Just Say the Word

sussudio

I feel so good if I just say the word
Su-Sussudio
Just say the word, oh-oh
Su-Sussudio

Sussudio
Phil Collins

The crowd is hostile, but the tune is catchy — it wins them over. (Go ahead, watch the video — soooo 80’s. We’ll wait.)

Fast forward 34 years to a new tune:  “Su-su… socialism.” Just say the word, and it’s an instant failure to communicate. The Millennials get up and dance. Their parents think about re-writing their wills.

I found all the sources for this week’s post by Googling “when did socialism become a bad word?” This article[1] has that title, and gives two answers. The first is the word’s historical definition:

“Merriam Webster defines it thusly:

“any of various economic and political theories advocating collective or governmental ownership and administration of the means of production and distribution of goods

“a) a system of society or group living in which there is no private property b): a system or condition of society in which the means of production are owned and controlled by the state

“a stage of society in Marxist theory transitional between capitalism and communism and distinguished by unequal distribution of goods and pay according to work done.”

The second answer is also historical:  to the older generation, socialism means the Cold War, the Commies, and the other nasty stuff in this  video. (It’s short — again, we’ll wait if you want to take a moment to watch it.)

Socialism video

“Socialism” sets off alarm bells for those who lived through all that:

“For a generation with no memory of bomb shelter drills or sledgehammers smashing the Berlin Wall to pieces, the sad reality of life under socialist rule has been forgotten, and the lessons of the Cold War have been relegated to the ‘ash heap of history’ alongside communism. Instead, the concept of socialism has often been confused with liberalism. Socialism seems like a fine idea that means a more social equitable society for everyone—free health care and free education for starters.

“Socialism is not roads, welfare, and free education. Socialism has always had a more ominous goal and shares close historical and ideological connections with more reviled terms: Marxism and communism. Karl Marx took socialism to what he viewed as its natural conclusion: The ‘abolition of private property.’”

How Did America Forget What ‘Socialist’ Means?  Politico Magazine (March 22, 2016)

But the new version of socialism isn’t about state-owned means of production,[2] the abolition of private property, or a Communist revival:

“For conservatives and libertarians, the news that millennials are embracing socialism is frightening. They shouldn’t fear, because the United States is not going to nationalize the economy any time soon. That’s because the word “socialism” doesn’t mean what our newfound socialists use it to mean.

“To people who don’t like it, socialism means ‘state control over the means of production.’ Turn to your nearest dictionary and you’ll find something like that. But it means something different to the people who use the term as a positive thing. Your coworker’s son who wants to take America in a socialist direction? He simply wants more government.”

Millennials Use The Word ‘Socialism’ — And May Not Know What It Means, The Hill (Oct. 27. 2019

If it’s true that the hypothetical “coworker’s son” wants “more government,” then what for? Among other things, to support the republic — the res publica, the commonwealth — as we saw last time. I.e., the new socialism is in fact about things like “roads, welfare, and free education.” Finding a seat for those topics at the economic policy-making table is apparently a catchy idea:

 “Socialism is no longer a dirty word in the US, certainly not among millennials, anyway, who face a far grimmer economic future than previous generations. It isn’t surprising that a number of recent polls show millennials are increasingly drawn to socialism and wary of capitalism.

“The popularisation of what has been termed by some as ‘millennial socialism’ in the US arguably began with the Occupy Wall Street movement in 2011. Bernie Sanders’ presidential campaign gave it further momentum, and Ocasio-Cortez’s recent win added more fuel to the fire.

“You can see this trajectory reflected in the membership of the Democratic Socialists of America (DSA). Founded in 1982, it had about 6,000 members for most of its history. Shortly after the 2016 election, the organisation saw a boom in membership, reaching 11,000 paying members in December 2016. Since Trump took power, interest in the DSA has grown exponentially. A spokesman said it hit 47,000 members last week, and has ‘seen the fastest growth in our history following the win of Ocasio-Cortez.’”

Socialism Is No Longer A Dirty Word In The US – And That’s Scary For Some, The Guardian (July 29, 2018)

Catchy, but will it win over the hostile crowd? Aside from associations with the dictionary definition and Cold War history, “millennial socialism” is up against a more systemic, more powerful obstacle:  deeply entrenched cultural faith in the capitalist free market . We’ll look more at that next time.

