Bernie's Bad Ideas

10 things to hate about Sanders' economic policy

Joanna Andreasson, photo by Gage Skidmore/Creative Commons

There is much to cheer about the unlikely success of Bernie Sanders in the Democratic presidential primary. Starting with the fact that it has come at the direct expense of a joyless power politician, Hillary Clinton, who has bad policy ideas, worse constitutional instincts, and an above-it-all contempt for personal honesty and accountability. By the admittedly low standards of the 2016 race (and national politics in general), Sanders is decent, likable, and authentic.

Some of Sanders' policies, too, are among the best of those major-party candidates still in the hunt. He is the only one in the field who would repeal federal marijuana laws, junk the PATRIOT Act, and shut down the National Security Agency's domestic spying program. He was the only one to meaningfully come out against the Iraq War in real time (pending the discovery of as-yet-elusive evidence to back up Donald Trump's claims that he too was an early and prescient critic), and he's the most skeptical about both America's global policing and its wasteful military budget. Unlike Trump and Clinton (and waiting-in-the-wings independent Michael Bloomberg), Sanders was against the 2005 Kelo v. New London Supreme Court decision enshrining the practice of private-to-private eminent domain transfers. He has been a forceful if not totally consistent critic of government bailouts and corporate welfare.

In the interregnum between Sanders' convincing victory in the New Hampshire primary and his subsequent shellacking in South Carolina, a number of libertarian-leaning writers mused about whether, given much of the above, there was a libertarian "case" for Bernie Sanders. "With a Republican-controlled Congress—or one remotely close to its current makeup," Andrew Kirell wrote in a widely circulated column at The Daily Beast, "President Sanders would have a tough time getting his most radical economic policies passed, leaving him to fight for the civil liberties causes that matter to liberals and libertarians alike."

This article is not intended to answer the question about the candidate's libertarian bona fides one way or another. Rather, it is to point out, amid the distracting hullabaloo of a historically weird presidential campaign, that Bernie Sanders has at least 10 awful policy ideas that would materially damage the country if enacted.

At press time, the betting markets were not bullish on a Sanders presidency—the odds were just 2 percent according to the betting/polls aggregator PredictWise on March 1. But if Hillary Clinton's legal troubles with her private email server snowball to untenable proportions, it's not hard to imagine Sanders going toe-to-toe with the highly divisive Donald Trump and eking out a victory. In national head-to-head polls, the democratic socialist has topped the populist billionaire 17 out of 24 times through the end of February, including five out of six in 2016 (by an average of 8 percentage points).

Such a win may not usher in the "revolution" that Bernie calls for in every stump speech, but it would mean that a sizable chunk of the electorate was energized not just by the candidate's admirable comportment and sporadic civil libertarianism, but most of all by what has formed the core of his appeal: decidedly redistributivist and centralizing economic ideas. With any kind of coattails, some of those ideas could be translated into legislation on both the federal and local levels. And as the new boss of 4 million employees, a President Sanders would have wide latitude to convert his mandate into concrete regulatory actions, even if Congress is not quite ready to spend an additional $1.4 trillion on health care each year.

The following is not a ranking, and sadly is not definitive.

1. $15 Minimum Wage
In every campaign speech, Bernie Sanders vows to jack the federal minimum wage up to $15 an hour. This would double the prevailing minimum in about half of the 50 states.

So the same one-size-fits-all wage floor would apply to booming Columbus, Ohio, and perpetually struggling Los Angeles, despite the screaming disparity in local prices. Columbus (unemployment rate: 4.6 percent) is the fourth most affordable city in the nation, according to the Money Crashers website, with a median home price of $105,000 and median rent of $825 a month. Los Angeles (unemployment 6.8 percent) is the seventh most expensive city (according to the Expatistan cost of living index), with a median home price of $563,000 and rent of $2,655. California's minimum wage is $10, and the city of Los Angeles last year passed a gradual hike to $15 by 2020; Ohio's minimum wage is $8.25.

Sanders would be pushing the federal government into territory no state has yet dared to tread. Seattle, which became the first big American city to pass a $15 minimum wage ordinance in 2014, has seen since the beginning of its implementation in April 2015 the worst nine-month period of job losses since the financial crisis. Besides the economic and employment effects, drastic minimum wage hikes also boost the cost of government—in New York, which is considering the nation's first statewide $15 requirement, estimates put the additional cost for workers just at local governments and state-funded nonprofits at $1 billion per year.

