On Friday’s broadcast of Bloomberg’s “Open Interest,” White House National Economic Council Director Kevin Hassett argued that the government stakes in multiple companies aren’t socialism “Because it’s not control” “And we’re certainly putting up firewalls to make sure that the government can’t come in and micromanage those firms.”
Hassett said that “socialism is when the government owns the capital, and then hands it out to people, is a very simple definition. And so, let’s just say, hypothetically, the government decides to have grocery stores, where it sets the prices and tells people, like, when they can get in and get the cheap stuff. The history of this is that the grocery stores end up being empty, prices don’t matter because there’s nothing to buy. And, over time, socialism leads to public disorder, and you see it in Venezuela, you see it in Cuba, and so on. And so, it’s a terrible path to go. But I think that what people underappreciate is that the policies that have been advocated by Democrats since President Trump took office, where, hey, you could have wealth taxes, you could have really high taxes on income, you could have really high taxes on capital gains, they’ve been basically sliding towards socialism for a long time. And so, while the new people are a lot more charismatic than the people in the Senate, I think the policies that they’re advocating, Medicare for All, like, come on, Hillary Clinton’s healthcare policy was about that, right? And so, I think that’s the uncomfortable thing that Democrats have to come to terms with is that these socialists are actually advocating things that Democrats have advocated for a long time.”
Bloomberg International Economics and Policy Correspondent Michael McKee then asked, “Well, if government ownership of means of production is part of the definition there, then the Trump administration has taken shares in Intel, MP Materials, Trilogy Metals, Lithium Americas, and they’ve got the golden share in U.S. Steel. Why is that not socialism?”
Hassett answered, “Because it’s not control — so, for example, the Norwegians have a sovereign wealth fund. They own maybe about 3 or 4% of U.S. equities. That’s not socialism. They’re not going in and telling the management what to do and so on. And so, I think that one of the things that President Trump and Howard Lutnick have noticed is that, in the end, the U.S. would be way better off if we have something like a sovereign wealth fund. And we’re certainly putting up firewalls to make sure that the government can’t come in and micromanage those firms.”
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