Ten Democratic Socialists of America (DSA) Arguments for Socialism and Why They’re Wrong

Daft DSA drafts delusional demands

The Democratic Socialists of America (DSA) published a new policy program and platform this summer called Workers Deserve More. A committee elected under the group’s 2025 convention rules drafted it, its National Political Committee approved it, and it now stands as the clearest statement of what America’s largest socialist organization wants. Below are the DSA program’s main arguments for socialism, my short responses to them, and links to some of the most relevant evidence.

1. “Under socialism, ‘You have no debt. You don’t need health insurance. You don’t pay a mortgage or have a landlord, because comfortable housing is a human right.’”

There are prices on housing, medicine, food, and energy because these goods are scarce and have alternative uses. Scarce means that there is not enough of them to satisfy all demand at a price of zero. Those goods must be produced by people who must be fed, trained, equipped, and persuaded to show up to work. In a free market economy, workers produce those goods because they are paid to, the owners of firms organize production efficiently because their profits depend on it, and the owners of capital sell it to the most profitable firms. All that activity is guided by the incentives and information provided by prices.

Similarly, there are many different uses for these goods. Prices provide a signal and incentive to producers to decide what to build and to consumers to decide what to buy. Abolishing prices abolishes neither the costs of production nor the choices of consumption. It destroys the information and incentives that tell producers what to make, in what quantity, where, and at what sacrifice of alternatives. No socialist economy has ever solved the problem of efficiently allocating those resources without prices set by market exchange. The Soviet Union rationed by queues and shortages rather than by price, a condition documented for decades by the economist Alec Nove. It also rationed by prices of a sort, but they were set by central authorities with no incentive to change them in response to changing supply or demand. A price of $0, or any price below that which would be set by the market, does not create abundance. It results in greater scarcity by failing to reward producers and lets consumers know that they can be wasteful. Everything still gets paid for, in taxes, in waiting, and in greater scarcity from the goods that never appear.

2. “Free markets are failing workers because, ‘The world is in chaos, but for the bosses, it’s all going according to plan.’”

About 43 percent of humanity was in extreme poverty in 1990 when communism was collapsing in Eastern Europe and the Soviet Union. By 2024, it had fallen to 10.4 percent, the largest improvement in living standards in recorded history. Roughly 800 million of those people were in China, where poverty collapsed after the Communist Party abandoned collectivized agriculture and shifted away from a planned socialist economy. Both endpoints use the World Bank’s new $3.00-a-day extreme poverty line (2021 prices), applied back in time so the comparison is consistent over the decades.

American workers share in the gains. Median household income reached a record $83,730 in 2024, and, measured with the correct deflator, real wages for typical production and nonsupervisory workers rose more than 40 percent since 1990. They are also working less. Annual working hours in rich countries fell from roughly 3,000 in 1870 to about 1,750 today, which means free markets already delivered a shorter workweek and threw in a doubling of life expectancy while at it. The sectors where American workers still face rising prices and stagnant quality (housing, health care, and education) are precisely the sectors where the government already restricts supply, controls a large share of production, and/or sets prices. The bosses did not plan economic problems; the people, most likely socialist central planners in today’s societies, unintentionally did (with a hearty assist from Baumol’s cost disease).

3. “As free market economies fail, they turn to right-wing authoritarianism, but ‘if we lived in a classless society and governed ourselves, we could freely build a world without war or poverty.’”

Economic freedom and political freedom are correlated. The Economic Freedom of the World report finds that the freest quartile of economies enjoys average incomes 6.2 times higher than the least free. Incomes for the poorest tenth are 7.8 times higher and life expectancy is 17 years longer. Denmark, the democratic socialists’ favorite exhibit, is nothing of the sort. It ranks ninth in the world for economic freedom, and its prime minister traveled to Harvard to say, “Denmark is far from a socialist planned economy. Denmark is a market economy.” The regimes that actually abolished private ownership ran the authoritarian experiment themselves. More than two dozen socialist trials ran over the past century, and every one that collectivized its economy ended in one-party rule. Socialists will often deny that those countries were really socialist because they are selecting on outcomes, but there is a long history of Western socialists celebrating each new socialist government at the beginning of its reign, only to sour on it when the disaster strikes. The worst get on top, as Hayek warned, because socialism rewards the greediest, most power-hungry, and least restrained politicians.

The classless society fared no better on its other promises of peace and social harmony. Each trial produced a new ruling class of party officials with better apartments and worse manners than the bourgeoisie they replaced, peace among nations tracks commerce rather than collective ownership, and China invaded Vietnam four years after Vietnamese communists conquered the entire countries. Socialists couldn’t even stop fighting each other whether in World War II, in the Sino-Soviet border war of 1969, or after the Vietnam War. Authoritarianism follows the concentration of economic power in the state. That concentration is the DSA’s core proposal.

4. “Guarantee universal healthcare at no cost to individuals.”