Even Sanders admits that mandating higher wages will drive up prices for Americans ("Look, the truth is, yes, you may end up paying a few cents more for a hamburger at McDonald's," he said during a February town hall forum). But what the candidate consistently fails to grapple with is the argument set forth by Princeton economist Alan B. Krueger—who isn't some ax-grinding libertarian, but rather the former chairman of President Barack Obama's Council of Economic Advisers, and the most influential academic proponent of raising the minimum wage, just not that high that fast.

"$15 an hour is beyond international experience, and could well be counterproductive," Krueger wrote in The New York Times last October. "Although some high-wage cities and states could probably absorb a $15-an-hour minimum wage with little or no job loss, it is far from clear that the same could be said for every state, city and town in the United States.…The push for a nationwide $15 minimum wage strikes me as a risk not worth taking."

2. Free College Tuition
Bernie Sanders hates rich people so much, reason's Robby Soave has noted, that he wants to send their kids to college for free.

The Sanders higher education plan goes like this: free tuition to every public university in the country, paid for by a tax on Wall Street. So Virginia's College of William and Mary, currently ranked sixth in U.S. News & World Report's list of top public universities (and ranked second for in-state tuition at $17,656), would cost the same as my semi–alma mater Long Beach City College, which currently clocks in at $1,104.

Why is evening that score advisable, let alone necessary on the federal level? Because, as Sanders wrote in The Washington Post last October, "We live in a highly competitive, global economy, and if our economy is to be strong, we need the best-educated workforce in the world." Besides: "In Finland, Denmark, Ireland, Iceland, Norway, Sweden and Mexico, public colleges and universities remain tuition-free. They're free throughout Germany, too."

But by Sanders' own stated goals, he's trying to apply an expensive fix to something that isn't quite broken. The United States has a higher rate of college enrollment than every country Sanders listed except tiny Finland. The graduation rate, too, is higher than all except Norway and Ireland. The U.S. is home to roughly 20 percent of the world's international college students, according to the Open Doors Report on International Educational Exchange, attracting one million foreigners to its higher ed institutions, compared to just 300,000 Americans studying abroad. In many countries where tuition is at or near zero, there is little incentive to build new universities, and competition for the scarce number of slots is brutal.

America may have some of the most ridiculously expensive undergraduate experiences—10 universities charge more than $50,000 a year, according to U.S. News—but it also boasts an extensive system of state schools, low-cost private options, and online courses. And the sticker shock that Sanders is responding to is largely a result of the federal government trying to make post-secondary education cheaper: As the New York Federal Reserve found in a study last year, higher ed institutions that were "more exposed to changes in the subsidized federal loan program increased their tuition disproportionately around these policy changes, with a sizable pass-through effect on tuition of about 65 percent." In other words, when the federal government tries to make college cheaper, it often ends up paradoxically boosting prices.

3. Universal Pre-K
For more than a decade, government preschool has been a dream of liberal reformers, from Rob Reiner to Hillary Clinton, Bill de Blasio to Bernie Sanders. It's a can't-miss pitch to any bleeding heart: Help the most vulnerable kids! But study after study has shown universal pre-K just doesn't work.

"Researchers at Vanderbilt University have spent the past six years comparing cohorts of Tennessee pre-K students with their peers who applied to the statewide pre-K program but were lotteried out," former Tennessee Education Commissioner Kevin Huffman, a supporter of the program during his 2011–2015 tenure, pointed out in The Washington Post this February. "The results are not stellar. The pre-K students entered kindergarten with a decided advantage over the comparison group, but that advantage diminished over time. By the time the children reached third grade, the pre-K attendees actually underperformed the comparison group."

Similar results have been observed in Oklahoma, which has had universal preschool since 1998 without any observable gains in performance. The beloved federal program Head Start has also stubbornly failed to demonstrate positive impacts on enrolled kids. It's almost as if government has a questionable track record in delivering quality public school education. As Huffman writes, "Why would we think we can build a 'high-quality' program for all the nation's 4-year-olds when decades of effort have failed to produce universal high-quality in any other grades?"

There are other objections to universal pre-K: It would disrupt or destroy the existing private preschool market, be used to forcibly unionize teachers of tots, and subsidize the education choices of well-off parents. And like all federal education initiatives, it would likely cost more money than projected, especially over time. But even setting aside all of that, the unhappy fact remains: Mandated pre-K just does not work.

