In the cascade of irresponsible lies emanating from the Trump White House, the Republican accusation that the Democrats are becoming “communists” stands almost alone in its devastating irresponsibility. These charges carry reminders of “red scares,” blacklists, McCarthyism, and “are you now or have you ever been?” questions.
These charges are more than a reminder of times the country thought we had moved beyond. The levels of political, economic, and historical stupidity necessary to make these accusations are staggering.
In practice, communism has involved government ownership of the means of production. Typically, this goes hand-in-hand with suppression of opposition political parties, the free press, and freedom of speech, though these suppressions are not unique to communist countries. In fact, such crackdowns on democratic institutions and practices are entirely compatible wth – and common in – free market capitalist societies, though exceedingly rare in social democrat countries.
“Social democracy” is as far removed from the state ownership of Leninist-Stalinist-Maoist communism as buccaneer free market capitalism is. Both social democrats and laissez faire capitalists believe in capitalism and free markets. The essential differences between social democracy and Milton Friedman capitalism are 1) social democrats think labor is also a vital factor, along with capital, in production and 2) social democrats think public education, healthcare, and social insurance are important to a healthy society. Friedman capitalism says the only social value is return to investors. Period.
Unsurprisingly, three of the four most prosperous countries on earth, according to the 2026 “Prosperity Index” (Sweden, Norway, Denmark) are social democrat countries. The US ranks 30th.
If Trump was genuinely concerned about “communism,” he might turn his attention to a political leader who is moving us in that direction – himself! Anyone who thinks the economic system established by Trump is in any way “free market capitalism” is an absolute economic illiterate. Trump’s crony capitalism, like Mussolini’s Fascism, is far closer to the government control of the means of production provided by Marxist-Leninist communism than it is to the free market Adam Smith first described in “The Wealth of Nations.” Strong-arming networks about their news and programming, demanding that people be fired, making approval of mergers contingent on support of Trump, influencing major procurement decisions on the basis of ownership by the president’s family, and penalizing law firms on the basis of who they defended are grotesque distortions of free enterprise that put us in the same league with autocracies like Hungary, Russia, and China.
Beyond these acts of blatant favoritism, President Trump has overseen and approved the U.S. government using taxpayer money to purchase equity stakes in 14 private and 14 publicly held companies in less than two years of his second term – including giants such as U.S. Steel, Intel, Westinghouse, and IBM. Over the USA’s 250 years, this is—by far—the most significant change in American economic policymaking. Widespread government ownership of private companies is the definition of socialism. Until recently, conservatives even denounced government enterprises such as the TVA and USPS and until a few years ago denounced the mere listing of key emerging technologies as “picking winners and losers.” Government ownership makes a fundamental distortion of the free market, creating favored enterprises that cannot be allowed to fail, reversing the corporate incentives within these companies from market success to courtier success, slowing market reactions, putting a giant safety net under the favored companies.
The Cato Institute, a conservative think tank, characterized Trump’s economic environment as state capitalism and a steppingstone toward “creeping socialism.”
Another Trump project, high tariffs, represents the antitheses of free market capitalism. The essence of free market capitalism as outlined by Smith, is the “invisible hand” that, without government intervention, guides resources to their most efficient use. Tariffs are a huge distortion of the market and, by definition, reward inefficiency and penalize market success. But the Trump version goes far beyond a simple act of state intervention in markets. Trump’s system, where the countries or companies that grease his palm get relief, is a level of anti-capitalist corruption worthy of the Ottoman empire.
Finally, the Trump administration’s banishment of peer review and dictate that only “approved” science can be funded is worthy of the sclerotic days of the 1970s and 1980s when the Soviet system was collapsing from its own corruption and inefficiency.
