Jeffrey on Social Welfare Programs

(HT Drudge Report) Terence Jeffrey’s article, “Jeffrey on Socialism's Trajectory: Obama's HHS Is Bigger Than LBJ's Government,” is an interesting blend of the good, the bad and the ugly.  To be sure, the bad and the ugly are small, and the good is big.  His main point is that in the past increased spending on social welfare programs has dramatically increased the size of government and placed us on a socialist path to ruin and that Patient Protection and Affordable Care Act (healthcare reform) pushes us further down that path.

The ugly is the overuse of the word “socialism.”  The Merriam-Webster Dictionary defines socialism as

a system or condition of society in which the means of production are owned and controlled by the state.

None of the programs he mentions, Social Security, Medicare, Medicaid, the prescription drug benefit, and now healthcare reform is a socialist program.  The government exercises control without owning the means of production.  Like socialism, the healthcare programs, as they have been designed and implemented, have weakened markets by limiting the role of prices. Socialism is only one road to serfdom. 

The bad is the exaggeration of the growth of government associated with the introduction of Medicare and Medicaid in 1965 and the prescription drug benefit in 2003.  He introduces his ideas with an interesting fact he discovered while examining the historical tables published with Obama administration’s $3.7 trillion budget.  If the budget is passed as the administration proposes, the Department of Health and Human Services will spend $909.7 billion, more than the entire 1965 inflation adjusted budget of $822.6 billion.  The fact is a good literary tool because it catches the eye, but it also exaggerates the still impressive growth of government.  It exaggerates because America’s population and wealth have grown; we should expect a bigger budget.  Measuring the budget as a percentage of gross domestic product is a more meaningful measure. 

As Jeffrey noted, budget expenditures, which were 17.2% of GDP in 1965, grew to 25.3% of GDP in 2010.   Expenditures by Health and Human Services represented a miniscule .68% of GDP in 1965 to 6.25% in 2010.  The contribution of Health and Human Services expenditures to the total budget is similarly impressive.  Those expenditures were 6.24% of total budget expenditures in 1965 and grew to 24.7% in 2010.

The good was Jeffrey’s brief tour of important events leading to an expansion of the size of government.  In 1937, Roosevelt attempted to pack the Supreme Court with politically like-minded justices.  He failed to pack the Court, but he succeeded in intimidating it.  Social welfare programs deemed unconstitutional prior to the attempted Court packing were found constitutional thereafter. Medicare and Medicaid began in 1965 and government grew.  The prescription drug benefit was signed into law in 2003 and the government grew.  The new programs are at least correlated with an increase in the size of the federal government as a percentage of GDP and because they programs have grown rapidly, they are probably one of the causal factors of government’s growth. 
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China Is Liberalizing Its One Child Policy

China’s population is set to peak at 1.4 billion in 2026 and then to decline to 750 million in 2100 (“China's Impending Population Bust”).  Allie Townsend writes clearly and concisely about China’s plans to liberalize its one child policy and a factor that may be driving the change in “China Could Overthrow One-Child Rule.”

The pilot projects, which are set to begin in 2011, allow for a second child per family if at least one spouse is an only child. USA Today reports that Beijing, Shanghai and four other provinces will follow suit in 2012, with nationwide adoption of the new policy expected by 2013 or 2014. In 1979, China's one-child policy was introduced after decades of huge population boom followed by mass death due to resulting food shortages. The policy, which has prevented 400 million births, restricted the country's ethnic Han majority to have only one child per family (exempting most ethnic minorities) and has remained nearly the same since, though a few exceptions have been made. (Some rural farm families have been allowed to have a second child if the first is a girl.)

A wide gender imbalance, as well as the need for more children to care for parents, has likely influenced the government's tight control on the country's birthrate. (Even though prenatal sex screening was banned in 1994, female infanticide is still in practice because of the cultural preference for boys.) A study published in the British Medical Journal in 2009 found that China has some 32 million more boys than girls under the age of 20.

