It might be hard to imagine, but there was a time not that long ago when capitalism looked really, really good, at least in America. Not just in the sense that rich people had fancy things they might have liked to show off on Instagram if it existed, but also in moral terms, both within societies and between them. After American capitalists helped the Allies beat the Nazis, a strong labor union movement meant workers shared in postwar economic prosperity. Real purchasing power and regular workers’ share of income were high enough that (white) people had a good chance at gainful lifelong employment with just a high-school education. The richest Americans had their exclusive golf clubs and beach resorts, the mansions and cars and vacations normal people couldn’t sniff. But the trappings of financial security and independence—home ownership among them, if redlining didn’t screw you over—were often tangible, if not already in hand.
This era reached its peak about 65 years ago, when despite postwar labor disputes and the national disgrace that was Jim Crow, the booming US economy helped it get the Cold War off on the right foot. Producing what has become known as the Great Compression, the high tax rates of World War II and explosion of the union movement had already made America significantly more financially equal by the late 1940s and early 50s. In 1954, often brandished as the high-water mark for the American labor movement, the share of the total national income going to the top 10 percent of the population was “only” about 32 percent, according to an analysis by the left-leaning Economic Policy Institute. In 2012, by contrast, the top 10 percent nabbed 48 percent of all income, while just about 11 percent of workers were represented by a union.
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In that bygone time, the rest of the planet was made to bear witness again and again to the freakish power of the free market, the triumph of individual entrepreneurship and profit-seeking. (Also: lots of deadly and cruel anti-Communist campaigns worldwide.) Then-Vice President Richard Nixon famously prevailed in his 1959 “kitchen debate” with Soviet Premier Nikita Khrushchev by extolling the abundance of nifty consumer products normal Americans had at their fingertips. In the mainstream imagination, at least, the socialist alternative—with its authoritarian implications, material-good rationing, and drab aesthetic, all represented by the USSR—wasn’t just less exciting or fun. It was less just.
“For so long, anything associated with the term socialist was not something that could be said in mainstream politics if you wanted to be taken seriously,” Stephanie L. Mudge, a sociology professor and expert on socialism and social democracy at UC-Davis, told me, adding that this wasn’t always the case. “Capitalism has an interesting trajectory because in the early 20th century it was kind of a bad word for a lot of people. And it sort of got valorized, especially in the late postwar period.”
Though capitalism still obviously has its defenders, there’s more and more evidence that millennials are turning away from it. According to a Gallup poll released Monday, more Democrats view socialism positively (57 percent) than capitalism (47 percent). And while that partisan bent makes some intuitive sense, the age discrepancy is glaring: Among all 18-to-29-year-olds, including conservatives and Republicans, a small majority (51 percent) of Americans surveyed were high on socialism, whereas fewer—45 percent—had nice things to say about capitalism. Those over 65, on the other hand, were way more fond of capitalism (60 percent viewed it positively) than socialism (only 28 percent did).
What happened in the last few decades to create such a massive generational divide? The first part of the answer is that the boogeyman that was the only self-described socialist superpower on Earth disappeared. Just as important, if not more so: capitalism went belly-up over and over again, and the Democrats, the major American political party built around reining in the worst excesses of capitalism, failed to keep its own worst impulses in check, instead endorsing a bank-friendly agenda many on the left are still fighting against.
“Without the Cold War and without the Soviet Union, it becomes possible to talk about socialism in a away that isn’t with reference to what is understood as a dictatorial society or political system,” Mudge told me. “In other words, when there’s no living example of a really socialist country, then people are free to imagine different kinds of socialist institutions without having to defend themselves as somehow being pro-Soviet or pro-Stalin or something like that.”
“Young people—millennials and younger—who didn’t grow up in the Cold War, just as a general trend or rule, socialism is not the pejorative for them that it once was,” agreed Andrew Hartman, a history professor at Illinois State University and author of Education and the Cold War: The Battle for the American School.
As the legacy of the USSR and its Stalinist excesses has faded from memory, capitalism had plenty of time and space to stretch its wings and make people suffer. And suffer they did, especially after the 2008 crash—a process aided and abetted by financial deregulation championed by Democrats like Bill Clinton—when the whole rug came out from underneath the myth of the American economy. “That’s completely shaped how a whole generation of people think of the economy,” Hartman told of me the financial crisis and its aftermath.
In the last decade, Americans have been increasingly hobbled by student debt, a looming anvil that closes in even before they begin their adult economic lives. The median outstanding student-debt load for young adults running their own household in 2010 was about $13,000, according to a Pew analysis of Federal Reserve Board data—and the portion of families that had student debt was the highest on record. It was around this same post-crash period that total student debt began to exceed credit-card debt for the first time.
Meanwhile, foreclosure rates skyrocketed, and as millions of new renters—some of them foreclosed folks who needed a place to live—entered the market, those rates also spiked, leaving the most appealing jobs and cities out of reach to many. The people who could pay rent found they had to use a larger and larger share of their income to do so: By 2013, half of US renters were paying over 30 percent of their income just to keep a roof over their head, compared to 18 percent a decade earlier, according to the Joint Center for Housing Studies at Harvard. And speaking of jobs, the ones that pay well without making you put in 80 hours a week began to seem almost mythical, or else the object of scorn.
Capitalism was more of an inviting villain than ever. And the harder people looked at what went wrong, the angrier they got at the system they had been taught to love.
Financial elite-led economic collapse, subsequent stock-market fiascos, ponzi schemes, white-collar crime sprees, rich people stashing their assets in offshore tax shelters—capitalism, to many people these days, is less visible as an engine of prosperity than a series of shady grifts. Politicians like Bernie Sanders who tap into that resentment—rather than ducking it, as mainstream Democrats like Barack Obama often did—have benefitted. “Do I consider myself part of the casino capitalist process by which so few have so much and so many have so little, by which Wall Street’s greed and recklessness wrecked this economy?” Sanders smirked when asked if he identified as a capitalist in a 2015 Democratic presidential debate. “No, I don’t.”
Likewise, Alexandria Ocasio-Cortez, the 28-year-old Democratic Socialist from the Bronx, romped in a long-shot primary challenge to a powerful incumbent Democrat by sticking it to the free market—and generally expressing disdain for organized wealth—in her speeches and online outreach. She hasn’t pivoted to the center since her win, either. “Capitalism has not always existed in the world and will not always exist in the world,” she told PBS last month.
It’s hard to find American politicians who actively support socialism in the traditional state-owned-industry sense—even Sanders and Ocasio-Cortez don’t go there. But many Democrats have the backing of the financial industry and support the sort of pro-business deregulation that so many left-of-center voters disdain. Supporting “socialism,” whatever it means to individual people, is a way of signaling dissatisfaction with these Democrats.
“Because liberalism has become a term that has become associated with Clinton-ian, third-way politics, socialism is the term that Sanders and others have adopted to actually mean sort of the left-end of New Deal liberalism,” Hartman suggested.
Of course, both academics I spoke to agreed that the simpler explanation for all of this comes down to the 2016 election. As Hartman put it, “They probably think about capitalists as being people like Trump now.”
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