Socialism – The World’s Most Intractable Addiction

An alcoholic employee was called into the boss’s office and was given an ultimatum.  It went something like this. 

You are a valued employee, and because of that, you have been given numerous chances to correct your deficiencies.  Yet you continue to come in late for work, or some days, not at all.  You continue to miss important deadlines.  When you meet the deadlines, your work is either incomplete, or contains numerous errors. Other employees have tried to cover for you, but it only detracts from their own work performance.  Therefore, no further concessions will be made to you, and no more excuses will be accepted.  This is it.  Either take control of your life and perform according to standards, or else, turn in your keys in return for your final paycheck.  Which will it be?

The above story is probably true, many times over, but I have fictionalized several elements of it.  First, the reality is that instead of an employee, the real story involves a country. Second, instead of alcoholism, the reality is socialist economics.

The country is Argentina, but many other countries fit the description.
Argentina Bets on Price Controls

Argentina is on the brink of collapse. 
I wrote about this recently in The Bold Pursuit, "Yet Another Socialist Paradise is Collapsing."

Instead of the technical details, this time I wish to focus, as I did in the fictional account of the alcoholic, on the psychology of addiction, not addiction to a drug, but to ideological beliefs that have been consistently and repeatedly shown to be false, and worse than false, catastrophic.

Socialism as an economic and political system is inexplicably addictive.  One can understand its initial appeal, because that appeal is simplistic, easily reduced to mindless slogans. Socialism addresses the scourge of poverty by saying simply, give money to the poor people. It addresses the problem of high prices by commanding sellers to lower their prices.  And when all the socialist remedies only dig the hole deeper, the last ditch resorts include raising taxes, confiscating wealth from those who produce it, and entrenching a class of voters who will never make the short-term sacrifices that are necessary for their long-term benefit.

Socialism has even more appeal when it is contrasted to our present economic system, the one we mistakenly call capitalism, but which is more properly referred to as “crony capitalism.”  A better term for that system might be, feudalism.  In any case, the present system as practiced is a twisted perversion of the free market system.  Compared to it, socialism starts to look good to those who are stuck on the bottom rungs of the economic ladder.

While socialism’s initial appeal might be understandable, what is not excusable is the persistent failure to recognize that socialism is not the easy way out of economic injustice, but is rather a fatal dependency on remedies that do not work.  Compared to truly free markets, socialism is a disaster.  Would that there were a truly free market to prove this.  Free markets have, alas, all but become extinct, and what now passes for capitalism is in reality a close cousin of socialism, even in the United States.

Is there a remedy?

It is no longer possible to simply do away with the century (and more) of clutter that has destroyed free markets, and to replace that clutter with the few basic principles that allow anyone—literally anyone—to have free and unfettered access to the marketplace.  Those principles include truly representative government, anti-trust laws, anti-fraud laws, and property rights.

The entrenched social powers are so firmly in control of our economic system that—and this is quite literal—a child can no longer start and operate a sidewalk lemonade stand in the US. In order to do so, the child would have to hire a consultant to navigate the government regulations, the legal hurdles, and competition from lemonade producers who can crush any hint of competition.  In other words, to sell ten cents worth of lemonade, a ten-year-old child would have to have about ten thousand dollars in startup financing.  Think of it as the 10-10-10 rule. 

The problem extends upward from there, to many thousands of good business ideas that are never given a chance to succeed.

This inability to create new businesses without large investments up front would have, according to the founder of hardware giant Home Depot, prevented his corporation from ever having gained a foothold in the marketplace.

Make no mistake, large corporations, although many of them benefited from free markets when they were first begun, now oppose the very idea.  Partnering with big government, big corporations lobby for ever more oppressive regulation of business, knowing that that will stifle competition.

In doing so, they have persuaded millions of welfare recipients to settle for a life of indolence and hopelessness that is poisoning our society from within.

The real tragedy of this is that there are places in the world where there is a remedy. Argentina is a prime example.  When a social and economic system is in the early stage of collapse, the prospect for reform rises dramatically, as people become desperate to find a solution to their problems.  This brief window of opportunity has opened in Argentina.

Unfortunately, the window is all too often closed by those who instead of free markets, impose the harsh hand of raw power.  This seems to be happening in Argentina and elsewhere.  Instead of more freedom, people tend to seek less of it, in the form of dictatorships.

The outlook is bleak.  Nation after nation, addicted to spending, taxation and overregulation is killing the proverbial goose that lays the golden egg.  Revolutions are inevitable.  Social collapse will follow, as will wars and rumors of war.

Still, even this outlook is not entirely bleak. There was a revolution in 1776 that, centuries later, still points the way to justice and prosperity.

We need a reset button.

http://www.theboldpursuit.com/tbp-journal/2014/9/8/socialism-the-worlds-most-intractable-addiction.html