Historical Clues to How Socialism Could Impact Your Portfolio

One of my children recently told me, “Dad, I’m voting for Bernie Sanders.”

At first, I thought he was pulling my leg. When I realized he was dead serious, I almost had a heart attack.

Sanders has strong support from the Millennial crowd. But I am one of those old-fashioned capitalists that happens to love free enterprise.

So, I told my son this story.

On April 21, 1967, the graceful Svetlana Alliluyeva, arrived in New York via a Swissair flight from the Soviet Union. She then announced to a crowd of reporters, “Hello there, everybody! I am very happy to be here.”

Svetlana Alliluyeva at her arrival press conference

Ms. Alliluyeva then held a press conference to renounce her citizenship to her native Soviet Russia, describing it as “profoundly corrupt.” She symbolically burned he Soviet passport. It was the most spectacular Soviet defection since Rudolf Nureyev in 1961.

Her defection was a major PR win for the U.S. as it and the USSR continued their bitter cold war. It also featured a scathing rejection of her deceased father, who she described as “a moral and spiritual monster.”

Who was her father? None other than Joseph Stalin, the former dictator of the USSR.

Alliluyeva became a full U.S. citizen in 1978. She later released her autobiography, Only One Year, which earned her $2.5 million.

That’s a lot of money now. But back then? It was a fortune, one that would have never been possible in her communist homeland.

After half a lifetime of communism, she fled her father’s regime for the freedom that the U.S. offered, which she said made her feel “able to fly out free, like a bird.” And in the end, she finally got see the fall of the government her father oversaw.

I shared this story with my son because it seems the lessons of the past seem to be completely forgotten by many young Americans. We are now nearly 30 years removed from the collapse of the USSR. And I tremble with fear that at the growing popularity of socialism in the United States.

After all, the economic structure of this country is what allowed my family to achieve our own American Dream.

If you’ve been with me for long, you know that I was born in Japan, the offspring of an American solider stationed there after the end of WWII and a cute Japanese waitress at a noodle shop near the U.S. Army base in Tokyo.

My military father was transferred back home in 1958, and my mother and I left Japan to start a new life with him in the United States.

Our long, two-month trip on a slow naval transport ship must have been frightening to my then 20-year-old mother.

Unfortunately, my parents’ marriage dissolved shortly after we arrived. And even though my mother was alone in a strange country with no family, friends or money ... she chose to stay in the U.S. because it was a place where anyone who studied hard and worked hard could be successful.

A few years later, she married Ken Sagami, who adopted me and is the vegetable farmer who raised me.

I am sad to say that both of my parents are deceased. And even though they never made much money, they lived long, healthy, admirable lives and saw all three of their children become successful
professionals.

A family photo — My mother holding my sister, yours truly in the middle and my younger brother on the right.

My younger brother is one of the top executives at Nordstrom (JWN), and my baby sister is one of the most respected occupational therapists in the state of Washington.

And me? My career was a mystery to my father, who always said my hands were as smooth as a woman’s, but he was madly proud of all of us.

My siblings and I will forever thank them for working us like dogs on the family farm because that hard work made us who we are today.

That hard work combined with capitalism is why my siblings and I are ... well ... millionaires.

The story about Svetlana Alliluyeva got his attention. I now have eight months to get my Sanders-loving son to see the errors of his political ways.

Wish me luck!

And by the way, the big 1,200-point rally on Wednesday wasn’t because of the Federal Reserve or good news about the fight against the coronavirus outbreak. It was because of the thought that Joe Biden would wrestle the democratic nomination away from Bernie Sanders.

Here’s my opinion: If you don’t want to see your portfolio shrink to the size of a walnut, you too should talk to your kids about the global history of socialism.

Best wishes,

Tony Sagami