4. Medicare for All
According to the Sanders campaign's own numbers, which are designed to look as rosy as possible, expanding Medicare to cover every human being in America would require an additional $1.38 trillion in federal spending every year. That's about one-third of Washington's current annual outlays. Or more than twice what we currently spend on the military. Or 8 percent of total gross domestic product.

And yet it's still not believable. "The numbers don't remotely add up," University of Chicago economist Austan Goolsbee, another former chairman of Obama's Council of Economic Advisers, told The New York Times in February.

Left-leaning Emory University health care economist Kenneth E. Thorpe calculated that the real price tag of Berniecare would be more than double campaign estimates, leading to an overall growth of government of at least 40 percent, maybe higher. On top of that, Thorpe estimated that the Obamacare overhaul would lead to 71 percent of American households paying more for health care, contrary to Sanders' insistence that the average worker would see a net gain in her bottom line.

And as syndicated columnist Steve Chapman has pointed out, Sanders' plan "is to Medicare what a Tesla is to a Toyota," since Bernie wants to add new goodies like long-term care and dentistry, while removing restraints like deductibles and copays.

The amount of taxation and debt required to pay for such a scheme boggles the imagination. And judging by the track record of the Veterans Health Administration, there is no reason to believe that government-run health care will produce better outcomes for patients than what they have access to now.

5. Protecting Veterans from Privatization
One of the most bizarre non sequiturs in a campaign season chock full of them was a question from MSNBC's Rachel Maddow at the February 4 Democratic presidential debate in Durham, New Hampshire, about the Department of Veterans Affairs (V.A.). Startlingly, the query wasn't about how to reform the appalling waiting times for veterans' health care, or a culture of incompetence and corruption that has included widespread falsification of records and the punishment of internal whistleblowers. No, it was this: "If either one of you is nominated as the Democratic Party's nominee, you will likely face a Republican opponent in the general election who wants to privatize or even abolish big parts of the V.A. It's a newly popular idea in conservative politics. How will you win the argument on that issue given the problems that have been exposed at the V.A. in the last few years? What's your argument that the V.A. should still exist and should not be privatized?"

Sanders was lucky the question wasn't about his actual track record as chairman of the Senate Committee on Veterans Affairs. As The New York Times reported in February, "a review of his record in the job…shows that in a moment of crisis, his deep-seated faith in the fundamental goodness of government blinded him, at least at first, to a dangerous breakdown in the one corner of it he was supposed to police." Ouch.

What was Sanders doing in May 2014 instead of holding oversight hearings and sounding the alarm bell over a national disgrace? Complaining to The Nation magazine about "a concerted effort to undermine the V.A.," led by "the Koch brothers and others," who "want to radically change the nature of society, and either make major cuts in all of these institutions, or maybe do away with them entirely."

At the debate, Sanders welcomed Maddow's question by claiming falsely that a Koch-affiliated veterans group wants to "privatize" the V.A., vowing to prevent that from happening, and then making the vague gesture that "We've got to strengthen the V.A." Meanwhile, veterans across the country continue face long wait times and fake appointment dates.

(David Koch is a trustee of Reason Foundation, which publishes reason magazine.)

6. 'Equal Pay for Equal Work'
On his campaign website, Sanders declares that "it is a national disgrace that women only earn 79 cents for every dollar a man earns." Actually, it is a national disgrace that politicians keep abusing this long-discredited statistic.

As Elizabeth Nolan Brown has pointed out at reason.com, "this is based on data that fail to account for women's work histories and life choices. It aggregates the earnings of women in all positions and compares this average against the earnings of all men." Or in the words of Washington Post fact checker Glenn Kessler, "By all accounts, there is a wage gap, but it has declined over the decades—and depending on how the data are viewed, in some cases it barely exists."

To combat this debatable problem, Sanders backs the serially unpassed Paycheck Fairness Act, which would require employers to submit all payroll information to the federal government for a gender-based review, even though gender discrimination is already illegal and the Equal Pay Act has been on the books since 1963. The proposed law would surely be a boon to accountancy firms, lawyers, and bureaucrats at the federal Equal Pay Agency, while hiking up the compliance costs of merely having an employee. As with the minimum wage increase, enacting yet another equal pay law would make employing people more expensive under a Sanders regime. When an activity becomes more expensive, entities tend to engage in less of it.