[1]When did socialism become a bad word?Kimberly Bulletin (Apr. 5, 2019)

[2] Never mind that the student loan business has been nationalized, as we saw previously.

What’s With Student Loans?

obama state of the union 2013

“It’s a simple fact:  The more education you’ve got,
the more likely you are to have a good job
and work your way into the middle class.”

2013 State of the Union Address

President Obama was repeating an enduring cultural belief. Maybe it was still true when he said it, but not anymore — for a lot of reasons we’ve looked at throughout this series, but especially in light of today’s social and economic calamity of soaring higher education costs and student loans.[1]

student debt graph

Chart from Next Gen Personal Finance (May 30, 2015)

Student debt grew steadily 2000-2014. Toward the end of that period, a revenue provision tacked onto the 2010 Affordable Care Act gave the Federal government a monopoly on the student loan business. Since then, total loans have risen exponentially — by 50%, to $1.52 Trillion.

Nationalizing student debt has been a government money-maker, in terms of both capital and income:

“The trillion plus in student debt that the state holds makes up a plurality of its financial assets — 37 percent, far more than national reserves officially held in gold or foreign currency.

“Because the government’s borrowing costs are so low, student lending is incredibly profitable. The Department of Education expects to reap $18.99 in profit on evert $100 in loans originated in 2014… and we’re talking over $25 billion in projected negative subsidy — that is, profit — off the 2014 cohort alone.”[2]

Kids These Days: The Making Of Millennials, Malcolm Harris (2017)

Meanwhile, educational costs have also soared.

educational costs

Tuition data from National Center for Education Statistics. Inflation data calculated using 1963–1964 tuition and tuition increase at rate of inflation from CPI Inflation Calculator. Graph by Noa Maltzman

Today, average undergraduate loans are $30,000. Paying them off represents a 21-year mortgage. What’s the ROI from the students’ point of view? Answering that question requires examining (1) the loans themselves — how they’re originated, paid off, etc., (2) what higher education is doing with the loan proceeds students are handing over, and (3) the cultural belief Pres. Obama articulated. For all of that, I refer you to the book Kids These Days, cited above, and to a 70-minute film Broke, Busted, and Disgusted, which I just watched.[3]

What’s to be done? The remedies in the film are prospective — they’re too late for the $1.52 Trillion already in place. Going forward? Well, it is an issue in the election coming up — at least for the Democrats — and here are summaries of candidate proposals:

Writing this makes me revisit my own experience with student loans and the cost of higher education.

I went to an expensive private college. My financial aid package included scholarships, work study, and student loans. I paid off the loans in five years. The relief was tangible. I vowed never again.

My financial aid package at DU’s MBA/JD program included scholarships and student loans. I declined the loans and worked a lot, sometimes full time. I made it through the first three years without loans and would have finished that way. An accountant friend told me I was crazy — it was cheap money. I took out a loan my fourth year. I paid it off in six years. The relief was tangible. I vowed never again.

In 2009, just after the Great Recession and an ill-timed, ill-advised, and poorly executed exit from law practice, I was short of funds to pay for two of my kids’ final years at expensive private colleges (they’re two years apart in age, but their final years coincided). I took out $30.000 in “parent plus” loans to make up the difference. I declared bankruptcy the following year, and found out student loans hadn’t been dischargeable since 2005.

In 2013, as part of an attempt at mid-life reinvention, I was accepted into a graduate program in sports psychology at DU. There was no way to pay for it other than student loans. I decided not to attend. The relief was tangible. Lesson learned.

In 2016, I qualified for disability income. I used most of my back-pay award to pay off my parent-plus loans. The relief was tangible. Lesson learned. I vowed never again.

It’s easy for me to feel entirely responsible for my own history. But as for today’s reality, as a young friend said recently, “I’m starting to believe it’s not all my fault.” Coming up, we’ll look at more economic support for that thought.

[1] As I write this, the headlines today show Felicity Huffman entering prison for her role in the college admissions scandal.

[2] Citing Department of Education Student Loans Overview Fiscal Year 2014 Budget Proposal. Click here for the 2020 numbers

[3] Of course the documentary has an agenda, but it’s well-done and worth watching.