{"id":1104,"date":"2026-07-06T13:13:23","date_gmt":"2026-07-06T13:13:23","guid":{"rendered":"https:\/\/commercialrelocationpros.com\/?p=1104"},"modified":"2026-07-06T13:13:23","modified_gmt":"2026-07-06T13:13:23","slug":"the-consumer-socialism-trap","status":"publish","type":"post","link":"https:\/\/commercialrelocationpros.com\/?p=1104","title":{"rendered":"The \u2018Consumer Socialism\u2019 Trap"},"content":{"rendered":"
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This past January,<\/span> in his inaugural address, Zohran Mamdani memorably promised to \u201creplace the frigidity of rugged individualism with the warmth of collectivism.\u201d In the parlance of the Democratic Socialists of America, of which Mamdani is a member, collectivism is a good thing. It is not meant to recall Stalin\u2019s seizure of farms, which resulted in mass famine, or Mao\u2019s Great Leap Forward, which also resulted in mass famine. American socialism today is different. The DSA still formally aspires to \u201cpopular control of resources and production,\u201d otherwise known as seizing the means of production. Yet the New York City mayor\u2019s attention-grabbing policy proposals\u2014to freeze rents, establish city-run grocery stores, and pay for universal child care\u2014are aimed at a more modest goal: socializing the cost of consumption.<\/p>\n

Read more The Pretense Has All but Gone<\/a><\/p>\n

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Explore the August 2026 Issue<\/h2>\n

Check out more from this issue and find your next story to read.<\/p>\n<\/div>\n

View More<\/section>\n<\/div>\n

\u201cConsumer socialism\u201d does not liberate workers from the exploitation of owners; it liberates consumers from the burden of prices. Although its advocates may claim inspiration from both the Great Society tradition of the Democratic Party and Nordic-style democratic socialism, consumer socialism is really a muddle of the two. The Great Society emphasized poverty reduction through means-tested programs such as Medicaid and Head Start; consumer socialism is meant for all. And unlike the Nordic welfare states, which are supported by high levels of taxation for all workers, Mamdani\u2019s approach aims to raise sufficient revenue from corporations and the rich. Consumer socialism tries to have it all: universal social provisions without universally steep taxes. It retains, like other forms of socialism, a supreme optimism in the ability of state planners to shape markets. Where the old central planners failed, the new ones think they will succeed.<\/p>\n

Mamdani is only one of consumer socialism\u2019s proponents. The newly elected mayor of Seattle, Katie Wilson, is a former transit organizer who campaigned on both universal child care and spending $1 billion to pay for union-built public housing. The leading candidate for mayor of Washington, D.C., is DSA-backed Janeese Lewis George, who also calls for universal child care and massive production of below-market-rate housing. (She is open to the idea of government-run grocery stores as well.) Mamdani, Wilson, and Lewis George have claimed the mantle not of Stalinists or Maoists, but of a different subspecies of socialist\u2014the \u201csewer socialists\u201d who ran Milwaukee for decades starting in 1910. They made peace with the capitalist superstructure and devoted themselves to good, incorruptible governance and reliable public infrastructure\u2014sewage systems, yes, but also parks, libraries, and fire departments. In their time, they were skewered for practicing \u201cslowcialism.\u201d In a speech he gave to mark his 100th day in office, Mamdani labeled \u201cour 2026 answer to sewer socialism\u201d as \u201cpothole politics\u201d\u2014doing mundane jobs, such as filling more than 100,000 potholes, because \u201cgovernment is not too busy, not too self-important, not too mired in paperwork to fix the problems of this city.\u201d<\/p>\n

Sewer socialism is attracting renewed interest in America because it is too boring to threaten capitalism. Lenin despised its predecessor, municipal socialism, for much the same reason. In the late 19th century in English and German cities, socialist administrators operated public utilities such as gasworks, electric trams, and even city-owned slaughterhouses. This variation of socialism aimed to blunt the rapacity of capitalism rather than sharpen its contradictions and hasten the coming revolution. Under municipal socialism, Lenin wrote in 1907, \u201cattention is diverted to the sphere of minor local questions, being directed not to the question of the class rule of the bourgeoisie, nor to the question of the chief instruments of that rule, but to the question of distributing the crumbs<\/i> thrown by the rich bourgeoisie for the \u2018needs of the population<\/i>.\u2019\u200a\u201d<\/p>\n

Lenin\u2019s ghost would be similarly unimpressed with contemporary American socialism\u2014too much democracy, too little murder. Still, there\u2019s nothing small-bore about consumer socialists\u2019 desire to overhaul the economy. In their view, high prices are not market failures but moral ones, the result of greed and corruption, which can be vanquished with the right intention. The ideal state is a kind of Lake Wobegon, where every price is below average.<\/p>\n

One irony of <\/span>consumer socialism is that it is better tailored to the laptop classes\u2014which now form the backbone of the Democratic Party\u2014than to the American left\u2019s traditional working-class base. The upper classes disproportionately use child-care centers, while lower-income households rely more on stay-at-home parents and relatives. This is partly because wealthier people can more easily afford formal care services. But not every community may even want to send their kids to a child-care center. Some evidence suggests that Latina mothers prefer to have a relative look after their children, even when cost is no issue. Rent stabilization and controls apply to units, not occupants\u2014which in New York has sometimes meant showering benefits on celebrities and on politicians, such as former Governor David Paterson and the late Representative Charles Rangel. Upper-middle-class meritocrats are generally not exhausted by capitalism. They are exhausted by the costs of rent and child care in desirable neighborhoods\u2014bills that the preexisting means-tested welfare state would never have covered.<\/p>\n