7. Expanding Social Security
As recently as 2012, the notion of reforming entitlements in the face of dire long-term deficit forecasts was still a mainstream Democratic Party sentiment. "We've got to deal with this big long-term debt problem," Bill Clinton warned in his Democratic National Convention speech that year, "or it will deal with us." The whole reason the nation enjoyed sequestration cuts in the growth of federal spending from 2013 to 2015 is that President Barack Obama was seeking a grand bargain to rein in entitlement promises and put the nation's finances somewhere near a sane position.

Bernienomics, and its effect on Hillary Clinton's already left-of-Bill economic commitments, has helped obliterate the memory of Democrats' rhetorical feints toward fiscal responsibility. Instead of pruning back the entitlement state, Sanders wants to dose it with fertilizer.

"As president, Sen. Sanders will fight to expand Social Security benefits by an average of $65 a month; increase cost-of-living-adjustments to keep up with rising medical and prescription drug costs; and expand the minimum Social Security benefit," his website vows.

Social Security already pays out around $900 billion per year. Its legally separate disability insurance trust fund, which disburses $140 billion, is scheduled to run out of money as soon as this year, after which only payroll taxes can be used to fulfill its obligations; and that pot of money is only four-fifths as large as current payouts to the 11 million disability recipients. The same fate is projected to befall the main Social Security trust fund by 2034. And both programs are actuarially sound compared to Medicare and Medicaid.

To promise more retirement money, in the midst of all the other handouts Sanders is offering, is to essentially assert that there's no real limit on what a federal government can spend. It's no wonder that, when asked at the February 11 Democratic debate in Milwaukee, "How much larger would government be in the lives of Americans under a Sanders presidency?" and whether there would be "any limit on the size of the role of government," the progressive said only, "Of course there will be a limit," and spent the rest of his time talking about the federal government's lapsed responsibilities.

8. Investing in Green Jobs
At the 2008 Democratic National Convention, Barack Obama and the rest of the party's bigwigs repeatedly boasted that by investing in renewable energy sources, the new administration would create "5 million green jobs." Six years later, anxious progressives were asking in The Nation, "Where Have All the Green Jobs Gone?" Sanders must have let his subscription lapse.

To scroll through his campaign's "Invest in Clean, Sustainable Energy" page is to be reminded of all the Obama administration promises that failed to materialize. Yet Sanders doesn't derive any lesson from them, other than to sink more money into the project.

So it is that six years after the administration, absurdly, promised a "Recovery Through Retrofit" that would soon "pay for itself," and four years after the promised home weatherization-fueled economic boom produced such Daily Beast headlines as "Obama's Green Energy Flop," Sanders is back at it: "Energy Efficiency is a 'low-hanging fruit' because the investments made in energy efficiency are so effective in reducing carbon pollution emissions, and the return on investment is so quick," his campaign website claims. "For every dollar invested in energy efficiency, families and businesses can enjoy up to $4 in energy savings, and for every billion dollars invested in energy efficiency upgrades we can create up to 7,000–8,000 new jobs."

Bernie Sanders is one of the most insistent national voices against corporate welfare. "At a time when we have a more than $15 trillion national debt," he wrote at Politico in 2012, "U.S. taxpayers are set to give away roughly $110 billion to the oil, gas and coal industries over the next decade. We cannot afford it."

The country's debt level now stands at $19 trillion and climbing fast, and yet Sanders thinks we can afford "massive and sustained investment in clean energy technology development and implementation," plus "billions of dollars" for "communities most affected by a transition to a clean energy future."

9. Opposing International Trade
There are respectable arguments for opposing international trade agreements. Regrettably, Bernie Sanders doesn't use them.

Instead of going after the way America uses its heft to craft deals that protect domestic corporate welfare while blocking access to developing countries that could benefit from selling goods to the United States, Sanders peddles the fiction that international trade makes poor people poorer.

As he put it when describing the Trans-Pacific Partnership, the latest notch in his 100 percent voting record against trade agreements, "It is part of a global race to the bottom to boost the profits of large corporations and Wall Street by outsourcing jobs; undercutting worker rights; dismantling labor, environmental, health, food safety and financial laws; and allowing corporations to challenge our laws in international tribunals rather than our own court system."

