than any massive overhaul of the system.

In short, candidates for political office often threaten the end of Social Security as a way of scaring voters. Real assessments of the program show no need for worry or fear. Like other panics over illnesses, environmental changes, technological failures, and political confrontations, news of the collapse of Social Security is largely exaggerated and used to manipulate public opinion. J.