Mamdani will probably fall short of implementing his vision: Budget constraints mean that buses are unlikely to be free, as he promised; his child-care proposal received funds to last for just two years so far; and New York, a city of more than 8 million people, will have, at most, five city-run grocery stores by the end of his first term. Despite his pledges to tax the rich, he is limited in his ability to do so, and although his recently passed pied-\u00e0-terre tax might raise $500 million a year, universal child care would, according to his own campaign, cost $6 billion a year.<\/p>\n

The natural habitat of consumer socialism\u2014solidly left-wing American cities\u2014imposes serious limits on its ambitions. Unlike the federal government, cities typically cannot run huge deficits year after year, and must quickly reckon with promises that cannot be paid for. In 2018, New York City officials rolled out a voucher program with an unwieldy name, CityFHEPS, and the laudable goal of decreasing homelessness by subsidizing housing. In 2019, the annual cost of the program was budgeted at $25 million; its projected cost last fiscal year reached $1.7 billion, as the number of recipients and the cost per voucher increased simultaneously. Faced with the city\u2019s daunting budget deficit, Mamdani reversed his campaign pledge to expand CityFHEPS and has instead scrambled for ways to hold costs down.<\/p>\n

Read more Fixing Social Security Is Easy, but It Isn\u2019t Simple<\/a><\/p>\n

Many risks lurk in consumer socialism\u2019s promises of cheap goods and services. If New York City or Washington, D.C., rapidly increases subsidies for child care, for instance, without expanding the number of approved providers, the existing ones will charge more to meet excessive demand. Another complication is that the more generous any city benefits are, the more people will move across municipal limits to use them\u2014creating a cost spiral.<\/p>\n

The sewer socialists chose their targets carefully. Milwaukee\u2019s mayors had a strong economic rationale for pursuing public ownership of utilities: avoiding the massive, duplicative costs of rival water networks without letting a private monopoly gouge consumers. In contrast, publicly run grocery stores are interventions in a low-margin, highly competitive industry. In his 100-days speech, Mamdani pledged, \u201cAt our stores, eggs will be cheaper. Bread will be cheaper. Grocery shopping will no longer be an unsolvable equation.\u201d But the mathematics of running retail outlets might prove more flummoxing than he realizes. Many aspects of life in the Soviet Union have come to be retroactively romanticized; its grocery stores are not among them.<\/p>\n

Optimists think\u2014or hope\u2014that Mamdani-style socialists have a greater awareness of economic constraints than they let on. My colleague Derek Thompson recently said that Mamdani may be sporting \u201cthe abundance mullet, which is to say, economic populism in the front and abundance in the back.\u201d Abundance<\/i> is a term that Thompson coined in this magazine to describe policies that expand supply through public and private investment and deregulation\u2014essentially supply-side economics for liberals. The idea is that Mamdani would win popular support by freezing rents\u2014an idea almost unanimously derided by economists\u2014while simultaneously boosting home-building. But the second half of this bargain may never materialize. Although New York\u2019s Rent Guidelines Board has approved a promised freeze for nearly 1 million rent-stabilized apartments, Mamdani\u2019s efforts to permit more home-building have been plodding by comparison. Absent new supply, restrictions on rent increases will limit mobility for those who receive the benefit, and increase costs for those who do not.<\/p>\n

Plans are already <\/span>afoot to scale consumer socialism across America. National Democrats have realized that the high cost of living makes for a powerful midterm-election theme, and some in the party prefer to address it with subsidies and price controls rather than measures that increase personal incomes and economic growth. The Congressional Progressive Caucus recently released its \u201cNew Affordability Agenda,\u201d which includes plans to make child care a nationwide entitlement\u2014staffed by day-care workers paid as much as teachers\u2014and to create a new set of housing subsidies for rent and down payments. Progressives also argue that this can be financed without tax hikes on ordinary people, but through targeted taxes on plutocrats and corporations. Enacting any such changes nationwide would require many more votes than the caucus currently has. And the problem with implementing such plans at the local level is that the rich can always decamp to Austin or Miami, as some of California\u2019s billionaires are threatening to do over a ballot measure that would take 5 percent of their wealth.<\/p>\n

Perhaps cities like New York will refine a functional version of consumer socialism, in which subsidies are balanced with enormous supply-side expansions in the number of homes and child-care centers, leaving everyone better off. Perhaps capitalism can be appropriately fettered within the confines of a select few cities, inspiring a nonviolent, nationwide socialist revolution. That would be a remarkable triumph for Mamdani\u2019s consumerist ideology, which wears the transgressive label of socialism but is born primarily out of anger over prices (and an innate American antipathy toward taxes). American collectivism may be, as Mamdani promised, warmer than rugged individualism. It will certainly be warmer than Soviet or Maoist collectivism. It could also be just as unworkable. And it will certainly be extraordinarily expensive.<\/p>\n

This article appears in the <\/i>August 2026<\/i> print edition with the headline \u201cThe \u2018Consumer Socialism\u2019 Trap.\u201d<\/i><\/small><\/p>\n

Read more The Age of the Trillionaire<\/a><\/p>\n<\/section>\n","protected":false},"excerpt":{"rendered":"

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