“At no cost to individuals” doesn’t include the individuals who will pay for it. The Mercatus Center’s Charles Blahous estimated that Medicare for All would add $32.6 trillion in federal costs over 10 years under assumptions favorable to the plan, and the left-leaning Urban Institute put the figure at $34 trillion. That mostly shifts spending from premiums to higher taxes, but the new expanded tax bill would start near a tenth of GDP, grow from there, and exceed what doubling all projected federal individual and corporate income tax collections could cover. And presumably the entire point is to expand health care consumption that randomized experiments show does little to improve health, so these estimates understate the extra resources that such a scheme would require. Single-payer systems also pay with longer wait times, because a monopoly provider whose patients cannot take their business elsewhere doesn’t have an incentive to change. England’s National Health Service carried 7.3 million waiting cases as of this spring, and the median Canadian patient now waits 28.6 weeks between referral and treatment, triple the wait in 1993.

America’s own health care problems cannot be blamed on free markets because the United States does not have a free market health care system. The US government controls 84 percent of health spending through a complex system of tax rules, expenditures, and other mechanisms. That’s higher than in 27 out of 38 OECD countries. The share of the US health care sector under government control “is closer to communist Cuba (89%) than the average OECD nation (75%),” according to Michael Cannon of the Cato Institute. The specific portions of the national health care systems under direct government control and how they are controlled vary across countries. American health care is a largely government-run system.

5. “Housing is a human right. Build new, publicly-owned social housing, strictly regulate investment properties, establish universal rent control, and guarantee right to counsel for all tenants.”

Government intervention tends to raise housing prices. Universal rent control would deepen the shortage it claims to address and is among the policies most widely critiqued by economists. A 2012 survey asked economists about whether rent control would have a positive impact on the quantity and quality of broadly affordable rental housing and 2 percent agreed that it would, about what you’d expect if they misread the question. Economist Nancy Stokey summarized the evidence well when she wrote, “The planets are lined up here: theory and evidence point in the same direction.”

San Francisco’s rent control expansion cut the supply of rental housing by 15 percent and likely raised citywide rents by about 5 percent. Publicly owned housing adds an agency problem on top of a shortage while making the government your landlord who cannot go broke, answers to politicians rather than to tenants, fills units by political allocation, and maintains buildings the way Pruitt-Igoe was maintained. If the goal is to increase the supply of housing to lower prices, abolish or reduce the burden of zoning and other land-use ordinances. We should do that anyway, and it would be far better and infinitely cheaper than a cross-country government construction project.

6. “Establish public ownership of the largest corporations and essential industries to ensure democratic control and accountability to the people.”

Venezuela ran this exact program on its largest industry, oil, within living memory. The Chávez government fired about 20,000 employees of the state oil company for political disloyalty, packed it with loyalists, and eventually put a general in charge. Production fell from 3.2 million barrels per day in 1997 to 2.4 million by 2015, before Washington imposed any sanctions on the industry. Venezuelan GDP per capita, adjusted for inflation, fell 73 percent between 2012 and 2020, a decline that began years before US sanctions could have caused it. If free markets caused Venezuela’s poverty, cutting Venezuela off from global markets should have enriched it. These failures all began years before American socialists stopped praising Venezuela for its socialist policies.

The failure in Venezuela, as elsewhere, is a principal-agent problem, not a personnel or cultural problem. A private owner who wastes capital loses his own money, and a firm that wastes enough goes bankrupt. A political manager wastes other people’s money, cannot go bankrupt, and gets promoted for loyalty rather than output, while the nominal owners (the people) have no way to monitor him and no shares to sell. Democratic control of the Venezuelan state oil company just meant control by whoever controlled the state, which is what it has meant in every large-scale nationalization. The longer experiments agree. North Korea was richer than South Korea in 1970, and after five decades of public ownership on one side of the DMZ and private ownership on the other, South Korean incomes are about 29 times higher.

There is no superior class of American personnel in the Trump, Biden, or any likely future administration that will overcome those problems of socialist command and control. There is no good reason to expect the mass nationalization of American firms to succeed and every reason to expect it to fail. Let business owners and investors take the risks of running businesses, keeping the profits and eating the losses. There is no good reason for the state to take on those burdens.

7. “Enact aggressive wealth taxes on the richest individuals and corporations to spend on public goods and infrastructure.”

The 400 richest Americans are worth $6.6 trillion and the federal government spent $7 trillion in fiscal year 2025. Confiscating every asset of Forbes 400 wealth, once, assuming no fall in value, would run the federal government for about 11 months. An annual wealth tax is a very high income tax in disguise. A 3 percent levy on wealth earning an 8 percent return takes the equivalent of a 38 percent income tax before the actual income tax arrives. At the 5 percent rate proposed on California’s November ballot, any asset yielding less than 5 percent faces an effective rate above 100 percent.

