“In The Big Rock Candy Mountains
There’s a land that’s fair and bright
Where the handouts grow on bushes
And you sleep out every night”
~ The Big Rock Candy Mountain by Harry McClintock (1928)
July 7, 2025 — Don’t look now, gentle reader, but “democratic socialism” may be coming to a city near you. From the The Guardian…
Mamdani says leftwing populist victory can be replicated across US
Zohran Mamdani, in his first major interview since his upset victory in the Democratic party’s mayoral primary in New York shook up US politics, said his brand of campaigning and leftist political stances can translate to anywhere in the US.
Mamdani, a Democratic socialist, stunned many observers by beating Andrew Cuomo on Tuesday night, delivering a devastating blow to the former New York governor who ran a centrist campaign backed by most of the party establishment.
Mamdani told MSNBC’s Jen Psaki that his populist campaign – which focused on inequality and promised radical moves on rent, the price of food and free public transport – could be deployed anywhere in the US as Democrats seek to combat Donald Trump and his Maga movement.
We won’t spoil the ending for those who didn’t catch the Collectivist Utopia production when it played out across the world stage throughout most of the 20th Century. Needless to say, there are plenty of… ahem… “plot twists” along the way.
But what is “democratic socialism,” really? And how does it differ from social democracy… or bad ol’ regular socialism?
Theft by Any Other Name
Essentially, democratic socialism is same-old, same-old socialism… except it bets (in Mamdani’s case correctly) that people will be soft-headed enough to actually vote for it. That is, those who promise a kind of repackaged workers’ paradise openly seek highly regulated markets, massive government intervention through things like price controls, and even collective ownership of the means of production, as in “community owned” grocery stores.
Whether it’s through rent controls… “soak the rich” taxation and vote-buying handouts for the masses… or populist claims like “billionaires should not exist”… the story is as old as the politics of envy itself. It also renders H.L. Mencken’s old line in ever higher relief:
“Every election is a sort of advance auction sale of stolen goods.”
Conspicuously generous with other people’s money, Mamdani’s platform focused on the hoary tropes and gimmicks that have so reliably failed elsewhere, all of which are predicated on the fatal conceit that The State can possibly understand the inner lives of individual citizens… and should therefore act to order and coordinate their existence in every conceivable way, like some grand puppeteer. All for their own benefit, of course.
We plan on visiting the Big Apple toward the end of our summer travels and will let you know our thoughts from the ground in future Notes…
But for now, a quick geography quiz for you. See if you can name this place, which we’ll codename Mamdani Land…
Continued Below…
Out of 23,281 Stocks…
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Mamdani Land
The country has a small, homogenous population, something in the order of 5 million people. Most of the citizens share similar religious and cultural views, which helps with what reductive sociologists sometimes call “cohesion.”
The government runs a state-funded, universal healthcare system, which provides free care to all nationals (plus a generous public insurance plan to help alleviate healthcare costs for expatriates working inside the country).
The state also spends considerable sums building and maintaining public hospitals and employing plenty of doctors, nurses and healthcare professionals to serve all citizens.
Free public education is also high on the list of priorities, thus the state sets, and is primarily responsible for, guiding future generations through a national curriculum. All levels of education – from kindergarten to university – are completely free for students and parents alike. The country enjoys one of the highest literacy rates in its region.
In addition, the state provides mothers with paid maternity leave and all citizens with unemployment insurance and disability benefits, should they find themselves unfit to work.
The government also invests heavily in national infrastructure, including an extensive public transport system. Naturally, there is a state-owned airline (the largest in the country) and state owned seaports and airports. The country has the strongest currency in the world and one of the highest per capita incomes.
Oh, and the state also maintains one of the richest sovereign wealth funds on the planet, which it manages on behalf of its citizens, to guarantee retirement pensions for all.
Any guesses?
Have we not imagined a kind of socialist utopia, the likes of which Mr. Mamdani and his comrades in arms, AOC and Colonel Bernie Sanders et al., could only dream?
As mentioned before in these Notes, the so-called “Nordic model” is the go-to example for these misty-eyed do-gooders, who insist that we could all be as happy, healthy and good looking as our viking cousins… if only we were to adopt a more generous approach to social welfare benefits.
And yet, if you guessed Norway as our mystery country, you would be… wrong.
Non Causa, Pro Causa
While all the rest of the clues hold true, the Norwegian krone is nowhere near the top of the fiat power table. In fact, it has fallen by half against the USD since its high in 2008. (Back then, one greenback bought you roughly five of the king’s krones. Today, it’ll nab you ten.)
The proud owner of the strongest currency title, and the correct response to our little pop quiz, is Kuwait. (A single Kuwaiti dinar currently trades for 3.23USD.)
Strange, then, that we seldom hear arguments in favor of adopting a Kuwaiti-style theocratic autocracy in order to achieve the kind of democratic socialist utopia advocated by Mr. Mamdani and his fellow travelers.
Why don’t we see college “studies” graduates waving “Anocracy Now!” placards, sporting “Tribal Monarchy Before Profits!” t-shirts and ditching their Che Guevara-style berets for Arabic-style ghutras?
Curious, no?
Could it be that these nations have something else in common, aside from generous welfare schemes, that lies at the root of their vast fortunes? Indeed, might they be rich despite their profligate spending habits, rather than because of them? Could their enormous sovereign wealth funds (Kuwait: $1.1 trillion; Norway: $1.75 trillion) have originated from something other than their respective styles of “giveaway government?”
Might they have accrued their wealth by multiplying it, rather than by dividing it?
Hmm… what else do these tiny nation states have in common? If only there was a simple, three letter answer, something rhyming with foil… or turmoil… or disembroil. Quick, somebody call Sir Arthur Conan Doyle!
We raise this confounding conundrum because if we don’t know and understand whence riches came – what Adam Smith referred to as the “Nature and Causes of the Wealth of Nations” – it’s highly unlikely we’ll be able to appreciate and safeguard them into the future. Indeed, we may end up killing the golden goose altogether!
The error here lies in something called the non causa (pro causa) fallacy. Or, in plain English, putting the Nordic cart before the Arabian horse.
That is to say, universal healthcare and “free” (taxpayer-funded) education and the rest of the redistributive voter bribes are ways of spending money, not generating it. Progressive taxation is a means of redistributing wealth, not producing it. The difference is non-trivial.
Countries like Kuwait and Norway are not rich because of their respective governments’ addiction to expensive giveaway programs, whatever one thinks of the merits or alleged compassion of such redistributive policies. They are wealthy despite them.
Down at the other End of the World, meanwhile, president Javier Milei has been busy liberating Argentina’s long-suffering citizens from three-quarters of a century of politicians’ worst laid plans. We’ll have more about the goings on in our adopted home later in the week.
Cheers,
Joel Bowman
Notes From the End of the World & Grey Swan
P.S. Paid members, please join us for Grey Swan Live! with Matt Milner airs Thursday, July 10 at 11 a.m. ET. With both private credit and private equity markets gaining pop trend status in the investment markets, we’ll dig deeper into Elon Musk’s SpaceX and xAI private placements — the next curveballs from the Trump arch-nemesis universe.
Your thoughts? Please send them here: addison@greyswanfraternity.com