I have two comments to add.  An aging population might also be contributing to the policy change.  Someone must pay for the social programs that support the elderly.  Finally, the mass death due to food shortages was not caused by the increasing population nor was the mass starvation due to bad weather.  It was due to bad policy pursued by China’s communist government.
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Sowell on Interventionist Policy

Thomas Sowell is a great writer and one of my favorite economists. His latest book is "Intellectuals and Society." In "Massive Government Intervention Drove U.S. Deeper Into Depression," an Investors Business Daily editorial, he offers the hypothesis that government intervention may deepen and lengthen economic downturns. He presents historical evidence to support his position comparing the stock market crashes of 1929 and 1987. His hypothesis is similar to Higgs' "Regime Uncertainty" (see "The Crisis Paradox). Key sections of Sowell's article articulating the conventional wisdom concerning Roosevelt's interventions and Sowell's dissent read

Many saw in the Great Depression the failure of free market capitalism as an economic system and a reason for seeking a radically different kind of economy — for some Communism, for some Fascism and for some the New Deal policies of Franklin D. Roosevelt's administration.

Whatever the particular alternative favored by particular individuals, what was widely believed then and later was that the stock market crash of 1929 was a failure of the free market and the cause of the massive unemployment that persisted for years during the 1930s.

Given the two most striking features of that era — the stock market crash and a widespread government intervention in the economy — it is not immediately obvious which was more responsible for the dire economic conditions. But remarkably little effort has been made by most of the intelligentsia to try to sort out the cause or causes. It has been largely a foregone conclusion that the market was the cause and government intervention was the saving grace.

While unemployment went up in the wake of the stock market crash, it never went as high as 10% for any month during the 12 months following that crash in October 1929. But the unemployment rate in the wake of subsequent government interventions in the economy never fell below 20% for any month over a period of 35 consecutive months.

In short, though the stock market crash has been conceived of as the "problem" and government intervention as the "solution," in reality the unemployment rate following the economic problem was less than half of the unemployment rate following the political solution.

He enumerates how bad monetary policy, protectionist trade policy, doubling taxes on high income earners, and price fixing stifled economic recovery.

Next, Sowell describes Reagan's benign response to the 1987 stock market crash, the media's harsh criticism and the ensuing economic recovery.

There is of course no way to rerun the stock market crash of 1929 and have the federal government let the market adjust on its own to see how that experiment would turn out. The closest thing to such an experiment was the 1987 stock market crash, similar in size but not in duration to the 1929 collapse. The Reagan administration did nothing, despite outrage in the media at the government's failure to act.

"What will it take to wake up the White House?" the New York Times asked, declaring that "the president abdicates leadership and courts disaster." Washington Post columnist Mary McGrory said that Reagan "has been singularly indifferent" to the country's "current pain and confusion." The Financial Times of London said that President Reagan "appears to lack the capacity to handle adversity" and "nobody seems to be in charge."

A former official of the Carter administration criticized President Reagan's "silence and inaction" following the 1987 stock market crash and compared him unfavorably to President Franklin D. Roosevelt, whose "personal style and bold commands would be a tonic" in the current crisis.

The irony in this was that FDR presided over an economy with seven consecutive years of double-digit unemployment, while Reagan's policy of letting the market recover on its own, far from leading to another Great Depression, led instead to one of the country's longest periods of sustained economic growth, low unemployment and low inflation, lasting 20 years.

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Feldstein on Obama Administration's Economic Policy

(HT Mankiw) Martin Feldstein was a chairman of the Council of Economic Advisors under President Reagan and is a professor of economics at Harvard.  In "Missing the Target," a Wall Street Journal opinion article, he agrees with the Obama administration's conclusions that government intervention was needed but thinks that the interventions were ill designed.  He describes the impact of the interventions as follows

...despite the talented team of economists in the administration, most of the president's economic policies have done little to help the problem. And indeed, many of these policies have created even more problems than they solved.

He enumerates several interventions a specific problems with their design.

