Sen. Bernie Sanders (I-Vt.) famously said in the 2016 campaign, “The business model of Wall Street is fraud.” He declared that he was not a capitalist. Whether or not he decides to run in 2020, many of those who supported him will be looking to Sen. Elizabeth Warren (D-Mass.) to take up the progressive banner. She sure is sounding more like a candidate each day. But unlike Sanders, she is striking a more restrained ideological tone — for now. She had this exchange with John Harwood in an interview for CNBC:
Q: You don’t think capitalists are bad people?
A: I am a capitalist. Come on. I believe in markets. What I don’t believe in is theft, what I don’t believe in is cheating. That’s where the difference is. I love what markets can do, I love what functioning economies can do. They are what make us rich, they are what create opportunity. But only fair markets, markets with rules. Markets without rules is about the rich take it all, it’s about the powerful get all of it. And that’s what’s gone wrong in America.
(As an aside, we also should note that she sounds saner and tougher than President Trump on Russia, observing “by attacking our allies he not only distances us from them, he also is basically teaching our allies they can get along without us. Does the dollar have to be the reserve currency? You know, that’s of enormous value to America. . . . When he stands up and attacks our intelligence agencies and attacks our law enforcement officers, and then defends a country that has launched a cyberattack on the United States — and indeed, seems to go, ‘wink-wink, nod-nod’ — then boy, he is not serving the interests of the United States of America.”)
We’re pleased Warren says she doesn’t see the economic system that lifted billions around the world out of poverty to be intrinsically evil. That nevertheless leaves a lot of questions to be answered. We’d be interested to hear — more including:
- What constitutes “theft’ and “cheating”? Are we talking about insider trading or something more endemic to markets?
- If markets produce wealth, shouldn’t we be opening markets internationally, increasing free trade and creating new opportunities?
- What new market rules are needed? (She’s talked sensibly about excess concentration in certain markets but we’d be curious to hear what other systemic problems she sees.)
- At what point do new market rules undo the benefits of capitalism?
- What’s the right balance of taxes, expenditures and debt?
I’m not looking for detailed white papers, but I sure do want to know more about her economic philosophy. We have a GOP president who thinks trade protectionism, huge deficits, cronyism (i.e., picking winners and losers), subsidizing dying industries (e.g., coal) and corporate welfare (e.g., aid to farmers impacted by his tariffs) make for a successful economic scheme. We find that preposterous, but his total incoherence leaves an opening for Democrats and anti-Trump conservative challengers to engage in redefinition and creative thinking. For one thing, it is obvious neither party thinks “small government” is feasible. But what do we do with the government we have?
The big issues we confront include vast inequalities in wealth and productivity by region, wage stagnation, unsustainable debt, education and worker training appropriate to the current economy, repairing and improving the health insurance system (which has made more expensive and chaotic by GOP attempts to sabotage the Affordable Care Act), confronting future dislocation caused by technology (e.g., AI), and sustaining an international economic system that allows the U.S. and other capitalist democracies to thrive.
These are big, important issues that are impossible to address when we are worrying if the president is a Russian asset or if his trade war will send us into an economic spiral. However, it is not too much to ask people running to replace him to think through some of these serious issues and give us at least a hint about where they’d like the country to go. Let’s hope the legions of Democrats, some independent candidates (we hope) and a few GOP challengers (we hope) eyeing a 2020 run agree.