With the 2020 elections, we are hearing a lot about socialism. Many fear that, should the Democratic party sweep the White House and Senate, an inevitable march toward the US becoming a socialist country will begin.

Socialism is an economic system in which the means of production and distribution of goods are owned and controlled collectively or by the government. It is characterized by production for use rather than profit, equality of individual wealth and incomes, the absence of competitive economic activity, and government determination of investment, prices, and production levels.

A truly socialistic economy has no privately owned business. Since all business are government-owned, there is no competitive force serving to improve services or drive down prices. Prices are not set competitively but by government policy. Economic freedom is seen as counterproductive to what is best for humanity. It is assumed that the state can distribute resources more efficiently and fairly than a free market. Everyone is—at least in theory—economically equal, with no rich or poor.

Many who are being labeled as socialists call for higher taxes on the rich, more funding for massive infrastructure improvements, and expanding social welfare programs with proposals like "Medicare for all." These initiatives are not necessarily socialism, but rather an expansion of social programs.

Embracing increased taxes on fossil fuels and more government spending for health care or green initiatives is not inherently a call for a socialistic economy. It is a call for bigger government and placing more restrictions on free enterprise, which certainly can be a step along a long journey toward socialism.

True socialistic attraction has always been grounded in a combination of wishful thinking and ignorance, according to "The Opportunity Cost of Socialism"—a study released in 2018 by the President’s Council of Economic Advisers (CEA), and reported on by Charles W. Calomiris, "Socialism: The Opiate of the Corrupt and Ignorant", November 14, 2018.