...the president allowed congressional Democrats to design the $787 billion stimulus package. The result was an unnecessarily large increase in the national debt for a very modest rise in gross domestic product, with too much emphasis on redistributing income and preserving public-sector jobs and not enough on raising economic activity. Only about one-fourth of the nearly $800 billion will be used for government spending that adds directly to GDP. In contrast, the funds given to households will be largely saved or used to pay down existing debts. And the dollars that went to state governments relieved pressure to use their "rainy day" funds or levy temporary tax increases.

The flaw in the stimulus package wasn't, as some say, that it was too small. It was that it was poorly targeted. Instead, Congress and the president could have gotten more stimulus from accelerating the repairing and replacing of equipment in the civilian and defense sectors. Long-term reductions in marginal tax rates of the type used by Presidents Kennedy and Reagan would also have been better than temporary tax cuts that have no positive incentive effects.

Other programs by the administration have had similar failings. "Cash for clunkers," for instance, was successful in raising auto buying and gave a temporary boost to GDP, since two-thirds of the third-quarter GDP rise was motor-vehicle production. The credit for first-time home buyers also gave a temporary boost to the housing market. But both programs just borrowed demand from the future...

Local banks around the country have cut back business lending because they fear future losses on existing real-estate loans. The administration's plan to prevent mortgage defaults by helping millions of homeowners reduce their monthly mortgage payments fizzled down to helping just a few hundred thousand. Moreover, nothing was done to reduce the incentive to default among the 15 million homeowners whose mortgages now exceed the value of their homes. And nothing has been done to deal with the $1.5 trillion of distressed commercial real-estate loans that will have to be rolled over during the next five years.

The administration's plan to induce local banks to sell impaired loans to nonbank investors so that they could start lending again was well intentioned. But it failed, despite generous proposed subsidies, because banks don't want to reduce their accounting capital.

Although solving the banking and real-estate problem is key to recovery, the president's focus on his health legislation and the public's concern about future deficits appears to have stopped him from dealing with these problems...

Feldstein ends by expressing concern over the administration's "legacy of debt:" both larger deficits and national debt.
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Shleifer: State versus Private Ownership

Chavez styles Venezuela as having a socialist economy and himself as the representative of the people. Simon Romero describes current problems with state production of electricity and water in a resource rich country (The New York Times, "Blackouts Plague Energy-Rich Venezuela."

CARACAS, Venezuela — This country may be an energy colossus, with the largest conventional oil reserves outside the Middle East and one of the world’s mightiest hydroelectric systems, but that has not prevented it from enduring serious electricity and water shortages that seem only to be getting worse.

President Hugo Chávez has been facing a public outcry in recent weeks over power failures that, after six nationwide blackouts in the last two years, are cutting electricity for hours each day in rural areas and in industrial cities like Valencia and Ciudad Guayana. Now, water rationing has been introduced here in the capital.

The deterioration of services is perplexing to many here, especially because the country had grown used to cheap, plentiful electricity and water in recent decades. But even as the oil boom was enriching his government and Mr. Chávez asserted greater control over utilities and other industries in this decade, public services seemed only to decay, adding to residents’ frustrations.

The bolded emphasis added to the quote is mine. Economists are not among the confused or perplexed. Andrei Shleifer concludes his Journal of Economic Perspectives article, "State versus Private Ownership (Vol. 12, No. 4, Fall 1998, Pgs. 133-150) as follows.

Private ownership should generally be preferred to public ownership when the incentives to innovate and to contain costs must be strong. In essence, this is the case for capitalism over socialism, explaining the "dynamic vitality" of free enterprise. The great economists of the 1930s and 1940s failed to see the dangers of socialism in part because they focused on the role of prices under socialism and capitalism, and ignored the enormous importance of ownership as the source of capitalist incentives to innovate. Moreover, many of the concerns that private firms fail to address "social goals" can be addressed through government contracting and regulation, without resort to government ownership. The case for private provision only becomes stronger when competition between suppliers, reputational mechanisms, and the possibility of provision by not-for-profit firms are brought into play. Last but not least, the pursuit by government officials of political goals and personal income, as opposed to social welfare, further strengthens the case for private ownership, as the dismal record of state enterprises around the world and the tragedy of communism illustrate all too well.