The number of OECD countries with net wealth taxes fell from 12 in 1990 to 4 today. Norway raised its rate in 2022 and its own finance ministry counted $14.1 billion in deferred income leaving with the emigrants, exit tax notwithstanding. France’s tax raised about €3.5 billion a year and cost roughly €7 billion a year in other revenue, as an estimated €200 billion in capital went abroad. Seventy-three percent of American billionaires are self-made, and they owners are among the most mobile people in the world. If taxed, they will just move and take their capital and economic productivity with them.

The DSA seems to think that wealth is hoarded treasure when much of it is capital. Capital is just a fancy economics term for the stuff that people use to produce other things, like machines, tools, buildings, and equipment, as opposed to the other inputs, like land and raw materials, the people doing the work, and the ideas that bring it all together. Homes and personal assets account for just 2.7 percent of billionaire wealth. They own the wealth because they built the firms that created it. The incidence of a wealth tax is a separate question. In theory, a tax that follows the owner’s residence rather than the capital itself could leave workers untouched, since foreign investors would buy the taxed assets and keep the machines running. In practice much of that wealth sits in closely held businesses that foreign capital will not buy, so taxing it shrinks the tools that make labor productive, reducing the marginal value product of workers and their pay. Modeling of the Warren tax found 63 cents of every revenue dollar falling on workers as lost earnings.

8. “Establish ‘a 32 hour work week with full pay and benefits, and a living minimum wage . . . [and] a federal jobs guarantee.’”

The jobs guarantee’s own advocates at the Levy Economics Institute estimate direct spending of $409 to $543 billion per year, and outside reviewers found even that figure understated by roughly a third. The cost is the smaller objection. An employer that cannot fire anyone, cannot go broke, and answers to elected officials becomes a patronage machine. Fifteen million guaranteed jobs would make the federal government the largest political employer in American history, with every incentive to expand the rolls before each election. If people are forced to work less, who is going to supply the goods and services that the DSA wants to redistribute?

The Congressional Budget Office estimated a $15 federal minimum wage would lift 900,000 people out of poverty while eliminating 1.4 million jobs, with losses concentrated among the least-skilled workers the policy claims to help. This pattern has already been confirmed across the literature, where 79 percent of published employment estimates are negative. France tested the mandated short week twice. The 1982 cut from 40 hours to 39 raised affected workers’ probability of losing their jobs by 2 to 4 percentage points, and the 35-hour law failed to raise employment at all. A 32-hour week at 40 hours of pay is a 25 percent labor-cost increase, and employers will economize on the newly expensive input by replacing it with capital, outsourcing, or just making less. Shorter workweeks were purchased by productivity growth, not by government decree.

9. “Provide free, quality public education from pre-K to college and cancel all student debt.”

Canceling all student debt is a regressive transfer from working-class Americans to higher-income college graduates. Universal forgiveness delivers about five times more money to the top income decile than to the bottom, $6,267 against $1,276 in present value, with the top 30 percent of earners collecting 40 percent of the dollars. The majority of American adults hold no bachelor’s degree. They would be taxed to relieve the minority whose degrees already earn them a large wage premium. That’s because education is not a public good, it’s rivalrous and excludable. There may be some positive externalities from education (and plenty of negative ones too), but the people who pay to attend school capture most of the benefits in the form of higher wages. They don’t need a taxpayer-subsidized deal any more than a business making an investment to increase profits.

10. “Fully abolish ‘the police and prison system which protects the rich and jails the poor.’”

American criminal law reaches too far into American life. Legalizing drugs and eliminating other victimless offenses would reduce encounters between citizens and police. Yale Law School Professor Stephen Carter argues that legislatures shouldn’t pass laws they aren’t willing to kill to enforce because every law the police enforce is ultimately enforced at gunpoint. Police officers respond to rotten incentives because the doctrine of qualified immunity prevents anyone from suing them when they break the law. Worsening that problem, the Trump administration is not going to prosecute ICE agents for committing crimes when there are illegal immigrants to deport for civil violations of immigration law. Immigration enforcement is a recent exhibit, with dozens dead in custody since 2025 mostly for the offense of selling their labor in the US without government permission. Still, police are essential for protecting life, liberty, and private property. Yes, they would do that better if they faced better incentives and didn’t enforce so many plainly silly victimless crimes.

Socialism, as law professor Ilya Somin observes of its century-long record, has always required coercion to make people surrender their property to the state. An extensive police force is the one government agency the rest of the DSA platform cannot do without. Abolishing the police would undo the rest of the DSA platform. I don’t favor abolishing police, but doing so would be the only way to obviate the rest of this platform if the DSA ever takes power. In such a case, they would not take this final step.

The DSA platform saves its most revealing demand for the end. It would place the entire coercive and economic apparatus of the state under a single chamber of government with no institutional checks. It would be a strongman soon enough if they ever got power. No court could prevent that body from violating individual rights at a whim. A government that owns the largest corporations, employs every worker who wants a job, sets every rent, and faces no court it does not control would be just another socialist principal-agent problem waiting for economic forces to destroy it. The DSA platform is not a serious work of political horse-trading, but a wish list that is unusually unspecific and thoughtless about the economic challenges. We don’t have to learn that lesson again.