The last quarter-century has seen the most dramatic economic improvement in human history, with more than a billion people being lifted out of extreme poverty. "Most of the credit," The Economist magazine argued in 2013, "must go to capitalism and free trade, for they enable economies to grow—and it was growth, principally, that has eased destitution."

It's not just classical liberals making this argument. The United Nations, hardly a talking shop for what progressives deride as "neoliberalism," gave credit in its 2015 Millennium Development Goals Report to "an open, rule-based, predictable, non-discriminatory trading and financial system," argued that it will be "crucial" going forward "to strengthen the integration of developing countries into the multilateral trade system," and even pointed out that increased trade helped achieve a goal Sanders and other American lefties have long treasured: reducing the debt burdens in poorer countries.

Not only does Sanders wave away all those easily observable gains from trade, he adds a punitive nationalism to the mix: "We need to end the race to the bottom and develop trade policies which demand that American corporations create jobs here, and not abroad."

10. Reversing Citizens United

The 2010 Supreme Court decision Citizens United v. Federal Election Commission made it legal to broadcast documentaries and other media critical of federal candidates shortly before elections. Bernie Sanders, like Hillary Clinton, wants to make reversing that decision a litmus test for any prospective Supreme Court nominee. "Any Supreme Court candidate of mine will make overturning Citizens United one of their first decisions," Sanders tweeted in January, exhibiting a curious conception about how judicial review works.

In 2011, Sanders, for the first time in his career, introduced a constitutional amendment on the Senate floor. Which freedom was he proposing to expand (that being the main purpose of the Bill of Rights)? None: He was seeking to rescind the freedom of people who pool their resources together as a for-profit corporation to express an opinion about anyone running for federal office just before an election. This amendment to reverse Citizens United (though thankfully not for nonprofits like the Reason Foundation!) predictably got nowhere, but it remains a central plank in the 2016 Sanders campaign.

Sanders, like many campaign finance reform enthusiasts, dismisses the free-speech objection as a smokescreen thrown up by billionaires who want to corrupt American politics. Beyond pooh-poohing the central role that government censorship played in the very case he seeks to eradicate, Sanders has elevated its impact to truly mythical proportions, positing that campaign finance corruption is the reason America hasn't adopted virtually every policy on this list.

"The real issue," he said at the January 17 debate in Charleston, South Carolina, "is that Congress is owned by big money and refuses to do what the American people want them to do. The real issue is that in area after area, raising the minimum wage to 15 bucks an hour, the American people want it. Rebuilding our crumbling infrastructure, creating 13 million jobs, the American people want it. The pay equity for women, the American people want it. Demanding that the wealthy start paying their fair share of taxes. The American people want it.…The point is, we have to make Congress respond to the needs of the people, not big money."

There is no room, in the Sanders worldview, for opposition to his democratic socialism emanating principally from people who simply disagree.

On February 17, four economists who disagree with Bernie Sanders issued a scathing joint statement that marked an important gut check for American progressivism. Not because the economists were free market zealots, but because each of them had been chair of a Democratic president's Council of Economic Advisers.

"We are concerned," wrote Alan Krueger, Austan Goolsbee, Christina Romer, and Laura D'Andrea Tyson, "to see the Sanders campaign citing extreme claims by Gerald Friedman"—an economist who forecast 5.3 percent annual economic growth under a President Sanders—"that cannot be supported by the economic evidence. Friedman asserts that your plan will have huge beneficial impacts on growth rates, income and employment that exceed even the most grandiose predictions by Republicans about the impact of their tax cut proposals.

"As much as we wish it were so," the economists concluded, "no credible economic research supports economic impacts of these magnitudes.…These claims undermine the credibility of the progressive economic agenda."

A decade ago, left-of-center commentators prided themselves for being members of the "reality-based community," in reference to an old Karl Rove quote that dismissed adherents of such to be naive. Now, after seven years of economic realities smacking Democratic promises in the face, Bernie Sanders has arrived to say that the problem with all the spending, the centralizing, and the stimulusing, is that it did not go nearly far enough.

It would be more comforting to those who share Sanders' broad critiques about U.S. foreign policy and domestic criminal justice if those were the issues most animating his infectiously enthusiastic fan base. But outside of a memorable February debate exchange over Henry Kissinger, they are not. Those most ardently Feeling the Bern so far this campaign season are the ones embracing his economic ideas. And sadly, many of those ideas are terrible.