The benefits of private delivery-regulated or not-of many goods and services are only beginning to be realized. Health, education, some incarceration, some military and police activities, and some of what now is presumed to be "social" insurance like Social Security, can probably be provided more cheaply and attractively by private firms. It is plausible that 50 years from now, today's support for public provision of these services will appear as dirigiste as the 1940s arguments for state ownership of industry appear now. A good government that wants to further "social goals" would rarely own producers to meet its objectives.

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Freedom to Joke in East Germany?

(HT Wall Street Journal) I quote from "East German Jokes Collected by West German Spies," written by Hans-Ulrich Stoldt and Klaus Wiegrefe for Spiegel Online.

"Telling jokes was playing with fire," says Kleemann [a former official from the Birthler Authority, which was set up after German unification to manage the archives of the East German secret police, or Stasi]. The Stasi had 91,000 employees and a network of around 189,000 civilian informants to spy on the East German population of 17 million. It regarded every political joke as a potential threat. Anyone who poked fun at the representatives of the organs of state and society was subject to prosecution.

"There were cases of people who were jailed, it was particularly bad in the 1950s and 1960s," says Kleemann.

Here's one example about how that risk was lampooned: "There are people who tell jokes. There are people who collect jokes and tell jokes. And there are people who collect people who tell jokes."...

The other jokes, stripped of commentary are

Did East Germans originate from apes? Impossible. Apes could never have survived on just two bananas a year."

"What would happen if the desert became communist? Nothing for a while, and then there would be a sand shortage."

"Why does West Germany have a higher standard of living than we do? Because communists can't get work permits there."

"A new Trabi [a car made in East Germany] has been launched with two exhaust pipes -- so you can use it as a wheelbarrow."

The Chernobyl nuclear accident in 1986 spawned a new proverb, for example: If the farmer falls off his tractor, he must be close to a reactor.

Chernobyl, incidentally, wasn't an accident, another joke went. It was just a Soviet program to X-ray its population.

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Economic Systems (Repost)

Radio talk show hosts, blogs, and other forms of news dissemination, noting the growth of government in the first two months of the Obama administration have been calling President Obama a socialist. I even heard one talk show host refer to his supporters as Obamunists. Such complaints made their way through a New York Times reporter to the president, who gave a dismissive answer. Joe Curl writing for the Washington Post in "Obama makes Oval Office call to reporters," explains that President Obama has become concerned that his answer was inadequate.

President Obama was so concerned that he had appeared to dismiss a question from New York Times reporters about whether he was a socialist that he called the newspaper from the Oval Office to clarify his policies. "It was hard for me to believe that you were entirely serious about that socialist question," he told reporters, who had interviewed the president aboard Air Force One on Friday.

Below I have provided definitions of several economic systems and a little information about the economists providing the definitions.You can decide which system best describes the collection of policies thus far expressed by the Obama administration.

From the Concise Encyclopedia of Economics, in an article titled "Socialism," Robert Heilbroner defines socialism.

Socialism—defined as a centrally planned economy in which the government controls all means of production—was the tragic failure of the twentieth century. Born of a commitment to remedy the economic and moral defects of capitalism, it has far surpassed capitalism in both economic malfunction and moral cruelty.

The "About the Author" section of the article states,

Robert Heilbroner, a socialist for most of his adult life, was the Norman Thomas Professor of Economics (emeritus) at the New School for Social Research and author of the best-seller The Worldly Philosophers. He died in 2005.

Milton Friedman the Nobel Prize Laureate in Economics who supported capitalism in the popular press in Capitalism and Freedom (The University of Chicago Press, 1962, pg. 5.) writes,

As it developed in the late eighteenth and early nineteenth centuries, the intellectual movement that went under the name of liberalism emphasized freedom as the ultimate goal and the individual as the ultimate entity in society. The kind of economic organization that provides economic freedom directly, namely competitive capitalism, also promotes political freedom because it separates economic power from political power and in this way enables the one to offset the other. History suggests only that capitalism is a necessary condition for political freedom. Clearly it is not a sufficient condition.

Robert Hessen, who writes on business and economic history, and is a senior research fellow at Stanford University’s Hoover Institution writes in the Concise Encyclopedia of Economics ("Capitalism") that

Capitalism,” a term of disparagement coined by socialists in the mid-nineteenth century, is a misnomer for “economic individualism,” which Adam Smith earlier called “the obvious and simple system of natural liberty” (Wealth of Nations).

Sheldon Richman, the editor of The Freeman: Ideas on Liberty at the Foundation for Economic Education, writes for the Concise Encyclopedia of Economics ("Fascism")

As an economic system, fascism is socialism with a capitalist veneer.

Where socialism sought totalitarian control of a society’s economic processes through direct state operation of the means of production, fascism sought that control indirectly, through domination of nominally private owners. Where socialism nationalized property explicitly, fascism did so implicitly, by requiring owners to use their property in the “national interest”—that is, as the autocratic authority conceived it.

George Reisman, writing for the Mises Daily in "What is Interventionism?," describes interventionism,

Interventionism is any act of government that both represents the initiation of physical force and, at the same time, stops short of imposing an all-round socialist economic system, in which production takes place entirely, or at least characteristically, at the initiative of the government. In contrast to socialism, interventionism is a system in which production continues to take place characteristically, at the initiative of private individuals, including private corporations, and is motivated by the desire to earn private profit. Interventionism exists in the framework of a market economy, though, as von Mises puts it, such a market economy is a hampered market economy.

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Obama Like Putin? Not!

Laurie Kellman, an AP writer, reports in "No. 2 House Republican compares Obama to Putin," that

The No. 2 Republican in the House on Thursday compared President Barack Obama's plans for the auto industry to the policies of Russian Prime Minister Vladimir Putin, saying the White House has stripped credit holders of rights and given them to Democratic allies.

"They said, 'Set aside the rule of law, let's strip secured creditors, bondholders, of their rights. Take them away outside of the bankruptcy process and give them to the political cronies and the auto workers' unions," Rep. Eric Cantor, R-Va., said in an interview with The Associated Press.

"It's almost like looking at Putin's Russia," added Canton [sic], the GOP's House whip. "You want to reward your political friends at the expense of the certainty of law?"

While I do not like President Obama's policies named by Rep. Cantor, they are a order of magnitude better than Prime Minister Putin's.  According to the Heritage Foundation's "Index of Economic Freedom World Rankings," the United States ranked 6th best in the world prior to the Obama presidency.  Russian ranked 146th.  While the Obama administration's policies will take us in the wrong direction for economic freedom, they will be significantly above Russia's.  Freedom House ranks political rights and civil liberties on a scale from a best of 1 to a worst of 7.  In 2008, the United States earned a 1 in political rights and civil liberties.  I don't believe that those scores will change during the Obama presidency.  Russian earned 6 in political rights and a 5 in civil liberties.  Let's keep the debate real.

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Yikes

In a Rasmussen Reports article titled, "Just 53% Say Capitalism Better Than Socialism," the authors write,

Only 53% of American adults believe capitalism is better than socialism.

The latest Rasmussen Reports national telephone survey found that 20% disagree and say socialism is better. Twenty-seven percent (27%) are not sure which is better.

Adults under 30 are essentially evenly divided: 37% prefer capitalism, 33% socialism, and 30% are undecided. Thirty-somethings are a bit more supportive of the free-enterprise approach with 49% for capitalism and 26% for socialism. Adults over 40 strongly favor capitalism, and just 13% of those older Americans believe socialism is better.

Did the drum beat of right wing talkers calling President Obama's policies socialistic cause this sad result, or are Americans just that ignorant of socialism's deplorable history?
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TARP and Pay for Performance Act

Critics of current policy emanating from the Congress or the Obama administration overuse socialism as a description of its policies they disdain. They might recall that not all undesirable policies are socialist, and the economic system that it describes does not fit the policies that the administration pursues. Nor are the administration's policies yet well enough defined to properly tag them with existing definitions. The evolution of the TARP, formally known as the Emergency Economic Stabilization Act of 2008, illustrates the inchoate nature of policy. The House has voted to amend the Act with the Pay for Performance Act.

The language of the Pay for Performance rewrites current contracts which weaken property rights and this is bad. The pertinent language is in bold.

‘(1) PROHIBITION- No financial institution that has received or receives a direct capital investment under the Troubled Assets Relief Program under this title, or with respect to the Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, or a Federal home loan bank, under the amendments made by section 1117 of the Housing and Economic Recovery Act of 2008, may, while that capital investment remains outstanding, make a compensation payment, other than a longevity bonus or a payment in the form of restricted stock, to any executive or employee under any existing compensation arrangement, or enter into a new compensation payment arrangement, if such compensation payment or compensation payment arrangement--

The act does not define how pay should be related to performance. Instead it establishes a committee to report back to the Congress.

‘(1) ESTABLISHMENT- There is hereby established a commission to be known as the ‘Commission on Executive Compensation’ (hereinafter in this subsection referred to as the ‘Commission’).

‘(2) DUTIES-

‘(A) STUDY REQUIRED- The Commission shall conduct a study of the executive compensation system for recipients of a direct capital investment under the TARP. In conducting such study, the Commission shall examine--

‘(i) how closely executive pay is currently linked to company performance;

‘(ii) how closely executive pay has been linked to company performance in the past;

‘(iii) how executive pay can be more closely linked to company performance in the future;

‘(iv) the factors influencing executive pay; and

‘(v) how current executive pay incentives affect executive behavior.

‘(B) CONSIDERATION OF PROPOSALS- The Commission shall consider, in addition to any recommendations made by members of the Commission or outside advisers, the effects of implementing increased shareholder voice in executive compensation.

Many experts who have studied executive compensation believe that current rules used by corporations are stacked in favor of executives and not shareholders. Rules that alter the balance of corporate control from the executives to the shareholder without dictating a salary range could improve corporate performance. Rules that set a salary range rob owners of an important right, determining compensation, and the new standards would be either codified, thus slowing market reaction to changing human resources, or entrust salary determination to a Congressional body with no proper interest in corporate.

Stuart Varney, a Fox business channel host, describes in a Wall Street Journal article ("Obama Wants to Control the Banks,") his misgivings about the amending act. He does not like it or the apparent heavy handed method being employed to implement it.

I must be naive. I really thought the administration would welcome the return of bank bailout money. Some $340 million in TARP cash flowed back this week from four small banks in Louisiana, New York, Indiana and California. This isn't much when we routinely talk in trillions, but clearly that money has not been wasted or otherwise sunk down Wall Street's black hole. So why no cheering as the cash comes back?

My answer: The government wants to control the banks, just as it now controls GM and Chrysler, and will surely control the health industry in the not-too-distant future. Keeping them TARP-stuffed is the key to control. And for this intensely political president, mere influence is not enough. The White House wants to tell 'em what to do. Control. Direct. Command.

His misgivings are a little premature, but given recent actions of Congress, they do have proper foundation.
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Alan Blinder on Socialism, and the Obama Administration

In a previous post, "Amartya Sen on Capitalism," I noted that President Clinton would be an adherent of capitalism under Sen's definition. This post notes that Alan Blinder, a member of President Clinton's first Council of Economic Advisors, and a former Vice Chairman of the Board of Governors of the Federal Reserve System, does not count President Obama among the ranks of socialists, and is positive about the administration's early policy actions. His Curriculum Vitae is here. Blinder writes in "Obama Is No Socialist," for the Wall Street Journal that,

Socialism means public ownership and control of businesses, right? So which industries does the president propose to nationalize?

Banking? Well, no. Secretary of the Treasury Timothy Geithner has made it clear that he opposes nationalizing banks, despite much outcry from the political left -- and even some from the right -- to do just that...

What about health care? Doesn't Mr. Obama want "socialized medicine"? No. He wants to reform the current system so that it costs less and covers more people.

In the article, he supports the administration's budget, tax code changes, and, to a lesser extent, the less explicit financial sector reform. He ends the article,

So where does all this leave us on the road to socialism? If Mr. Obama is able to get all of these proposals through Congress, the U.S. will have a fully private banking system, propped up with temporary government support; a uniquely American health-care system that covers virtually everyone; and a somewhat more progressive income tax.

If this is socialism, then let's make the most of it.

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Economic Systems

Radio talk show hosts, blogs, and other forms of news dissemination, noting the growth of government in the first two months of the Obama administration have been calling President Obama a socialist. I even heard one talk show host refer to his supporters as Obamunists. Such complaints made their way through a New York Times reporter to the president, who gave a dismissive answer. Joe Curl writing for the Washington Post in "Obama makes Oval Office call to reporters," explains that President Obama has become concerned that his answer was inadequate.

President Obama was so concerned that he had appeared to dismiss a question from New York Times reporters about whether he was a socialist that he called the newspaper from the Oval Office to clarify his policies.

"It was hard for me to believe that you were entirely serious about that socialist question," he told reporters, who had interviewed the president aboard Air Force One on Friday.

Below I have provided definitions of several economic systems and a little information about the economists providing the definitions. You can decide which system best describes the collection of policies thus far expressed by the Obama administration.

From the Concise Encyclopedia of Economics, in an article titled "Socialism," Robert Heilbroner defines socialism

Socialism—defined as a centrally planned economy in which the government controls all means of production—was the tragic failure of the twentieth century. Born of a commitment to remedy the economic and moral defects of capitalism, it has far surpassed capitalism in both economic malfunction and moral cruelty.

The "About the Author" section of the article states,

Robert Heilbroner, a socialist for most of his adult life, was the Norman Thomas Professor of Economics (emeritus) at the New School for Social Research and author of the best-seller The Worldly Philosophers. He died in 2005.

Milton Friedman the Nobel Prize Laureate in Economics who supported capitalism in the popular press in Capitalism and Freedom (The University of Chicago Press, 1962, pg. 5.) writes,

As it developed in the late eighteenth and early nineteenth centuries, the intellectual movement that went under the name of liberalism emphasized freedom as the ultimate goal and the individual as the ultimate entity in society. The kind of economic organization that provides economic freedom directly, namely competitive capitalism, also promotes political freedom because it separates economic power from political power and in this way enables the one to offset the other. History suggests only that capitalism is a necessary condition for political freedom. Clearly it is not a sufficient condition.

Robert Hessen, who writes on business and economic history, and is a senior research fellow at Stanford University’s Hoover Institution writes in the Concise Encyclopedia of Economics ("Capitalism") that

Capitalism,” a term of disparagement coined by socialists in the mid-nineteenth century, is a misnomer for “economic individualism,” which Adam Smith earlier called “the obvious and simple system of natural liberty” (Wealth of Nations).

Sheldon Richman, the editor of The Freeman: Ideas on Liberty at the Foundation for Economic Education, writes for the Concise Encyclopedia of Economics ("Fascism")

As an economic system, fascism is socialism with a capitalist veneer.

Where socialism sought totalitarian control of a society’s economic processes through direct state operation of the means of production, fascism sought that control indirectly, through domination of nominally private owners. Where socialism nationalized property explicitly, fascism did so implicitly, by requiring owners to use their property in the “national interest”—that is, as the autocratic authority conceived it.

George Reisman, writing for the Mises Daily in "What is Interventionism?," describes interventionism,

Interventionism is any act of government that both represents the initiation of physical force and, at the same time, stops short of imposing an all-round socialist economic system, in which production takes place entirely, or at least characteristically, at the initiative of the government. In contrast to socialism, interventionism is a system in which production continues to take place characteristically, at the initiative of private individuals, including private corporations, and is motivated by the desire to earn private profit. Interventionism exists in the framework of a market economy, though, as von Mises puts it, such a market economy is a hampered market economy.

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